This is a feature from Tapestry’s newsletter, The Thread. To receive bi-weekly deep dives into non-profit and co-op financing, subscribe at tapestrycapital.ca/newsletter.
Community bonds are a great source of funding for many non-profits, co-ops, and charities. They can rally a community to your cause just like a donation campaign, while also providing much-needed project funding that remains in your organization’s control. But before you get started, you’ll need to rally your internal team — and most importantly, your board of directors.
Many non-profit board members are unfamiliar with community bonds. Some may even be skeptical. “Most of them are used to doing fundraising campaigns and soliciting donations,” says Jennifer Bryan, director of campaigns at Tapestry Community Capital, “but this is a very different way to raise funds.”
As someone who’s worked in the non-profit sector her whole career, Jennifer knows a thing or two about working with a board. Here are three ways to talk about community bonds with them:
Know your audience
Boards contain multitudes. One of your directors might be a marketing manager, while another is an investment banker, and a third is a hardworking volunteer. Fortunately, community bonds are a multi-layered tool that can appeal to board directors from all sorts of backgrounds.
For marketers and those in fundraising, a bond campaign might be the perfect way to grow your supporter base and engage with existing and lapsed donors. Finance professionals might look at the campaign as a way to diversify your organization’s project capital stack and save on the cost of capital. Others will be interested in the values-alignment — returning interest to local economies, rather than commercial lenders. Figure out what interests your board, whatever it is, and weave it into your proposal.
Focus on flexibility and empowerment
Community bonds allow non-profit organizations to set their own terms and conditions, as well as rates of return. Emphasize that when speaking to your organization’s board. This flexibility is rarely available with commercial lenders and through standard financing options available to non-profit organizations, and your board may be interested in alternatives. You could even outline estimated savings on the cost of capital or sped-up timelines as a result of raising funds on your own terms.
“When boards learn the community bond is something that’s flexible and that they can tailor it to the organization’s strengths or weaknesses, that really helps to seal the deal,” Jennifer says.
Bring them to our workshop
Tapestry runs a 2.5 hour workshop for board members, non-profit staff, and volunteers to talk through community bonds. Think of it as ‘community bonds 101’ where our experienced team will answer any questions you, your team, and your board have. It’ll show the full trajectory of a community bond campaign from start to finish.
Part of the workshop involves a brainstorming session on how to use a community bond, including mapping the potential investor base in your community. This helps your board see that a community bond campaign isn’t a pie-in-the-sky idea. As Jennifer says: “It shows the organization that they actually have a much bigger pool of potential investors, partners, and resources than they might have thought.”
Interested in booking a workshop with Tapestry? Get in touch!