Channel 4-backed fintech closes, seeks buyer

London-based sustainable investment platform Clim8 is shutting down and looking for a buyer, but says shareholders are likely to lose money on a potential sale. It’s the latest sign that early-stage consumer fintechs are struggling amid the funding drought.

Clim8, which was founded in 2019 and has raised £17.4m to date, will no longer offer its investment platform to new clients from today, according to a client notice seen by Sifted. The platform will be available to existing customers until May 30, CEO Duncan Grierson said.

“The venture capital environment has completely changed in the last year and it is extremely difficult for startups to raise new funding. Unfortunately, we have not been able to scale our customer base quickly enough to show strong enough traction to venture capital investors,” Grierson said in an email to Sifted.

He said Clim8 is solvent, has more than enough money to pay all costs and is looking for a buyer for the company. Grierson said Clim8 had informed all shareholders including those from Crowdcube and that all were likely to lose money.

“We aim to maximize the value of the company and have an ongoing interest, so it is not possible to predict the final outcome, but it is likely that there will be a loss for shareholders.”

The climate fintech rode the wave of the Covid retail investment boom, during which time it raised over £6.6m from nearly 5,000 investors through three crowdfunding campaigns on Crowdcube, giving customers the opportunity to join as users and also shareholders in the company.

Clim8’s institutional investors include Channel 4 Ventures, 7Percent Ventures, British Business Bank, Evergreen Fund and Basil Partners.

The future of Clim8 customers

Existing users of Clim8’s investment platform were told today that their investments and cash on the platform are protected by the company’s custodian WealthKernel, and that from April 1 they will not be charged for using the platform for their investments.

Customers have been given 60 days to decide what to do with the investment portfolio.

Options include transferring their investments to Aviva-owned investment platform Wealthify; transfer their portfolio to another investment platform; or withdraw their money in cash. Customers who decide to move to Wealthify will also receive a sign-on bonus, Grierson told Sifted.

Clim8 allowed retail investors to invest in share portfolios that were filtered according to specific climate-related metrics – such as tonnes of carbon dioxide saved, gigawatts of clean energy generated or liters of water saved.

Crowdcube nominees own 15.8% of the company’s shares, while CEO and founder Duncan Grierson has a 31.63% stake, according to Beauhurst data.

Clim8 is the latest in a string of recent European fintech closures, including French teen neobank Vybe, German crypto investment platform Nuriand French restaurant payments fintech sunday.

Sifted has contacted other investors for comment.

Amy O’Brien is Sifted’s fintech reporter. She tweets from @Amy_EOBrien and writes our fintech newsletter — You can register here.