Founder and managing partner of The Redsand Group, Nicole Anderson, announced in a recent interview with Finextra TV that the group will launch a fund to work with the venture community to support fintech aimed at tackling sustainability across financial services through tools such as blockchain and tokenisation.
Looking into the issues and challenges associated with real businesses that are going through green transformation, Anderson says Redsand is best described as an incubator: “We’ve been involved in incubating businesses based on mandates coming from corporates, generally financial institutions, to help them recreate and consider blind spots or pitfalls they may not have seen in relation to sustainability objectives.”
During 2020, the group will also shift focus toward defining and solving some of the key challenges across insurance, re-insurance and capital markets by building ventures and helping companies use the technologies available to improve their sustainability record.
The work that Redsand recently undertook in the real estate space in Scandinavia, for instance, touched on making the market accessible through technologies such as blockchain, with the project’s primary value meaning that the entire fundraising process became much more efficient.
Redsand aims to provide access to individuals, consumers and retail investors with the same experience that an institutional broker or investor would have in investing in property. “It also focused on the tokenisation, liquidity and opportunity for taking cost out that particular opaque asset class as the key issue we were tackling,” explains Anderson.
“At the same time, because it was the real estate and construction industry, we looked at the use case of blockchain for tokenising the supply chain. This meant that we could create immense transparency for how capital was being deployed across the physical supply chain.”
As the research has a ‘green’ focus, Redsand provides stakeholders, investors, regulators, corporate partners and supply chain partners with clear supply chain visibility into how the chain was operating and, where the deficiencies were.
Anderson adds that “Investors almost experienced an ‘epiphany’. Not only was the asset class far more liquid, but investors were given the certainty that their money could be traced and was being invested in truly ‘green’ ventures.”
Anderson elaborates that while the power of tokenisation technology to allow any asset class to be tokenised and fractionalised is well known, we need to be asking what the trajectory is for digital assets.
Tools such as those being used by The Redsand Group signify a shift for financial services, as the emergence of practical solutions to boost transparency and quantify data means the ‘all care no responsibility’ excuse no longer flies.
Anderson says her South African background speaks to her understanding of the need to address financial inclusion, a driving motivation behind founding Redsand.
Redsand’s work has evolved from social impact ventures into more sophisticated plays: “Our work now has a much bigger, global implication. When you overlay the environmental impact of new businesses and what responsibility finance bears in ensuring that the good businesses survive and the bad businesses are financially encouraged to transition, this is a huge new opportunity and innovation is imperative.
“Those corners that have been immune to change, such as capital markets, asset management, insurance and re-insurance, are the most exposed and therefore are faced with the biggest opportunity and challenge.”
Finextra Research and ResponsibleRisk will be focusing on sustainable finance in investment and asset management at the second SustainableFinance.Live Co-Creation Workshop in March 2020.
Register your interest for the event, where you will be able to discuss the demand for sustainability, the challenges that lie ahead for sustainable investment and how firms across financial services and technology can achieve the UN’s Sustainable Development Goals by 2030.