September 26th, 2018
ATB Financial joins the crowdfunding crowd
Edmonton Journal by Dan Barnes | August 8, 2013
EDMONTON - For a small business in need of a cash injection, crowdfunding has solidified itself as an appealing and viable alternative to a bank loan.
But to a bank like ATB Financial, which is testing a rewards-based crowdfunding platform called Alberta BoostR in Edmonton and Grande Prairie, where is the appeal in helping provide a free alternative to a loan that would generate interest revenue?
ATB doesn’t take a cut of the Alberta BoostR crowdfunding transactions. Instead, the company put its corporate logo on a website, spent employee time and money to research and build out that website with processes for collecting and disseminating funds, promoted the initiative through their branches and in various media, and now await the results.
In hopes of what, exactly?
“It’s not about us. It’s about the local economy and local businesses,” said Sean Ballard, director of innovation for ATB Emerge in Calgary. “As it stands right now, we have no financial gain in this at all. The usual model is you take a small percentage of each transaction.”
But chasing small percentages of small transactions wouldn’t seem to make sense to an institution that generated $245 million in profit on $1.2 billion in revenues in the fiscal year ended March 31. Its strategy for now is centred on making the platform useful and easy to use for those local businesses.
“If we get that right, building a business model around that isn’t hard,” Ballard said. “This is an entry door into the space of crowdfunding as a whole. It could be a much more interesting play. This is a step for us along the path.”
He heads the small Emerge innovation team charged with tilling what could be rich soil outside the parameters of standard banking business territory for ATB. Alberta BoostR is just one of their projects.