Abundance Generation is a UK based company that has built something amazing: a ‘democratic finance’ platform, allowing ordinary (ie: not rich) people to invest as little as £5 (about $8) in renewable energy. This energy will power communities at more affordable prices, and pays back its investors at a rate that satisfies them. Abundance has just seen total investment in its projects exceed £1 million.
Recently, I caught up with Abundance Director Bruce Davis in a noisy café close to his West London office. In the second half of this article, you’ll find the video interviews with Bruce, explaining the social value of democratic finance, of people taking responsibility for their money, and of defining risk.
How do we use our money, and why? For Bruce, an anthropologist, this is the question we should ask ourselves. After helping launch a peer loaning platform called Zopa, Bruce began investigating democratic finance models that could be used to build infrastructure. He teamed up with renewables proponent Karl Harder, and, just over six months ago, Abundance Generation was born.
Since then, two projects have gone into development. As you read this, one of them is powering a community in the Forest of Dean. The other is under construction. Another four projects are in the funding stage, and will one day be powering other communities. In an increasingly commercialised season that’s supposed to be about peace, happiness, and goodwill to all men, Abundance Generation’s brand of democratic finance is a refreshing tonic.
Reclaim Your Money
Bruce: “[People should] actually have the confidence to make decisions about where [their] money goes, and how it is used, rather than putting it to someone else and saying, ‘Right, OK, you make those decisions for me…’”
Invest In ‘Things’
’Invest in things’ is one of the pillars of thought on which Abundance is built. Traditional financial models mean that investing in assets is a luxury for the very rich. But with democratic platforms, even students with no money can invest, in amounts of £5 at a time, in a range of renewable projects to protect their investments.
With costs of winter fuel rising (and so long as it’s fossil fuels being used, set to rise exponentially), clean energy and the independence it offers is becoming more popular. There is the environmental aspect to consider, but for many, that’s a luxury: for the majority, the reasons are ideological or financial. Bruce believes in having the confidence to assume responsibility for one’s own money, and not letting institutions continue to disempower you.
Moving Money Out of Banks
Bruce: “99% of what banks communicate – what they call ‘trust’ – is actually a distrust in yourself. They try to undermine your confidence, to make you reliant on them.”
Abundance is building a portfolio of investment opportunities along the same lines: renewable energy to communities. Having multiple projects means investors can spread their money around and avoid putting their eggs into a single fate-tempting basket. This is how Bruce explains the concept of risk in finance:
“When we talk about ‘risk’ what we actually mean is ‘uncertainty’… I would say that risk is a good thing because it’s when you’ve quantified uncertainty… Actually what you need is a mix of risks. We’ve lost the ability to think about risk in terms of managing uncertainty.”
As an example, he refers to the Deepwater Horizon oil spill, which pension plans and other ‘safe’ investment plans all, mistakenly, placed great trust in.
You will hear more about Abundance Generation in 2013. Thanks to Bruce for agreeing to the interview. For more information, visit www.abundancegeneration.com