In order for funding to work it must be organic, with as little barriers by gate keepers, while at the same time providing the support to effectively leverage donations. NYukCo will be testing local funding. We inherently provide support and oversight. the challenge is designing funding and financing programs that are organic. We decided to look into Unofficial funding and financing.
Notice we used unofficial, while these methods are not “traditional ” as in sanctioned by approved financing practices, they are called TRADITIONAL by locals because they have been passed down through generations and as such are part of the culture or tradition. Many official programs and grants have severe restrictions and terms that often cannot be met by local entrepreneurs.
Some of the questions asked over the 15 years …
- How can a designer with bad credit, and No money, find funding for their line. The average designer leaves school with a heavy student loan. One designers has a n outstanding balance of over $100000
- How do you fund your company, create a brand, establish your brand in the fashion market,and pay yourself, when you have no money, and is hindered by everyday restraints such as daily bills, student loans and a pissed off landlord (LOL)
- How can people invest in your brand. At what level do you have to be for people to buy company stocks
- How do you know if you’re ready to take on investors.
- How do you get investors. ( Especially if you have bad credit
Funding and Financing is one of the last areas I have to tackle and explore. I have thus far successfully leveraged sweat equity and effective budgeting, bootstrapping and barter within collective working situations.
Many suggest “crowdfunding” however, most existing crowdfunding platforms reach into social circles and give token rewards. Together these both may be that the reason black, ethnic or local crowdfunding does not succeed. Financial resources within peer circles are limited especially for nondescript rewards. Translated locals support the projects they may not have cash to contribute! Many with cash flow are not connected to circles outside their own and may be isolated from local or niche entrepreneurs.
There is also a misconception about the success of “crowdfunding”, as a means of funding, of starting businesses and building communities. The goal of crowdfunding is not merely raising money, but raising money to help businesses to success. If you check many of the successfully funded campaign most companies still struggle and many have not advanced their product. If you plan and/or develop a product that has holes, you leak resources.
Funding & support programs-
How can I access local funding for fashion & Lifestyle creatives in the local sector
- Su-Su Investment clubs
- Investors, venture capital ,angels
- Budgeting, bootstrapping and barter
- Factoring, Banking, Line of credit
- Creating Your Own Benefits package savings plan
- Health insurance, retirement, vacation time etc
- Business Insurance, license fees, supply
- Budgeting, bootstrapping, collaboration and barter how is this going to get done
TRADITION CULTURAL FUNDING
During one conversation on Facebook with Pia- Marjoire- Nigel-Monica Jim I was able to learn about (traditional & new) Business models and strategies. The synopsis
i.Guyap / Gayap or (Raising a Barn US) not sure I spelled it right , this still goes on, some folks would be doing just this tomorrow to help my son build his house. It’s really simple, you need to know people or better yet people need to know you or someone concerning you. With this you generally have a need, say your house , your yard or something needs fixing or in one case
“you’re trying to build but don’t have the all the resources , my friends husband with whom he worked with and a few other friends in the building industry was contacted and they in turn contacts other persons, no one expects to be paid because each other knows it will be done for them should they need it, food and drink is provided for the workers and that’s that ,this is how things were done in the old days and even to today. People still do this. it is powered by a close knit “community.” Formal programs include Habitat for Humanities and Hands on Atlanta
ii. The “Fish Fry” or bake sale though is another model… My late partner tested this with a group of seniors who were losing their funding. Recently our 13 year old intern raised money for her prom using this method but with cupcakes
In the case of the seniors pooled money, bought supplies at first retail. When Paul and I discussed it he got them to purchase at wholesale or got it donated by corporations. They cooked and sold to the tenant in their apartment complex.
iii. the sou sou model “community investors commit to a regular donations. the talent is paid and investors earn an increment on their share after due after the event. a third party Holding company will be needed and payment made after debts are paid out
iv. the Bazaar or “Harvest Fair which is a very community oriented form of crowd sourcing … it also helped develop entrepreneurial skills.
v. the “Traditional Trinidadian Carnival band ”model is a little tricky but you have a general concept, a Creative property… essentially you break that large “Band” or concept into smaller “sections , license the rights to those sections. Whether a full license or partial residual – all talent basically defer/exchange payment … their input is valued as an asset and each shares proportionately in profits. Any upfront cash can be accrued via Pre-selling blocks to promoter or adding a monetary equity level (or matching Grants). Each person is then vested in the success, marketing and sales of that creative property.
vi. The Party Model – My Native Trinidad has a version of the Rent Party that is highly Successful. A Form of Self Help through Fetes . Wikipedia Ddescribes it a RENT PARTY as
A rent party (sometimes called a house party) is a social occasion where tenants hire a musician or band to play and pass the hat to raise money to pay their rent, originating in Harlem during the 1920s. The rent party played a major role in the development of jazz and blues music. The Oxford English Dictionary states that the term skiffle means “rent party”, indicating the informality of the occasion. Thus, the word became associated with informal music. However, many notable jazz musicians are associated with rent parties, including pianists Speckled Red, James P. Johnson, Willie “the Lion” Smith, and Fats Waller, although rent parties also featured bands as well. The OED also gives boogie as a term for rent party.
Rent parties were often the location of so-called cutting contests, which involves jazz pianists taking turns at the piano, attempting to out-do each other.
vii. Games– My late American mentor introduced me to “games” 50-50 raffle where tickets were sold at events for $1 the pool was split 50-50 with the house and winner. there were several other games including the “numbers” games mentioned below. We should collect & preserve these from a HERITAGE standpoint!
viii. whe-whe (wey-wey) ji’z/ [wewe] n (Trin).. Numbers in the US is A privately (now governments run these) run lottery in which any of 36 symbols or ‘marks’ are bought on impulse (often from dreams or superstitions); a ‘banker’ keeps the secret winning mark upon which when revealed, payment is made
ix. Barter exchanges– run by Community Exchange System and via Wikipedia CES is described as
The Community Exchange System (CES) is an Internet-based trading network which allows participants to buy and sell goods and services without using a national currency. While the relatively new system can be used as an alternative to traditional currencies such as the dollar or Euro or South African rand, the Community Exchange System is a complementary currency in the sense that it functions alongside established currencies. It is international in scope. It does not have printed money or coins but uses computer technology to serve as an “online money and banking system” or alternative exchange system and as a marketplace. It is an advance from an arrangement in which either one good or service is exchanged for another good or service, or commonly called barter, since it uses a digital unit of value. While there are reports that the system is growing, in 2011 the system handles only a tiny fraction of international world commercial activity.
Free onlene CES www.community-exchange.org/
x. Collective- Cowork & collaborate works well with large ticket item that are common to a group, space, machinery, tools..
xi. Pre-tails – Pre-sell your Hustle: A Zero start process – the idea is to Book and pay for the Rental or Sale of a skill product or services during a set period. with the rendering of that product or service set at a longer than normal period.
x11. Auctions/Garage sales sell what you are willing to part with and us eteh cash to build what you want
X111 “Crowdfunding” as we refer to it today is a cash based model originally meant to go around SEC regulations of $250.000 minimum for investment. Usually executed by a web based company in one of four formats-
- Equity Based Crowdfunding (Earlyshares)
- Donation Based Crowdfunding (Warby Parker) (Non Equity)
- Lending Based Crowdfunding (Kiva) (Non Equity)
- Reward Based Crowdfunding (Kickstarter) (Non Equity)
- Pre-tail or Pre Sale based Crowdfunding (Non Equity)(the ones I came across were predatory and so I will not post about them)
all of which involves cash contributions. It should be noted that the Jobs Act now allows for equity rather than rewards but the regulations may again have barriers of entry.
Understanding that during alpha we will design and test several funding initiative you can find them on the Support page