Establishing a business designed to strengthen community, not bank accounts, can be daunting. Eager entrepreneurs may see family and friends scatter when approached with ideas, logistics and money concerns. The competition for funding can be ferocious as investors look for companies with ballooning profit potential. Marc Dangeard recognized a need to help social entrepreneurs land loans more easily by supporting each other, rather than competing, and founded Entrepreneur Commons to fill the void.

Entrepreneur Commons is a network of small local groups of social entrepreneurs, people who identify a social problem and create businesses to make social change. They need to generate enough profit to sustain the business, but not necessarily maximize profit. They meet to support and help each other get their businesses ready for funding by sharing experiences, resources and contacts.

There are currently six chapters with nearly 100 members in Oakland, San Francisco, Menlo Park, New York and Paris. The group uses an online gateway, Entrepreneur Commons Academy, to communicate with the greater network. The Oakland chapter meets this Wednesday (and the third Wednesday of each month), from 8 to 10 a.m.

Dangeard, a San Francisco resident for 20 years, managed the European American Angel Club, a San Francisco-based group that supports and funds European businesses in the United States, for two years. He watched the intense competition for loans, especially for companies not interested in enormous profits, leave many businesses floundering.

He based the Entrepreneur Commons funding model on microfinancing and mutual guarantee associations, which give small loans to groups with little or no collateral. Many countries acknowledge this type of loan helps reduce poverty and encourage development.

“The social network is the key,” said Dangeard.

New members are invited to the Commons by their peers, who eventually vote for who gets loans; in effect, the network screens for the best projects. Members give small loans to the strongest, most prepared businesses. Recipients continue to support the Commons as they grow their businesses and repay the loans. The financial risk is diminished by the large recipient pool and relatively small amount of the loans.

“The value for everybody is having the network as big as possible, not growing through a big loudspeaker, but through partnerships,” explains Dangeard. “The head of the chapter invites people he knows, it starts with that trust which is critical to the growing of the network.”

Local chapter meetings are open until a core group emerges; at that point, new members must be invited. Once the group is established, the trust building begins.

“This is a very important component,” he said. “At the first meeting they talk about the projects. As time goes by and the projects develop and mature, members jump in and ask, ‘Do you know this guy?’  or ‘How much of my own money should I invest?’ or ‘What if my kids don’t want (or I don’t want my kids) to take over the business, how do I transfer it?’ or ‘Do I need a personal and a business lawyer?’”

As members share contacts, other businesses in the community benefit from the referrals.

Commons members can also talk about their doubts and fears without scaring anyone away. They learn how their peers have handled similar situations, and even when it may be time to pursue another direction. The success of the group depends on each member’s success, Dangeard said. That’s the only agenda.

Dangeard is building the fund through access to Angel Investors and other successful entrepreneurs. The Oakland chapter is open for new members. Learn more here.

Entrepreneur Commons meets
Wednesday March 17 from 8 to 10 a.m. 
436 14th St., Suite 808, 8th Floor, Oakland

To attend the event, e-mail mary@katovichlaw.com.