January 7, 2013, marks the beginning of a new, transparent and democratic way of financing clean energy through crowdfunding that could disrupt the two largest industries in the world: energy and finance. Mosaic, an online marketplace that connects investors to high-quality solar projects, has begun offering investments to residents of California and New York as well as accredited investors from around the country. For the first time ever, the American public will be able to invest directly into clean energy projects and receive a solid return.
Mosaic’s first investment offerings for New York and California residents are in solar projects on affordable housing apartments for low-income residents in California and offer a 4.5 percent annual return, net of servicing fees, with terms of approximately nine years. With 10-year Treasuries at near historic lows (1.90 percent), CDs at 0.5 percent APY, bonds averaging 5.20 percent from 2003-2012 and stocks in the S&P 500 averaging 4.95 percent annualized returns from 2003-2012, Mosaic’s expected yields are competitive with the best investment products on the market.
“Energy investing has traditionally been a bank only game, but already, hundreds of people from across the United States have invested to finance solar projects through Mosaic. We expect millions
more to follow,” Mosaic CEO Dan Rosen says. “The transition to clean energy represents one of the greatest opportunities for wealth creation of our time. We created Mosaic to accelerate that transition by enabling more people to participate in it and to profit from it,” Mosaic’s President Billy Parish says.
To date, $1.1 million has been invested through Mosaic by more than 400 investors to finance twelve rooftop solar power plants in California, New Jersey, Arizona and the Navajo Nation. Though the SEC has not yet adopted rules implementing the crowdfunding provisions of the JOBS Act, Mosaic is pursuing other avenues for crowdfunding clean energy ahead of the adoption of final rules. As President Obama said after signing the JOBS Act in April 2012, “For the first time, ordinary Americans will be able to go online and invest in entrepreneurs that they believe in.”
Update: Mosaic sold all of its shares in all of its public projects within the first 24 hours of opening them to New York and California residents. They had more than 400 investors and received more than $313,000 worth of investments.