Global fintech and funding innovation ecosystem

Powering local regeneration through crowdfunded investment

Nesta UK | Rosalyn Old and Johnathan Bone | Sep 4, 2019

taking ownership community empowerment through crowdfunded investment - Powering local regeneration through crowdfunded investmentEarlier in May 2019, Nesta commissioned a report called 'Taking Ownership:  Community Empowerment through Crowdfund Investments' that looked at how community-led projects have the power to transform local areas socially, economically and environmentally and how institutions such as local governments, municipal authorities and foundations, can help community-led initiatives by making the most of new investment crowdfunding models (eg community shares and bonds).

Key Findings

  • Investment crowdfunding has been used to fund a broad range of local assets, including but not limited to, saving local shops and pubs from closure, creating new community centres and art spaces, and expanding leisure facilities and infrastructure projects.
  • Potential opportunities in using investment crowdfunding for community-led initiatives include helping to fund projects that would otherwise struggle to access finance elsewhere, increasing the use of and volunteering for community initiatives, and strengthening local resilience and self-determination by bringing communities together to improve their area.
  • The main challenges for community organisations raising money in this way include gaining access to assets to buy or use on a temporary basis, transitioning from grassroots fundraising to implementing a project and avoiding negative impacts on diversity and inclusion.
  • Local government, city authorities and institutional funders have a crucial role to play in supporting community organisations to make the most of opportunities and overcome the challenges mentioned above by offering flexible funding options (including grants, bridging loans and co-investment), helping them access space by easing the asset-transfer process and supporting meanwhile use, developing active communities and their relationship with local and city government, and investing in skills and capacity building.

The study confirmed that these financial tools have the power to enable projects that wouldn’t otherwise be funded, provide longer-term financial sustainability and increase volunteering, the stories of community empowerment, self-determination and resilience are what really set these models apart. Despite the clear benefits of using these fundraising models for community projects, awareness of them and the types of projects they can be used for is relatively low, and case studies which others can be inspired and learn from are few and far between.

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Building on their report, they recently published 10 case studies from pubs and sport clubs to renewable energy and housing that have used crowdfunding investment models to create change locally.  While there are challenges associated with raising money in this way, communities across the UK are working (often with the support of institutions such as local authorities, trusts and foundations), to overcome these barriers.

Case studies

We hope these examples will encourage those of you involved in community organisations to try it out, learn from your peers and for institutions to take on a greater and more innovative supporting role in this sector.

1. Transformation under the motorway - Projekts MCR Skate Park

  • Location: Manchester, North West England
  • Community investment model(s) used: Community shares
  • Amount raised from community: £132,194
  • Number of community investors: 70

When you arrive at the site under Manchester’s inner ring road, Projekts MCR looks much like any other skatepark, but beyond the ramps, it also acts as a community centre for a whole range of local groups. They recently set out plans to expand the park further under the motorway, increasing ramp area as well as creating a community space and the city’s first skate cafe. They hope that these developments will increase revenue, ensuring the longer-term financial sustainability of the park. The overall project is set to cost £840,000 with £132,194 coming from community shares investors, alongside grant funding from Sport England, Co-operatives UK, The Community Shares Unit’s Booster Programme and The Veolia Environmental Trust.

Projekts community are committed to the success of the project, as they see the social benefits - providing children and adults opportunities to come together, learn, exercise and build confidence. They teach young people ways of working that would benefit any community; as the users physically move around the space they are constantly aware of those around them, learning to give space and work together to maximise everyone’s experience.

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Over the last 14 years, Projekts has worked with over 20,000 people to develop their confidence and contribute to physical and social regeneration of the area through skatepark activities. Its community activities focus on underrepresented groups, such as classes for girls and women, with their participation up from 160 visits in 2012 to 3,755 in 2018.

They’ve also spruced up neighbouring outdoor space with a local group as one investor explains:

“The wasteland outside the park was re-used and planted. Projekts don’t have to do this - they’re not just a business, they go above and beyond what they have to do” - A Projekts MCR investor

Most of their 70 investors are users of the skatepark (or their parents) and alongside plans to offer investors 4 per cent interest each year after year 3, other rewards include branded t-shirts or a ramp named after them. Other investors include a local pizza restaurant which saw links to their brand image (their logo was designed by a skateboard company), and one of their biggest investors was an individual which the local council signposted Projekts to.

One investor shared their experience of feeling listened to as investors as well as customers. With the funding in place, the team are now looking for the best way to engage shareholders in their co-operative governance going forward.

“With community shares there is a benefit for the community and indirectly for the skatepark. They’re not just in it for the money, it’s about people supporting the project. Others fail - here it’s people that are making the difference” - A Projekts MCR investor

Overall, the community shares route has provided several advantages for Projekts: demonstration of community support, new co-op members and the peace of mind that comes with being financially more sustainable. However, they recognise the resources required to check the feasibility of a project and get the right skills in place to make it happen and would like to see more support to access people’s untapped potential and develop this with each project.

“How do you assess the value of a project to get the resources for it to go ahead? Spending time going to other projects can give a good gauge of what you need, but it shouldn’t just be down to the skills that you happen to have to start with” - John Haines, Managing Director, Projekts MCR

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2. Community-powered network - Broadband for the Rural North (B4RN)

  • Location: Lancashire, England
  • Financial models used: Community shares, bonds and loans
  • Amount raised from community: over £5 million
  • Number of community investors: over 2,300 shareholders

In 2013 the government committed to extend superfast broadband to 95 per cent of the UK by the end of 2017. But what about the remaining 5 per cent? Even before this commitment, a group of neighbours in rural Lancashire decided that if they wanted a good broadband network, they’d have to do it themselves. This led to the creation of Broadband for the Rural North or ‘B4RN’ who, after establishing that their project didn’t fit grant funding applications or bank finance criteria, decided to raise the money they needed from the communities they will serve. Since they opened their first community shares offer in 2011, they have gone on to raise over £5 million from local comm

Broadband for rural north UK - Powering local regeneration through crowdfunded investment

unities in shares, bonds and loans, allowing them to bring fast broadband to several previously underserved areas across the North West (alongside community investment they also received a business development loan from the Esmee Fairbairn Foundation, but notably B4RN has received no public funding). Alongside helping their community access fast broadband, community shares investors currently receive 5 per cent interest while those investing in the recent bond will receive 4.5 per cent a year (while both depend on the ongoing success of the business, the bond interest rate is set in advance, whereas the shares interest is determined annually by the directors).

B4RN’s model is based on rural communities taking responsibility for funding and building their own network as part of the wider B4RN scheme. The network is built by volunteers harnessing the skills, resources and knowledge within the community, and bringing them together around a shared aim. For example, local farmers and landowners support the project by digging trenches for the cables across their land in return for ‘shares for work’ - £1.50 per metre for the distances they’ve installed.

See:  Cities using Crowdfunding for Community Projects

The farmers know the best place for the cables on their land, and have an inherent interest in the project succeeding, because it gives them a reliable internet connection too. This means that B4RN are able to install fast broadband to areas in which it would not be feasible for private companies, who do not have this access or local knowledge and so would have to dig up roads at great expense. Further support comes from places of worship and village halls are given access to the network for free if they host a connection point (schools are also charged a low rate with the small schools getting free connections too).

“We wonder if the bigger benefits are the community ties we leave behind after it is built, the legacy of people talking to each other.” - Barry Forde, Chief Executive, Broadband for the Rural North Ltd. (B4RN)

The first laying of cables started in 2012 and a few months later B4RN won the The Internet Services Providers' Association’s ‘Internet Hero’ award. By June 2017 they had connected more than 3,270 properties to fast and affordable broadband and are now present in Lancashire, Cumbria, Yorkshire, Norfolk and Suffolk, demonstrating what empowered communities are able to achieve. Currently over 6000 customers are benefitting from one of the fastest connections in the world.

Continue to see more Case Studies --> here

Download the full 96 page PDF report --> here


NCFA Jan 2018 resize - Powering local regeneration through crowdfunded investment The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit:

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