Eight New Year's Resolutions for the Local Investment Movement

V.2, N.63

The new year means taking stock and looking forward. Despite the deafening and hollow political noise this past year, there were also a few great developments in our field worth carrying forward. So…

…in no special order, here are our eight resolutions for the local investment movement in 2025:

(1) Keep reminding “impact” investors of the fundamental importance of place: Too many investors apply a single-issue lens to their choices—BIPOC businesses, affordable housing, net-zero impacts—without doing the hard work of weaving together investors and investments locally. Our stories show, again and again, that place helps ensure that investments are personal, transparent, humane, and responsible. Every dollar you reinvest locally increases the income, wealth, and jobs in your community.

(2) Strive to increase your social return, not your private return: As I argued in our last issue, if you’re expecting a private return of 15%, as many impact investors are, you’re not only deluding yourself but short-changing your community. Look instead for great local investments that pay 3-5% and make visible changes in your life in the form of fewer unhoused people, more resilience, less inequality, and better schools. And if you want higher returns, prioritize investing in yourself (see resolution #6 below).

(3) Push Republicans to lead securities law overhauls nationally and locally: Democrats, not Republicans, generally present the bigger obstacles to reforming 1930s securities laws. Overall, these laws continue to make it difficult for most of us to invest in local businesses and projects, unreasonably expensive for us to create local investment funds, and virtually impossible to develop local stock exchanges and pension funds. With Republicans now in charge, we have a unique opportunity to pass new crowdfunding reforms, deregulate local investment funds, and legalize local pension funds. We will continue to publish promising proposals and campaigns for reform over the coming year.

(4) Get your local government involved: There is really not a single local government anywhere in the world that is uniformly and coherently promoting local investment. Let’s change this. In the United States, for example, we should be encouraging our states, counties, and cities to embrace public banks (like North Dakota’s), use small-denomination municipal bonds (like the Connecticut Green Bank), create community land trusts (as Burlington did in the 1980s), and reward local investors with tax credits (as Michigan soon will). This is what real economic development looks like, not wasteful corporate gifts to monopolists like Amazon.

(5) Make sure your community has at least one community investment fund: The United States has roughly 12,500 registered investment funds, yet those that focus on local businesses or projects and allow grassroots investors to participate number fewer than 40. Most are new, small, and struggling. Our goal should be to replicate these funds in every one of America’s 36,000 towns. There are lots of good ideas for accelerating this process. Spread cutting-edge fund models like Diversified Community Investment Funds (which are primarily real estate companies open to grassroots investment). Create national back-office support systems to lower start-up costs. Transform these funds into public-private partnerships with public money (see resolution #4 above).

(6) Go solo with your pension: It’s not easy to localize your pension savings, but my last book, Put Your Money Where Your Life Is, shows you how. My wife and I created a Solo 401k, borrowed from it to put solar on our roof in the California desert, and now pay ourselves back quarterly rather than a ghastly monthly utility bill. Our annual rate of return, over a decade, will easily reach the high double digits. This year, I borrowed from my personal Solo 401k to pay off high-interest credit cards, also generating double-digit returns.

(7) Expand your local ownership options: Some of you still wonder why we have so much information in The MSJ about public-private partnerships, cooperatives, perpetual employee trusts, and enterprising nonprofits. What does that have to do with local investment? Everything! You can’t invest locally unless you have local ownership opportunities. Part of our mission should be to use these new forms of ownership to transform, stabilize, and expand our most important local businesses.

(8) Organize your hood: Ultimately, local investment is about changing the investment behavior of your neighbors and the capital-raising behavior of your local businesses. Port Townsend, Washington, a community with 10,000 residents, continues to have a LION organization that regularly brings together local investors and businesses. It has facilitated nearly $1 million of local investment every year since 2007. Think about ways you can do this in your community through dinners, events, workshops, websites, e-zines, and so forth. At little or no cost, you can be a Main Street Champion leading this important work. (We invite you, in fact, to join our expanding list of Champions, which lives now on our website.)

Over the coming year, we at The Main Street Journal pledge to continue delivering the stories, examples, and ideas that can propel each of these eight actions.

In this issue, you’ll find stories on:

• Five emerging strategies for inclusive ownership, identified by ImpactAlpha.

• How “community bonds” in Canada fund affordable housing initiatives across the country.

• A report card on the $11 billion New York State politicians, mostly Democrats, wasted last year on corporate welfare.

• The successes of Colorado’s Employee Ownership Office, established in 2020.

• How the city of Birmingham, in the United Kingdom, is reviving itself by engaging the public to identify Assets of Community Value (ACV).

• The role of worker-cooperatives in Rhode Island in developing the new cannabis economy.

• The surprising nuances of defining what exactly a “distressed community” is. By traditional measures, poverty is highest in rural counties, but by new measures, it’s highest in large metro areas.

Finally, many of you will notice that The Main Street Journal cuts off below my introductory piece. The rest of our information—news links, partner voices, resources, events, jobs, and asks—has not disappeared but is now only available for paying subscribers. If you’ve read our last few issues, you know that we are developing strategies to improve our financial base.

A year ago, about 600 of you indicated that you were willing to become paying members. Now’s your chance! So…our ninth resolution is for you to become a paying member. For $5 per month—the cost of a meh latte these days—you’ll get full access to our content, including our interviews and local investment listings every other week. (If you’re stretched financially, just write to jen@main-street-journal.com, and we’ll comp you for a few months.) Please, please, please…click below.

- Michael Shuman, Publisher

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The National Coalition for Community Capital (NC3) is dedicated to educating, advocating, and activating community capital—and serves as MSJ's fiscal sponsor. Thank you for being a part of a growing movement! Contact NC3 for support integrating local investing in your work: info@nc3now.org.