Success is often defined by money - at the fintech start-up Tomorrow Bank, sustainability is defined by 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 for investing 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. From this the three men developed an idea: money as a solution for the climate by using it positively. 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 first, so that you don't have to hide the money at home. But what is not part of the agreement, and where it is not really discussed, is that banks work with the money. You invest in things that make the most profit and are very intransparent. You agree with the concept that the money is kept there and is not advised that you basically have no say.
What makes Tomorrow Bank different from the competition?
Our big differentiator is clearly that Sustainability. In contrast to N26, for example, we clearly show where the funds are - and in real time. We show how many good bankers we have at any given moment, we also make sure that the money really flows into sustainable projects. And we have built 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.
N26 is probably competition and inspiration at the same time, but we still do our thing. You've definitely preceded it in terms of banking usability. But if we want to build the bank of tomorrow, then we have to make sure that we have one World of Tomorrow finance that we really want to live in and by helping people along the way.
Source & Copyright Tomorrow Bank
With ESG there are already sustainability standards in the financial sector?
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. Because ESGs are very superficial.
For example, Nestlé has a good ESG rating because they meet certain criteria. In doing so, it has been proven that they destroy landscapes. So the right things are not looked at and, above all, the business model is not examined. A positive ESG rating does not mean that it is a sustainable company is. Therefore, from my point of 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. In addition, 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 continued to aim to change the world through sustainable entrepreneurship. At that time there were around 350 "sustainable funds", of which only three were actually 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 do this. We were then ultimately linked through mutual friends and then 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 written on our nose that we will be Europe's largest financial platform for sustainable thinking and have set our sights on the target of 1 million customers. We currently have 87.000 customers. It's going very fast right now. Not only do they want to stay in Germany, they also want to work across national borders. An incredibly strong community has emerged so far and we are growing mainly through the Friends refer friends channel. That is why we are always happy to receive recommendations.
Click here it's about sustainable banking at Tomorrow Bank