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It’s New Economy Week, and PCI Fellow Michael Shuman is sharing 24 Ways to Invest Locally. Each day this week, Post Carbon Institute will roll out four ways you can—right now—begin to move your money from Wall Street to Main Street, and help build a vibrant, more resilient economy in your community.
(13) Educate Local Businesses about Securities End-Runs
– Local businesses are largely unaware of ways of acquiring capital that do not require expensive, time-consuming securities filings. For example, in most states the pre-selling of goods and services are not regarded as securities. Awaken Café
in Oakland raised more than $50,000 for its new store from its customers by preselling coffee. In addition, many churches and unions are large enough to be regarded as accredited investors and are interested in supporting local business.
(14) Create A Local Stock Market
– – As crowdfunding spreads, there will be a growing number of local stock purchasers who wish to sell their shares. You can facilitate this by creating a local or regional stock exchange. Mission Markets
has a turn-key web platform that can enable your community to get started with this immediately.
(15) Move Your Public Money
– – Where is your city doing its banking? If it’s not local, lobby for a change. The Bank of North Dakota
does this on a statewide basis, placing local tax collections and federal government transfer payments on deposit in local banks before it’s needed. More than a half-dozen states are looking seriously at creating their own public banks. Meanwhile, states like Massachusetts are moving more public money into local banks.
(16) Create a Local Investment Fund
– – Pools of capital are preferable to one-off investments because they diversify risk. There are thousands of local-investment pools around the country, most of them linked with local economic-development programs, but nearly all of them are only open to accredited investors. Important exceptions that allow unaccredited investor participation include MountainBizWorks
in North Carolina, the New Hampshire Community Loan Fund
, and The Economic & Community Development Institute in Columbus, Ohio (www.ecdi.org
). These funds demonstrate that it’s possible to create nonprofits that can take money from all kinds of local investors, and use those funds to grow local businesses.
Check back every day this week for for more ways to invest in your local economy.