Tips for Local Food #3 : Creative Funding – finding new & innovative ways to fund your local food enterprise

As part of our series on Top Tips for Local Food Distribution, we’re diving a little deeper into each of the 5 tips we gave. This week is ‘Creative Funding’ – finding new & innovative ways to fund your local food enterprise.

Bucky Box - helping you find new & innovative ways to fund local food enterprise

 

You can also check out ‘#1 : Get Social – a guide to new media for local food‘ & ‘#2 : Call on Existing Resources & Support – Standing on the Shoulders of Giants‘.

 

Finding it hard to find the capital to get your local food enterprise off the ground? Want to scale up your business, but finance is a barrier?

 

Here’s our first guide to creative funding paths for local food enterprises, which we think may help you find a path away from the loan sharks & corporate banks, to an exciting future of local food funding.

 

You may remember we wrote a blog off the back of National Good Food Network’s webinar about funding local food.  This is still a great resource for a variety of creative ways to fund local food enterprise, so we’re re-posting the slideshow below.  However, this blog is the follow up with some fresh new ideas from our research in this space too.

 

Local Food Funding Webinar Round-up

[<a href=”http://storify.com/buckybox/local-food-investment-webinar” target=”_blank”>View the story “Local Food Investment Webinar – National Good Food Network” on Storify</a>]<br /> <h1>Local Food Investment Webinar – National Good Food Network</h1> <h2>A webinar hosted by @ngfn on innovative ways to fund your local food enterprise.More information at the National Good Food Network here: http://bit.ly/y7TKRg</h2> <p>Storified by Bucky Box · Sun, Aug 05 2012 21:27:10</p> <div>Youngfarmers</div> <div>Find out how the USDA supports local and regional food systems. Free webinar TODAY 3:30p ET 12:30p PT http://bit.ly/y3qVhDNatl Good Food Netwk</div> <div>’Cutting Edge Ways to Fund your Food Business’ #NGFNwebinar on now http://bit.ly/w07Ggl – thanks @ngfn!Bucky Box</div> <div><b><i>You can see the FULL webinar video here now too:</i></b></div> <div>Cutting Edge Ways to Fund Your Food Business – an NGFN webinarwallacecenter</div> <div><b>Check out the live-tweeted round-up here too:</b></div> <div>Study & Support of #FoodHubs – resource coming soon from USDA & Wallace Centre http://foodhub.info #NGFNwebinarBucky Box</div> <div>USDA Unveils New Food Hub Resource Guide to Expand Market …Apr 20, 2012 … CHICAGO, April 20, 2012 ? The U. S. Department of Agriculture unveiled the first Regional Food Hub Resource Guide, bol…</div> <div>Food Hub Center — National Good Food NetworkBuilding Successful Food Hubs: A Business Planning Guide for Aggregating and … Check out the Regional Food Hub Resource Guide, a new …</div> <div>Panelist & speaker Michael Shuman is introduced to the webinar audience of around 80 people from around the country (and world in Bucky Box’s case!)<br></div> <div>Michael Shuman (economist & author) – ‘Local $, Local sense’ : the importance of #investment in #food. Webinars coming up! #ngfnwebinarBucky Box</div> <div>Information from NGFN:<br><span style=”font-style: italic;”>Drawing from his new book, “Local Dollars, Local Sense:  How to Shift Your Money from Wall Street to Main Street,” Michael Shuman will explain a dozen, low-cost strategies local businesses are using to secure new capital from the general public.  He will talk about specialized bank CD programs, prepurchase deals, new-generation cooperatives, internet sponsorship sites (like Kickstarter), P2P lenders (like Prosper and Kiva), community lending circles, investment clubs, municipal bond schemes, local revolving loan funds, direct public offerings, and local stock exchanges.  He also will report on the latest news of a crowdfunding reform bill – sponsored by Tea-Party Republicans but endorsed by the Obama Administration – that is working its way through Congress and could literally make trillions of dollars of new capital available to local business.</span></div> <div>www.postcarbon.org</div> <div>$103m to relocalise food in Boulder, but #local people can fund this with a fraction of our savings & securities. #ngfnwebinarBucky Box</div> <div>Economic impact of moving 25% of food to #local: 1899 jobs, $81m in wages, $138m local gdp – in Boulder County alone! #ngfnwebinarBucky Box</div> <div>’A tiny fraction of national long term capital is invested in local markets’. Shift $ from Wall St to Local! #ngfnwebinarBucky Box</div> <div>AGREED! Software being one! "Many efficiencies discovered in current food system that are not contrary to Good Food." #ngfnwebinarBucky Box</div> <div>The Local Food investment tips start rolling in from Michael Shuman….<br></div> <div>Investment in Local Food: 1) Speciality Deposits (CD’s) http://trib.al/43JZ5Y #investment #food #ngfnwebinarBucky Box</div> <div>Specialty Deposits – Deposit Services – Citizens Business BankWith CDARS, you can access FDIC protection on multi-million dollar CD investments through Citizens Business Bank. There are few guarant…</div> <div>1) Speciality Deposits: Alternative Credit Union CENTS http://trib.al/Et7k9d #ngfnwebinar #investmentBucky Box</div> <div>Alternatives.org: Business CENTS – Alternatives Federal Credit UnionWhether you are at the starting stages or have been in business for years, Business CENTS can help. Business CENTS is a comprehensive s…</div> <div>Investment in Local Food: 2) Co-op Investment – lighter & easy to get off the ground #ngfnwebinarBucky Box</div> <div>Cooperatives take up the next 5 minutes or so – seem like quite the possibilities in this space.<br></div> <div>#Co-ops are amazing. It’s official. Food Hub with Co-op backing anyone? #ngfnwebinarBucky Box</div> <div>International Year of Cooperatives Video Clip 2012uncoopsyear</div> <div>2012 International Year of Co-operatives | Welcome to the official …A key aim of the International Year is to raise public awareness of the co- operative business model. In the media section you can find …</div> <div>Carrying on with the tips…</div> <div>3) LION – local investment opportunity network – Local Food enterprises can apply! #investment #ngfnwebinarBucky Box</div> <div>The Concept | Lion InvestingWe know it's important to “buy local.” What if we could also invest locally? LION – the Local Investment Opportunities Network – co…</div> <div>Local Food Investment tip #4: Sponsorship – get in on the @kickstarter crowdfunding revolution! #ngfnwebinarBucky Box</div> <div>KickstarterKickstarter is the world's largest funding platform for creative projects.</div> <div>Haha, "The electronic Mohammad Yunus" Local Food Investment tip #5: e-Lending – get in on @kiva action! #ngfnwebinarBucky Box</div> <div>Kiva – Loans that change livesMake a loan to an entrepreneur across the globe for as little as $25. Kiva is the world's first online lending platform connecting …</div> <div>Local Food investment tip #6 ‘Slow Munis’ – Municipal Bonds http://trib.al/lHzWn8 #ngfnwebinarBucky Box</div> <div>Municipal bond – Wikipedia, the free encyclopediaA municipal bond is a bond issued by an American city or other local government , or their agencies. Potential issuers of municipal bond…</div> <div>Local Food investment tip #7 Pre-Sales – Get your money up front to aid growth! #ngfnwebinarBucky Box</div> <div>Local Food $ tip #8 Local Stock: locally raised funds for local projects http://trib.al/wV2kns #ngfnwebinarBucky Box</div> <div>Stock take of new legislation bills related to Crowdfunding – as backed by Tea Party & Occupy Wall Street.<br></div> <div>Pending legislation in US could open up a whole realm of new securities to Local Food if #crowdfunding legislation goes thru! #ngfnwebinarBucky Box</div> <div>Local Food $ tip #8: Local Stock Exchanges – Hawaii might be first off the rank! #ngfnwebinarBucky Box</div> <div>Local Stock Exchanges and National StimulusLocal Stock Exchanges and. National Stimulus. Michael Shuman. Business Alliance for Local Living Economies. Since the global financial …</div> <div>Local Food Investment tip #9: Investment Clubs like @SlowMoney & @SlowMoneyNYC #ngfnwebinarBucky Box</div> <div>Slow Money: Investment strategies appropriate to the realities of the …What it means to be an investor in the 21st century, promoting principles of soil fertility, sense of place, and cultural, environmenta…</div> <div>Local Food investment tip #10: Self Directed IRA (there’s even a "For Dummies" book for it!) #ngfnwebinarBucky Box</div> <div>Tax Advantages of Day Trading Through Self-Directed IRAs – For …Much of the tax hassle associated with day trading is eliminated if you trade through a self-directed Individual Retirement Arrangement…</div> <div>So the big question: "When the 1st $1trillion shifts from Wall St, what would you do for local food with a portion of it?" #ngfnwebinarBucky Box</div> <div>Prepare for the next stockmarket crash as everyone shifts their investment into local channels.Sustaination</div> <div>Food Hubs were talked about a fair bit as a shifting trend to open up new markets for CSA’s and local growers.  Check out http://foodhub.info to jump to the Wallace Centre’s resource portal for Food Hub information!<br></div> <div>Csrwire</div> <div>Food Hubs – Viable Regional Distribution Solutions – an NGFN webinarwallacecenter</div> <div>Big excitement about #FoodHubs from Michael Shuman as future of local food on #ngfnwebinarBucky Box</div> <div>Staticflickr</div> <div>I think Sustaination might have to bring our early investment offer forward.. over excited by #ngfnwebinar — thanks @buckyboxSustaination</div> <div>Michael Shuman opens the webinar to questions.  He explains investment into Food Hubs could be a prudent move at the moment.  We also ask about investment in technology for Food Hubs…<br></div> <div>Afraid we disagree on that one! ‘Most useful basis for software in local food is redeploying old technology’ what do u reckon @sustaination?Bucky Box</div> <div>@buckybox if you *can* re-use old software, then obviously do that. But there’s *always* room for necessary innovation #foodtechSustaination</div> <div>@Sustaination I’ve not seen too many VegeBox schemes operating SAP tho. Is #Tech moving too fast to deploy old tech for emerging industries?Bucky Box</div> <div>@buckybox barcode scanners, cheap gsm cell phones for remote data capture… all useful old tech which can be used.Sustaination</div> <div>@Sustaination True, simple smart phones & tablets will have a big role in the emerging decentralised food system. Time to make it happen.Bucky Box</div> <div>NZ Social Enterprise Bucky Box to Simplify Distribution for – SeedstockJan 16, 2012 … Bucky Box is a Wellington, New Zealand-based social enterprise dedicated to building software to improve the world&#39…</div> <div>BuckyBox: Helping Farmers Get Fresh Food To Your Table – Co.ExistCommunity supported agriculture and other farm-to-consumer schemes potentially offer a great way for independent farmers to compete in …</div> <div>Software firm focuses on helping small organic farms | Springwise3 days ago … Founded by one of the entrepreneurs behind Ooooby – which we covered back in 2010 – New Zealand-based Bucky Box is a sof…</div> <div>Study on shifting 25% of food to Local systems can be found here (PDF): http://trib.al/eoufudBucky Box</div> <div>Great stuff @NGFN, TY for the webinar, really interesting & helpful! Report to follow here: http://trib.al/T2EFXN #ngfnwebinarBucky Box</div> <div>Ditto! RT @buckybox: Great stuff @NGFN, TY for the webinar, really interesting! Report to follow here: http://s.coop/aorx #ngfnwebinarSustaination</div> <div>Check out more of National Good Food Network & Wallace Centre’s work here:<br></div> <div>Welcome — Wallace CenterWelcome to Wallace Center</div> <div>Welcome to your National Good Food Network — National Good Food NetworkThe National Good Food Network is bringing together people from all parts of the rapidly emerging good food system – producers, buyers, d…</div> <div>Check out more of Michael Shuman’s work here:<br></div> <div>Cutting Edge Capital – Creative Capital Raising for Your Business » About UsJenny has over fifteen years of experience as an attorney for and creator of social enterprises. She has raised funds for and launched a …</div> <div>THE BUSINESS ALLIANCE FOR LOCAL LIVING ECONOMIES | BALLE – Business Alliance for Local Living EconomiesDansko Stepping up its U.S. Footprint (posted on Mar 15 2012) Philadelphia Inquirer The Dansko shoe company strives to manufacture their …</div> <div>Local Dollars, Local Sense by Michael H. Shuman – Chelsea GreenLocal Dollars, Local Sense by Michael Shuman probes the future of investing — making the case for investors to put their money into buil…</div> <div>Local Dollars, Local Sense: How to Shift Your Money from Wall Street to Main Street – Michael Shumanargusfest</div>Cooperatives & Community

There’s something about local food enterprise which shouts cooperation to us, and if there’s one thing we can learn from nature about feeding a geographical area / community / neighbourhood, then it’s that competition & cooperation can be utilised together for greater outcomes.

 

2012 is the year of the Cooperative, and there’s plenty of examples, events & resources about how you can use co-operative models in your local neighbourhood to either get started, or raise capital for expansion. Check out the Food feed over on the Cooperative-2012 site for more gems, including a series of ebooks on using Cooperative Models to create a better food system. There’s also lots of great examples over on NGFN’s food hub site.

 

The basic idea goes:

  1. Gather interest from your neighbourhood – leaflet the town!
  2. Establish the cooperative funding model – tell people how they can invest
  3. Create a funding opportunity & cast the net – tap your networks for interested investors & engage them in your opportunity
  4. Fulfill your cooperative investment opportunity – use the money to get started / grow & return profits to the investors.
Grants & Seed Funding

Governments, charities, philanthropists & other funders around the world are waking up to the potential for investment & philanthropic seed funding for local food enterprise.  Whether you’re an individual, community organisation or social enterprise, there’s lots of options with a little research.

 

Focusing primarily on US & UK (where the financial landscapes are most developed for local food) we have picked out the best guides & examples;

USA

UK

We’re aware of some great programs in UK which offer support & financial packages for food funding. Take a look at Local Food Grants, and Making Local Food Work.

 

If you’re looking for something outside of these regions, as people frequently are, we suggest starting with your National/Regional Government body which looks after Agriculture & Food, and then deploying the power of Google or Twitter to find local grants or support.

 

Crowd Power

Unless you’ve been avoiding the internet for the last couple of years, there’s a chance you would have heard of the ‘Power of the Crowd’ in some shape or form.  This is an emergent space where new offerings are popping up and disappearing all the time (mainly because if you don’t have a crowd, the idea wont work!).

 

Many people will be familiar with websites like Kickstarter, IndieGoGo, Pozible, PledgeMe and more. These are the fore-runners in the Crowdfunding revolution which follow a fairly simple formula;

  • Create a Project & write a creative introduction / post a video to entice people to support you.
  • Offer Rewards – at the time of writing, there’s financial & legal barriers to offering anything more than a ‘pledge’ to support the project.
  • Get Social – share share share with your networks to spread the word you’re looking for help to get started / scale up.
  • Crowdfund! If people believe in your idea & like your rewards, they pledge money. Simple and incredibly effective.  If your project hits the target, you get the money, the pledgers get their rewards, and the world gets another project which may not have happened otherwise.
Crowfunding can be used to remarkable effect, and stories of $10k projects being funded three or four times over are not uncommon.  There’s been some successful projects related to local & community food projects, but we believe the various sites out there could be used much more for local food start ups!  Not only do you get the money, you usually also get heaps of buzz, a ready-to-go customer base, and passionate advocates who follow your progress & delight in hitting your target with you!

 

Recently, Slow Money launched Credibles; a crowdfunding investment system which returns food instead of money, this US based system has the potential to be replicated around the world.  Also launched in the last month, Three Revolutions, a crowdfunding platform dedicated totally to food.

 

We have also seen a revolution bubbling around the world in ‘Crowd Investment’ through sites such as Crowdcube. This is worth keeping an eye on!

 

As ever, these guides are a work in progress. If you’ve had success / seen someone else be successful with funding their local food enterprise beyond sharks & pounds of flesh – we’d love to hear from you! Comment or Tweet!

3 thoughts on “Tips for Local Food #3 : Creative Funding – finding new & innovative ways to fund your local food enterprise

    • Thanks Anna! We’re proud of our Kiwi cousins doing exciting things with Crowdfunding over here!

      Thanks for the link too, great to see the Free Store on PledgeMe – keep up the great work, and do drop us a note if you hear from any local foodies looking to get things started!

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