If you buy organic, re-think your savings account 🌳
How Goodvest is making personal finance greener…
Many of us aim to be more mindful of our impact, to try and find the ways to be more sustainable in our choices in food, fashion, or travels. But we do not often think about the impact our savings (and the banking system behind them) can have on the world.
Thank you for taking the time, Joseph. First, can you give us a bit of background about saving accounts and personal investment? I imagine that many people do not think very often about that topic, so how does it currently work, and what is wrong with it?
Indeed! If in France we are rather big savers, the investment of these savings is not the first concern of a majority of French people.
In my opinion, one way to improve that, is to increase the transparency in this area. For instance, most people ignore what they are financing and at what cost. Until now, investors simply trusted bankers without ability and means to challenge them.
The problem is that your savings might finance sectors or companies that go completely against your values. And, this is a serious problem because our savings influence and build the world of tomorrow: by financing it.
For each euro invested in renewable energies, more than eight euros are invested by French banks in fossil fuels. 86.2% of French savings are invested in fossil fuels, weaponry and other companies with low human rights standards (Source: Reclaim Finance).
The consequence is that the average carbon footprint of a French's savings account is estimated at 11 tons of CO2/year, that's about 10 return trips from Paris to New-York.
“86.2% of French savings are invested in fossil fuels, weaponry, and other harmful industries.”
Damn. I, for one, am definitely not tracking the impact of my savings. How did you personally get in touch with that issue?
Don't worry, you're far from being the only one!
Personally, I have always been interested in both finance and entrepreneurship. Thanks to my family I was made aware of the subjects very early on.
After the French baccalaureate, I studied hospitality management in Lausanne because I had a third passion: taking care of people. I think that there is a strong link with what we are trying to do today with Goodvest, by improving the financial well-being of our clients. I insist on well-being, because there is no sense in building up wealth if it contributes to destroy the world in which we would like to live in. We are saving and investing for tomorrow, for our future.
Goodvest was therefore born on the will to help people build a sustainable financial heritage.
I started working on the Goodvest project last year, during my entrepreneurship master degree at HEC, where I did the Launchpad program. I tested the market and conducted several hundreds of interviews to confirm that there was a strong need.
This summer, Antoine joined me to become the CTO of Goodvest. We quickly reached several hundred pre-registrations.
Antoine is an EFREI Paris alumni where he did a Master 2 specialized in cybersecurity. After a little less than 2 years at KPMG as a Cybersecurity Risk consultant and the desire to have an impact on tomorrow’s planet, he resigned from KPMG and joined me to co-found Goodvest. Antoine, with his technical background and his experience in entrepreneurship and management, is in charge of tech & product. His complementarity with me is one of Goodvest’s strengths today.
So, after being getting the feedback from those hundreds of interviews, what did the two of you decide to create to address the issue?
We strongly believe that people should know what they are financing. The world is getting more and more transparent about many things: food for instance with Yuka but also in clothing... but not retail finance, particularly in France!
Once again you are saving and investing for your future, so you shouldn't contribute to destroy it with your money. Since it's your money, you should be able to choose what you are financing.
At Goodvest, we offer to invest your savings in sustainable funds which are aligned with your values and transparent about their carbon footprint and holdings while taking into account your investor profile and your goals. We grant you access to the most demanding investments in the market, allowing you to save in a world you want to live in.
Here are some of our commitments:
Supporting a liveable world:
All our portfolios are aligned with the Paris Agreement, therefore contributing to limit global warming to maximum 2 °C.
In order to analyse the carbon footprint of the funded companies, we rely on our partner Carbone 4, specialized in the study of the carbon footprint across the entire value chain, from the narrowest scope to the widest (scopes 1, 2 and 3).
Our funds are focusing on the United Nations Sustainable Development Goals.
The exclusion of harmful sectors:
We apply a strict exclusion strategy for harmful sectors such as fossil fuels, tobacco, arms, adult entertainment or companies violating the United Nations pact.
“The world is getting more and more transparent about many things […] but not retail finance.”
Our collective consciousness has shifted much regarding sustainability issues in many consumer industries. Does that trend also apply to your field?
I think that the COVID-19 has a lot to do with the collective consciousness especially in finance. With the COVID-19 we are saving more and more, and the savings deposits are hitting an all-time high, which means that we are necessarily more concerned about it than ever before.
In the same time several green finance apps projects were launched as green neobanks or a Yuka like app for finance: Rift. All this new ecosystem will for sure help raise awareness about the impact of savings.
Recently even the European Commission became concerned by it.
Another consequence of COVID-19 is a true take-off of online investing, when, yesterday, people used to prefer a physical meeting, now they have been converted to digital. This was clearly confirmed by the statistics on deposits of online investing solutions.
Still, all these behaviour changes usually require nudges to push people into action. What do you think pushes your prospects toward your solutions?
Indeed, when it comes to investing one often need nudges to push people into action because it is a sensitive subject, especially here in France. But we identified many factors or situations pushing people to change something about their savings, as a news source of revenue (new job or salary increase). For responsible investment there is also the awareness that you get when giving birth, we have a lot of young parents in our pre-registered prospects.
But the thing that many are looking for when it comes to investing is performance, and here as well, sustainable funds are well ranked. How to explain it? Successful corporations have more funds to invest in environmental and social developments, they also attract more talents or consumers and are less exposed to the risk of penalties. Lastly, they are often operating in growing sectors such as renewable energies or technology.
“With the COVID-19 […] the savings deposits are hitting an all-time high.”
On the other hand, traditional industries are often reluctant to upheaval. Are you feeling much resistance among the existing ecosystem?
Online investing is already a pretty competitive industry, costs of acquisition are high and traditional online investing apps will have a hard time finding customers if they are not different. Indeed, our approach is very different and unique, but new players will join us, and we need to go fast, that is why we already signed several dozens of BtoBtoC affiliation & distribution partnerships.
Each year online savings solutions are gaining ground, the industry is changing slowly but surely and 2020, with the COVID-19, was a game changer. We are at the centre of two strong trends: digitisation of savings and responsible investing.
Finally, we are also providing our solution to IFAs (Independent Financial Advisors) in need for more modern and sustainable investment solutions.
Alright, you got me convinced :) How do I join?
We are launching in less than a month, and our pre-registered customers will get 3 months free.
So visit our website, and you will benefit from these advantage and invest in a better world. We already have more than 2 000 pre-registrations and €10M ready to be invested!
“Each year online savings solutions are gaining ground, the industry is changing slowly but surely.”
Before you leave, what do you believe going through the HEC Paris ecosystem and particularly through the Incubateur brought to you and to your project?
HEC Paris ecosystem brought us a lot, starting from the X-HEC Entrepreneurship master, then the Launchpad, and lastly the Incubateur. We met many experts in branding, SEO, finance and some of them even invested in Goodvest!
We arrived here less than three months ago, and I really feel that we are moving faster and faster thanks to this ecosystem.
Thank you, and best of luck!