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Favabank Community Bartering Favabank is modernising the age old idea of barter, exchanging items and time as favours between members of your community. Connect with people in your neighbourhood via the exchange of favours.

Bartering Favours Next time you need a helping hand or need to borrow something, why not try to source it from your local community?

Barter and Recycle Your Unwanted Stuff All barter exchanges are tracked using a virtual currency called a 'Fava', to create a 'gift economy' where the more you have given, the more likely that people will want to reciprocate. The Fava is the foundation for 'pay it forward' economics.

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Doug Richard & the Government Investment Scheme SEIS, Socialism in Reverse?

Posted by John Durrant on Wednesday 14th November 2012, 5:18PM

Favabank needs funding, my own finances have run dry and I'm a little stuck with the project at the moment, unable
to put in the time required to push the project forward due to the need to earn a little money elsewhere.

So as part of investigating potential sources of funding I found myself today at an event by the 'School for Start-ups', founded by Doug Richard of Dragon's Den fame. Much of the content of the event focussed on a new government scheme called SEIS - the Seed Enterprise Investment Scheme (http://www.seis.co.uk), a scheme which essentially de-risks certain kinds of angel investment via various mechanisms including tax breaks, which in the right circumstances can be a 100% de-risking of the investment for the angel.

Positioned as a wonderful opportunity for both the angel investor, and the start-up receiving investment, what Doug Richard and others at the event, extolling the virtues of capitalism, failed to point out that the person picking up the tab for this wonderful scheme is the humble taxpayer. So the ordinary working person, heavily taxed via their income and expenditure, is yet again the person bearing the risk, while the already wealthy angel has an opportunity to become even wealthier by doing just what the bailed out banks do - privatising profits while socialising risk.

Of course it is wrong to point the finger of accusation at the angel, they're smart, they're just exploiting opportunities to their best advantage. The villain here is surely the government as creators of SEIS (George Osborne seems to be taking credit for it). Via the apparently virtuous attempt at kick-starting the economy, what they have created with SEIS is a kind of reverse socialism, where taxpayers are funding the 'entrepreneurial' exploits of the wealthy. And of course these very investors will be hailed as capitalist heroes, when in reality they are beneficiaries of socialism.

I'm still not sure where Favabank will be able to source funding, a venture philanthropist? or angels specifically interested in social enterprises? Maybe we will be able to take advantage of funding available from within the co-operative movement, or perhaps via the new crowdfunding platforms? Although Favabank has yet to finalise its cooperative structure so currently has no way of making a formal proposition to anyone interested in investing - we're open to ideas though.

While SEIS is a 'no-brainer' for investors and entrepreneurs, I guess I won't be endearing myself to SEIS investors by writing this, and maybe others won't see schemes like SEIS as unethical in the way I do, and perhaps I would ultimately have to be pragmatic and accept that the financial arrangements of a would be investor are their business and not mine?

Doug Richard was actually a charming & charismatic speaker, seems to be authentically supportive of entrepreneurs and genuinely wishing to inform them with practical, straight talking advice, and to be fair to him, he's doing a good job of highlighting a very good opportunity for investors & start-ups while the government has kept it a bit of a secret.

I'd be interested in hearing opposing views from proponents of SEIS, and of course interested in hearing from anyone with more knowledge and experience than I have in the whole area of raising funds for this kind of 'cooperative' venture.

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