Fintech platform start-up Coop Exchange has hailed the completion of its pre-seed funding round as “a significant milestone“ which underscores its “potential as a major disruptor in co-operative and sustainable finance”.
The funding round saw the venture reach a £10m valuation, with Canadian insurer Co-operators leading the investment with a contribution of over CA$2m, acquiring a 12.4% stake.
Coop Exchange says it is “poised to revolutionise the co-operative sector by providing unparalleled acces to new capital sources”, offering a global platform with a mission “ to combat wealth inequality by facilitating investment in tradeable co-op shares, fostering the growth of co-ops and mutuals”.
It adds that the project “resonates powerfully with impact investors and sustainable fund managers, aligning financial returns with tangible social impact”.
Headquartered in London, with an EU office in Malta, Coop Exchange has a stated mission is “to address wealth inequality by growing the co-operative economy – providing co-ops with access to new sources of capital – and enabling everyone to invest in tradable co-op shares“.
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Board members include former Midcounties CEO and current ICA board member Ben Reid, former MEP and former ICA president Pauline Green, Icmif CEO Shaun Tarbuck, and Royal London CEO Barry O’Dwyer.
The goal is for the venture to become a regulated stock exchange, “allowing co-operatives to list co-operative financial instruments: bonds; and equity, with restricted voting rights in line with co-operative values and principles but with a share of surplus.”
This approach, says Coop Exchange, will protect investors and the co-op movement while opening a new market for sustainable fund managers.
“The co-operative model, upheld as the most sustainable business model, will be at the forefront of this new investment era,” it adds. “Coop Exchange offers fund managers a unique opportunity to access this substantial market of sustainable businesses and a potential new market of private business conversions.”
Stephen Gill, Coop Exchange, CEO, added: “At a time when co-operative capital is increasingly vital, Coop Exchange emerges as a distinct and crucial player, unlocking a fresh market for sustainable finance.
“Having Co-operators lead our pre-seed round is a testament to their forward-looking and co-operative nature, and we’re extremely pleased with this partnership.”
Rob Wesseling, Co-operators president and CEO, added: “As one of the largest impact investors in the world, anchoring financial security within positive community impact is the basis of our business model.
“We see our investment in Coop Exchange as a future-thinking extension of our purpose. Last year, we polled to find over 60% of our market is interested in aligning their investments with their values, however they see limited opportunities and premium costs as barriers.
“Supporting an exchange dedicated to businesses that reflect those values is going to break down barriers and accelerate the transition to a more sustainable economy.”
Daniel Sinclair, vice-president of corporate development and head of corporate venture capital at the Co-operators, said: “This new platform has the potential to significantly enhance how co-operatives secure capital and the pace at which they can do so.
“We’re pleased to come to the table as Coop Exchange’s first co-operative partner and investor. This partnership as an opportunity to boldly demonstrate our growth and innovation strategy, our desire to see more impact-driven businesses succeed, and our commitment to the co-operative business model.”
