TAMPA, Fla. — Trellance Cooperative Holdings Inc. has developed a new collaborative investment initiative designed to give credit unions greater access to the expertise and resources needed to make strategic investments in fintechs, CUSOs and other companies serving the industry.
The initiative, currently called the Investors Club, will provide participating credit unions with resources to identify, evaluate, structure, execute and support potential investments, according to Trellance.
The Tampa-based CUSO said the model is intended to provide credit unions with institutional-level investment capabilities while preserving each institution’s ability to determine which opportunities it wants to pursue and how much it wants to invest.
The Investment Requirements
Credit unions participating in the Investors Club will not be required to invest in every opportunity presented through the initiative. Instead, Trellance said each investment will be evaluated individually, with participating institutions making decisions based on their own strategies, risk tolerances and financial objectives.
Sharing Expertise, Due Diligence
Trellance said the initiative responds in part to the changing relationships between credit unions and the fintechs, CUSOs and technology companies on which they increasingly rely.
Those relationships are evolving in some cases from traditional vendor-customer arrangements into strategic partnerships that can include credit union investment or ownership, according to the company.
That evolution creates a need for greater access to investment expertise and resources, Trellance said.
By working collaboratively, participating credit unions will be able to share expertise and due diligence while potentially gaining greater negotiating leverage and access to operating resources.
The structure is also intended to accommodate credit unions of different sizes and with different investment strategies rather than requiring participating institutions to maintain identical investment portfolios.
Financial, Strategic Returns
Trellance said potential investments will be evaluated not only for their prospective financial returns but also for their strategic value to participating credit unions and the broader credit union industry.
Those considerations could include gaining greater influence over important technologies and capabilities, affecting product development and technology infrastructure, and supporting companies developing products specifically for credit unions.
Trellance said credit unions also can bring benefits to portfolio companies beyond the capital they invest, including access to members and markets, industry expertise, operating experience and distribution capabilities.
“Credit unions have an opportunity to put their capital to work in ways that strengthen the credit union movement and create value for their own organizations,” Trellance President and CEO Tom Davis said in announcing the initiative.
“The Investors Club is a new model for collectively investing in innovation, building scale and shaping the future of financial services together,” Davis added in the statement.
More Details to Come
Trellance has not yet disclosed details about the Investors Club’s initial investment targets, minimum investment levels or which credit unions will participate.
The company said additional information about participation requirements, investment opportunities and the structure of the platform will be released as the initiative develops.
Trellance Cooperative Holdings is a credit union cooperative headquartered in Tampa that operates a group of technology companies serving the credit union industry. Its companies include Rise Analytics, Optiri and ProBridge.
