Donkey Republic secures EUR 5 million in debt for vehicle financing through Nefco
Donkey Republic raises 5m EUR via a loan agreement with Nefco, the Nordic Green Bank. The money will be used to finance the renewal and expansion of Donkey Republics bike fleet across Europe.
Company Announcement No. 10 2022
Today more than 70% of Europeans live in cities and therefore transforming the way we move is critical in achieving a sustainable future. Donkey Republic has signed a loan agreement with Nefco, the Nordic Green Bank, that finances the initial scale-up of Nordic green solutions on global markets. The money will be used to purchase approximately 6.000 bikes and e-bikes that will be deployed across the many cities Donkey Republic is operating in. This addition will both replace and expand the existing fleet in those cities.With Donkey Republic’s growing herd of affordable and accessible shared bikes across Europe and beyond, Donkey Republic is working to get cities and people to join the republic and be a part of democratizing green mobility, to not only transform cities, but lives. Donkey Republic works to challenge the entire mobility industry to rethink what it means to be a sustainable mobility company. It is a company that believes in making sustainable mobility available to everyone as well as focusing on the green, physical and mental health benefits from using their bikes.
Road transport is the second largest source of greenhouse gas (GHG) emissions and fine particulate matter, and the largest source of NOx in Europe (Europa Environment Agency). To tackle that, Donkey Republic offers bike-sharing solutions that enable and encourage the replacement of private cars and other fossil-fuel vehicles in urban environments. Bike-sharing services is greening urban transport.
Making use of debt financing to grow the company's fleet is an integral part of Donkey Republic’s strategy. This loan is therefore a strong testament that Donkey Republic is well on track on executing its strategy.
The availability of shared micro-mobility enables the transition away from fossil fuel vehicles. Easy availability and affordable usage are important factors.
“Our mission is to make cities more liveable by offering cities and citizens a convenient, affordable and sustainable bike sharing service” says Erdem Ovacik, CEO at Donkey Republic. “In addition to the enormous environmental gains, cycling also brings substantial health benefits thanks to physical activity it offers”.
By replacing fossil fuel modes of transport, bike sharing reduces GHG emissions. The investment Nefco is now financing is expected to annually reduce emissions by up to 150 tonnes CO2e. Based on an assessment made by Nefco, the activity complies with the eligibility criteria ‘climate change mitigation’ of the EU Taxonomy. The EU taxonomy for sustainable activities is a classification system established to clarify which investments are environmentally sustainable, in the context of the European Green Deal. The aim of the taxonomy is to prevent greenwashing and to help investors make greener choices.
E-bikes have a larger emission factor than regular bikes and to minimise it, Donkey Republic has a life cycle approach towards its e-bikes by repairing batteries instead of replacing them, whenever possible.
“This type of business requires large upfront investments. Nefco wants to promote zero-emission modes of transportation and sees long-term potential in Donkey Republic’s solution and growth prospects. As a high-risk debt financier, we are ready to finance this stage to help the company grow and later attract additional lenders,” commented Søren Rasmussen, Investment Manager at Nefco.
ABOUT NEFCO
Nefco is an international financial institution, the Nordic Green Bank, that finances the initial scale-up of Nordic green solutions on global markets. Founded in 1990 by the five Nordic countries, Nefco has already financed and implemented over 1,500 projects in energy efficiency, renewable energy, clean water and sanitation, waste management and cleaner industrial processes, among others. To date, more than 600 Nordic growth companies have received financing from Nefco to scale up their green technologies and solutions on global markets. We serve the interests of our owners, Denmark, Finland, Iceland, Norway and Sweden, and work with concrete actions to accelerate the green transition aligned with the 2030 Agenda for sustainable development, the Paris Agreement, the EU Green Deal and the Nordic Vision 2030. Read more about us on www.nefco.int.
