About The Investment Opportunity
Direct Public Offerings (DPOs) are a way to raise capital by selling securities directly from a company to large numbers of unaccredited investors in the public. DPOs are an alternative to both private offerings of securities to small numbers of accredited investors and to underwritten public offerings in which brokers sell securities to their clients.
We have a unique opportunity in which the California Freshworks Fund has provided us with a Letter of Interest stating that it will potentially finance up to two-thirds (2/3s) of our project through a below market-rate loan on the condition that we secure the other one-third (1/3) of the project’s financing through equity sources and that the equity financing be secured prior to a formal loan application.
Our DPO is how we’re raising the equity portion of our project financing. We chose the DPO because it allows us to implement an authentic community investment campaign in which residents of California, of diverse economic backgrounds, can become Founder and Shareholders in creating People’s Community Market.
Our goal is to raise $1.2M from this direct public offering of preferred shares. We have set the minimum investment at $1,000 to ensure that we would reach our target. We feel that this is a low enough amount to allow many California residents of diverse economic backgrounds to purchase shares.
We do not play an active role in assisting friends to pool their money to make an investment in People’s Community Market. However, individuals are free to organize among themselves as they wish to pursue their economic interest.
You can donate money directly to People’s Community Market. However because, we are not a tax exempt or charitable organization, your donation will not be tax deductible. If you’re looking to make a tax deductible donation we suggest making a donation to our sister nonprofit organization People’s Grocery.
We have created a support role, called Champions, in which individuals and households who want to support our mission, beyond investing, spread the word about what we’re doing to their own network of family, friends, neighbors and co-workers. Please visit our Be a Champion page to learn more about how you can help us reach our goal.
About The Store
People’s Grocery is a non-profit that was founded in 2002 has operated numerous food projects (including the Mobile Market and the Grub Box), urban gardens and nutrition education programs in West Oakland. Peoples Community Market (PCM) is a for-profit business that is working to develop and operate a neighborhood food store in West Oakland. PCM has emerged out of the work and experience of People’s Grocery, but it is a separate organization with its own board of directors and staff. The two organizations will plan partner in a number of ways such as providing job training to the store’s employees and offering nutrition education and health services to its customers. Both organizations were founded by Brahm Ahmadi.
People’s Community Market is a startup business that is currently in its pre-development phase. We have undertaken a thorough planning process, have assembled a great leadership team and are currently pursuing financing.
The timeline for when we’ll open our store will be determined by when we secure the financing we need to move to the next stage of the project. While we have lots of momentum in securing financing and are in touch with many prospective investors, foundations and lending institutions, we don’t yet know when we’ll complete our fundraising efforts. Once we have completed fundraising we’ll move into a lease negotiation and finalizing our construction phase. We estimate that construction will take about six months to complete.
We have identified an ideal site for our store. It is located at the center of the West Oakland community at the busiest intersection in the area. It offers many ideal characteristics including a high residential population density in the immediate vicinity and easy access by public transportation with 10 bus stops and 5 bus routes within a 5-minute walking distance. We do not presently have a lease for this property. We plan to secure a lease once we have secured adequate financing has been secured. The current property owners have expressed a willingness to enter a lease negotiation with us.
There are many complex factors behind why supermarkets can’t or won’t open stores in lower-income urban areas. A few of the main reasons are:
- Higher development costs in densely populated urban areas where there is limited land availability for building larger supermarkets. One study concluded that it can cost up to 30% more and take up to three times as long to build a grocery store in a densely populated urban area.
- Supermarkets tend to suffer from higher employee turnover in lower-income areas where fewer residents have job training and job experience. Large supermarkets also lack the ability to provide the in-depth employee training and ongoing support necessary to mitigate this problem.
- Supermarkets tend to experience high rates of product loss from shoplifting, employee theft, damaged and spoiled products, and errors in recording the purchase and sale of products.
- Most supermarket chains are unable to customize their product mixes and services to the preferences and needs of specific communities. These large chains can have a difficult time adapting their products to the desires of communities with a high degree of cultural diversity.
We believe that there are solutions to all of these issues. Designing the right solutions requires fresh thinking, local insight and an investment of time and effort. Most supermarket chains aren’t able to make that kind of investment. There’s also evidence that independent grocers that are locally rooted can more effectively address these issues and can perform better and serve better in lower-income areas. We’re creating People’s Community Market to demonstrate solutions that can work and how independent stores can excel at providing those solutions.