Grassroots Finance

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The Sustainable Economies Law Center's Grassroots Finance Program develops legal resources and policies that allow local community financing and ownership of enterprises and assets, with a focus on securities laws and local investing.

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Why Grassroots Finance?

Traditional economic development models focus on attracting business and real estate investments from outside of a community. The unfortunate result is that the community becomes dependent on enterprises with distant and disconnected boards and shareholders, and wealth leaves the community, rather than remaining available for the community’s benefit. In a more sustainable economy, ordinary individuals would be able to raise capital from local community members’ equity investments or loans, crowdfunding, community-supported business models, and other creative means to start and grow community-serving and community-supported enterprises. Community members would have a vast array of choices for investing their money locally, rather than choosing to invest primarily in stocks traded on Wall Street. Most enterprises would be controlled by their customers, workers, and other connected stakeholders.  We want to live in a world where any project or enterprise can obtain financing from members of the local community, and where the majority of businesses in a community are locally owned and locally financed. 

SO HOW DO WE DO IT? We believe that we need to look beyond conventional financing mechanisms and tap into other pools of capital, including community capital (savings and investments of ordinary people), retirement savings, foundation endowments, funeral and life insurance financing, and more. To unlock these pools of capital, the Law Center is looking at a combination of legal, policy, and coalition-building strategies. For a brief introduction, check out Farmland Finance for the Next Generation of Farmers.

Our Strategies

Click below to learn more about our strategies, which include:

Transfer Retirement Savings Out of Wall Street

Create More Investment Funds, Permanent Cooperatives, and other Financing Intermediaries

Increase the Use of Direct Public Offerings (DPOs)

Use Funeral Financing and Life Insurance Funds for Land Conservation

Adopt State Income Tax Incentives for Local Investments

Encourage Divestment from Fossil Fuels

Increase Access to Capital for Marginalized Communities

Resources

Securities Law Basics: Click here to watch a video presentation about securities law basics, featuring squirrel cartoons!

Legal Resource Library: Check out our Legal Resource Library at CommunityEnterpriseLaw.org for information on financing, local investing, business entities, employment, and land and housing. Also check out the Community Enterprise Blog!

California has a new securities law exemption for worker cooperatives! Click here to learn more about how worker cooperatives can raise capital using the new securities law exemption for community investors.

Guide to Grassroots Finance for Farmers: Coming soon!

Contact

If you have questions or would to get in touch about this project, contact Grassroots Finance Attorney, Cameron Rhudy at cameron@theselc.org.


This work is funded, in part, by a grant from the Clarence E. Heller Foundation.


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