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Family business seeks crowdfunding for social change and profit

A Takoma Park couple is making their retail coffee business, Blessed Coffee, a force for social change, and has turned to "crowdfunding," a growing trend in fundraising, to expand their reach.

For those not yet in the know, crowdfunding is a way of raising capital through social media. Businesses seeking crowdfunding use websites such as Kickstarter or Indiegogo, which makes their campaign visible to interested investors who visit the site. Investors can pledge any amount, and the business may offer premiums in exchange, depending on the amount pledged. As of this writing, the couple has raised over $5000 toward a goal of around $225,000. They have 30 days in which to reach their goal.

The owners of Blessed Coffee have a strong focus on building and strengthening community and their business model reflects that.

The Takoma Park family business is only the second "benefit corporation" in the U.S., a designation created under a Maryland law enacted in 2010. The designation offers social entrepreneurs increased protection from shareholder lawsuits, and officially recognizes the socially conscious efforts of such business.

Sara Mussie and her husband Tebabu Assefa got their inspiration to get into the coffee business when they met an Ethiopian activist who opened their eyes to the realities of coffee farming. Farmers might receive only 50 cents on a pound of coffee that would retail for $10 or more.

Mussie and Assefa decided to go beyond the "fair-trade" model well-known in the coffee business, engaging in what they call "virtuous exchange," which expands on the fair trade model of merely offering producers a fair price, by offering both investment opportunities and higher profits to producers, along with building relationships between producers and consumers, they say.

The couple plans to open a cafe and small roasting facility in their hometown, in the hope of expanding their business to 15 major markets, and intend to give 50 percent of the profits to local community organizations.

The concepts of crowdfunding and social entrepreneurship are great for those who want to start a business that helps people and creates social change. And while there may be increased legal protections for such benefit corporations, they are still businesses, subject to the same legalities as any other. Attorneys experienced in business law can offer valuable advice in helping such socially responsible businesses achieve their goals.


Source: 
gazette.net, "Blessed Coffee company uses crowdfunding to raise money for Takoma Park cafe" Sarah Scully, Nov. 20, 2013

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