“Let’s put on a show!”
Planning a Capital Campaign
Presented by:
Ben Sandel
540-421-6976
BenSandel@cdsconsulting.coop
Start with a great story – in three acts
- The story of your co-op
- The story of your capital campaign – why
are you raising money from your members?
- The story of your financing – pro forma!
Your co-op’s story
• Your history – who you are, what you’ve
done to get this far
• Your Vision & Ends (if you have them)
• Your plan – 4 Cornerstones in 3 Stages
Your capital campaign story
Co-ops exist to serve their members, and capital
campaigns do that by:
 Providing a meaningful way to interact with members
 Offering a service of value to members
 Helping you open the store your members are eagerly
awaiting
Cooperative Principle # 3: Members’ Economic Participation
Your capital campaign story
Community Focus
(providing service)
Business Enterprise
(building economic engine)
Association of Members
(group activity)
Entrepreneurship
(distributing risk, educating
About cooperative business)
Your financial story – pro forma
• Demonstrates due diligence
• Defines the financial need
• Required for the documentation you’ll be
producing
Make it legal
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Find a good lawyer
Check state & federal laws & exemptions
Review bylaws, articles & incorporation status
See if Preferred Shares are allowed
Check if filings are required
Have your lawyer check your prospectus,
subscription agreement & promissory note
 Start 3 months ahead
Member loans or preferred shares?
LOANS
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Fixed payback dates
Show up as Debt
Easier sell
Members have more
control
• Established and proven
SHARES
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Buyback at board discretion
Show up as Equity
More challenging sell
Board/ops have more control
Innovative with less track
record
Can’t we do both, like a dramady?
PROS
 Offers options to members and board/operations
 Helps balance equity and debt
 Provides for more flexible financial planning
CONS
 Increases paperwork, legal costs, complication
 Makes the ‘story’ to members more challenging
 Adds burden on operations
 May require more filings, registrations
Recruit your cast and crew
 Coordinator
 Callers
 Collectors
 Large investor contacts
 Administrative help and gofers
 Promotion and communication teams
 Legal, regulatory, financial and campaign expertise
Don’t underestimate the time commitment!
Secure your early backers
Pre-commitments from your board, volunteers and
a few key supporters must make up
of your total capital campaign goal.
Build the set, plan the production
INTERNAL
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Accountability & org chart
Financial planning docs
Calling scripts and FAQs
Call lists
Process docs
Tracking systems
Communication plan
Timeline
EXTERNAL
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Risk & disclosure docs
Subscription agreements
Campaign brochures
Appeal letter(s)
Testimonials
Email updates
Press releases
Thank you notes
Confirmation letters and/or
share certificates
Determine your premier date
 Plan your campaign for Spring or early Fall
 Start the legal preparations 3 months ahead,
and the rest 6 weeks before implementation
 If possible, align your implementation date with
the announcement of your lease with
contingencies
Build the buzz
 Add the capital campaign message to member
communications well in advance
 Foster relationships with local press
 Prepare press releases, update website, feature
in all social media
Rehearse, rehearse, rehearse
 Make sure materials are ready and systems are
working
 Check with every team member to make sure
they are available, committed and excited.
Recruit replacements if needed
 Have at least one caller training session (for ALL
callers) the day the appeal letter hits your
members’ mailboxes
 Do practice calls with each other, family etc.
Make sure everyone is reading from
the same script
• “Money doesn't talk, it swears...” ~Bob Dylan
• “Money makes the world go ‘round” ~Fred Ebb
• “For the love of money is a root of all kinds of evil ...” ~1
Timothy 6:10
• “Money is power, freedom, a cushion, the root of all evil,
the sum of blessings.” ~Carl Sandburg
• “Money is a needful and precious thing,
and when well used, a noble thing…”
~Louisa May Alcott
Links to resources
• Member Loan Toolbox (also applicable for preferred share campaigns)
http://www.cdsconsulting.coop/node/566
• Article on sources of cooperative capital
http://www.cooperativegrocer.coop/articles/2013-04-11/grow-your-co-op
• Article on conducting member loan campaigns
http://www.cooperativegrocer.coop/articles/2004-01-08/conductingmember-loan-campaigns
• Article on member loan programs
http://www.cooperativegrocer.coop/node/2398
• Article on Preferred Stock offering
http://www.cooperativegrocer.coop/articles/2009-01-21/small-town-newbuilding
• Webinar: Legal Issues and Alternative Equity Strategies for Cooperatives
http://www.uwcc.wisc.edu/movies/LegalWebinar-2013-09-11.mp4