Community in business

Posted on Friday, 22 June, 2007 by

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The question

How can communities be self-financing? In my dealing with our group of dairy farmers it had often occurred to me: how to find some money to pay for the costs of running the community, and also for some of the work done? In all development work there is so much emphasis on sustainability, but for communities many seem to take for granted that they are externally financed.

CP2 – KM4dev – back to CP2 – and onwards

When looking at how other communities do it, it was clear that many struggle with it. I decided to bring it in as a “project” for the KM4Dev workshop in Zeist, the Netherlands. Even before that, during the CP2 dialogue in Setúbal at the end of May 2007, this issue was discussed. Together with John D. Smith, and with help of others, we further looked into it after the dialogue. I brought the results of those discussions with me to KM4Dev. This is what the project at KM4dev had as an introduction:

  • Title of the Project: Community in Business, exploring (self-)financing models for “communities” that use web2.0 tools
  • Project leader: Josien Kapma, Consultant (Portugal)
  • Brief description: Web 2.0 tools offer possibilities to communicate, organize or collaborate where before this would not have been possible or too expensive. This could offer a huge potential for development. Communities can be formed for joint learning and information exchange, e.g. for local initiatives of a particular region, or of peers like farmers, or micro entrepreneurs. Such communities may have a large value for the users or for development in general, but may not be institutionally sustainable when costs, however low, cannot be met in the long run. Leaders and technology stewards burn up, if not rewarded sufficiently, whether in financial or other terms. Traditional financing models, either membership or transaction based fees, are no longer always applicable. On the other hand the web presence may offer new opportunities. How can these “communities” incorporate sound financial models? What are designs that in an early stage take this cost-coverage issue into account? What can local private businesses contribute?

With a small group of sometimes varying participants we worked on the project. At several sessions, and once extensively over dinner, we explored some of the issues:

  • inventory of our experiences with similar communities, and the financing models in use, analysis of success stories;
  • brainstorm of possible financing models (looking also at non-development sectors).

We did not come to the point of the other stages;

  • elaboration of one or a few selected models for financing of communities.
  • test, further develop and promote ‘proved’ models.

Some results in next posts.