Imagine a social media platform that required a donation for every post.

You can like, thumb up, share, or retweet as often as you want. However, the platform deducts a minimum donation from your account and disperses it to the organization featured in your post.

This is the idea behind investment clubs. Individual members tout companies they believe in. The club pools funds and invests in a selected company.

Co-op Principal began an investment club aimed at supporting cooperatives. In addition to keeping money local and providing capital to organizations with a social mission, members learn about investing.

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Canadian co-op studies scholar Brett Fairbairn locates a tension in what he asserts to be the “dualistic” view of cooperatives, characterized by the twin set of economic and social goals. Within that framework, “industry” people (for Fairbairn, often managers) tend to focus on the primacy of economic goals while viewing social goals as a secondary expense, while “movement” people (Fairbairn introduces the wonderful phrase “arbiters of cooperative purity”) perceive the social mission as the primary raison de etre of cooperation.

The jump to applying this time-tested model to investing in cooperatives was first made in Minneapolis in 2013, when Co-op Principal was established. Club members agree to invest $50 per month, and they meet monthly (often at a local brewery) to discuss and vote on co-op investment opportunities. Since its founding, Co-op Principal has had a five-figure capital impact on its local co-op economy, and the club has generated annual returns for its members in the 2-4% range.

The vision of Co-op Principal’s founders was not simply to create a club in their city, but to spread the model across the country. To advance this agenda, they created a parallel non-profit intended to house model documents and provide support to other groups looking to get their own clubs going. Since its establishment, a similar club is now up and running in Boston, and at least three more are in the process of organizing for early 2017 launches. Active conversations are also now underway around how the growing of network of clubs can contribute resources to the non-profit for the purpose of developing the sort of shared plug-and-play online infrastructure that could drastically simplify the process of both starting new clubs and operating existing ones.

In short, co-op investment clubs are easy to set up (and hopefully will become even easier in the coming year) and have the potential to boost any community’s co-op movement in a number of positive ways. As such, every committed cooperator should seek out such a club in their community and, if it doesn’t exist, reach out to Co-op Principal for advice about starting one. Through small monthly investments and building a welcoming community of committed co-op enthusiasts, a robust network of cooperating co-op investment clubs could form the foundation of a reinvigorated co-op movement.

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The Cooperative Principal provides start-up know how and on-going education to everyday people who come together to invest in a radically different, co-operative future.

 We were frustrated with Wall Street and the lack of alternatives so we did some homework. While the name investment club carries some baggage, as legal entities investment clubs are granted some benefits that we can actually use to change the status quo. Most importantly, they can reduce the financial hurdle that often exists if you want to do something interesting, outside of Wall Street with your money. So, we started the Cooperative Principal to provide start-up know how and on-going education to everyday people who come together to invest in a radically different, co-operative future.

In order to make it easier for folks to start and run local investment clubs, we founded the Cooperative Principal. In terms of organizational structure, think of a bike wheel where the center or hub is the Cooperative Principal (CP), a Minnesota based non-profit. This center hub serves the local clubs that are at the end of the spokes, around the wheel. The CP provides the education, documents and some administrative support to make starting a legal, properly registered club easier. Then, on an on-going basis, the CP provides investment ideas and analysis, facilitates local clubs connecting with each other and promotes the growth of the larger co-op movement.

This is the beauty of CP Investment Clubs, people who on their own can’t afford to invest in their values now have a vehicle to do so and co-ops have access to a new source of capital.

Beyond the dollars and cents, there is a social and educational component to The Cooperative Principal. Members meet in person a minimum of 4 times per year, ideally in a social setting (think microbrewery!) and the clubs operate in a cooperative, democratic manner. Based on investment analysis from the central non-profit, or their own research, members discuss and vote on where to put their pooled funds. Club members are both participating in their own democratic organizations and supporting the co-op economy in a way that is only possible by working together.

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The Cooperative Principal is a new nonprofit organization that provides know-how and ongoing education to help start and run a local investment club—all with the goal of supporting cooperatives, organizations owned and operated for the benefit of their members.

Even though investment clubs aren’t as wildly popular as they once were, they still offer a great way to build your investment acumen. They can also provide the opportunity to learn about businesses, in my case co-ops in my community, and meet like-minded people.

At every meeting a member of our club presents an investment opportunity. The state I live in, Minnesota, leads the nation in business related co-ops, so we have many options to discuss. Then we vote on where to put our pooled funds. We have invested in five cooperatives so far including food, maple syrup and an investment co-op that buys and develops real estate in our community.

 A few important takeaways

1. Systematic investing, whether through an investment club or on your own, is important for people of all ages.

2. Supporting local and regional co-ops through periodic investments is a great way to link money and your values.

3. Investment clubs can give you a forum to pool money with like-minded people and make a meaningful impact on your community and region.


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