Let's talk about investments to change the world

A few days ago, the Climate Change Conference (COP 27) was held in the Egyptian city of Sharm el-Sheikh. It discussed measures to reduce emissions and move towards sustainable economic models. To this end, public but also private investments are essential. In the heat of this event, we propose something: let's talk about investments to change the world. Some phrases go down in history. One of them was uttered by John F. Kennedy during his acceptance speech as President of the United States and has been so often referenced that we might think it is hackneyed: "Ask not what your country can do for you, but what you can do for your country". Beyond the leadership role that public administrations and large private companies should play, the truth is that citizens can also contribute to building a more sustainable economy. They can do so by changing their consumption habits, but also by making investments to change the world. By investing in business projects that have a positive impact on our planet, and innovative businesses that contribute to reducing emissions and that are sustainable. Ethical investment is transforming the way people invest their money, introducing values such as environmental sustainability into the equation, which are complemented by obtaining an economic return. Added to this is the fact that alternative finance marketplaces are enabling small savers to discover innovative business projects that create wealth while protecting the environment. Below, we will discuss why alternative financing can play a key role in facilitating the implementation of investments to change the world.

Startups, real economy companies, and innovative local projects in search of funding

The word startup is already part of our daily lives. Such is the relevance and growth potential of these innovative companies that a Startup Law has just been passed in Spain to facilitate their start-up and consolidation. The legal text, which will come into force in January, seeks to encourage investment in this type of project. Alternative financing modalities such as Venture Capital or Business Angels have been crucial in the generation and growth of thousands of startups. This is evidence of the connection between alternative financing and the development of innovative business projects that contribute to transforming the world we live in. Beyond startups, the truth is that investments to change the world can go in multiple directions. For example, they can be aimed at supporting companies in the real economy that generate employment and wealth and are socially responsible. Or to encourage the implementation of projects that are strongly rooted in the local area and that seek to create jobs and revitalize areas that are not favored by globalization, such as so-called Empty Spain. What role can investors play in promoting this type of business project? A crucial one: is to facilitate their financing.

Providing liquidity to transforming projects so that they can thrive

When it comes to launching ecologically sustainable companies and/or with very positive repercussions for the communities where they are based, it is not enough to have a good idea. To make it happen, you need financing. A person may have a fantastic idea to launch a sustainable and quality tourism project in a beautiful rural setting, but he or she will need money not only to set up the facilities but also to invest in technology, from a website to process reservations to an ERP to manage clients and accounts. Online alternative financing platforms open up a range of funding possibilities for entrepreneurs and businesses willing to realize transformative, socially responsible, and environmentally sustainable ideas.

• Through crowdequity, they can seek investors to support their projects, obtaining rights over them, such as shares.
• Through crowdlending, they have at their disposal loans to meet expenses and make investments to consolidate their projects.
• Through crowdfactoring, they can finance invoices and obtain liquidity in the short term so as not to miss business opportunities or face unexpected situations.

Financial resources are essential to be able to build transformative projects. And the different forms of alternative financing allow these companies to access financial products that meet their needs.

Encouraging the participation of a multitude of small savers

On the other side are all those who wish to make investments to change the world. Alternative financing offers them the opportunity to contribute to the transformation of the productive fabric and society by opening up new investment channels beyond the traditional financial sector. In the collective imagination, there is an erroneous idea that investors are people or companies with large estates or with a lot of economic resources. However, this is not the case. Alternative financing marketplaces such as Inversa Invoice Market are designed to make it easier for any type of investor to make investments to change the world. On our platform, you can make investments starting from 20 euros. It is clear to no one that with 20 euros a business can not do great things. However, if a multitude of small investors uses their savings to finance a project, those 20 euros may acquire some zero or another behind. As with almost everything in life, collective effort is stronger than individual effort. For this reason, alternative financing platforms have become players to be taken into account both in terms of companies in the real economy that need liquidity and in terms of those people who wish to make investments to change the world, even if they lack large amounts of money to invest.

Investments to change the world... without giving up profitability.

Unlike crowdfunding, in which altruism prevails, since a person supports a project in exchange for mere rewards, more symbolic than anything else, other alternative financing modalities such as crowdlending or crowdfactoring do not renounce offering profitability for investments. On the contrary. Those who wish to make investments to change the world sacrifice their savings for the common good, but use their money to invest in socially and ecologically responsible projects that are good for the planet, the economy, and people. All this without forgoing economic benefits for it. For example, on crowdfactoring platforms such as Inversa, it is possible to finance companies that are part of the real economy, that create jobs and wealth at the local level and, in turn, obtain a return on the operation. The same is true for crowdlending. Investors do not lend their money in exchange for anything, just for the mere desire to help innovative or socially valuable business projects. Rather, in addition to seeing their money reimbursed, they will receive interest. Thus, in the field of alternative financing, investments to change the world perfectly reconcile a desire to transform the economy to protect nature, and also people, to make a return on one's savings.

Reinvesting to continue the transformation

As if all this were not enough, by making their investments profitable to change the world, savers can even reinvest the profits obtained. In this way, not only are savings protected against the effects of inflation, which is particularly relevant in a context of high inflation like the current one but the money is also used to promote innovative projects and transform the world from the bottom up. In short, the success of alternative financing platforms shows that the possibility of making investments to change the world is within the reach of all investors, however small they may be. And even if we do not have a large amount of money to invest, we do have the possibility of making the most of our savings to obtain a return on them and, at the same time, support socially responsible and sustainable companies.