Local investing can deliver more than just economic benefits. It can help attract or retain crucial businesses, like farms, retail stores, or conservation projects. Valuable relationships are created and deepened across the community as business owners, citizen investors, economic development professionals, government leaders, financial professionals, business groups, and others work together to catalyze local investing as a key ingredient of a vibrant local economy. Active networking and collaboration ensure that promising local entrepreneurs are discovered, educated, financed, and supported throughout their business lifecycle.
This coalition of different groups and individuals working together to promote and strengthen the local economy are what we call the Local Economy Ecosystem. This section explores the types of groups that should be part of your local ecosystem, and how to collaborate with them on building a culture of local investing.
Your work should begin with what already exists, and expand on that by reaching out to potential allies who are less involved. While the primary focus of your efforts is to spur local investment, the success of that initiative will depend in large part on having as large and interconnected a network as possible.
Here’s an example of how to get involved in a local investment ecosystem in your community:
This clip is from the webinar A Conversation with Isabel Strobing of Mainvest. You can watch the full webinar here.
Here’s a list of groups that can be valuable members of your local economy ecosystem. You should consider key members and leaders of the following locally-based groups as well as locally-focused representatives of chapters of larger regional or statewide groups:
- Business organizations, such as Chambers of Commerce, Main Street groups, AMIBA, and other “Buy Local” groups, and local industry groups in sectors that are important to your local economy.
- Economic and business development groups such as Economic Development Councils (EDCs), Small Business Development Centers (SBDCs), and business incubators.
- Investor groups, including local investing groups and angel (accredited-only) groups.
- Financial institutions and independent financial professionals such as bankers, financial advisors, and accountants.
- Educational institutions, especially those that teach entrepreneurship and business-related classes in locally-important sectors.
- Attorneys, especially those who specialize in business and securities law.
- Government, including executives, councilmembers, legislators, and their staff.
- Journalists and media that can help report on local investing developments.
- Nonprofits that are active in local investing, such as community foundations, community loan funds, and other community development financial institutions (CDFIs).
- Sustainability groups, such as Transition Networks, that want to increase local financial self-reliance.
SBDCs, incubators, small business technical assistance programs, private business consultants, and financial professionals are extremely important members of your ecosystem. Not only do they provide valuable assistance to entrepreneurs and business owners, they are often the first to know about local investment opportunities and, as such, can make timely and appropriate connections.
Start by convening a core group of ecosystem participants who share your goals and vision around local investing. At one of your early meetings, make a list of who else might be valuable parts of your local economy ecosystem, and decide who in your group is best connected to those groups or individuals, and best placed for reaching out to them. Focus on “centers of influence,” key people who are well respected in the community and whose opinions carry weight with others. You may need to provide basic education about local investing and its benefits to the community. You may want to create a short written overview to help explain the concept and provide links or references to further information, such as this website. Talk about what you are trying to accomplish, who’s on board, and what the potential participant can do to support your mission. Be available to answer follow-up questions, and stay in touch. Keep them posted about your progress, and try to involve them with your project as much as possible.