Community share investors raised more than £150m in eight years, research says

The coronavirus pandemic could drive increase in co-operative business models to sustain jobs and communities, Co-operatives UK says

More than 100,000 community share investors have raised over £150m in the past eight years as more communities seek alternative ownership models, according to new research.

A report by the membership organisation Co-operatives UKUnderstanding a maturing Community Shares market, shows that 92 per cent of businesses that have raised finance with community shares are still trading.

In what it describes as its biggest study of the community shares market to date, it also found that 80 per cent of people who invest in community share offers do so because of the wider social or environmental benefits of the organisation. 

More than half (53 per cent) of community shares investors said they felt the share offer would create a stronger community.

In addition, 85 per cent of businesses that have run a community share offer found it had a positive impact on their trading.

The report said that as the coronavirus pandemic has changed the face of business in the UK, with scores of shops, restaurants and other companies closing down, local people could save the spaces they cared about for as little as £10.

Share offers produce an average investment of £395 and an average annual return of 4.8 per cent. 

The report also highlights the democratic nature of the investment, with one vote per member, regardless of how much is invested.

Since 2012, £155m has been raised by more than 103,000 community share investors across the UK, to save and create more than 440 community spaces and businesses.

Rose Marley was announced as the new chief executive of Co-operatives UK earlier this month.

She believes that, as the pandemic continues to drive mass business closures, more communities will consider how they might benefit from setting up community share schemes.

Marley said: “Now is the time to consider those co-operative business models that can sustain jobs and communities. The growing community shares market is certainly one viable option.”

Marley said that communities no longer have to answer to faceless creditors or landlords who don’t have their best interests at heart.

She added: “By giving people a stake in a local business, and by encouraging community participation, businesses will flourish and help their communities to thrive, too.”

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