1 / 31

Community Shares

Community Shares . Jo Bird Co-operative Business Consultants Sept 2013. Raising Finance. Core, project, sponsorship Prepayment, credit, in kind Secured , unsecured, bond Withdrawable , transferable, mutual. Grants Supply chain Loans Equity. History – UK Consumer Co-ops .

rossa
Télécharger la présentation

Community Shares

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Community Shares Jo Bird Co-operative Business Consultants Sept 2013

  2. Raising Finance • Core, project, sponsorship • Prepayment, credit, in kind • Secured, unsecured, bond • Withdrawable, transferable, mutual • Grants • Supply chain • Loans • Equity

  3. History – UK Consumer Co-ops • 1844, Rochdale Pioneers set up co-op shop • 28 founder members • £1 each to rent a shop and buy initial stock • £1 worth c£100 today – this was a community share issue • Successful model taken up by thousands • But tradition lost in last century

  4. Rochdale Pioneers, 1844

  5. Co-operative Principles • Voluntary and open membership • Democratic member control • Member economic participation • Autonomy and independence • Education, training and information • Co-operation among co-operatives • Concern for community

  6. The Return of Community Shares

  7. From 2009 onwards • Community shares has mushroomed • 300 Societies registered • 120 share offers completed • Over £20 million raised from 24000 people • Average amount raised £200k • Average 240 members investing £900 • Many share offers offer 3-8% interest

  8. Key Sectors for Community Shares

  9. Four types of share offer • Membership offer: To recruit members Nominal share capital. • Pioneer offer: Small group of founder members raise high risk capital. Ideal for Seed EIS. • Target-bound offer: To raise a target amount. Ideal for S/EIS. • Open offer: To maintain open membership and allow withdrawals, supported by track record.

  10. Community shares: key elements Community Shares

  11. Building a community around the co-op • Regular communication with members – mailing list, newsletters, facebook, website • Maintaining momentum • Public meetings –to introduce the idea, and to launch • Local and national media coverage • Activities, campaigns and working groups

  12. Member engagement Investor Customer Volunteer Service user Activist Members Expert Worker Director Supplier

  13. Enterprise Investment Scheme • HMRC scheme • 30% tax relief with EIS • 50% tax relief with Seed EIS, <2 yrs trading, up to £150,000 share offer • Loss relief • More return than a cash ISA • Cannot withdraw shares for 3 years • Some sectors are excluded inc financial services, on-lending, farming, land, property • www.hmrc.gov.uk/eis/

  14. Underwriting offers: • Appraisal report and due diligence • Community reassurance • Enable asset purchase • Fills shortfall, max a third up to £50,000 • Enables monthly instalments • Arrangement fee 2% and interest 8%

  15. Companies • Not possible for Company Limited by Guarantee to issue shares • Expensive for Company Limited by Shares • Community Interest Companies • Regulated by FCA under FSMA 2000.

  16. Only Co-op and Ben Com Societies • A unique form of capital • One-member-one-vote not one-share-one-vote • £20,000 maximum holding of withdrawable shares • Withdrawable shares cannot increase in value, but can decrease • Withdrawable under certain conditions • Interest can be paid on shares • Mostly outside remit of FSMA 2000

  17. Exemption From Regulation, But ... • But share offers are still covered by the Misrepresentation Act 1967 • The share offer document must offer a fair view of the proposal on which people can rely • The FCA still has an interest – good practice guidelines have been developed with the Community Shares Project

  18. Case Study – Tree Station • Tree work and wood fuel business • Part buy out of sole trader in 2012 • Raised £140,000 from 140 members • Minimum £200 investment • Gained EIS afterwards

  19. FC United of Manchester

  20. Case Study – FC United of Manchester • Football club formed due to rising ticket prices and market failure • 2,000 fans attend non-league matches • 3 teams • Raised £1.7m from 3,000 members • EIS • Share offer still open • Minimum £200 • £5m blended finance inc grants and loans

  21. Case Study - The Old Crown • Pub in village of Hesket Newmarket, Cumbria • Came on the market in 2002 • Concern about future of last pub in village • The community bought the pub a year later • 124 members with an equal stake of £1,500 • Members elect a Board of between 3 and 15 • The co-op appoints a licensee – experienced local pub manager – to run the pub • Turnover increased from £90k to £250k • Now provides 12 local jobs

  22. Case Study – Harlaw Hydro • Set up to install a 65kw water turbine on River Leith in the small town of Balerno near Edinburgh • Will generate electricity, sold to National Grid, income from Feed In Tariff (FIT) • Members elect a Board, but 3 Directors appointed by Balerno Village Trust • Total financial package of £313,000 • Raised over £150k community shares, plus grants and loans • Seed EIS tax releif • £60k a year for community projects

  23. Free grant for advice and support • From the Co-operative Group • To set up or grow co-operative enterprise • Registration as a co-operative • Membership, democracy, decision making • Business and financial planning • Community share issues • Can re-apply after 12 months • www.co-operative.coop/enterprisehub

  24. Further resources Community Shares www.communityshares.org.uk Co-operatives UK www.uk.coop Co-operative and Community Finance www.coopfinance.coop Co-operative Business Consultants www.cbc.coop

More Related