Community Based Crowdfunding: Connecting Business With Capital

2019 ECG Economic Development Summit April 30, 2019

The Local Crowd

Crowdfunding Made Local Diane Sontum Co-Founder

& CEO

Kim Vincent Co-Founder

& COO

Our mission is to support the wellbeing of communities by catalyzing

entrepreneurial ecosystems through the introduction of a educational

crowdfunding tool.

Community Funded Enterprises

Diane Sontum

Jessica Romero Kim Vincent

The TLC Team

Jason Arnold

The Crowdfunding Industry

Types of Crowdfunding

Seed Crowdfunding

Crowdfunding Economic Impact Crowdfunded companies increased quarterly revenues by an average of 24% Equity-based increased revenue by 351%. 39% of companies hired an average of 2.2 new employees (48% more said they plan to hire.) Within 3 months, 28% had closed an investor round. (An additional 43% were in discussions.) Every hour invested in a successful crowdfunding campaign returned $813.

CROWDFUND CAPITAL ADVISORS

Wow, Easy Money!

Wow, Easy Money! NOT!

The Real Environment

Can a Crowdfunding Strategy Help Create Sustainable Rural Communities?

Crowdfunding Research conducted in 2014-2017

Why Local Crowdfunding? Leverage!

1st Tier

1st Tier

2nd Tier

2nd Tier

3rd Tier

80% of funds raised come from activities of the Campaign Creator and his or her team.

It’s About Relationships

Building and connecting your community Doing something meaningful Having authentic voice Telling compelling story Keeping an engaged audience

Money comes after you create connections

It’s About Education Teaching Best Practices Creating User Success

–Massolutions Crowdfunding Industry Report

Day to Day marketing plans raise 180% more.

Regular updates raise 126% more.

Videos raise 105% more.

Teams raise 38% more.

Best campaigns last 20-40 days.

Best descriptions are 300-500 words.

Once you reach your goal, you are 78% more likely to exceed it.

Personal email is Best way to connect. People are 22% more likely to give once

the project has reached 40% of its goal.

A Breakthrough for Women

Women-led campaigns reach

their goals more often than men.

What if we could put an end to the gender gap women entrepreneurs face

when raising capital?

How would the lives of women and

families be changed?

The Local Crowd Monroe

TLC Campaigns from Monroe

City of Monroe Campaign

A New Opportunity! TLC 4SE Gather information from social entrepreneurs to

identify their needs and “pain” on a grassroots level.

Develop the TLC crowdfunding platform into an educational laboratory that helps SEs raise capital, connect with others and participate in the development of the 4th sector ecosystem.

—FourthSector.net

Social Enterprise

What is the 4th Sector?

What is a Social Enterprise? An organization that addresses a basic unmet need or solves a social or environmental problem through a market-driven approach.

—Social Enterprise Alliance

Three Models for Social Good

Opportunity Employment: Examples include Goodwill Industries, Greyston Bakery & Nisolo Transformative Products or Services: Examples include 4Ocean, Benetech, The Local Crowd, Soles4Souls. Donate Back: Examples include Newman’s Own, Songs Against Slavery

“1.4 billion pounds of trash enters the ocean each year. We are making it our mission to stop this.”

—Andrew Cooper and Alex Schulze

4 OCEAN is transforming our oceans

A Growing Trend

So…why is it so hard? No consistent access to capital Mission drift Finding the right suppliers Measuring impact Low Profit Margins Burnout and depression

Established Ecosystems Have…

Legal Structures

Capital Markets

Governance Forms

Support Personnel

Tax Laws

Measurement Protocols

Regulations

The Hockey Stick Expectation

4th Sector Ecosystem Experience

The Aha Moment…

“The biggest thing I learned today is that we are a 4th sector company.”

--Kari Brizius President, Relan

When social entrepreneurs learn they are all part of an emerging economic sector, they realize…

Together we can pave that road!

Introducing TLC 4SE!

FORCE!

“All fourth sector education and information exists at the 6,000 foot level. You are going to bring it to the six-foot level.”

--Rajesh Mehta NSF Program Manager

Four Pilot Communities Goshen, Indiana (Phil Metzler) Laramie, Wyoming (Trey Sherwood) Monadnock Region, NH (Jen Risley) OmniWorks Business Incubator,

Los Angeles, CA (Brent Imai)

Benefits to Pilot Communities Localized Crowdfunding Platform Comprehensive Educational Program resulting in high

success rates 5% Crowdfunding Fees Returned to Community Host

(during research period). Interviews (You can help shape 4th sector ecosystem) Raise funds for local social enterprises Engage & energize local community Fun!

The Local Crowd

TLC Tender Loving Care

Join the 4th Sector Movement!

Take our survey Tell us your story—communities & SEs Start or encourage a crowdfunding campaign Share the information with social entrepreneurs

you know!

THANK YOU! Diane Sontum diane@thelocalcrowd.com

Kim Vincent Kim@thelocalcrowd.com

888-465-9622 The Local Crowd.com