Finally, sticking with tonight’s business theme (which wasn’t planned — I go where the news takes me), Ecostructure Financial has lauched a new program for smaller-scale green business start-ups and investors: its Ecological Community Loan Pool. I wrote about this at Treehugger — here’s the scoop:
We’ve seen quite a bit of encouraging news lately about major venture capital firms looking to invest in clean and green technologies, and hope this signals a trend towards sustained investment in the eco-business sector. Still, many good concepts aren’t yet ready for a pitch to Kleiner Perkins or an IPO, so Ecostructure Financial has created a funding solution for the small-scale eco-preneur with a winning idea: their new Ecological Community Loan Pool. Ecostructure, started by seasoned green businessperson Mark Winstein, has launched its own VC fund, but also wanted to create more opportunities for investors and entrepreneurs operating on smaller budgets. Their solution is a marriage of the community development financial institution model with peer-to-peer lending portal Prosper.com.
“You could call our system the EBay for ecological investing,” Mr. Winstein told SocialFunds.com. “For us, this is a low-cost way to essentially replicate a community development financial institution at a small level to allow the public to directly invest in companies that are doing some amazing work for the environment.”
“There’s a whole wave of companies whose very purpose is to solve an environmental problem, and almost none of those companies have publicly-traded stock,” he continued. “If we want to solve these environmental problems, we need to open up a lot more investment to a larger section of people.” …
“There are at least 4000 eco-preneurs out there, and for many of them a $25,000 loan would make a really big difference,” said Mr. Winstein.
The EBay comparison is apt because lenders bid for loans, thus allowing the market to set the rate a borrower ends up paying. Additionally, borrowers must submit their business plan to Ecostructure for scrutiny by both company staff and a scientific panel that judges the environmental and financial soundness of the proposal. Sounds like a definite win-win.
I won’t do this much (replicating a Treehugger post here), but I know the folks at Ecostructure have been working really hard on this, and it’s a very cool idea…