The Trumpington Meadows Delivery & Action Group (TMDAG) has begun the process of incorporating and funding a community-owned café in the empty retail unit near Sainsbury's on Osprey Drive.
This will include a provision for community space to be operated on a charitable basis.
The anticipated key benefits will be:
- simply having an indoors place to meet in Trumpington Meadows, which we're calling the "Community Space"
- community integration and cohesion, and a common sense of ownership
- greater flexibility and amenity for the enlarged Work-From-Home population
- removing the “empty shops” problem at the heart of the community
Why do we need a Cafe?
Revd. Mandy Maxwell and Revd. Stephen Dove, St Mary and St Michael, Trumpington
As part of our outreach to the community, the church wholeheartedly supports the cafe project. The church building flanks the new development of Trumpington Meadows but is cut off from it, and therefore separated from what is now the new centre of the parish. There is a desperate need for a central, neutral space in order to promote social cohesion, develop networks and friendship groups, and provide an amenity - a gathering place - for a population of upwards of 2,000 people who otherwise have to rely on hiring out expensive rooms in the local school, or have to travel to Clay Farm or the City of Cambridge. The location of the cafe is key; the proposed site is directly opposite the local primary school, the only focal point in the development. In addition, it would improve morale if the cafe was owned by and for the local community. The provision of this kind of infrastructure is an aspect of social justice which the church is keen to explore.
Business structure and funding
The fundraising for the startup costs (including fit-out, leasing and licensing), and overall legal control and responsibility, will be vested in a corporate body (“the Society”) to be registered with the Financial Conduct Authority. The Society will initially be financed via the offer of community shares both to individuals and to institutions with an interest in the local area. TMDAG has good links with appropriate institutional investors. An estimated £100,000 must be raised. It is hoped that dozens if not hundreds of residents will be willing to chip in, with a minimum investment threshold of about £30.
The Society may conduct a competitive tender process to select a franchisee to carry on the commercial business of the café; there are already two credible parties interested. The presence of a franchisee is not essential to the success of the project; the Society may choose to operate the café business directly. It is likely that early-to-mid-career hospitality entrepreneurs will self-select into applying for the franchisee opportunity.
It is not yet proven that a café business is viable. To investigate and validate the proposition and begin negotiations with the landowners, builders, council and potential investors, a company is being established legally separate from TMDAG. If the café is commercially viable, an application will be made to the FCA to convert this company into of a Community Benefit Society (the "Society" mentioned above) which would be allowed to make a community shares offer to residents of Trumpington and to companies, churches, charities and other organisations connected with our development.
It is not legally possible for a share offer to be made to the community until the FCA has registered the Society, which will take some weeks or months. In particular, it is forbidden for the shares in the potential business to be offered to the public while it remains registered as a limited company. In the meantime, anyone who is interested in helping out with the practicalities of fitting out buildings, running a café franchise, planning permission, accountancy, electronic point of sale systems, marketing, real estate and so on should get in contact with the company, but please do not under any circumstances ask or expect to invest in it, directly or in kind. The company relies partly on volunteer labour, but is raising some of its own capital and may be able to pay money for people's expertise and labour.
Community Benefit Societies are legally required to operate on basis of one shareholder one vote; the predecessor company will be operated on the same principle during its hopefully brief existence. For more information on Community Benefit Societies, see here.
Subject always to approval by the members of the Society, the community space inside the café will be operated by a charity. TMDAG, Trumpington Church, BPHA and Trumpington Residents' Association have all been given the right to nominate trustees of the charity which is being established for this purpose. Over time, the charity is likely to pursue additional projects.
- Phase 1: the café company investigates commercial viability, and starts to line up the lease and other contracts
- Phase 2: if the proposition is unviable, the company winds itself up and returns what remains of its funds to early investors, otherwise it applies to the Financial Conduct Authority to be converted into a community benefit society
- Phase 3: once converted, it will no longer be a company but a registered society, and will make a community share offer for any further funds it needs
In parallel with these phases, negotiations and planning will take place for fitting out and running the café.
If approved by the FCA and converted into a society the café business will likely end up with dozens of member shareholders. The nature of shares will be somewhat different from ordinary shares in a company, particularly in the following respects:
- society shares pay interest, not dividends
- society shares may be withdrawn, i.e., investors can get their money back in return for their shares, so long as this won't bankrupt the society
- society shares cannot be sold to others; this is largely mitigated by the ability to withdraw the capital as previously mentioned
In common with shareholders in limited companies, shareholders in societies have limited liability: if the business fails, the money a shareholder loses is limited to how much he/she/it invested. The profits of a society must be reinvested in the business, or given to local community causes (in the case of the contemplated community benefit society we plan to establish) or to members (in the case of cooperatives).
Part of the idea for a community cafe came from two developments in the village of Reach, northeast of Cambridge: the villagers banded together around twenty years ago to buy out the freehold of the local pub to prevent it being turned into a house. Later, people near the same village raised £340,000 to build their own solar farm, using the community share offer system proposed for our cafe.
The Community Space
The café will be designed and fitted out and run with provision for a community space built in from the start. In practice, this will mean that most or all of the floor space will be available to community groups (e.g., in the evenings) at a greater discount than a commercially-run café could afford.
The café will be a place where people can have actual conversations. In too many places open to the public in Cambridge, efforts are made which prevent people from being able to hear each other talk, for example, by playing loud music to discourage customers from lingering. In other contexts, some members of a community are priced out because the basic food and drinks are too expensive. While understandable from the perspective of those businesses' need to turn a profit, these are things which a more community-oriented business would not need to do. An amenable space which was quieter during the daytime would also be of great benefit to the now much larger population who work from home.
Support from partners
Among others, the Church has been involved in the cafe project from the start:
"As part of our outreach to the community, the church wholeheartedly supports the cafe project. The church building flanks the new development of Trumpington Meadows but is cut off from it, and therefore separated from what is now the new centre of the parish. There is a desperate need for a central, neutral space in order to promote social cohesion, develop networks and friendship groups, and provide an amenity - a gathering place - for a population of upwards of 1500 people who otherwise have to rely on hiring out expensive rooms in the local school, or have to travel to Clay Farm or the City of Cambridge. The location of the cafe is key; the proposed site is directly opposite the local primary school, the only focal point in the development. In addition, it would improve morale if the cafe was owned by and for the local community. The provision of this kind of infrastructure is an aspect of social justice which the church is keen to explore."
Revd. Mandy Maxwell & Revd. Stephen Dove, St Mary & St Michael, Trumpington