A Few Essential Ingredients for a Purchasing Cooperative

Composting & Buying “Compostable” Paper Goods in Durham, NC

A local environmental leader, Crystal Dreisbach, Founder and Executive Director of Don’t Waste Durham, invited me to join her and two local restaurant and food truck owners to imagine how we could help them purchase biodegradable plates, cups, and carry-out containers as a co-op.

The basic problem? 

Tim Morris, owner and operator of Caffe Bellezza, started the meeting: “The compostable cups I buy cost 200% or more of what their paper counterparts cost.” He continued, “If it was just a matter of 15-25% more, it would be much more palatable.”  Joe Choi, owner of Namu, said, “I have to pay 45 cents per bowl. The compostables cost so much more, I have to increase prices. Fortunately, my customers are willing to pay more for the compostables, but it’s a lot.”

The frustration was clear.

While many of Joe’s customers are willing to pay a premium, he did feel like he had lost some sales over the increased prices. Tim, whose coffee shop is much smaller, is paying 30 cents per 12 oz coffee cup with a Java Jacket and lid. Whereas Crystal shared that a larger coffee shop, three-location Cocoa Cinnamon, is paying 15 cents since they buy 12,000 per month.  Buying at a much higher volume can make a difference for price.

 

Compost pick-up was another major pain point.

Joe shared this experience: “The service for compost hauling used to cost me $600 per month. They increased it to $900/month when I had to increase the service level. And then just a couple weeks ago, after Compost Now bought the smaller company I was using, they increased the price to $1,800 per month.”

 

Volume and Basic Feasibility Economics

We talked about how, between the 3 of them, they could easily come up with 100 restaurant owners and food trucks that they knew personally. We estimated an average spend of $4,000 on products that they might switch to compostables, if the price and quality was reasonably good. So we estimated $400,000 per year of purchases and a 2.5% rebate of $10,000 to coordinate & organize the effort.

For the compost hauling, we estimated that the average trash and recycling pick-up cost was $350 per month and the average compost hauling was $300 per month or about $7500 per year combined. Multiplied by about 30 restaurants we thought we could easily engage $225,000 per year with a 10% rebate of $22,500 to organize the co-op.

We quickly sketched a path to how this co-op for compostables and composting could begin to generate meaningful revenue to pay for the organizer entrepreneuer.

This vision relies on a few key assumptions:

  1. The facts are in our favor. With 100 buyers of compostables and 30 buyers for composting & waste pick-up and a cumulative participation of $600,000+ per year, this co-op could:
    1. Negotiate meaningfully better pricing and terms, so the value to the customers would be sufficient for them to join
    2. Find suppliers and vendors who would agree to our terms. They would offer relatively small order minimums, an easy path to affiliation with the co-op, reasonable delivery terms, payment terms, return policy, and they would agree to pay the rebate required to fund the co-op in an on-going way
    3. Tap into sufficient market competition. There are enough providers that want our collective business that we could use competitive negotiating to get what we’re looking for — or at least a minimum viable level to make it workable. Assessing the minimum viable level is one of the hardest parts of this calculation, but is essential to the early stages of a purchasing cooperative.
  2. The buyers trust that the opportunity is real and worth their time. The art of organizing this process relies on:
    1. Making sure we’re in close relationship with critical “early adopter” and “influencer” restaurant and food truck owners. Since the stakes are highest for them, they need to be at the table each step of the way to hear pushback from the suppliers and develop their own, more nuanced understanding of the market, so that they can make a compelling argument to their peers about why they need to organize.
    2. Having enough data from a variety of buyers, from small food trucks to large restaurants, to extrapolate total potential purchase volumes with reasonable accuracy, while still being conservative enough to earn credibility with suppliers when more than we said actually show up to make the first few group purchases.
  3. The suppliers believe us and are eager to serve us. When negotiating and talking with suppliers, providers, or distributors, they must feel that the opportunity with this group of buyers is viable. This occurs through sharing large projections of total spend that gets their attention, as well as specific anecdotes of real buyer needs and challenges that we’re solving through this process. We must present as established and prepared so the seller will believe that we’re going to be successful.
  4. Relationships are key. The art of this negotiation also relies on an iterative process of getting to know suppliers and what they can and won’t do for us at certain levels of market power, leverage, and percent of their total revenue. We have to make sure that we’re relating to a person who’s up high enough in the company that they can make decisions with their own discretion and values and be impacted by a human argument.

 

Next Steps: Organizing More Buyers

Recruiting buyers actually starts with talking to providers to get a sense for their constraints, openness, and interest. What volumes would make up a meaningful chunk of their business? What value could the co-op add to their lives to make their job easier?

After that, let’s say the critical numbers are around $300,000 and we think we can do that through 12 of the larger & more influential buyers. Can we get 12 buyers to believe this might be possible, such that they show up to a meeting and follow up by sharing their spend data, what would make it worth it to them to switch, and what would hold them back.Once the organizer builds a successful network of 12, then the growth of the co-op becomes a matter of scale. Do the same thing, just do it bigger!

Because ultimately, the person who is in the middle of coordinating all of this is the essential ingredient. Even if purchasers and suppliers are aligned, without the right broker, the opportunity could fail. This person needs to be an intermediary that can deliver trustworthy, believable, and disciplined follow-through, negotiate well with all parties, and balance relational instinct with ruthless savvy when it comes to the numbers.

None of these skills rely on natural talent. CPA Co-op is here to train and support “Organizer Entrepreneurs” who have the passion to make a difference and change our local economy.

How to Build Awesome Leadership Teams

Too often, I find myself unclear on what makes great leaders. And how I can help great leaders work well as a team.

This is a big problem for me, especially with the appetite I have to make change. If you’re building an organization, a movement, or care about making change in your school, community, or company, this framework and basics might help clarify your thinking.

Screen Shot 2019-08-22 at 10.25.35 AMThis post is based on my notes from a training I went to at the Ayni Institute last week.

What are the three key steps to building great leadership teams?

  1. Recognize Good Leadership
  2. Find & Enroll Good People
  3. Create Good Team Dynamics

1. How to Recognize Good Leadership

First of all, let’s start with a definition I recently picked up from Ayni Institute, building off of work from Marshall Ganz and the work of Metro IAF.

Leadership = accepting responsibility to create conditions that enable others to achieve purpose in the face of uncertainty.

We’ll come back to this, but I think the elements of (1) accepting responsibility, (2) creating conditions to enable others, and then (3) the focus on achieving purpose in the face of uncertainty are vital starting points.

In some contexts, we are hiring leaders, in other contexts, we’re recruiting and building teams of volunteer leaders.

For both contexts, I think there are 5 key things we should look for:

  1. Deep Motivation.  Do they know why they’re doing what they do? Why this work?  Why do they have this deep, intrinsic motivation? Can they articulate this?
  2. Vision. A sense of what they want / what they believe is possible.  Vision isn’t necessarily the ability to communicate this, but that they have a sense of the way things could be.
  3. Anger / Grief. Do they have a deep emotional connection to the work. The point being it’s not just in their head, but that they feel it in their heart. For example, I have grief about the state of school lunches, because of the daily struggles I face with helping my daughter make healthy eating choices.
  4. Patience and Sense of Humor. While anger / grief are a key component to why somebody is motivated to do the work, it’s also equally important that the person also has patience and a sense of humor, because things take time. There will be a lot of loss for most campaigns that are trying to make meaningful change. We want leaders who will be in it for the long-term.
  5. Accountability. Do they do what they say? One of the most important things you simply cannot train for. Recognizing when people are accountable to what they say is essential. Screen Shot 2019-08-22 at 10.25.54 AM

Since going to this training at Ayni last week, I’ve been seeing these five elements in leaders everywhere — from folks I work with to people I’m trying to recruit. It’s amazing how simple and helpful just having a clear sense of what makes a strong leader. How would you evolve and/or add to this list for your context?

2. Finding and Enrolling Good People

“Who you’re working with precedes what your working on.”

This jarred me when I heard it last week, but the more I think about it, the more it resonates.

It basically asks the simple, but essential question: Who are your people?

  1. Know Your Turf. What’s the geography? Who are the institutions? What’s the landscape you’re working in? Where might you find the kinds of people you’re most looking to work with Do you have a mental picture of the kind of person you’d like to recruit? I’d want the person to be just like so-and-so… because she is X, Y and Z.
  2. Play the Field. Don’t invite everybody to the team. Too often we’re tempted to do this. Set a high bar for who you invite. Do they do real work? Do they accept responsibility? You can try people out by setting low bar commitments. Who can you invite to come to this gathering? What kind of people do they bring? Who do they know? Can they think of a list of people they have good relationships with and how do they describe the work they’ve done together? Really take your time and do your assessment before you invite people to join the team.
  3. Look Behind People. Where do they fit into other things / departments / organizations / communities? You have to ask other people that know them or have worked with them? Try to make real assessments based on results in other contexts. Sometimes it won’t be obvious where to look or who to ask, but take the time to check around & see where they fit.
  4. Proposition Them. You have to ask them to lead with you. This can be the hardest and most important step. You need to make a real, intentional invitation. For this to go well, I’ve found you need to affirm and name what you’ve seen in them. Take the time to write down and share with them what you recognize about their leadership, their motivation, grief, patience, vision, and reputation of being accountable. Simply naming these things for them will be a kind of affirmation and also help them gain perspective on who they are and what you see in them. Then invite them to join you to be part of making this team. Tell them how you want it to be different and while it may be hard, why you believe in it. Also name what might be in it for them. “I want to invite you to this team, because I think this team can support you in this and that way and help you actualize more of your full potential.”

There’s an element of leadership that’s about spiritual awakening — allowing people and inviting people to reflect more deeply on why they’re here — their deeper purpose and mission — and inviting them to live into that more fully.

The idea in a good team is that it allows you to fulfill your full potential.

3. Create Good Team Dynamics

  1. Culture. Early and intentionally setting your culture might be one of the most important things you can do. What does this mean?
    1. Decision-making. How do the decisions get made? Do you use the advice process?  Or what is your process? Even if it’s simple, naming it together is better than not talking about this. Otherwise, the person with the most informal power will set the tone of the culture around decision-making for you.
    2. Rituals and Shared Practice. For us at CPA, we’ve gotten into the habit of quarterly retreats as a staff and making sure we do some improv exercises / games at each retreat as a way to be silly, have fun, and use more creative sides of our brains together. (And because we have a great team member who loves leading improv games.) Another practice is making intentional time to evaluate after each meeting we have. Even if it’s just 5 minutes, we try to make it a practice that we share one feeling word on how we felt the meeting went. We try to draw a few takeaways, lessons, things that could have been improved and ask ourselves: “Did we get the reaction we wanted?” An organizing mentor used to say: “If it’s not worth evaluating, then it’s not worth doing.” In other words, we’re creating a culture of continuous learning.  What are the shared practices that make up your ideal team culture?
    3. Screen Shot 2019-08-22 at 11.30.46 AM

      Find ways to Relationship Build. This is the bedrock of our team culture. Making intentional time to deepen our relationships with one another, and also taking time in our interactions with clients, investors, everybody — to build relationships. So often our culture focuses on the transactional, the tasks that need to get done, the project management to do list, the goals we have to achieve our bigger purpose. However, if we don’t take time for the relational, we miss the opportunity to form a deeper emotional connection that might be essential for the unexpected down the road.

  2. Accountability. What are the processes for holding each other accountable? How do you create space for mutual accountability? Is it team check-ins? Shared reflection on goals? A periodic write-up on the meetings/conversations we had and where our latest thinking is as a result of those? Did we do what we said we’d do on the timeline? If not, what happened? Why?
  3. Training. Doing a training together can be an interesting way to set a standard for the work and in a way be another form of accountability. It offers a great way to combat awkward power dynamics or experience differentials in a group. If everybody goes to the same training, agrees to the new, common set of expectations, then there is a new baseline.
  4. Meetings with Purpose. Ensure your meetings have purpose in a broader arc of what you’re trying to accomplish. Make sure folks know why they’re coming to your meeting, what the purpose is, the intended reaction(s), decisions to be made are ,and that they have all the necessary information / reports in advance so that the time in the meeting isn’t sharing information or something that could have been shared in advance. For example, the IAF “campaign cycle” goes through five stages. Your meetings might have more purpose if you fit them within your broader campaign roadmap:
    1. Relationship Building
    2. Research, Cut the Issue
    3. Strategy
    4. Action
    5. Evaluation

Here’s another example of a Campaign Cycle from Marshall Ganz at Harvard University.

Screen Shot 2019-08-22 at 11.31.08 AM

If you found this helpful, I recommend:

1. Checking out your local community organizing affiliate – with Metro IAF or otherwise

2. Learning more about Marshall Ganz and his online courses / trainings: https://online-learning.harvard.edu/course/leadership-organizing-and-action-leading-change

3. Checking out the offerings of the Ayni Institute and their research on social movements https://ayni.institute/training/

4. From a more business angel, the work of Seth Godin,  his blog, podcast and his Akimbo Workshops. For example here’s a post about how things can be different for your organization & how it starts not at the bottom, but at the foundation.

Or think about joining us at the Community Purchasing Alliance: CPA.coop!

 

Carbon Offsets: To Buy or Not To Buy? A Short Guide

Three of my best friends from college just texted me telling me they’re planning to buy carbon offsets and wanted my two cents. The problem is: I’m having difficulty reducing my thoughts to a text.Screen Shot 2019-07-25 at 10.05.12 PM

A little more than 10 years ago, my work as a climate change and clean energy consultant led me to writing a paper on Greenhouse Gas (GHG) Offsets. Screen Shot 2019-07-25 at 10.06.24 PM The more I learned, the more I realized the complexity inherent in trading money for “emissions reductions” in other places. The problems begin with the complexity of the basic criteria for what makes up an offset (additionality, measureability, complete accounting, verifiability, enforceability, permanence).

Here is an excerpt from my 2010 IHS CERA Report where I explain these 6 criteria.

Assuming you’re looking for a less technical response, I like this below excerpt from Josie Wexler of Ethical Consumer’s “A Short Guide to Carbon Offsetsbecause she emphasizes some DIY offsetting options and also reminding us that the most important thing is to reduce our own emissions.

Recommendations from Ethical Consumer

We recommend offsetting at the level of individual projects (rather than just giving to a company’s whole portfolio) because this is the level at which there is most information available. Accordingly, most of this feature deals with how best to choose such a project. In the process it also looks at criticisms of specific types of offsets, and of the whole concept.

If you want to buy official offsets, we recommend giving to Gold Standard-approved wind or solar energy projects. You can find Gold Standard VER projects on the Gold Standard website and you can buy Gold Standard CERs directly through the UN’s platform.

Alternately, if you fancy DIY offsetting and want to give to educational projects, the fantastic website Skeptical Science (which largely tackles climate sceptic misinformation) lists some that are crowdsourcing.

Lastly, you should always take promised emission cuts with a pinch of salt, bearing in mind that independent research has cast doubt on them, even in the case of the most reputable standards.

The best thing to do is reduce your own emissions in the first place.

Does it matter if it’s less than a drop in the bucket?

Voluntary vs. Compliance

One of the biggest problems I have is that individual purchases of carbon offsets are like a fraction of a fraction of a contribution to what’s needed.

Carbon offsets were created under the Kyoto Protocol’s Clean Development Mechanism as a way for countries to comply with their emissions “cap”. Because entities in the EU and in other places have had to comply with these regulations, its created a need for offsets for “compliance” purposes. The vast majority of offsets are purchased from “Compliance” buyers.

The rest of us are “voluntary” buyers — including companies and universities and others.

Then of the “voluntary” buyers, companies buy 98% of the market and individuals (like you and me) buy less than 1%.

Again, to quote the Ethical Consumer:

Corporations, mostly multinationals, bought 98% of voluntary carbon offsets in 2015. Individuals bought less than 1% of them, and their share has been shrinking.

Despite the impressive growth of the voluntary offset market, its current effects are not even drops in the bucket of what is necessary for meaningful climate-change mitigation.

But something is still something, right?

Screen Shot 2019-07-25 at 10.04.52 PM

Well, if you want the mainstream, neoclassical economic analysis on carbon offsets, here’s an articulation of the public good and the free rider problem by Matthew J. Kotchen in the Standford Social Innovation Review “Offseting Green Guilt.”

His conclusion is as follows:

My own view is that purchasing carbon offsets is better than nothing, assuming that you are careful about where you buy them. Yet when considering ways to reduce your own carbon footprint, you should compare offsetting to the more certain alternative of directly reducing your own emissions. As offset provider Carbonfund.org states, your motto should be, “Reduce what you can, offset what you can’t.”

If I wanted to encourage you in purchasing offsets, I’d sign off here, given that I like Carbonfund.org’s great tag line.

However, I’ve become quite a skeptic and I believe it’s important to also read through the critique of carbon markets and offsets in particular. The Corner House in the UK provides one of the better critiques on carbon trading.

The report describes the financial aspects of carbon trading and how the carbon market has changed over the past few years as new interest groups and complex financial arrangements have become involved. As a result, carbon quota prices have become more volatile, speculation in the carbon market has increased, and the market is increasingly delinked from its original objective of providing an effective cost-management tool to reduce carbon dioxide emissions.

Their synopsis document is called, “Designed to Fail“. Here’s an excerpt from page 7:

Advocates of the offset system point to the many world-wide carbon-reduction projects that are funded by the system; the savings to industry (and thus consumers and society at large); the flow of money from North to South; the export of new technologies to developing economies; and how innovation in low carbon technologies has been incentivised. FERN [the author] believes that these claimed benefits very rarely exist in reality, and are heavily outweighed by the significant, systemic failure of offsetting to reduce emissions at all, which we discuss in the last section of this paper.

Another point they make is that “of the US $ 144 billion carbon market, only US $ 3,370 million goes to project developers and only a fraction of that will go to communities who host projects.”

I think some of their critiques help remind us that fundamentally carbon offsets weScreen Shot 2019-07-25 at 10.04.37 PMre created to make it easier for us to do more “cost effective” emission reductions. The reality is also that emissions reductions may be  cheaper in other places in the Global South.

Thanks to our mainstream neoclassical economic theories and practitioners — with our focus on markets, free trade, individuals, & utility maximization — we’ve created a carbon trading market allowing us to continue doing what we’re doing with our fossil intensive energy infrastructure and pay others to make reductions.

The challenge is: can we create a commodity from a reduction in emissions?

This brings us back to the point of what are the 6 criteria for offsets: additionality, measureability verifiability, complete accounting, enforceability, permanence.

Is our money well spent investing in the financial markets creating these offsets projects, the financiers, administrators, marketers, developers, and verifiers? Screen Shot 2019-07-25 at 10.04.43 PM

Is it better spent on a specific project you do in your house to reduce some of your emissions? Or a project with somebody you know? In your city or in a community you have relationship with and an understanding of abroad?  Or might our money be better spent on advocacy or organizing? If we could pass climate policy — with a cap on emissions — on state or federal levels — that would do the most good. What about giving $10 to the Chesapeake Climate Action Network — they’re one of the local groups who I most respect in their organizing and advocacy work. On a national & international level, I believe 350.org has done and continues to do some incredible work. For me it comes down to building power and better vehicles for change.  So that’s where I’m investing my money. What are the vehicles I believe are capable of building the power needed to help people, institutions, systems make the hard decisions/investments to decarbonize? And what are the paths to getting states, regions, countries to implement the policy and regulatory changes we need to decarbonize our electric & transportation sectors?I have a few ideas… but I’ll leave that for another post.

Livable Future Insurance: Re-thinking Risk and Your Investment Choices

Shifting our investments to local, direct investing is really about buying “livable future insurance”.

The concept is basically that we’re dramatically under-calculating the devastating impacts of super storms, heat waves, hurricanes, & all climate related disruptions over the next 20-40 years. The interesting thing is that many of us will be drawing down our retirement savings on a similar time horizon. I think collectively we’re grossly under-calculating the risk of climate, inequality and related disruptions will have on the stock market. The 8% average annual returns of the past 90 years are not what we’re going to see going forward. Not if you believe the most recent IPCC report.

When you add on to this the reality of health care and long-term care costs, food system instability, other unexpected disruptions — the world will be fundamentally different 20-40 years from now. Whether you’re a technologist (with VR and AI), or a malthusian (finite limits of world’s resources) — the world will be different.

But what are we doing to re-think our retirement savings strategies? Our long-term investing? How are we investing for a livable future?

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Here’s my proposal

 

Durham’s Angel Investor / Slow Money Circle

Investing in Black & Latinx Entrepreneurs

  1. We believe the traditional advice on investing needs to be re-thought given current realities with carbon, inequality, refugees, healthcare, elder care, and mass criminalization of black and brown bodies. We need to be more thoughtful about the structures of sin and evil we are complicit in perpetuating by following status quo investment advice.

  2. We believe the stock market is riskier than most people think, and that we need deeper economic, power, financial, & ruthlessly critical analyses to help us create a livable future for our grandkids and their grandkids.

  3. We believe that understanding racism, all of it’s systemic, institutional, interpersonal impacts is fundamental for white folks to do the work to begin to see the ways we’re all bound up in the structures and extractive mindset that keeps us apart, disconnected from deeper work, where we’re from, and where we’re going.

  4. We believe in the redeeming power of real, deep relationships and contemplative practice, especially based on trust, mutual respect, mutual accountability, grace, and mercy.

  5. We need new vehicles, platforms, communities, learning groups, cohorts to do the important, hard thinking on how do we really divest and where do we reinvest? What alternatives are we building?

  6. Capitalism tends toward the concentration and centralization of wealth and we see it all the time in various sectors and industries we’re in (for example John Oliver’s recent piece on Private Equity’s recent entrance into manufactured housing). Can we democratize these sectors, create co-ops, employee ownership structures that can scale?

What collaboratives of deep thinkers are you engaging with to build this next generation of people moving their money in strategic ways to build the power we need for a more just and livable future to be possible?

“Now the other thing we’ll have to do is this: Always anchor our external direct action with the power of economic withdrawal.” – Martin Luther King, Jr.

Join the conversation:

https://forms.gle/6CdcT7wgZhvBP1Ww6

Force Multiplier for Racial Equity?

“Imagine a monopoly game with 8 people. Then imagine 4 of the people are forced to leave the room until all the properties are purchased. Those 4 people are invited back in and asked to keep playing. How do you think they’ll do?”

“That’s what it’s like to be black.”

Geraud Staton tells a story like this during his February 2018 Equity in Entrepreneurship talk at ReCity – an innovative co-working space in Durham. Geraud leads LaunchDurham as part of his role at the Helius Foundation, where he helps necessity-driven entrepreneurs grow their businesses and give it their best shot.

To me, this feels like some of the most meaningful work we can do if we want to get serious about racial equity.

Three years ago I met Traveon Smith, Founder of LGC Security because a charter school leader told me she wanted to give him a chance to bid on the security services their school was going to need that year. I was running a purchasing cooperative in Washington DC that helped churches and schools find high-performing local service providers. That Spring one of my projects was helping eight charter schools find a more responsive and reliable security services provider. A week after we released our Request for Proposals, Traveon from LGC sent me his bid. I decided to sit down with him and tell him a bit more about what the schools and our co-op were looking for and to get a sense of his company, his experience, and why he was so eager for this opportunity.

Two minute video telling the story of Traveon’s journey building LGC Security

It turns out LGC was selected by one school that summer. Then another that Fall, and three more that Spring. By 2017, Traveon had landed more than $2 million per year in security contracts from charter schools and was about to win a bid to serve Howard University. His team had grown from 3 to more than 100 full-time staff.

The way I helped Traveon and LGC wasn’t to give them a handout, it was simply to help better understand the needs of the clients he wanted to serve. I gave him insight about how they thought about their schools and what I head learned was most important to them. Then he did the rest. He won their businesses. He’s had to work extremely hard to earn their renewals and referrals and it still isn’t easy. But now he has a business. He’s built some wealth for his family and is offering good employment for more than 100 people that look like him.

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When I think about the twenty public and private-sector leaders I’ve met with in Durham over the past few months, I’ve heard racial equity come up over and over again. But when I ask about what action they’re taking or organizing as a collective, it feels like there is less happening than we’d like.

I want to propose a locally-focused purchasing cooperative owned by and led by Durham leaders. The cooperative would be a collaboration between non-profits, faith institutions, education leaders, property owners, and our largest anchor institutions: universities, health care, and public sector. The focus of the co-op would be three-fold:

    (1) Help community institutions (i.e. churches, small business, non-profits and any others) save money and be more intentional on contracting for facilities, construction, and professional services.
    (2) Build spaces for large buyers to meet, discuss, and hear trusted peers talk about good experiences with local, minority- and women-owned firms. The purpose being to help spread the word about newer and smaller firms that are hungry to grow.
  • (3) Support entrepreneurs in coming together to hear about the landscape of upcoming projects, build trust with peers, perhaps new collaborations, and discuss shared challenges. The purpose would be to direct folks to existing resources and identify gaps.

We recognize Durham and our region is undergoing incredible growth. Construction firms consistently tell me how hungry they are for more skilled workforce.

My hope is that by building a collective vehicle that organizes more of our purchasing, we connect more of the dollars we spend with high-performing businesses owned by people of color.

In the past 4 years, I grew a buying co-op of community institutions that collaborated on utility bills and saved $100,000 to what is today a group of 75 that now shifts $16,000,000 per year and intentionally contracts together with 57% of their spend now going to minority owned businesses.

Working with Durham and other area leaders I believe we can be more intentional with our purchasing and contracting and over the course of a few years shift more than $1,000,000,000 to minority-owned firms.

My aim is to start small, begin with where we’re at today, but gradually build a vehicle for each of us to become more intentional in making our purchasing a force multiplier for change.

This is Why I am Writing

I believe you have a hunch about your most important project. The one that if it really succeeds could really make a difference. It could contribute to something extraordinary.

I’m writing because I want to invite you into a caring community that has also glimpsed this part of themselves and knows they need more support and encouragement to work on this most important project.

As an organizer, I see my work as bringing people together, helping to create and hold the space where we can listen and help each other see what’s really holding us back.

In this blog, I hope to share some of what I feel might be my most important work — reflections on co-op economics, heterodox economics, better ways of thinking about our retirement and college investing and personal finance…Screen Shot 2019-02-02 at 11.17.34 AM

But also to share other ideas and reflections on what I’m trying to do with a young small organization that is desperately trying to find where it can have the most powerful impact — on the economy, in our schools, in our religious communities, in how we collaborate.

The journey has been way more emotional and rigorous than I expected. The stakes keep feeling higher and the fear and anxiety grow. But our potential to do good in a deep and meaningful way is growing as well. My missteps and shortcomings as a manager — something I once thought I’d be great at and really enjoy — are also giving me lots to reflect on. I believe that in sharing all this with you, you might have some advice and suggestions for me.

My hope is that by writing an invitation to you every month (and perhaps a couple other quick notes in between) will feel compelling to you — so much so that you’ll write back and engage.

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Once I hear from enough of you that you’d like to take a leap with me, I’d like to launch an intensive workshop. This would be a curated cohort that will combine the best of what I’ve been learning from a truly transformational leadership workshop I went on in early 2018, mastermind groups I’ve been a part of over the past year, a couple coaches and colleagues who have been shaping me, and my desire — my desperate desire — to see more of you deeply committed and ruthlessly pursuing what you feel might have the biggest chance at really making a very real and significant contribution.

Democratizing Economics: I believe

I believe our economics can embody a greater democracy.Screen Shot 2019-02-02 at 11.17.46 AM

I believe our economic institutions can be more democratic and fair.

I believe the plurality of thought in economics would bring great benefit to society.

 

I believe in culture and that our culture is the sum of the ideas floating around inside of it.

We all know it’s much easier to take in others’ ideas than it is to create and share the unique combination of ideas your experiences bring to bear.

Screen Shot 2019-02-02 at 11.28.26 AMI believe we need to be talking more about certain ideas.

I believe George Saunders rightly characterized our media situation with his essay, “Braindead Megaphone”.

 

I believe our most important work is really matters.

I also know how easy it is to be distracted.

I believe that you spending more of your time on your most powerful work will change you.

 

I believe that creating tension is essential to producing work and creating change.

In organizing, we call it an “agitation”.

Agitation is the art of challenging a person to be true to their values, true to self and to act on those values out of their own self-interest. It is the art of pointing out the contradictions between what a person professes and how she or he acts.” ~Gameliel National Training Manual

I also believe new kinds of connection are possible.

New curated cohorts learning together can cement new relationships that move us deeply.

I believe in coaching, good feedback, holding up a mirror, reflecting back to each other what’s most important and what we see.

 

This is the heart of it: Learning to see.

Learning to see inside ourselves.

Learning to see beyond the next turn.

Learning to really see the other. Be with them and help them see themselves.

Is that a gift you are ready to give?

 

I think our economics needs it.

I think our economy needs it.

Will you join me?

Invite: Accelerating Shared Prosperity in Durham

Together with my co-founder, Merald Holloway, I have been gradually building the basis for a buying co-op here in Durham & beyond.
On Thursday at 6pm, Merald and I will join some really remarkable entrepreneurs:
  • Geraud Staton (Helius Foundation) – watch the first 2 minutes of this video and you’ll be blown away by the inequity in black business ownership in Durham, where we once were and where we are today. Geraud’s one of the most pioneering contributors to this space.
  • Keith Daniels and Tom Droege (Resilient Ventures) – a mix between an angel and VC fund, aimed specifically at helping black entrepreneurs in Durham, NC, and beyond.
  • Rob Sheilds & Zenzele Barnes from ReCity Network (see previous roundtable events here), will be hosting and facilitating an interactive community conversation that I hope will re-invigorate our imagination of what we can be doing together to really move the needle.
Might you be able to join us on Thursday and ask a hard question, that deepens our collective thinking on this? 
 
I’m inviting you for two reasons: 
(1) I think you have something to contribute & believe the conversation can help us imagine more about what kinds of partnerships and collaborations are possible.
(2) Geraud, Keith, Tom, Rob, Zenzele, and Merald are grounded in the reality we live in, but are taking big leaps to do the hard tangible work to push us forward.
I’ve been inspired by their grounded-ness, audacity, and hope this conversation can help move us collectively in the right direction.
Thursday, Feb 7, at 6pm | ReCity Network 112 Broadway St 
A Community Conversation featuring
  • Helius Foundation
  • Resilient Ventures
  • Community Purchasing Alliance
a simple dinner will be provided
RSVP — it’s free.

Community Purchasing Alliance Cooperative
We’re building momentum in Durham… here is a recap of our November meeting.
If you’re not able to make it, but want a sense of the couple short stories I will share, here is a 4-minute video along the lines of what I’ll be saying.
In 2018, our coop aggregated $16 M in contracts. 60% went to minority owned businesses. Here’s my invite to you… let’s come together to actualize the flourishing of ALL entrepreneurs in our community by implementing anti-racist spending decisions at our community institutions.
Or better yet, 
Listen to Traveon Smith, Founder of LGC Security tell his own story about growing and the role our co-op played.
Watch Gladys Martinez, Owner of Service Industries tell her story about her janitorial company and the Co-op members she serves

My Investing Turmoil in 5 Feelings: Trapped, Angry, Entangled, Disconnected…and Hopeful

When I think about what’s happening in our world, I see wealth consolidation, growing inequality, I see more homeless folks.

Do my investments in corporate America and all the publicly traded companies that are part of the S&P 500 have anything to do with that?

1. I feel trapped.

I’m stuck in the mainstream retirement investing paradigm.

And I want out.

Screen Shot 2018-07-12 at 1.11.19 PMI did all the things I was told. I made smart choices and took advantage of employer’s matching contribution. I put extra money into Vanguard S&P 500 Index Funds. I even put money into the best Socially Responsible Investment (SRI) funds I could find: Calvert, Pax, Domini, TIAA-CREFF.

Every time I review my investments though, I  get frustrated with how entangled I am in the same exploitative economic system I believe is at the root of so many of our problems.

I feel the intense dissonance from what I say I believe in and where my money actually is. It’s a similar dissonance to those times when I eat a burger, even though I know if I skipped it, I would save enough energy to charge my iPhone for 4.5 years.

It’s cognitive dissonance.

The challenge with investing is: where are all the good “happy” meat options?

2. Angry at “Those” People

“Today will be the last day for Stow, Melanie… [and a list of names were read]”

“Please clean out your offices by 5pm.”

I was 22 and it was my first Friday of my first full-time job. I was thrilled because I had basically landed a dream job as an energy researcher at one of the top firms in the world. As the meeting came to an end, I realized that dozens of colleagues were being laid off. Stow  was the renewable energy expert I was most excited to work with. He had co-authored the definitive paper on emerging energy technologies.  Melanie, a single mother with a son in Iraq, who worked with me on getting settled in on the job, selecting benefits, and everything else.

Screen Shot 2018-07-12 at 1.05.56 PMAs I searched for answers, I found many colleagues distraught, but they calmly explained that while we had been a private company, we were recently acquired by a larger publicly traded firm, and the lay-offs were likely an effort to please investors by positioning for company for better quarterly returns.

This was a key moment in my awakening.  The 401(k) options my employer offered got me started on this path. It was a path I wasn’t sure I wanted to be part of, but everybody in my life told me it was the right, smart thing to do.

I think this is how most of us start.

The injustice of how Stow  and my other colleagues were treated jolted me to realize the world was really run by those shareholders – those big banks and folks on Wall Street.

As I’ve continued to reflect on, ask questions, and learn about investing, I realize my ownership of mutual funds and index funds means I’m also one of “those” people.

3. Entangled. We are all Those People

Merely by following the advice of the smartest people around us (as I did, when I was counseled by people I trust and that share my values), we go with the mutual and index fund options we’re offered.

I bet you’re just as entangled as I am. The reality is everyone who owns a mutual fund – even the socially responsible investment (SRI) funds — we own shares of these publicly traded companies that are beholden to our desire to grow shareholder value and deliver a return – ideally on par with the rest of the market.

Because that’s what you and I want when we review our investments, right?

We want the hard earned $250 that we eek out of our monthly budget to turn into $750,000.Screen Shot 2018-07-12 at 1.18.58 PM

With the power of compound interest, we know that if we start when we’re 30 and retire at age 70 and earn an 8% annual return along the way, we’ll get to $750,000.

If we earn an average of 9% return, we’d have more than $1,000,000.

If the average annual return is 5%, then it’s only $362,000.

That’s the power of compound interest (all with the same $250/month for 40 years). It’s also why there’s a whole industry around retirement planning, savings, and so much information about investing.

4. Disconnected. What do we want from our investments?

Well, clearly we want to retire. That’s something that in the past was part of the deal we got when we signed up with an employer — a pension. Today, it’s something we have to build on our own and that’s why 401k and 403b and Roth IRAs and financial advice and investing has become so much more focused on the mass market. We’re getting messages all the time about what we should and shouldn’t do. My hope is that you might take a step away from all of that and join me in asking some bigger questions.

What do we want to be part of?Screen Shot 2018-07-12 at 1.08.02 PM

I still have yet to receive a Google Ad or sponsored social media content that actually takes me to an investment option that really aligns with my values and conscience.

When I think about what’s happening in our world and our country, I see wealth consolidation, growing inequality, I see more homeless folks.

Do my investments in corporate America and all the publicly traded companies that are part of the S&P 500 have anything to do with that?

As a student of economics, a person of faith, and a co-op entrepreneur, I wish I was encouraged to wrestle with these questions more seriously in light of my faith. In the absence of hearing it from the pulpit, I invite you to think with me about these questions as a matter of conscience.

5. Hopeful. Alternatives are Becoming More Accessible

Though I’ve been wrestling with these questions for nearly 10 years — about our mainstream investment paradigm, socially responsible investing (SRI), and alternatives that make sense for me – I’m feeling more hopeful than ever about the options that are emerging.

One of the most inspiring recent things I’ve seen is the movement towards “Community Capital” spurred by recent changes in securities law (JOBS Act), allowing more people to participate in crowd-funding platforms that allow you to make equity investments in small businesses.

Resources that I’ve recently come across include:

  • Locavesting, a website (and book) pointing to many local, alternative and community capital options
  • Investibule, a platform for small firms looking to raise money
  • NC3 – a network & collaborative bringing together champions of community capital to more local, social entrepreneurs
  • New Economy Coalition’s – CommonBound conference & Community Capital track
  • ReValue, a financial advisor trying to integrate community and local capital

Screen Shot 2018-07-12 at 11.58.39 AMScreen Shot 2018-07-12 at 11.59.15 AMScreen Shot 2018-07-12 at 11.59.35 AM

Resources that I’ve integrated into my investing portfolio and urge you to consider in your investing as well:

I admit, some of this takes work. I also believe it’s a tremendous opportunity.

I see it as an opportunity for:

  •  new relationships, (i.e. slow money networking)
  •  to re-weave the fabric of our local communities,
  •  community-wealth building,
  •  building more equitable, prosperous, and just future for our kids and grandchildren,
  •  economic democracy, cooperatives, ESOPs, and other employee-owned firms,
  •  you and I to have a much more meaningful and authentic impact with our investments.

What possibilities could you imagine if half the people you knew took half of their investments and channeled them in ways that really resonated with their values and vision?   What would that world look like?

What path are you looking for?

Drop me a line and let’s discuss. My hope in writing this is that it starts a discussion and leads to new things.

“Do not go where the path may lead, go instead where there is no path and leave a trail.”  — Ralph Waldo Emerson

Will you join me?

I’m eager to build and contribute to communities of people that want to ask, wrestle with, and live into these tensions with more integrity.



        

Trust and Co-ops

Five years ago, I started the Community Purchasing Alliance Cooperative with a Steering Team of church leaders, a community organizer, and a few generous lawyers.

Today, we are 75 member-owner community institutions. We collaborate on $15,000,000+ in contracts each year. Yet the most important thing we’ve created doesn’t show up in the numbers.

It’s trust.

We’ve built an incredible amount of trust with our members. What’s surprising to me about this is that most of the trust-building has happened not because of anything the staff did, but because of the conversations we facilitated between members. When decision-makers are talking to peer decision-makers about a similar challenge, the value they create and insight they’re able to offer builds something special

Nathan Schneider talks about this same phenomenon in his most recent article for the Coop Biz Journal - Winter_2018_Journal_CoverNational Cooperative Business Association. Nathan starts:

“I’ve noticed some patterns that may become more common in the co-ops to come.”

He’s reflecting on his experience as a reporter:

“They will create value not just with the services they offer to members, but with the connections they enable among members—and the efficiencies members discover together.

This rings true for my experience. For example, at the founding meeting of our co-op in 2014, I remember sitting next to Troy Watson and her telling the room of 50 founding and prospective members and others gathered, “While the savings are helpful, it’s the connections I value most.”

I think this continues to be the experience many of our members have. While we help them manage risk and reduce cost in some of their contracts, it’s the personal connections we’re able to help them make with peers that they value most.

Nathan continues:

“Their specialty will be in fostering trust on trustless networks…”

As I think about where we grow next — whether through building out an online platform for users to co-create value and connection building on something like MARVL.org or whether through developing a new co-op using a similar model in another region — Nathan reminds me that the focus of our work must be in fostering trust.

That’s the specialty of what a co-op can offer and offer with great integrity.