It is critical that a capital community is designed and operated so that it is economically sustainable: it makes enough money to pay the bills and engage in all of the programs and activities that benefit its members.
It appears that a capital community may generate enough revenue to support an entrepreneur as a new venture. The size and popularity of a particular topic of a capital community may even support a small business or nonprofit association.
In certain situations, the capital community may be an extension of an existing association, government program or civic organization. Economic sustainability may not be required, but it much more likely that it will be strongly supported if it does not pull resources away from established programs and activities.
Revenue may be generated from:Membership fees
· Program fees
· Coaching services
- Seekers – organizations who are raising capital
- Sources – individuals or organizations looking to put their capital to work
- Services – individuals or organizations offering help (for a fee ) in raising capital
· Matchmaking Seekers and Sources
· Advising Sources
· Publication of Guide on Capital Sources (specific to topic of capital community)
· Publication of Guide to Service Providers
· Publication of Directory of Members
· Support services to Investment Club
· Support services to Investment Fund
· Support services to Financing Fund
· Referral fees
Common expenses associated with these fees include:
· Executive director, coordinator or other manager
· Support staff
· Food and beverages
· Websites, Meetup fees, email
· Cell phone
· Event site rental
· Bank and payment processing fees
· Professional services: attorney, accountant, IT, marketing
· Office rental
Some of the revenue sources may be regulated. If so, it will be necessary for the capital community to gain any necessary permits or authorizations and there may be a variety of associated costs with qualification, application and compliance.
Fees for membership and certain activities and programs may increase as the value is established and recognized. As the size of the capital community increases, it will become attractive to businesses seeking to promote themselves through sponsorship.
The interaction of each member with all other members may prove to be of highest value. The positioning of the capital community as the common ground between raising money and the topic of the capital community may be unique – offering access within the network that cannot be achieved in any other way.
It is expected that the Guide on Capital Sources will be of significant value (more details on this in a later posting). This seemingly elusive information may fully justify whatever membership fee is charged (if included with membership) or may be sold separately.
The lessons learned from forming these capital communities will be shared at Comcap Colorado (http://www.comcap.us/colorado) to be held on February 1, 2017. Registration is now open for on-site participation and remote viewing.
Karl Dakin, President
Colorado Community Capital PBC