What are community shares?
An introduction to community shares
Community shares are different from normal shares. Community shares aren't about making a profit, they're about investing in a community. And they're a fantastic way for community led housing groups to raise investment capital.
Legal stuff
Community share issues can only be issued by co-operative societies, community benefit societies and charitable benefit societies.
How community shares work
Liza Minnelli was right: money makes the world go round. And just like any other kind of enterprise, a community led housing project needs capital to start, to grow, and to be sustainable. Traditional housebuilders would usually get their capital from their shareholding members, the bank, maybe the council and their own funds - but these options aren't always open to community led housing projects.
Community shares are a way for money to be pooled from individuals who also want their community to thrive and can spare some money to help it to do so.
You'll still need to work for those investments though. A business plan will need to be drawn up and so will an offer document. For a community led housing project to be viable the community shares are generally locked in for a certain period of time which means investors won't be able to take their money out. With the low returns as well (remember, community shares aren't about making a profit) proposals will need to be credible and inspire.
How to start a community share campaign
There are a few platforms available that groups can run community share offers and crowdfunding campaigns through. Here are some of the platforms that have been used by other groups:
