Here is an overview of the whole Common Good Bank project, including a diagram, that show how our strategic plan fits into the larger picture: Common Good Bank Project Development
Here is an overview of the whole Common Good Bank project, including a diagram, that show how our strategic plan fits into the larger picture: Common Good Bank Project Development
Actually the Nonprofit Sponsor is a crucial part of the Common Good Bank system. Its usefulness as a vehicle for running the project is great, but incidental.
I. The Business Plans are most important. These … are what potential investors will want to see.
Good point. I have modified the chart accordingly.
L. Promotion … very much in process.
It was, but at this time we are intentionally holding off on promotion until messaging and strategy are settled and organizers are trained to promote Common Good Bank effectively.
N. thru Q. have been raised to the top and made discrete, separate processes.
The diagram is intended to reflect dependencies, so this change makes no sense. I have clarified the purpose of the diagram in the PDF.
P (N). Human Systems – I strongly recommend that the entire organization stop everything its doing and work on the human scale until the organization is well settled, before proceeding any further. There's a lot of relationship building, discussion of roles and responsibilities, the election of the board, officers, and so forth that would need to occur before expending "M – Funding." There should be assurances of adequate funding, and the available monies would need to be allocated and accounted for. This is the point in time when a PR/HR system must come into play.
I agree that S2BE (dba Common Good Finance) must have sound human systems before spending ALL of the money we raise. However, board development and staff development are ongoing projects that cost money, so they must progress in parallel with fundraising and spending.
N (O). IT Development … i'ts the whole organization that must be intimately involved, so it doesn't begin until the people are assembled, and on board. Its about fully implemented systems, meaning computer systems, but also operational procedures, training & familiarization, testing, software modification, etc. I strongly recommend that CGB not seek its Charter until there's a green light of readiness from everyone involved.
O (P). The Charter is the formality when everything comes together. banking regulators will want to pry under the covers…
Getting a charter approved takes months, so we want to apply as soon as we are confident that the plan will be approved. All that is required is a sound plan and ready money to cover the costs of starting the bank. Getting a charter does not depend on having the software finished. Regulators are happy to meet with us ahead of time to work out any potential problems. On the other hand, we don't know yet how long IT Development will take. We will need to open within one year of getting a charter, so we don't want to apply for a charter until we are sure we have less than 15 months of IT Development to go. In summary, we want to apply for a charter as soon as we are ready enough.
Even the concept of running the bank democratically was questioned…
Radu, This is a misunderstanding of the planned Common Good Bank's democratic system. I address this issue in the CGB Design Forum here: http://commongoodbank.com/foru…..cracy#p186
Regarding problems of democracy, the balance of voting on large and small issues will have to be established through the operation of the bank, beginning with the current plan, in which democracy actually leaves lending decisions to trained professionals but maintains oversight by "setting lending priorities." That is, no funding fast food, more lending to organic farmers, etc. It is kind of like the military – we have these goals, now try hard to accomplish them, using the strategies you're familiar with. Also, distributing the community-directed profits works best democratically: should give all of it to the school, or also give some to a new housing project? Will there be opportunities for people like Joe to try and fund his project with community-directed profits? Sure, but overall, if the residents are educated and knowledgeable (and with thousand of dollars at stake, I think they will be) good decisions will be made.
When pitching the idea, skepticism is great, and this isn't a project being sold, but an opportunity to create something new. We don't just want your money, or signature, we want your input, your vision for a just society. This is an uphill battle because we live in a consumerist society, people expect packaged products ready-to-eat, so a lot of people won't get it, but skepticism is good. There are a bunch of dreamers out there, though.
This project is one part business, and one part political, so its as much about changing relations of power through the process (organizing) as it is making a product (responsible bank accounts), which makes it very unique and difficult.
I love the idea of getting small grants along the way to be able to pay a few professionals.
Over the summer I went door to door with an environmental organization, and found it a nice way to knock on 80 doors, talk to 45 people, get 25 signatures, and raise about 200 dollars a day. With the uniqueness of this project, you may not raise as much, but it helps get the word out, and sharpen the word in the process as well. A phone canvassing could be good, too – Hudson Bay Company (also ran the field canvass I did) has a great phone base for raising money, or just getting information out quickly. I don't know about pricing, though.
Hope this adds something to the discussion, and I hope to work more with the project after I graduate.
If we were to get the software completed to perform the necessary interfacing between a Depositors' Association and a willing partner, could we not then pronounce the advent of "common good banking.?" Could we not then tell anyone (everyone) that if the institution with whom they presently bank agrees, that their existing account can become a "common good" account and enjoy many (if not all) of the benefits of membership in a Depositors' Association as envisioned when Common Good Bank itself is chartered?
I run into the problems mentioned. All the people I tried to promote Common Good Bank to were very skeptical, even though they are progressive people. Even the concept of running the bank democratically was questioned: “If Joe has enough friends to vote funding for Joe’s business which will eventually fail, what good does for the community” or “Democracy is good as an oversight mechanism but operationally… how would be the army to operate democratically?”
A few ideas:
- Can Common Good Finance earn income towards the Common Good Bank funding? Financial/credit/money advice may be a good way to earn income, spread the word about Common Good Bank and become trusted.
- If getting a Charter is so difficult (due to the lack of funding) why not try to form a credit association. This would be not a replacement of the Common Good Bank, but rather as a two-pronged spear. It may not be possible to create FIAT money but it could be a easier start. Also, it will be a way to test the concept and hone its operations (lending procedures, software, etc.)
- The democratic process maybe can be changed from an active involvement, which is also very time consuming, to a passive way. I am thinking to ask members to allocate their money over a given set of areas of lending as they join. They can change the allocation as they want but at their own convenience thus avoiding a periodic voting process that can be very counter productive. The actual lending decisions will be left for lending professionals, trained to the bank rules.
I apologize in advance if I'm about to say things that you have already considered ad nauseum over your last three years of trying to kick this idea into gear. I am merely one the countless interested parties who is waiting eagerly to be able to participate in a local CGB division. So I am not privy to all you have been through. But my suggestion – and I'm almost embarrassed to say it because of my ignorance – is that it seems to me you should rethink smaller, concentrate your efforts and energies, and leverage what is in order to build what might be.
It appears to me, as an outsider reacting to the issues you are trying to address and the circumstances you describe, that you should focus like a laser on opening one community-based CGB in MA that becomes the pilot for your larger vision. Your idea, after all, is one based on microeconomics, which is inherently local, while your ambitious 20 year plan seems to be geared toward attracting monied people with aspirations of building a national common good banking "empire." Instead, why not start small, test your concepts in one community, focus on garnering support and customers from a narrowly defined geography where the participants can see their money at work in their community, serve that community really wel, gather feedback from that community, and then expand from that base. Once you have the model working well, expansion will be much easier.
I would further suggest that you team with one of the established entities you mention in places like Sweden or Zambia – e.g. create a "sister bank" relationship whereby organizers of those projects serve as advisors to your effort and as advocates who bring credible case studies testifying to the real world power of the concept.
I am often reminded in my line of work that taking on a small project generally leads to all of the same hassles and headaches as a larger project but with much smaller rewards in the end, so why bother with the small stuff? However, in this case, with so many moving parts, regulations and prerequisites, and with your support fragmented and the enthusiasm you need so diffuse, I think you need to follow the advice of the popular 20thC mantra: think globally, act locally.
You may want to consider splitting the business development portion and the fundraising into two separate positions. My experience in business tells me that the single position you outline requires two very different types of personalities and that much of the frustration you are seeing from the community organizers stems from this issue. The BD/ education portion of the position is best served by experienced folks who are experts and can answer questions directly. Regarding the fundraising – and this may sound counterintuitive, but has it been considered to ask very large, even corporate investors? Here are some examples of large entities that stand to profit monetarily or through branding via the creation of the CGB:
http://www.kpcb.com/: These guys were the seed investors in Bloom energy. This product has the opportunity to create decentralized energy production for companies, communities and eventually even individual housing. The issue they are struggling with now is is the time it will take to make the small boxes as profitable as the large ones. If we offer them a shortcut by saying "If you fund CGB, you will create a new faster route to market for your product. By empowering communities to purchase large scale energy systems for themselves, you get to market faster than if you were to wait for consumers to buy this product individually."
Google ventures: Google's ethos is "don't be evil". By helping to seed true democracy, they are standing by their ethos and even though they are still for profit, have gone a long way towards ensuring that their profit is used for good. This is huge for their branding & recruitment efforts.
Bill Gates (http://www.gatesfoundation.org), Vinod Khosla (http://www.khoslaventures.com/…..;& others: These investors have obviously significant capital to spend and want to invest specifically into building a better world. Even though their ROI will not be as high as other sources of income, the potential for democratization and therefore upside should outweigh any financials (as this is likely not their first priority, unlike the investors above).
Hello All, sorry I posted this first in the wrong place…titled Money Honey.
Strategically, I would focus on the following.
Completing the detailed business plan. This includes the bylaws and articles of incorporation, which are the soul of the plan. You can't have a democracy without a constitution
Focus on raise funds for the Charter and execution of the business plan. Not knowing all of the factors in your project, I would say to drop many of the activities that you are engaging in to further develop the tools you need to raise the large sums of money required to get the charter and follow through with the project. I would ask myself, is this activity the best way to raise large sums of money? If yes, do that, if not, that activity can come after funding.
What about movie stars with a radical liberal bent…any friends of friends have a connection to an open mind with a big wallet? This may sound silly, and it is, but it is just one crazy example of something to consider. Or, George Soros Open Society Institute? What I am saying is that I would be sure that I exhausted every possible avenue to raise the over $1.5M you need. Also, is there really no legal way to raise a large amount of small donations? Can you raise money as Common Good Finance that is a Common Good Bank incubator…the non-profit and the bank run by separate people?
I want to say that I really believe in the Common Good Bank project! It is getting to the root of injustice. If the common good can gain a place on the Monopoly board, it will surely grow due to its cooperative advantage.
I wish I could come to the meeting and meet with all of you.
ekrawczyk said:Thanks for sharing this William. I like having a plan with a timeline. Will this be up for one of the weekly conference calls? Eric
Conference call topics are driven by staff needs and interest, so (since you ask) probably yes.
Note that the timeline is part of a plan, not a commitment carved in stone. We have changed the planned timeline several times in response to unforseen obstacles, problems, and delays. Several individuals have criticized or dismissed the CGB project because the plan keeps changing. However, since we are doing something that has never been done before, it makes total sense to keep adjusting the plan as we find our way forward. And we ARE finding our way at an ever-accelerating pace.
People want to know "when can we expect the bank to open". The answer to this is: "sooner, if you help".
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