Trillion Fund: where normal people can invest (and save the world)

July 5th, 2012 by

microtask_trillion_fundLast week we discussed the new JOBS Act, which allows startups in the US to use online crowds to raise funding. We noted the huge potential this has for not just the crowdfunding industry and startups, but the investment world as a whole.

One platform that is planning to take advantage of these new laws (the UK is set to follow the US later this year) is Trillion Fund. Trillion Fund’s modest goal is to eventually raise a trillion dollars for sustainable energy projects. Just as ambitious is the fund’s goal of raising it in small increments from people looking to invest modest amounts of money.

Trillion Fund is led by a diverse group of overachievers from the investment, tech and renewable energy industries. Julia Groves is one of them. I caught up with her last week to discuss her plan to use crowdfunding to save the world (and help normal people make money from investing).

Trillion Fund is an exciting concept. Where did the idea come from?
It came about as a way to use crowdfunding to solve two problems.

The first is financial markets and the way investment works at the moment. Currently, investment opportunities for smaller investors are terrible. We want to offer these people the chance to invest directly in companies they like, and achieve a decent rate of return in doing so.

The second problem is energy generation. Almost everyone accepts that we need to find an alternative to fossil fuels fast – public support for change is enormous, especially here in Western Europe. But people think they can’t make a difference. The companies we offer to investors will all be dedicated to sustainable energy generation. People who invest with us will be helping to change the world.

If people can see where their money is going and the difference it is making, we think it has the power to change the way people invest. We want normal people to be able to get the satisfaction from investing that the super wealthy get. The equivalent of “Daddy, what did you do in the war?” for our generation might be “Mummy, what did you invest in?”

The early investors in particular will be making it possible for millions more to follow, so we have some special plans for them.

What minimum investment are you aiming for?
Eventually we want to get to $100. The more people that get involved the better. The economies of scale are particularly significant in renewable projects, but the potential benefits go beyond this, as five thousand people investing $100 will have a lot more impact than one person investing $500k.

If people have the chance to engage in meaningful, exciting projects, they might choose to invest small amounts of discretionary cash rather than wasting it on the normal consumer junk.

I hope you’re not referring to my iPhone?
No way! In fact, eventually we would like to have an app that allows investors a very convenient way to engage with us and their companies. For example I can see the output from my solar panels on an app on my Phone, (14kWhrs yesterday – and I have a small London roof!). There is something addictive about tickers and numbers going up all the time…

How will you choose which sustainable energy companies to offer?
We will choose our partners very carefully. The leadership team has a lot of experience with renewable energy projects and new ventures in general. I have spent the last two years installing solar panels on homes in the UK for example (and yes there is enough sun for it to be worthwhile! So long as the roofs face south-ish).

In the end the choice of where to invest and the level of risk is something each investor must decide for themselves. Despite our name we are not a traditional fund. Instead of choosing investments for our members, we will find the very best projects to invest in and provide the tools and information to make it as enjoyable and rewarding an experience as possible.

When should I send my check?
We are testing the platform with a couple of partners over the summer, and are working towards a public launch in the fall. The UK markets regulator is currently in the process of revising the rules relating to this space, in the same way that the SEC in the US has, so we will be working with them to ensure this new model of fund raising and engagement gets the rubber stamp. We won’t launch publicly until this process is finished. We’ll keep you posted!