Rabobank and Nxchange launch an alternative funding platform for SMEs
In December last year Rabobank and Nxchange, launched a new service, Rabo&Crowd that provides businesses with access to a brand-new financing channel, combining a bank loan provided by Rabobank with funding from private investors. The Nxchange platform enables SMEs to attract funding by issuing tradeable bonds. Investors can buy and sell these bonds on the Nxchange stock exchange. Currently at the pilot stage, Rabo&Crowd will be further refined and enhanced with the input of early adopters and investors.
Marcel Gerritsen, Head of Strategy & Innovation at Rabobank Corporate: “We’re seeing a growing demand among SMEs for alternative financing solutions. Rabo&Crowd provides businesses with access to investors through a regulated stock exchange. Rabobank will always provide a portion of the funding by means of a bank loan or credit facility. Rabo&Crowd is the result of experiences acquired with Rabo&Co, a platform through which high-net-worth individuals could invest substantial amounts in businesses together with Rabobank. Rabo&Crowd fits perfectly with our roots as a cooperative bank– it is all about matching investors with entrepreneurs looking for funding.”
Investors can join the Rabo&Crowd community for as little as €100, investing in businesses by purchasing bonds on the Nxchange stock exchange. Subject to market demand, the bonds can be traded on the Nxchange stock exchange before the expiration date, which is attractive for both SMEs and investors. Businesses can issue both short-term and long-term bond loans, while investors can sell bonds before the expiration date.
Businesses who have applied for crowdfunding through Rabo&Crowd – the minimum application amount is €200,000 – are assigned a Rabo&Crowd coach who manages the application process.
Once the application is approved, the coach also helps set up an online campaign to attract investors through the Nxchange stock exchange. The market exposure this generates also allows businesses to attract ambassadors and potential new customers.
Partnership with Nxchange
Marleen Evertsz, CEO and founder of Nxchange: “Nxchange is the first fully regulated Stock Exchange-as-a-Service. Businesses and financial services providers can use the platform to issue and trade bonds and other securities. We believe that the time has come for a more modern form of capital market transactions: efficient, real-time, 24/7, transparent, and supported by compliance procedures. Partnerships such as this alliance with Rabobank will help us to make our capital market solution available to as many people as possible.”
Crowdfunding and Rabobank
Rabobank was the first bank in the Netherlands to actively work together with crowdfunding platforms, having partnered over the past two years with Collin Crowdfund, OnePlanetCrowd, Knab Crowdfunding, and ZIB Crowdfunding. These partnerships will remain in place; the difference between Rabo&Crowd and these other four platforms is that the latter provide crowdfunded, non-tradeable private loans while Rabo&Crowd provides tradeable bond loans.
First Customer on New Platform
The first company looking to raise funds through Rabo&Crowd and Nxchange is Billink, which specializes in flexible payment solutions for online retailers that allow consumers and businesses to make purchases on credit. Billink’s sales and marketing director Laurens Withagen: “We analyzed and compared several different types of financing, and Rabo&Crowd strongly appealed to us because it really brings something new to the market. The funds generated through the bond issue will allow us to provide even better services to our clientele of online retailers, as well as to achieve our growth targets. We have issued a total of €700,000 worth of bonds, and investors can get on board from just €500.”
For more information visit www.rabobank.com