Center for Community Based Enterprise

1. Center for Community Based Enterprise Potential Partners Guide to the Center for Community Based Enterprise, Inc. (C2BE) mission, vision, strategy, entities & programs 1/4/08 631 W. Fort St., Detroit, MI 48226313-331-7821 www.c2be.org

2. How can C2BE help you? • Expand your vision of community economic development to include Community Based Enterprise (CBE) structures • Education on successful CBE examples & strategies • Technical assistance • Network to find partners for developing local businesses • Information on incubation programs • Help find/ develop new products based on existing patents www.c2be.org PPT C2BE Guide v.2.5 1/4/08

3. What is a Community Based Enterprise (CBE)? A Community Based Enterprise (CBE) is a • locally owned for-profit or non-profit business • with a sustainable revenue model • intentionally structured to create community benefits, increased family asset equity, and to be “rooted” in a specific community • through its ownership structure, business model, or by-laws. www.c2be.org PPT C2BE Guide v.2.5 1/4/08

4. Presentation Elements • Define CBE • how it can help you • why we need it here and now • Describe new Center for Community Based Enterprise (C2BE) strategies, entities, programs & gap it fills • Explain example - Mondragon Cooperative Corporation (MCC) www.mcc.es • world’s largest industrial cooperative community • began in 1956 in circumstances no better than those today in Detroit • makes many products familiar to Detroiters www.c2be.org PPT C2BE Guide v.2.5 1/4/08

5. Economy of S.E. Michigan • Undergoing radical structural change • Causing major economic dislocation • Many highly skilled people have lost jobs • Major changes are needed to stem brain drain • Other regions have recycled talent out of such dislocations (Northern Italy, Silicon Valley) www.c2be.org PPT C2BE Guide v.2.5 1/4/08

6. Situation Requires Bold Innovation • Current efforts have a common focus on providing services & money to traditional private businesses without explicit long term commitments to community • C2BE & Ingenuity US will provide structure and long term focus to build locally rooted, well distributed, self-sustaining & expanding wealth www.c2be.org PPT C2BE Guide v.2.5 1/4/08

7. Underutilized Local Resources • Thousands of highly skilled workers • Sophisticated technology & facilities • Lots of idle intellectual property (IP) in products (that are close to market stage) at 300 local manufacturing technology companies • Socially responsible capital seeking deals • Excellent education & training facilities • Fresh water, arable flat land, moderate climate www.c2be.org PPT C2BE Guide v.2.5 1/4/08

8. Entrepreneurs are Scarce • Michigan is 40th of 50 states in entrepreneurial activity (Kauffman Foundation, 2007 New Economy Index) • People came here to work for big companies that no longer need Detroit • C2BE will provide entrepreneurship resource entity www.c2be.org PPT C2BE Guide v.2.5 1/4/08

9. C2BE Mission • Link entrepreneurs with underutilized local resources to develop locally rooted businesses paying living wages. • Find, create and support community based enterprises in Detroit. • Provide best practices information & technical assistance to enable community based enterprises everywhere. www.c2be.org PPT C2BE Guide v.2.5 1/4/08

10. C2BE Vision • Make the City of Detroit and its neighborhoods a “national applied innovation lab” for community-based wealth creation strategies • Using multiple community building strategies, entities & education programs, create a business development & assistance resource focused on locally based businesses • Create a network to help people find business partners & develop new businesses • Complement & utilize existing SE Michigan economic revitalization efforts – without duplication www.c2be.org PPT C2BE Guide v.2.5 1/4/08

11. Unique C2BE Strategy • Reverse of traditional companies that start from products • C2BE starts with local people, resources, & rootedness criteria • Seeks viable products & services to make businesses paying living wages • Making dinner with what’s in the fridge www.c2be.org PPT C2BE Guide v.2.5 1/4/08

12. C2BE Programs in Development • Environmental scan of & developing relationships w/ local CBEs, locally owned businesses, & local organizations interested in CBE • Development of on-line membership community & working groups • Select conference for anchor institutions to facilitate creation or growth of local sourcing businesses • Outreach to and Business plan competition for auto industry ex-pats • Large conference in Detroit with CBE world leaders presenting best practices www.c2be.org PPT C2BE Guide v.2.5 1/4/08

13. C2BE Programs in Development continued • Study trips to established CBEs in Quebec, Halifax, Mondragon & Northern Italy • Business development resource program • Policy & Advocacy -Fair Exchange Center • MetroDetroit GOING LOCAL – local business network & think local first campaign • Establishing IUS as a business & innovation broker • Establishing new businesses from IP acquired via IPCG • Community Benefit Agreement conference www.c2be.org PPT C2BE Guide v.2.5 1/4/08

14. C2BE Partner Entities • C2BE – non-profit 501(c)3 • Ingenuity US (IUS) – a C2BE for-profit sub business & innovation broker • Intellectual Property Commercialization Group (IPCG) has private investors- likely contractor to C2BE for business development/resource center • Fair Exchange Center- Policy/Advocacy center for CBE strategies base on KSU/Sloan Capital Ownership Group research • Metro Detroit GOING LOCAL – network of existing local businesses to promote buying locally –”Think Local First” campaign – based on BALLE experience www.c2be.org PPT C2BE Guide v.2.5 1/4/08

15. Public Not For Profit For Profit Center for Community Based Enterprise : Partners and Programs Center for Community Based Enterprise, Inc. (C2BE) 501(c)(3) C2BE Policy & Advocacy Program “Fair Exchange Center” Bootstrap Detroit (BsD) Advisors developing C2BE Governments seeking, using & sharing Fair Exchange practices IP Commercialization Group Contractor to C2BE & potential partner in IUS “Going Local” local independent business network convened by C2BE C2BE For Profit Subsidiary - Business Brokerage & Seed Fund –enabling cooperation & locally rooting assisted businesses Ingenuity, US, LLC (IUS) C2BE Business Development & Resource Program New & Existing local businesses join network for group benefits & possible 5(c)(6) R&D Member Company A Member Company B Member Company C Fair Exchange Joint Venture Companies LEGEND R&D for Company B, C etc. www.c2be.org PPT C2BE Guide v.2.5 1/4/08

16. Talent Magnet • C2BE, Ingenuity US will attract & retain new & existing talent to the region because: • Ingenuity US/IPCG will be a unique, innovative & exciting business group: • Creating new products & technologies; • While fostering community & addressing financial, social & environmental bottom lines. www.c2be.org PPT C2BE Guide v.2.5 1/4/08

17. Mondragon example – demonstrates that CBE can: • Generate significant wealth • Enable superior business competitiveness • Retain higher levels of capital internally to reinvest for growth • Serve as a model for Ingenuity US www.c2be.org PPT C2BE Guide v.2.5 1/4/08

18. Mondragon summary • Starting with nothing but hope & leadership in 1956, as of 2006 there are: • 83,601 people • working in over 200 related cooperatives • assets worth 22.5 billion euros • total annual sales of 13.4 billion euros w/ retained earnings of 677 million euros • Mondragon Bank administers 12.3 billion euros in assets • Worker members own 2 billion euros in assets • 861 worker members sit on governing bodies • Cooperative engineering university, schools & social service system www.c2be.org PPT C2BE Guide v.2.5 1/4/08

19. Mondragon Cooperative Corporation 2006 Data • Following slides, taken from data on the MCC website www.mcc.es, shows what can be accomplished: • by hard-working, dedicated people • in circumstances where their children were leaving home for lack of work • making products similar to those made locally • paying EU wages & benefits www.c2be.org PPT C2BE Guide v.2.5 1/4/08

20. Most relevant data (in millions of euros) To 31-12-2006 Concept 2005 2006 Annual Variation BUSINESS DEVELOPMENT MCC Total Assets 22,977 22,550 19.9 MCC Equity 4,226 4,696 11.1 MCC Consolidated Results 545 677 24.2 Caja Laboral Assets Under Administration 11,036 12,333 11.8 Lagun-Aro Funds 3,303 3,626 9.8 Total Sales (Industrial & Distribution) 11,859 13,390 12.9 MCC Total Investment 866 1,243 43.5 EMPLOYMENT MCC workforce at end of year 78,455 83,601 6.6 % members over co-operative workforce 81 80 -1.2 % women over co-operative workforce members 41.9 41.9 - Industrial Area accident or incident rate 58.3 54 -7.4 www.c2be.org PPT C2BE Guide v.2.5 1/4/08

21. Most relevant data - continued Concept 2005 2006 Annual Variation PARTICIPATION Worker-member Share Capital 2,010 2,282 13.5 No. of worker-members in Governing Bodies 835 861 3.1 % profits distributed to worker-members 57.4 50 -12.3 SOLDARITY Resources earmarked for active. of social content 33 34 3.0 No. students in MCC Education Centers 7,642 7,429 -2.8 RESPONSIBLE ENVIRONMENTAL MANAGEMENT No. of ISO 14000 certifications in force 42 45 7.1 No. of EMAS certifications in force 4 4 - FUTURE COMMITMENT % Resources earmarked for R&D&i/Industrial Area Value added 5.5 5.3 -3.6 No. of Technology Centers in the MCC 11 12 9.1 www.c2be.org PPT C2BE Guide v.2.5 1/4/08

22. Products INDUSTRIAL Agricultural Hardware Components for manufacturing furniture Aluminum Casting Assembly of Aircraft Components Aluminum Injection & Machining Assembly & Welding Installations Assembly of Automotive Components Automatic Bending Machines & Flexible Bending Automation Equipment for Doors Casting Moulds & Modules Body Assemblies Autotransformers Brake Housing and Suspension Arms CNC Punching & Sheet Metal Punching Machines Bicycles Coach Manufacturers Camping Equipment and Tools Grinding Machines and Machine Tooling Clinical Material Wind Powered Generators Table Top Crimping Standard High Speed Steel Drills Plastic Injection Molding Laser Cutting Machines Industrial Appliances Sanding Machines & Sanding Plants Food Preparation Products Fork Lift Trucks Medium Powered Transformers Plastic Extrusion Vertical Transport Systems Pine Boards & Planks Prefabricated Elements for Construction Casting parts for car industry Manufacture & Repair of Lifts & Escalators Clutch Housings Engineering, Manufacturing & Assembly of Metal Structures Electrical Conductors & Hotplates www.c2be.org PPT C2BE Guide v.2.5 1/4/08

23. Key Features in Mondragon Success* • Fr. Arizmendiarrieta’s grand vision (beginning with individual dignity) of the future & his influence over both students & disciples when putting his ideas into practice • Personal nature of the co-operatives - people are given priority over capital. This results in a high level of worker involvement in the company, through direct participation in both the capital and the management - creating a positive atmosphere of consensus and collaboration. • A decidedly business-like approach to the co-operative phenomenon, in which company profitability and planned, rigorous and demanding management efficiency are seen as basic principles. • Re-investment of practically all resources generated. • Ongoing adaptation to the changes taking place in the environment. • Creation of efficient inter-cooperation instruments: in finance, social welfare, innovation, R&D, co-ordinated job management & situations of crisis. • Highest level of importance attached to training, both formal education at MCC University Faculties and Professional Schools, Lifelong Training linked to professional refresher courses and advanced courses. * This material is adapted from the FAQ section of the Mondragon Cooperative Corporation website www.mcc.es. www.c2be.org PPT C2BE Guide v.2.5 1/4/08

24. C2BE & Ingenuity US Values • Distributed local ownership • Retention of social capital within productive businesses • Shared R&D, capital and technical resources over a group of businesses • Educating workers to expect redundancy and continuous retraining • Providing a focused workforce development system aiming workers at retraining in specific new skills for specific new businesses • Respect for diversity & inclusion www.c2be.org PPT C2BE Guide v.2.5 1/4/08

25. C2BE & Ingenuity US Values (continued) • Community cohesion through active participation & mutual support • Sweat equity • Individual dignity • Cooperation • Sharing information within the group • Personal responsibility for quality, service and & responsiveness to customers • Integrity is never compromised www.c2be.org PPT C2BE Guide v.2.5 1/4/08

26. C2BE Status 1/4/08 • 60 advisors • Incorporated • 501(c)3 application submitted • Development of program ideas w/ volunteers beginning work on them • Experts available for consulting • Creation of website http://www.c2be.org • Raised preliminary expense funds from advisors • Seeking institutional partners & foundation funding www.c2be.org PPT C2BE Guide v.2.5 1/4/08

27. 1/1/08 Status of For-Profit Partners • IPCG has investors & IP licensing contracts within auto industry • IUS • developed mission, vision & values • is performing pre-feasibility analysis on several potential businesses • still seeking some members of business team www.c2be.org PPT C2BE Guide v.2.5 1/4/08

28. Contact & Contributions Contact Deborah Groban Olson, Executive Director Center for Community Based Enterprise, Inc. Fort Street Presbyterian Church, 631 West Fort Street, Detroit, MI 48226 (313) 331-7821 ofc.,(313) 300-6517 cell, (313) 331-2567 fax, dgolson@c2be.org Tax deductible contributions can be made by sending a check, made out to “InventorEd, Inc.”, with a note that it is “for the benefit of C2BE”, to “Accounting Department, InventorEd, Inc. 1323 W. Cook Rd., Grand Blanc, MI 48439”. www.c2be.org PPT C2BE Guide v.2.5 1/4/08