Green Deal Finance Co turns to public investors in £5 million fundraising drive

Image: Campbell and Kennedy.

The Green Deal Finance Company (GDFC) is seeking to raise up to £5 million to accelerate the roll-out of its new offering as it prepares to open new loans to UK homeowners.

The company, which was bought by Greenstone Finance and Aurium Capital Markets in January, is hoping to raise at least £4.2 million of debt finance through peer-to-peer platform Abundance to use in building its new offering to the market. This could be extended to £5m in total supplemented by investors with more than £100,000 to invest.

As of today (23 May), the offer had raised 31% of its target to fund GDFC Services, the main operating company in the group to revitalise the original scheme.

The funds will contribute towards GDFC’s ongoing efforts to build an improved marketing and communications programme as well as sign up more installers, improve the customer journey and improve the website.

Speaking to SPP back in March, GDFC chief executive Kilian Pender explained that a key priority was to build a more attractive consumer offering and experience which he described as “a painful process” previously.

Speaking about the new offer with Abundance, which offers 12% interest per annum over the three year short term debenture, Pender said: “Our latest fund raise through Abundance gives a broader set of retail investors the opportunity to invest in the GDFC, allowing us to accelerate the roll-out of the business and therefore making a greater positive impact on the environment sooner.”

"The customer experience before of getting a Green Deal was pretty clunky. It was quite a painful process to sign up to the loans and so we want to completely change that." Kilian Pender, CEO of GDFC.

As an investment platform, Abundance is best known for its involvement in community renewable energy schemes having raised over £40 million for almost 25 projects.

Bruce Davis, co-founder and joint managing director at Abundance, said: “We’re very pleased that the GDFC has chosen to raise funds through an Abundance-arranged bond offer. Both companies are focused on the win-win scenario of enabling ordinary people to do something positive for the environment while benefitting financially.

“Improving the energy efficiency of the UK’s housing stock comes top of the energy hierarchy, making a real difference to the UK's contribution to mitigating global climate change. This is a great opportunity for people to invest in an entrepreneurial company looking to transform this sector.”

GDFC has not revealed when new loans will be open to UK homeowners to fund domestic energy efficiency and generation installations, stating it will begin originating loans "imminently".