VCIB buys CoPower, eyes expansion of its green finance model


CoPower head of marketing Greg Overmonds (from left), head of capital formation Trish Nixon, co-founder David Berliner and head of projects Jonathan Frank pose for a photograph in Toronto on Sept. 12, 2019. Photo by Carlos Osorio

David Berliner has been interested in conserving and protecting the environment since he was a teenager. Now, he has a chance to make a real difference.

His youthful days canoeing through Algonquin Provincial Park in Ontario have given way to a green financing platform he co-founded in his late 20s called CoPower Inc. CoPower lends to green projects with steady, predictable returns and pools that debt into bonds it then offers to investors with as little as $5,000 to spare.

Now Berliner is poised to tap into significant capital – and potentially a half-million new customers – after one of Canada’s biggest credit unions bought his young company this summer in a deal announced on Thursday and expected to close later this month.

CoPower co-founder David Berliner explains the young company’s business model during an interview at its Toronto office on Sept. 12, 2019. Photo by Carlos Osorio

Vancity Community Investment Bank (VCIB), a subsidiary of Vancouver City Savings Credit Union (Vancity), is set to acquire CoPower. Vancity wanted to expand its sustainable-financing operations, Jay-Ann Gilfoy, chief executive of VCIB told National Observer, and CoPower offered a great opportunity to do so.

“When the opportunity came up to acquire (CoPower), we thought, ‘Wow, we get the instant team, we get the brand recognition, we get the great work they’ve done on the bond platform.’ It fits within the sphere of the things that we are looking to do in the bank,” she said in a Sept. 26 interview with National Observer before the announcement. “It just seemed like a natural sort of extension of what we were already doing, trying to get money to need.”

The feeling was mutual for Berliner.

“Vancity is similarly focused on using finance to solve big problems,” he said during an interview in an exposed-brick meeting room at the five-year-old company’s downtown Toronto office.

CoPower, which launched one of Canada’s first countrywide green-bond funds for retail investors several years ago, has so far focused on backing solar panels, heat pumps, energy-efficient retrofits to residential and commercial properties, and energy storage.

While green money typically flows into large-scale projects, CoPower’s model focuses on community-scale green projects, which use the funds to offset significant upfront equipment, installation and other costs. The company’s investment is paid off over time as it pockets some or all of the initial cost savings.

The Vancity-CoPower deal comes at a pivotal time, @5thEstate reports, with proven technologies to reduce energy consumption or generate feed power in the market — but with limited financing available to accelerate their deployment.

“That’s increasingly the best bang for our buck,” Berliner said. “Instead of having one big power plant far away, sending electrons to a city, having solar and wind and geothermal and batteries integrated into the fabric of our community is where more investment dollars are going.”

Jay-Ann Gilfoy, chief executive of VCIB, speaks to National Observer on Sept. 26, 2019. Photo by Carlos Osorio

The deal comes at a pivotal time, with proven technologies to help buildings and communities reduce their energy consumption or generate their own feed power in the market — but with limited financing to accelerate their deployment.

Gilfoy said part of the problem is that banks are almost exclusively geared to use money to create more money.

“Our goal is actually to make sure that things are starting to shift and change in the world that make it a better place to live,” she said. “Our goal, clear and simple, is to get money that doesn’t normally flow into where it’s needed.”

For CoPower — which has raised and deployed some $30 million across more than 1,100 projects — Vancity’s $27.4 billion in total assets and assets under administration presents a sizable heft the startup could use to greatly expand its addressable market and investment footprint.

Gilfoy said part of the problem is that banks are almost exclusively geared to use money to create more money.

“Our goal is actually to make sure that things are starting to shift and change in the world that make it a better place to live,” she said. “Our goal, clear and simple, is to get money that doesn’t normally flow into where it’s needed.”

For CoPower — which has raised and deployed some $30 million across more than 1,100 projects — Vancity’s $27.4 billion in total assets and assets under administration presents a sizable heft the startup could use to greatly expand its addressable market and investment footprint. MORE

 

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