Lendahand overhauls social impact strategy
Ethical crowdfunding platform Lendahand has signalled a shift towards backing larger financial brands so that it can reach small- and medium-sized enterprises (SME) indirectly.
The platform, which currently offers crowdfunded impact investments in SMEs based in developing countries, said this change would help balance creating impact and scaling the offering.
“When Lendahand started, the idea was that we would help SMEs that are not able to get access to finance,” the platform said in a regularly updated blog that analyses its own shortcomings.
“But we see now that by scaling up we must finance those small companies more indirectly through local financial institutions or finance companies that are bigger and have a larger funding need.”
It conceded that this would mean less impact per euro that goes into the platform.
Read more: New social impact investment app raises £860k seed funding
Read more: UK public ‘cares more about Blue Planet than Brexit’
“We are a commercial company and our shareholders are patient, but they also expect us to become profitable,” Lendahand said.
“More importantly, we want that ourselves as well. We want to show that a company can have a social mission in a sustainable and profitable way.”
The platform also said it is in the process of setting up an impact-first platform with two Dutch non-governmental organisations and is coming up with ways to measure the social impact its own investments are creating.
Read more: Abundance investors fund largest ever project