Success is often defined by money - at the fintech start-up Tomorrow Bank, sustainability defines the success of money
In an interview with Michael Schweikart, co-founder of Tomorrow Bank
Author: House of Eden
Tomorrow Bank invests today in tomorrow, offering customers a solution to invest their money in the environment and their own future. The bank is heading in a new direction by redefining success. Not in the form of growth and numbers, but as values and a strong community.
Inas Nureldin, Jakob Berndt and Michael Schweikart founded the FinTech start-up in 2018 with a shared vision. Money is powerful and money is part of that climate problem. This led the three men to develop an idea: money as a solution for the climate by using it in a positive way. With their business model, they set new sustainability standards for the industry and want to stand up to the bad banks. The company recently raised 14 million euros in a financing round.
With its claim, Tomorrow makes it clear that change is a process and not an overnight success. That is why they also call themselves a zebra - the "better" unicorn. In an interview with founder Michael Schweikart, he explains how Tomorrow Bank wants to assert itself as a zebra in the wilderness of the financial world and thus keep up with the predators.
"If we want to build the bank of tomorrow, then we must also ensure that we finance tomorrow's world"
Founding Team - Source & Copyright Tomorrow Bank
When it comes to banking, many don't even think about sustainability, but why is it so important?
They say "money moves the world" and there is something true about it, but we assume that it is moving in the wrong direction. And that's why we founded Tomorrow. Money has an effect, so it makes a difference where you direct it. From my point of view, money is the blood of the circulatory system. Depending on where it is invested, something can grow and flourish there.
Accordingly, it is also important which bank you are with. Because banks work with their customers' money. Unfortunately, many banks are currently investing in yesterday's industries and unfortunately promoting the companies that are destroying our planet.
“Banks invest our money in climate-damaging industries without our knowledge”: Why is that even possible?
I think in the old world, it was quite normal for customers to entrust their money to the banks. And that's a good thing at first, so that you don't have to hide the money at home. But what is not part of the agreement, and what is not really talked about, is that banks work with the money. They invest in things that make the most profit and they do it in a very non-transparent way. You agree to the concept that the money will be kept there and it is not pointed out that you basically have no say in the matter.
What makes Tomorrow Bank different from the competition?
Our big differentiator is very clearly sustainability. Unlike N26, for example, we show very transparently where the money is - and in real time. We show how many good bankers we have at any given moment, and we also make sure that the money really does go to sustainable projects. And we have integrated sustainability into every element of our business model.
This means that the dealer fee for payments is put into climate protection projects. We also want sustainable consumption and strengthen and promote sustainable behavior. We currently have a CO2 footprint so that you can see how much CO2 emissions a transaction causes. We do this to educate and create transparency without wanting to criticize.
Source & Copyright Tomorrow Bank
With ESG, there are already sustainability standards in the financial sector, aren't there?
While ESG is a step in the right direction, it's just a mini-step that often creates the wrong impression. ESG are basic standards that should be adhered to, but they are still often misused. This means that companies receive a good ESG rating even though they actually have a destructive business model. After all, ESGs are very superficial.
For example, Nestlé has a good ESG rating because they meet certain criteria. Yet they are demonstrably destroying landscapes. So they are not looking at the right things and, most importantly, they are not looking at the business model. A positive ESG rating does not mean that it is a sustainable company. Therefore, in my view, it is rather misleading.
We have therefore established our own testing process, where we exclude a large number of systems in the first step using 44 negative criteria. This includes fossil fuels, child labor, transparency, work on embryonic cells, etc.Furthermore, we check whether the business models are really sustainable. From our point of view, the investment is only sustainable if it has a positive impact on the 17 SDGs. Then we have an Impact Council. This is an important final part of the review process that discusses the controversial cases again.
Who is Tomorrow Bank?
We, Inas, Jakob and I, are all three series founders. We have all done something in social entrepreneurship and have already seen that it can really make a difference. This is a passion that unites us. We then got together more by chance, when we had all just finished a project at the same time and were looking for new shores.
We still had the goal of changing the world with sustainable entrepreneurship. At that time, there were about 350 "sustainable funds", but only three of them were really sustainable. Today, there are 800 funds that are sustainable on paper and yet only three are truly sustainable. That was a point for us: let's tackle this. In the end, we were connected through mutual friends and found each other in this way.
What can we expect from you in the future?
The goal is to direct a lot of money in the right direction and thus to have a positive impact. We have set ourselves the goal of becoming Europe's largest financial platform for sustainable thinking and have set a target of 1 million customers. We currently have 87.000 customers. Things are moving very fast right now. We don't just want to stay in Germany, but also work across national borders. So far, an incredibly strong community has emerged and we are growing primarily through the Friends Recruit Friends channel. That's why we are always happy about recommendations.
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