Raising capital directly from investors
Investment to help your organisation grow
Investment to help your organisation grow
We’ve raised over £185m for organisations like these:
Our dedicated, specialist team has years of experience helping organisations to raise capital directly from investors. See who you could be working with.
We support charities, social enterprises, mission-aligned “for profit” businesses and renewable energy projects to raise “non-bank” finance. A typical client is one who has a clear commercial proposition with equally clear social, cultural or environmental impact and who needs a form of finance that banks are typically unwilling to provide.
Many of our clients start by seeking bank debt but, often, lack the security or collateral required by those banks. Nonetheless, that does not mean they are not able to raise and service capital to grow and achieve sustainability – they simply need an alternative form of finance, often from alternative sources. It’s typically our role to help them access this capital.
When it comes to capital raising we:
This depends entirely on you. We first help to determine what kind of capital you need. We then ensure we find the right mix of investors to provide it.
We have unique access to over 6,000 registered users on our investment crowdfunding platform – we’re the only UK bank to offer its own crowdfunding platform. These social investors are keen to make a positive impact with their money, as well as earn a financial return.
Over the last 20 years, we have also developed strong relationships with an increasingly wide range of other investors including:
In recent years, we’ve raised over £150m capital for over 60 impact projects and from a blend of these investors.
Typically, our clients have a degree of sector track record and financial history against which we can appraise their performance. However, we have worked with several ‘new’ renewable energy projects where they have Feed-in-Tariff pre-accreditation (and hence visibility over future, government-backed income streams) and where we are familiar with the management team and construction partners involved from other projects.
Equally we might consider working with an established charity looking to develop a new social enterprise arm if the business case is compelling. We have also worked with one or two genuine start-up organisations where we felt the business case was robust, the impact was high and the quality of management clear.
So if there is clear visibility, or better still, contractual security over future income streams and cash inflows, we’d be happy to explore this with a prospective client but with the caveat that the majority of our clients are further progressed along their journey.
As you can see from our track record section, we work with a hugely diverse range of clients, operating across a breadth of sectors. What unites our clients is their positive impact on people and the planet and the fact that their values and ethos are aligned with ours. This can be subjective but if we feel that a prospective client is seeking to bring about positive change then we’re open to engaging with them to see if we can help. At all times we comply with the bank’s minimum standards.
Of course, the organisation or project needs to have the ability to service repayable finance and hence we need to feel comfortable that it has a clear and robust business plan - we’d also need to get comfortable with its financial position and performance (both historically and projected), the quality of management and with its track record in its sector. Some clients are much earlier in their journey than others and may not yet have ‘all the boxes ticked’ but we are open to exploring their needs and ambitions and we may feel that, with investment readiness support over a period of time, we can help them get to a position where they are well placed to take on investment.
No. In addition to capital raising services we also:
We do not provide regulated investment advice.
No. We raise the right form of capital to suit the client’s needs and objectives – factors such as legal constitution (i.e. charities can’t raise equity as the concept of shares does not exist), financial stability and existing borrowing levels also play a part in informing our thinking of what the right form of capital is.
An offer to investors can be structured in a number of ways – either as equity or debt (both secured and unsecured) or a blend of both. The terms will always vary from offer to offer – for example, we’ve raised capital that is repayable over 18 months to capital that is repayable over 20 years. Ultimately our offers are not ‘off the shelf’ but always tailored to the needs of our client and their specific business model.
What remains the case throughout is that we are raising repayable capital where investors expect to receive the capital back, with a financial return and to see their investment also facilitate significant impact.
No – we do not guarantee or underwrite our offers and all investment offers are carried out on a best efforts basis. Clients are effectively engaging us based on our proven track record of completing deals successfully. With over £185m raised, we’ve demonstrated our success in raising capital for over 80 impact projects across multiple sectors. This success is largely because we have a proven ability to judge what organisations we feel are ready, or could be with our support, to take on investment and which will deliver impact that resonates with the target investor audience. Our access to retail investors, a unique route to the investor market in our sector, is often an important consideration for prospective clients.
A meaningful proportion of our fee is typically contingent on a successful capital raising so this ensures we’re commercially motivated to deliver.
This varies from client to client. We’ve raised as little as £350k via a retail bond for a Bristol-based independent food retailer through to £10m (also via a large retail bond offer) for a national learning disability charity. Most projects are seeking to raise £1-5 million.
Things that have a bearing on our thinking on the optimal deal size include:
We’re always open to a conversation to understand your needs and whether we can assist.
Alongside our personal and business banking services, we also connect investors directly with positive organisations seeking finance through our crowdfunding platform. You can choose to invest in bond or share offers by businesses, charities and social enterprises working to deliver positive change. Find out more about the platform at www.triodoscrowdfunding.co.uk
Our retail distribution arm gives us a unique position in the social investment market and enables us to raise capital from an audience that our clients would otherwise struggle to access (particularly as any offer to that investor audience requires sign-off and approval from an approved person as defined under the Financial Services and Markets Act 2000).
In terms of institutional investors, such as charitable trusts and foundations or ethical funds, we have a very clear understanding of their individual investment criteria and of how best to structure an offer to meet this criterion. We also have a very strong track record of negotiating the best terms with those investors, of creating a competitive environment between investors to secure optimal terms for clients and of getting investments through due diligence and ‘over the line’– the risk of deal collapse due to approaching investors without a fully considered proposition is often a sufficient motivation for clients to draw on our expertise.
Our access to retail investors and the regulatory permissions to promote investment offers to that audience stands us apart in the social investment market.
When raising capital in this way our role for the client is to:
This depends on the level of work and resource involved, the complexity of the project, the amount being raised (if a capital raising project), the length of time we are involved for and the availability of grant funding to cover our fees etc. On a capital raising mandate, our fee is typically structured as an up-front engagement fee plus a success-fee based on a percentage of funds raised. The contingent success fee element ensures our incentives are clearly aligned with the client (i.e. on successfully raising the capital).
On other mandates we may decide a time-based fee is more appropriate. Specific pieces of discrete work – such as drafting a valuation report, preparing a financial model, drafting a due diligence or advisory report – typically attract a pre-agreed, fixed priced fee.
Given the range of work we undertake and the variety of fee levels and fee structures adopted, we’d advise that fees are something we’d need to discuss on a case-by-case basis.
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