Thanks to my position as The Main Street Journal editor, my focus on the local economy movement has zoomed in on the local investment movement. The Main Street Journal, a weekly online newsletter published by local economist Michael Shuman, aims to inspire more people to shift a portion of their savings and investments from Wall Street to Main Street.
“We have published hundreds of stories and dozens of interviews capturing what is new in the local investment movement—not just in the United States but worldwide,” shared Michael. “There are dramatic developments in the types of funds being created, in the ways communities are using local investment tools, and in proposed new crowdfunding laws.”
Some of the diverse topics we’ve featured this year include pre-selling, public banking, and local milling. Read on to learn a bit more about each topic. Then, claim this offer for a free 90-day trial subscription to The Main Street Journal and join the movement.
At the start of this year, Michael Shuman interviewed Ross Chanowski, founder and CEO of NuMarket. This crowdfunding platform offers community members credits to use at participating businesses.
“I started NuMarket in 2021, mid-pandemic, to provide small businesses with a new way to access capital,” said Ross. “NuMarket is rooted in community-based funding, which means it’s open to anyone who wants to invest in their real community. Small businesses maintain control over their vision, supporters become part of the brand’s story, and communities flourish as local ventures succeed. Ultimately, our mission is to strengthen small businesses by giving them the tools to grow and thrive.”
The Sullivan Country Store recently completed a NuMarket crowdfunding campaign. Owners Megan Lafaso-Hercher and Will Hercher raised over $8K to help financially sustain their store through the winter and better position them for a future expansion. Fifty-five community members will receive 120% of their contributions back in the form of credits to make future purchases at the store.
“For many businesses looking for local capital, the fees, disclosures, and legal hassles of regulation crowdfunding are simply not worth it. But there’s another approach that tiptoes around securities laws, commonly called pre-selling,” said Michael. “NuMarket takes this simple idea and puts it on steroids. In my mind, one advantage of pre-selling is that businesses can test their customers’ willingness to support them.”
"Our NuMarket campaign provided crucial funding for our store, allowing us to make important improvements while strengthening our connection with the community,” said Megan. “Seeing our customers invest in our future and knowing they’d get more value in return created a cycle of support that helped us grow in a sustainable way. Thanks to NuMarket, we're building a better and more resilient store for everyone."
Another theme covered this year in The Main Street Journal includes public banking. The Bank of North Dakota (BND) stands as the only US public bank and a model many communities aspire to create. North Dakota’s state government owns and deposits all its funds in BND, and then BND partners with local community banks and credit unions to boost local lending. In turn, the interest earned from these loans gets reinvested in local economic development efforts.
“In 2023, the Bank of North Dakota posted profits of nearly $200 million,” said Michael. “You would think that every other city, county, and state in the United States would be working assiduously to create their own version of the Bank of North Dakota and develop this huge, new financial resource to support priorities like affordable housing, net zero energy, or more BIPOC-led businesses.”
We interviewed Walt McRee, President and Chair of the Public Banking Institute, to learn more about public banks. “BND’s capital strength and independence from Wall Street helped keep the state out of the debilitating economic problems that resulted from the financial collapse of 2008,” said Walt. “While BND does not provide many consumer-directed lending services, leaving that business to local community banks and credit unions, several public banking initiatives elsewhere do focus on the need to help under-banked citizens acquire banking relationships.”
Our third example of themes covered by The Main Street Journal is local milling.
“Milling is a tough business,” wrote Michael. “Today, three companies control 57% of wheat processing. It wasn’t always this way. Back in 1840, there were 28,000 gristmills in operation, all closely connected to their local farmers. Cheaper transportation, advanced milling technologies, and sleepy antitrust regulators resulted in the elimination of nearly all these mills.”
Luckily, groups like the Craft Millers Guild are working to reverse these trends. The guild’s members collaborate to finance, process, and market each other’s products. Together, they’re rebuilding regional grain economies.
“There’s a larger lesson here about economies of scale,” Michael added. “Local businesses can compete against corporate giants if they work together with other locals, here and abroad, and share what works. The millers’ model should be applied to every other concentrated industry, whether chicken processing, steel smelting, or auto manufacturing. Small businesses in small communities have a shot at success if they are willing to connect, share, and learn from their peers elsewhere.”
Join Michael Shuman for a free virtual event called “What’s New in the Local Investment Movement: An Annual Report” on Thursday, April 17, from 1 – 2 pm. Discover how you can be part of the movement!
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Let’s elevate local investment innovations during Move Your Money Month this April. Direct more of your dollars to the banks and businesses based where you live, and join a growing movement prioritizing people, planet, and profit.
When you bank locally at a community bank or credit union in our region, more of your dollars recirculate throughout our local economy -- building more local jobs and prosperity. Traditional banks, publicly traded and owned by stockholders, exist to provide a return on investment to their far-away owners. On the other hand, community banks are privately owned and not publicly traded. Credit unions are cooperatives, meaning the members own their banks. “At local banks and credit unions, loan approvals and other key decisions are made locally by people who live in the community, have face-to-face relationships with their customers, and understand local needs,” said Stacy Mitchell from the Institute for Local Self-Reliance. “Because of this personal knowledge, local financial institutions are often able to approve small business and other loans that big banks would reject.”
Move your money closer to home and your heart by choosing a bank more aligned with your values. Who do you bank with now? Search for them here and find out what your bank does with your money. Discover how many dollars your bank invests in your community.
Want to Move Your Money closer to home? Find a new bank here.
In addition to moving your money to a community bank or credit union, we encourage you to invest in locally owned businesses. Why? The Monadnock Region Indie Impact Study found that businesses rooted in our region recirculate up to four times more money in our local economy compared to national chain stores. If we invested more capital in locally owned businesses, we’d see a return on investment that included more community health and wealth.
We’ll share local investing opportunities on our website throughout Move Your Money Month.
Stay Tuned
Thanks for banking, investing, and choosing locally owned and independent businesses each and every day!
The Local Crowd Monadnock - Keene, NH
