DIFFERENT MONEY IN DIFFERENT BUCKETS – PART 2 – COMMUNITY RESIDENTS
Karl Dakin
I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
QUICK CALENDAR
July 3 – Don Cohen Show – 9 a.m., MDT – LinkedIn Live
July 9 – Successful Funding Show – 8 a.m., MDT – LinkedIn Live, Facebook and YouTube
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FUNDING POINT – DIFFERENT MONEY IN DIFFERENT BUCKETS – PART 2 – COMMUNITY RESIDENTS
?In consideration of the multitude of possible funding sources for a community investment fund, the residents of a single community may be the most motivated candidates. With that generalization, the prospect of gaining investment from this source requires a more detailed assessment.
?Members of a community may include:
·?????? Residents
·?????? Businesses operating within the community
·?????? Property owners within the community
·?????? People working within the community
·?????? Business organizations
·?????? Civic organizations
·?????? Social associations
·?????? Government agencies within the community or tasked with helping the community
·?????? Educational programs and institutions serving the community
·?????? Anyone with an interest in or associated with the people, businesses, properties, or organizations within the community
This diversity of community members and supporters represents the full spectrum of possible motivations that may drive an investment decision.
?All investors are making investments in their self-interest. For members of a community to consider investing in their community, they must receive some benefit. There may be no motivation to invest if all the benefits are going to someone else in the community. A complete assessment would identify every individual or group of community members and quantify and qualify what benefits they receive and in what amount.
?Benefits may take the form of:
·?????? Jobs
·?????? Housing
·?????? Safety
·?????? Schools
·?????? Community Programs
·?????? Quality of Life
·?????? Opportunities
?RCI plans to raise funding in four stages:
· Seed Funding – high-risk funding to design and raise funding for a first-of-kind fund with a newly organized management team that will be expended quickly toward a Regulation CF capital campaign where the money may be paid back.
·?????? Community Investment Fund – a pooling of money from many investors toward the goal of causing revitalization of an underserved community in a manner that will create momentum for future economic growth that will take one year to invest and five years to work until investors may be paid back with both an appreciation of their investment and noteworthy and measurable impact.
·?????? Real Estate -construction lending (short term) and mortgage lending (long term) that will leverage down payment money from the Fund financing, increasing the size and number of real estate investments.
·?????? Business – equity ownership or revenue shares that multiply the investment from the Fund to grow existing businesses within the community and to recruit strategic businesses into the community
·?????? Programs and Projects – a cafeteria of several types of funding that match with one of the other types of funding or change the quality of the opportunity to qualify for other types of funding for purposes like workforce training, certifications, special applications, or other outcomes.
?A resident of the community may consider investing in Seed Funding of a Community Investment Fund if:
·?????? They have an existing relationship with a member of the RCI team or a community leader.
·?????? They have money that is immediately available to provide part or all of the needed funding
·?????? Money is available for the projected short-term duration of the investment – less than one year
·?????? Are a direct beneficiary of a community investment fund investment: a property owner or a business.
Until such time that RCI publicly names the community for which it plans to establish a community investment fund, the future benefit to a resident of the community is highly uncertain. RCI must (1) be successful in raising money for the fund and (2) may need to designate the specific real estate or businesses in which they will invest.
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?A resident of the community may consider investing in the community investment fund if:
·?????? They see a benefit to themselves, either directly or indirectly
·?????? They see a benefit to someone they support
An investment by a resident in the Fund is far more likely once a community has been selected and a resident is a member of that community. An offering through Regulation CF may include lower dollar priced investments that almost anyone can afford. An investment in the Fund will be for a term of six years, which may prove too long for most people. In addition, some residents may favor pooling their money with other people which makes them better investor candidates.
?A resident may invest in real estate purchased by the Fund or in a business in which the Fund makes an investment if:
·?????? They can provide debt financing or other monies to leverage the purchase of real estate by the Fund.
·?????? They can provide debt, equity ownership or revenue share funding to a business
The dollar amounts and investment terms will vary, providing multiple investment opportunities that may match the resident’s capabilities and preferences. An investment in real estate or a business will be a direct investment, giving the residents more choices.
?A resident may provide different funding that may augment or amplify funding from other sources. Funding would occur after the Fund makes an investment. Funding may take the form of a grant, contract for services, debt financing or equity. The large variety of investment opportunities may improve the likelihood of a match with a funding source. Until the Fund makes its investments, specific matching cannot occur. However, knowing that the Fund will invest in residential, commercial, and community real estate and in a number of existing and recruited businesses, several sources of funding may be identified as prospects.
?The more information becomes available about a Fund and where it will invest, the easier it will become to determine which residents may invest based upon their self-interest. Certain residents may invest in any of the four stages of fundraising. The diversity of investor profiles suggests many possibilities, but most likely residents will invest in the Fund or in one of the businesses in which the Fund invests.
?Although the fundraising is staged, the earlier that it is possible to designate a specific real estate project or a local business that will receive monies from the Fund, the earlier that investor candidates may be identified and qualified. It may be possible to work backward, finding a real estate project or business that is suitable for investment in a Fund when established and funded and use that business to qualify the community and secure funding through all stages.
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?SUCCESSFUL FUNDING
NEXT WEEK, TUESDAY, JULY 9, my guest on the Successful Funding show will be Jeff Dangremond. As a wealth advisor, he guides his clients in making impact investments. We will discuss investing in communities.
You can see all of my shows at the time of broadcast or recordings of past shows at my profile on LinkedIn.
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DON COHEN SHOW
I was a guest on Don Cohen’s show yesterday morning, July 1, and will be a guest again TOMORROW, Wednesday, July 3, at 9 a.m. MDT.
You may see a recording of today’s show at:
You may register to be in the audience for Don’s show on Wednesday at:
Don is an expert on LinkedIn, particularly on the use of Live streaming to build brands and communities. We will discuss using LinkedIn as a social media platform for building communities that support raising funding.
All shows where I have been a guest can be viewed on Don Cohen's LinkedIn page under Posts.
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?Karl Dakin, the Capital Coach
Dakin Capital LLC
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I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
4 个月Which residents of your community may invest in you?