Joining an Investment Club/Group

We highly recommend that local investors work together, not alone, in order to help each other out. Sharing expertise and insight helps everyone find better investing opportunities and make better investing decisions by drawing on the diversity of backgrounds and perspectives of the group.

Traditional sources of investment advice—such as accountants, brokers, financial advisors, and lawyers—do not always have the background to evaluate, understand, or encourage local investing, which gives local investors the opportunity to learn and become their own experts.

Local investing groups are grassroots, volunteer-run, and driven by a common vision to put money to work for the mutual benefit of investors, the local businesses and nonprofits they invest in, and the community as a whole. To support this mission, groups organize community outreach events and form collaborative relationships with a wide variety of players in their local communities, including people in business, finance, economic development, nonprofits, government, media, higher education, and more. Local investing groups can be organized as clubs or as networks. These two groups have different features that should be considered when deciding what form to use. For detailed information, please refer to our Introduction on Investment Clubs and Networks and Special Considerations for Investment Clubs pages.

An effective local investing group can mobilize literally millions of dollars from citizen investors, community foundations, and other organizations into local small businesses.

Local investing groups are important because, in any given community, they are the main advocates for, and practitioners of, citizen-led local investing. They can be an important force driving local economic development as they support the launch of new businesses and on-going success of existing businesses that create jobs and purchase goods and services from other local businesses. This “local multiplier effect” of dollars being invested locally, and then spent many times over, illustrates how local investing groups can help enliven a whole community and enhance its prosperity. Local investing groups can consist of investors only, or can allow non-investors to participate and join as members as well, potentially expanding the scope of the group’s mission to include many different ways of supporting local businesses, in addition to local investing.