COIN (Clallam Opportunity Investment Network)

What: Local investment network connecting local businesses and entrepreneurs with local capital and resources

More info: Contact Clea Rome at the Clallam County WSU Extension, at 417-2280 or e-mail clea.rome@wsu.edu or clallamcoin@gmail.com.

A new avenue has opened to keep local money inside county lines, to support small businesses and to provide opportunities for entrepreneurs.

The Clallam Opportunity Investment Network (COIN) evolved from a pilot project implemented in Sequim via a partnership between the Washington State University Clallam County Extension and the Association of Washington Cities.

“Banks, traditional sources of capital and the overall lending landscape really changed after the recession about 10 plus years ago,” Andy Meyer, Association of Washington Cities special projects coordinator, said. “Based on a lot of anecdotal information and talking with elected officials around the state we were finding from a small city economic development standpoint there was a missing piece for how to help small businesses access capital and how to support the growth and retention of small businesses.”

Recognizing this “missing piece” in cooperation with WSU, officials with the Association of Washington Cities spearheaded three pilot projects aimed at providing an alternative for small communities to increase economic stability through investment networks.

Sequim was the largest of three cities selected to pursue a pilot project. Two of the three pilot projects were located in small eastern Washington communities, but “we also wanted to pilot a project in a west side community and something a little bigger,” Meyer said. As a Port Angeles resident and a past planning director for Clallam County, Meyer was familiar with the economic makeup of Sequim and surrounding county and felt it was a viable area to support something like COIN. Additionally, in June 2014 the Sequim City Council endorsed the pilot project and was willing to play a supportive role in ushering local investing.

In reaction to the positive public response to the pilot project gained at informational meetings and workshops, an advisory committee for COIN formed with the Extension as a facilitator.

“Right now we’re in our beginning phases, but I envision COIN being much broader than a way to connect local businesses with local capital,” Clea Rome, WSU Extension director, said. “It can be a whole network of resources for entrepreneurs and small businesses.”

Having spent the past year developing the network, including the membership structure and guiding documents, the COIN advisory committee is now turning its attention toward building the membership and website, Rome said.

“Basically, what it looks like now is someone applies to be member of COIN and in doing so receives investment opportunities from a listserv,” she said. “It’s very much a one-on-one process and we (Extension) just help to facilitate the process and connect people looking for capital with those that might have capital to lend.”

As COIN develops, Rome anticipates hosting business showcases as another way to facilitate local investment opportunities.

COIN is modeled after the Local Investment Opportunities Network, a similar community spun investment network in Jefferson County that took shape in 2006 and has since invested more than $2.7 million into local businesses.

“We got a tremendous amount of support and assistance from folks working with the LION in Port Townsend,” Meyer said.

Representatives from LION even attended the meetings held in Clallam County and provided insight into how LION operates. Hearing from those involved with LION was “key in giving people here some assurance that this does work,” he said.

Like Meyer, Rome is inspired by LION, she said, and also identifies Clallam County as having the elements needed to support something similar.

“We have so many entrepreneurs and small businesses here, as well as a community with some capital to invest,” she said. “I think it’s really great to take some of those local dollars and invest them in our main street.”

Although small business are “key” for economic development in Clallam County, Rome said, often one of the greatest challenges for small businesses is access to capital.

“It can really make or break those early years for a small business,” she said.

Typically banks and alike lending sources have a certain level of loan requirements, Meyer explained, such as a minimum amount or a documented business background or track record. However, many small businesses don’t meet those requirements and that’s where something like COIN where investors are more willing to take on a different level of risk and/or make small loans can “really help,” he said.

Given the traction of COIN and success of LION, Association of Washington Cities and WSU officials would like similar local investment networks to become available to small communities throughout the state, Meyer said. Building on the pilot projects, the association is readying to take the concept of local investment networks to “another level” by applying it in a countywide project in Thurston County in 2016.

Club coincides with COIN

Working in tandem with COIN as a member of the network is Local Dollars and Sense — a newly developed, Sequim-based investment club.

Unlike COIN, which acts as a conduit for investment opportunities for investors to independently pursue, members of Local Dollars and Sense vote as a club to make investment decisions.

“We’re a handful of like-minded people that have an interest in supporting main street versus Wall Street,” Gerry Christensen, Sequim resident and club co-founder, said. “COIN is an opportunity to cast a wider net and it will help us (Local Dollars and Sense) get exposure and become more aware of what’s out there.”

Although Local Dollars and Sense primarily focuses its investments on local, organic and sustainable food “ecosystems” meaning everything from the production to distribution, Christensen said the club isn’t limited to that.

“We prefer to invest in ‘closed ecosystems,’” he said. “The ideal company would be a company that hires locally and sells locally and is sustainable.”

Already Local Dollars and Sense has made small business loans, including assisting a small grocery store in western Clallam County.

“We can be more nimble and flexible than banks, but we expect to get our capital back so we can keep recycling that money locally,” Christensen said.

For more information about Local Dollars and Sense or membership inquiries, e-mail gerry.christensen@gmail.com.