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Beans & Bonds: Case study of Planet Bean Coffee

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This presentation was used by John Brouwer at the Beans and Bonds session to present Planet Bean Coffee as a case study in social finance. ...

This presentation was used by John Brouwer at the Beans and Bonds session to present Planet Bean Coffee as a case study in social finance.

The 2011 Social Finance Forum, which took place at the MaRS Discovery District in Toronto on December 13 and 14, brought together investors and ventures in order to create meaningful interactions and learning opportunities to mobilize capital and inspire new ideas.

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Beans & Bonds: Case study of Planet Bean Coffee Beans & Bonds: Case study of Planet Bean Coffee Presentation Transcript

  • Freshly  Roasted  Specialty  Coffees  from  Fair   Trade  and  Organic  Coffee  Beans   Sabina’s  Co-­‐op  brings  us  Café   Femenino  coffees  from  the  Sidamo,  Yirgacheffe,  and  Harrar  coffees  from   Peruvian  Andes   Ethiopian  coffee  farmers  
  • Ar#san  Coffee  Roas#ng     Barista  Customer  Service  Ar#san  Batch  Roas#ng   Single  Brew     Downtown  Guelph  Coffee  Bar   35  employees  –  75%  young  people  
  • 3  Coffee  Bars  South  Guelph   East  Guelph   Downtown  Guelph  
  • Member  employees  vote  in  Sumac  board Sumac Community Worker Co-operative Inc. Membership  Shares  -­‐    voIng   Class  A  Preference  –investor   Class  B  Preference  –  member   Class  C  Preference  -­‐  corporate All  preference  Shares  –  non-­‐ voIng   Members  work  for  divisions  under  contract Common Shareholder- Sumac Common Shareholder- Sumac Common Shareholder- Sumac appoints  Board   appoints  Board   appoints  Board   Wearfair  Inc. Planet  Bean  Inc. Future  New  Business  Class  A  preference  –  investor  early   Class  A  preference  –  investor  early   Class  A  preference  –  investor  early  Class  B  preference  –  investor  later   Class  B  preference  –  investor  later   Class  B  preference  –  investor  later  All  preference  shares  non-­‐voIng  &   All  preference  shares  non-­‐voIng  &   All  preference  shares  non-­‐vo<ng  &  priority  over  common  as  per  series   priority  over  common  as  per  series   priority  over  common  as  per  series   Management Committee Management Committee Management Committee CEO   CEO   CEO   CFO   CFO   CFO   Division  Managers   Division  Managers   Division  Managers   Employees Employees Employees Eligible to apply for Sumac Eligible to apply for Sumac Eligible to apply for Sumac membership after 1 year membership after 1 year membership after 1 year
  • OrganizaIon  ObjecIves  Worker  Control  •   Employees  can  apply  for  co-­‐op  membership  aQer  one  year  Management  •   Scaled  for  effecIve  management  and  accountability    Incubate  new  ini#a#ves  •   as  a  division  of  Sumac    Tax  Efficient  •   Business  development  expense  in  pre-­‐tax  dollars  •   Recover  tax  on  losses    Growth  •   Opportunity  for  career  development    Delineate  Liabili#es      
  • Common Shareholder- Sumac appoints  Board     Planet  Bean  Inc. Class  A  preference  –  investor  early   Class  B  preference  –  investor  later  All  preference  shares  non-­‐voIng  &  priority  over   common  as  per  series   Management Committee CEO   CFO   Division  Managers   EmployeesEligible to apply for Sumac membership after 1 year
  • Financing  Development   DEBT  Working  Capital     Purchase  Equipment  (used)  •   Class  A  shares  –  early  stage   •   expansion  financing  2005-­‐06  •   Class  B  shares  -­‐  later   •   loans:  asset-­‐based  financing     Source  Source   •   two  social  purpose  loan  funds  •   individual  solidarity  share   •   private  loan      purchase   -­‐  -­‐  -­‐  -­‐  -­‐  -­‐     Expansion  Financing  2009-­‐10  On-­‐going   •   new  equipment  and  3rd  coffee  bar  •   retained  earnings   Source  •   sweat  equity     •   Bank  using  Small  Business  Loan     •   Federal  Business  Infrastructure     -­‐ -­‐  -­‐  -­‐  -­‐   Expansion  Financing  2011   •   new  downtown  locaIon   Source   •   Bank  Small  Business  Loan     •   two  social  purpose  loan  funds    
  • Business  Development  CharacterisIcs  Just  Do  it!   •   check  feasibility   •   start  before  business  opportunity  window  closes    Match  Business  Development  to  Financing  availability   •   financing  will  be  limited  so  stage  growth    Recruit  People  with  a  Passion  for  the  Product   •   give  them  the  opportunity  to  advance  product      Ini#ate  and  Build  Cash  Flow   •   need  an  early  income  stream    Build  the  road  as  you  walk   •   plans  are  out  of  date  upon  implementaIon      
  • ConsideraIons  U#lize  Solidarity  Investment   •   minimum  at  least  $5,000   •   keep  investors  informed  Beware  the  Garden  Path   •   consultants  and  programs  oQen  create  unrealisIc  expectaIons  U#lize  but  not  Depend  on  Government  Programs   •   program  Imelines  seldom  match  business  opportunity  windows    Flexibility   •   nimble  to  follow  market  opportuniIes    Joint  and  Several  Liability  Provisions    Stack  Financing   •   debt  for  asset  financing   •   lever  social  purpose  funds  for  bank  financing