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Can crowdfunding contribute to the rebalancing of the financial system via democratising investment? This paper begins to respond to this question by establishing how and why investors place trust in these markets. We offer two contributions. First, to theoretical debates on democratic finance; and second, to a more empirical body of cross-disciplinary research into popular investment via a qualitative analysis of 52 original interviews with investors in six UK crowdfunding markets. Our data is taken from a project with the UK's Financial Conduct Authority to enhance investor protection in these markets. Deploying concepts from across economic sociology, we find that investors: mobilise embedded networks to establish trust in crowdfunding; are motivated by expectations of 'blended returns'; prefer automated investment tools if they lack experience; and typically invest with funds they have earmarked as being prepared to lose. We conclude that enhanced investor protection is required for crowdfunding to help democratise finance. ; ¿Puede el crowdfunding contribuir al reequilibrio del sistema financiero mediante la democratización de la inversión? Este documento comienza a responder a esta pregunta estableciendo cómo y por qué los inversores confían en estos mercados. Ofrecemos dos contribuciones. Primero, a los debates teóricos sobre finanzas democráticas; y segundo, a un cuerpo más empírico de investigación interdisciplinar sobre inversión popular a través de un análisis cualitativo de 52 entrevistas originales con inversores en seis mercados de crowdfunding del Reino Unido. Nuestros datos se toman de un proyecto con la Autoridad de Conducta Financiera del Reino Unido para mejorar la protección de los inversores en estos mercados. Utilizando un enfoque de sociología económica, encontramos que los inversores: movilizan redes integradas para establecer confianza en el crowdfunding; están motivados por las expectativas de «rendimientos combinados»; prefieren herramientas de inversión automatizadas si carecen de experiencia; y típicamente invierten con fondos que han destinado a perder. Concluimos que se requiere una mayor protección de los inversores para la financiación colectiva para ayudar a democratizar las finanzas

Explorations of the longer-term potential for community energy to contribute to the energy transition can shape policy and practice today. However, much community energy research in Great Britain is currently, and understandably, focussed on short-term responses to the crisis in the sector induced by recent shifts in policy support. Therefore, we held a series of visioning and backcasting workshops with community energy practitioners and other stakeholders, to co-create a vision of a long term future where there is a thriving community energy sector. This paper presents the results of those workshops. Using the concept of business models to interrogate how community energy could be structured in the future, we find that the sector could diversify from its current focus on renewable electricity generation and energy efficiency, into new areas of the energy system: demand-side flexibility, mobility and heat. We also see potential for a Community Energy Confederation to help bridge the gap between the strengths of local organising, and the opportunities offered by larger scale activities. We identify the importance of actions by government – both at national and local levels – to realising this vision, in combination with the efforts of the community energy sector itself. Our research highlights the need for change in the institutional and spatial character of community energy; the sector's pragmatic attitude to the technological aspects of the energy transition; and its focus on community energy's role in delivering social and environmental co-benefits, in line with the concept of a just transition.

This report presents the first of four case studies of UK community energy organisations conducted during 2018/19. These will later be included as part of a synthesis briefing alongside findings from a series of sectoral-level interviews. The case study makes use of a combination of qualitative (e.g. interviews, organisation reports) and quantitative (e.g. financial reports) data. Key summary lessons include: The ability of community energy organisations to raise community finance is underpinned by government subsidies (e.g. feed-in-tariff). By providing a long-term guaranteed revenue stream, they de-risk the energy project. Their removal presents investors with a less attractive proposition, potentially closing down an important stream of finance. Local authorities are a key facilitator of community energy projects. For example, they may purchase power from community energy organisations, as well as provide space for power generation. The latter is highly dependent on the extent to which the procurement process and council leadership values locally supplied, low-carbon energy from not-for-profit organisations. Intermediaries are a key provider of economic, technical, social and political capital to community energy organisations. A key example are project developers such as Energy4All. Choices around legal structure have an important bearing on the financing and governance of a community energy organisation, including the: * Extent to which 'community benefit' is incorporated into the legal entity. * Level and type of finance it can raise. * Degree of risk it exposes its investors to. * Way in which control is exerted over the organisation's strategic direction and who wields this power.

This report presents the second of four case studies of UK community energy organisations conducted during 2018/19. These will later be included as part of a synthesis briefing alongside a series of sector-level interviews. The case study makes use of a combination of qualitative (e.g. interviews, organisation reports) and quantitative (e.g. financial reports) data. Summary of key lessons: Government subsidy is the cornerstone to securing both community and private finance. By providing a substantial long-term guaranteed revenue stream, the FiT allowed GEM to raise community investment and further investment from commercial and state-backed lenders. Even with the FiT in place, sourcing commercial finance was challenging. In its absence, it is unlikely that commercial lenders will lend. The ability to raise community finance is dependent on the affluence and population density of a locality. Unable to raise all the finance it needed from the community of Mull, the organisation was forced to access more expensive loan finance. Communities present important test beds for innovation, but direct long-term benefits may not be forthcoming. In its role as a trusted local organisation, GEM demonstrated an important role for community energy in facilitating innovation, but the extent to which it has been able to benefit from this is questionable. Partnerships with public landowners are critical to project delivery. Forestry and Land Scotland made land available for use by GEM, which was critical to their hydro scheme. Without this the project could not have taken place.

This report presents the third of four case studies of UK community energy organisations conducted during 2018/19. These will later be included as part of a synthesis briefing alongside a series of sector-level interviews. The case study makes use of a combination of qualitative (e.g. interviews, organisation reports) and quantitative (e.g. financial reports) data. Summary of key lessons: The withdrawal of the FiT has made business model innovation necessary, whilst legacy revenues from the FiT have made experimentation possible. The withdrawal of the FiT has meant that the CIC is unable to employ its existing revenue model for future projects, forcing it towards a more service-oriented approach. Interestingly, the 20-25 year long guaranteed revenue the FiT provides has also provided the CiC with the necessary capital and security for them to experiment with their business model. Community loans and bonds can be a viable alternative to community shares for delivering community energy projects. Instead of crowd-sourcing share finance from hundreds of shareholders, Gwent Energy has shown how raising community loans and bonds through a members-only Investor Club presents a different means of raising capital. Challenges of CIC legal structure have been overcome by an innovative finance model and a cooperative ethos. Whilst it has some advantages, the CIC legal structure suffers from the inability to raise community shares and the lack of an automatic democratic "one shareholder, one vote" system. These shortcomings have been overcome by legally incorporating these voting rights and raising finance through loans and bonds from community members only. In turn, these investors are invited to sit on committees to shape the CIC's future. Heating business models present key challenges for community groups. Gwent Energy have thus far been unable to expand the heating side of its business, because of a combination of the poor rate of return from some low-carbon heating technologies (e.g. heat pumps), the rising cost of ...