A clean energy ownership platform enabling people to part own new wind farms for zero CO2, low cost power
- London, United Kingdom
Categories: Energy Mixed Digital/Non-Digital B2C
- Social Media
- Investment sought:
- Discount offered:
Learn more about convertible loan campaigns.
Ripple is a highly scalable clean energy ownership platform, giving consumers a simple and impactful way to act on climate change.
We enable people to own a tiny part of a large scale wind farm and have the clean electricity it generates supplied to their home via the grid.
Ripple is a cheaper, more flexible and fully portable alternative to rooftop solar. It opens up clean energy ownership for people to who to rent or live in flats or plan to move home in the future, as well as those that can’t afford the £4000-8,000 cost of installing solar.
We’ve partnered with Octopus Energy to supply the electricity from the wind farm to our customers’ homes. They will market Ripple under the Co-op Energy brand, a fantastic fit.
Ripple’s mission is to make clean energy ownership affordable and accessible for everyone, everywhere. We’ve been selected to take part in Free Electrons 2020, the global utility start up program. This could enable us to pilot our ownership model outside the UK.
Substantial accomplishments to date
So far Ripple has:
• Over 4500 people pre-registered for its first wind farms. A successful 3 month Facebook campaign led to 2300 registrations.
• Partnered exclusively with Octopus Energy for our first wind farm.
• Finalised legal framework.
• Built our technology platform and website.
• Had first-of-a-kind co-operative society rules approved by FCA.
• Kicked off early discussions with a number of other potential supply partners, covering a third of the UK market.
• In discussions with Centrica (owner of British Gas, UK's largest utility) about a supply partnership covering household and business customers.
• In discussions with a major global renewable energy developer about potential projects in the UK.
• Secured exclusivity on 2nd wind farm project.
• Selected by utilities from more than 850 global start ups for one of 15 places in the 2020 Free Electrons Program. Free Electrons is a global program enabling start ups to pilot project with large utilities around the world.
• Awarded 2019 startup of the year by Seedrs and BusinessGreen technology awards.
• MOU signed with Sunamp, a UK heat battery manufacturer.
• MOU signed with ev.energy a smart electric car charging software.
• Secured £860k investment from 1000+ Seedrs investors.
• Built team of 8, based out of east London office.
Ripple plans to have four revenue streams:
1. Arrangement fees.
Paid by customers when they buy their share of the wind farm. Applied as a % of the upfront cost. It covers the transaction and marketing cost of launching each new wind farm project.
2. Customer acquisition fees.
Paid by supply partners for Ripple customers which switch to them. Not paid if a supply partner's existing customer signs up to Ripple.
3. Monthly management fees.
Paid by customers once wind farms are operational for the management of the wind farm and the Co-operative.
4. Partner sales commission / revenue.
Commission will be earned when we sell partner products to our customers.
We will undertake social media marketing and our supply partners will share with their customers. We also plan to offer Ripple as an employee benefit. Companies will be able to loan their employees the upfront cost, recovering through payroll.
We are also developing a B2B offering following strong interest from companies and suppliers.
Use of proceeds
We plan to apply for the Government’s recently announced Future Fund to match the investment secured in this campaign. This is a bridge round ahead of a further round later in the year.
This bridge round will be used to:
27% - Projects: project management of the pilot project, legal and transaction costs for follow on projects.
25% - New markets + Free Electrons: work to develop pilot projects outside UK.
22% - Business costs: rent, finance, insurance, legal.
16% - App + website: develop and build the customer app ahead of the first turbine being operational and integrate new suppliers into platform for later projects.
10% - Marketing + new offerings: marketing 2nd UK project, development of employee loan + B2B offers.
Salary costs are included in the relevant work area. We intend to recruit a customer service assistant and an intern/analyst over the summer.
Seedrs is supporting companies who are intending to apply to the Government backed Future Fund. You can read more about the Future Fund here: https://www.seedrs.com/learn/blog/the-future-fu....
In order for a company to be eligible to seek matched funding from the Future Fund, this investment round must be on the convertible loan terms that have been prescribed by the Future Fund for this purpose. These terms differ to our normal ‘advanced subscription agreements’.
Given this product differs from most campaigns on Seedrs, we urge all investors, including regular Seedrs investors, to read the information below and ensure you understand the terms in full before making your investment.
You will see a term sheet attached to this Campaign in the Documents section which sets out the key terms of the convertible loan and you can see the full document prescribed by the Future Fund here: https://www.british-business-bank.co.uk/ourpart....
A summary of the key terms is set out below, but should be read in conjunction with the term sheet:
Interest: 8% per annum, non-compounding. On conversion events, the company can choose to repay the interest or convert it to equity (generally without the discount). See the Term Sheet for more details.
Redemption Premium: An amount equal to 100% of the principal loan amount
Valuation Cap: £7,000,000
Qualifying Equity Financing. The convertible loan will automatically convert on an equity financing raising at least the total loan amount, at the lowest share price of equity financing less the Discount or, if lower, the Valuation Cap share price.
Maturity Date: 36 months from signing convertible loan agreement.
The default position is on the maturity date is that the loan will convert to equity unless the investor majority elect to redeem.
If redeemed, the company will repay the principal together with the Redemption Premium.
If converted, the conversion price will be at the most recent funding round share price less the Discount, provided that funding round happened after 20 April 2020 and was at least a quarter of the size of the convertible loan investment. If no such funding round has occurred, conversion will be at the share price of the last funding round prior to 20 April 2020 (no Discount) or, if lower, at the Valuation Cap share price.
Other events of default or conversion: There are various other scenarios in which the convertible loan may convert or be repaid and investors should reference the term sheet:
Non Qualifying Funding Round: The convertible loan can convert on an equity financing round which does not meet the size criteria of a ‘Qualifying Equity Financing”, at the election of the majority of investors under the loan. Please see the term sheet for how this conversion is priced.
Exit: The convertible loan will automatically convert or be redeemed on an Exit, whichever would give investors the higher cash return. Please see the term sheet for how conversion is priced and payments on redemption in this scenario.
Events of Default: The convertible loan is to be repaid on the events of default, such as liquidation or winding up. See the term sheet for more details.
Government matched funding
The company intends to apply to the Future Fund for matched funding on the total eligible amount invested in this funding round. The Future Fund will “match” the funding raised via Seedrs or other eligible sources, subject to a minimum investment of £125,000 and a maximum investment of £5m. The Future Fund is to be allocated on a ‘first come, first served basis’, so there is no guarantee that a company will receive the Future Fund matched funding.
This campaign is conditional upon receiving matched funding from the Future Fund. Seedrs will not complete the investment and transfer the funds raised until we have confirmation that the Future Fund matched funding application has been approved and that the Future Fund is ready to make the investment. If the application is denied, the campaign will be cancelled and funds will be returned to investors.
Because this campaign is conditional upon the matched funding, you will see that we have reflected the Future Fund investment as part of the round. It is distinguished in pink in the progress bar of the campaign. This is to give investors an indication of the potential total size of the funding round (and potential dilution on conversion), but to also distinguish it from regular investment through the Seedrs platform.
Conversion to equity
The convertible loan agreement prescribed by the Future Fund is equity focused and favours conversion of the loan to equity as the default position.
Redemption is only available in certain scenarios and is often subject to the vote of majority of the investors. Where a vote of investors is required, Seedrs will vote on behalf of any investors it represents as nominee.
There is a possibility that the convertible loan will convert in some scenarios without the consent of Seedrs (if we do not make up a majority of investors). It is also Seedrs’ position that this is primarily an instrument for investing in the equity of the fundraising business and our default position would be to vote in favour of converting the loans to shares in the company, unless there is a clear or compelling reason not to.
As always, investors should be aware of and accept the risks involved in investing in early stage and growth focused businesses: https://www.seedrs.com/pages/risk-warnings
In addition to the usual risk warnings included above, investors should be aware of and accept the following with respect to convertible loans:
The convertible loan agreement is intended as bridge funding to a future funding round, but there is no guarantee that a company will be able to secure further funding.
The Future Fund is to be allocated on a ‘first come, first served basis’ and there is no guarantee that a company will be successful in its application to receive the Future Fund matched funding.
There is a risk that the Company may not have sufficient funds to repay the loan on the maturity date, pay interest when it becomes due or pay the redemption premium included in the terms.
Convertible loans are unsecured obligations and in the event of a winding up or liquidation event will rank behind secured creditors of the Company.
Investors will not be able to sell their interest in the convertible loans on the Seedrs Secondary Market unless and until they have converted to shares in the company (and then only subject to eligibility and the terms and conditions of the Seedrs Secondary Market).
EIS Relief - past, current and future
As noted above, the convertible loan instrument is not compatible with EIS requirements, so no EIS applications will be made with respect to investments in the convertible loan.
The government has confirmed that investing in the convertible loan will not impact EIS relief previously claimed on investments in the fundraising company:
“The government has confirmed that such previous investments will not be affected where the convertible loan converts into shares. Where the convertible loan note redeems, we have been alerted that the government intends to make changes to the rules to clarify that this is compatible with such previous investments.”
However, investing in a convertible loan could impact your ability to claim EIS relief on future investments into the same company. The government has not clarified the position on this and has said it is a matter for HM Treasury and HMRC.
Seedrs is unable to provide tax advice. Tax treatment depends on individual circumstances and is subject to change.