SustVest Raises $160,000 From Angel Investors To Launch a Sustainable Investment Platform
The startup has raised the funds for a six-month runway with the aim to achieve approximately $1.3 million assets under management
Gurugram-based SustVest, a sustainable investment platform that allows retail investors to invest in fractional ownership of clean energy projects such as solar or electric vehicle (EV), has raised $160,000 from angel investors.
The funding was led by Paurush Sonkar, founder and CEO, Stallions Capital, and early-stage investors Balaji Vaidyanathan and Sandeep Shetty.
The investment will be utilized for product development and brand marketing, which will further allow the brand to provide the country's best-in-class sustainable platform, said an official statement.
"We have a robust expansion strategy in the pipeline and this investment will play a prominent role to make green investing affordable and accessible. In the next six months, we aim to onboard over 5,000 investors and have over INR 10 crore (approximately $1.3 million) worth of assets under management. We will be introducing new assets like greenhouses and small hydro and wind projects as we move," said Hardik Bhatia, co-founder, SustVest.
"We have introduced an alternative investment platform that will not only provide high returns and low risks to investors but will also positively impact the environment. Today, the investors are betting on renewables and investing via green stocks like Adani Green, etc. This is not a direct investment but they are investing in a company that sets up solar projects. The returns for the investors then depend on the company's performance and speculation that determines the company's stock price. At SustVest we are offering the opportunity to invest directly into the asset, which generates predictable returns and is immune to speculation. Investing through SustVest generates better returns than debt, mutual funds and FDs," he said.
According to Standard Chartered's Sustainable Investing Review 2021, India is on an upward trajectory when it comes to awareness on sustainable investing, with interest higher than the global average of 82 per cent. Its adoption rate of 68 per cent is also higher than the global average of 61 per cent.
ESG investing is defined by OECD as an approach that seeks to incorporate environmental, social and governance factors into asset allocation and risk decisions, so as to generate sustainable, long-term financial returns.
The potential to grow sustainable investing in India is significant: 67 per cent of Indian investors would take greater financial risks to gain social benefits, compared to 53 per cent of investors overall, found Standard Chartered
"The Indian Investor has a plethora of investment options to choose from, especially in recent times. However, considering that the majority of Indian investors have always relied on low-risk low-returns investments such as fixed deposits, postal savings, etc., considering their risk-averse nature, the market potential within India is immense. SustVest allows investors to taste a completely new asset class and that too with a green eco-friendly twist to it. I am confident that it is a matter of time before Indian Investors warm up to this asset class and SustVest becomes the go-to platform of choice," said Sonkar.
Founded in 2018, Sustvest is a sustainable investment platform that allows individuals or companies to invest in renewable energy assets, such as rooftop solar or EV charging points, starting with as low a figure as INR 5,000 ($64.39). As per the company, the renewable energy assets generate up to 15 per cent internal rate of return per year for its investors, who hold digital ownership of these assets while they are leased to consumers in return for a monthly rental. The rental income is distributed proportionally among investors.