The Non-Profit Company under the name “Co-Fund”, within the scope of its general objectives, as those are laid-out in the company’s statute, has as its primary objective the facilitation of the creation of new, or the growth of already existing Social and Solidarity Economy ventures. At the same time, by supporting such projects, Co-Fund seeks to promote wider networks of collaboration with Social and Solidarity Economy (SSE) Companies, consumer cooperatives and other social ventures that are inspired and operating on the principles of social solidarity and cooperation. In this way, Co-Fund aspires to contribute to the creation of a more integrated (as far as possible) democratic economic space, designed to meet the needs of primarily its participants but also the social needs in general, such as the need for work and the protection of the environment. Moreover, its operation will be aligned with values and practices contrary to those of the dominant profit-led economy, competition and indifference to workers’ needs and to the environment.
To achieve the above-mentioned goals, the prime and foremost activity of Co-Fund is the accumulation of a financial capital, aiming to fund start-up or existing SSE companies. Both the accumulation of capital and the financing of SSE companies will be done on the basis of solidarity. In short, the financial resources come mainly from small, periodic contributions by individuals or collectives that have the capacity and inspiration to donate. The financing of SSE projects aims to create new jobs of cooperative logic, as well as the participation of the funded ventures to the accumulation of capital, through reimbursement of the funding they received, and further contribution to it. The funding of each SSE project is done in a way that ensures viability for itself and its employees, thus securing both the reimbursement of the received amount, as well as the venture’s further contribution to the fund, in order to ensure that the funding capital serves its purpose. At the same time, Co-Fund tends to adopt measures for the reciprocation of the solidarity demonstrated by capital contributors, and encourages benefiter ventures to do the same, in the direction of shaping community and mutuality bonds between the above-mentioned parts.
For the precise arrangement of the rules governing its above mentioned activity, Co-Fund, by decision of its General Assembly, adopts these Rules of Procedure, the members of which undertake to abide by.
Structure of the Rules of Procedure
The Rules of Procedure organize and describe how Co-Fund operates concerning the following:
1) Financing of the company
2) Financing of SSE projects by the company
1. Financing of the company
The financing of the company is done through subscriptions from any individual or legal entity who accepts the purpose and the manner of operation of the company, as stated in its Statute and its Rules of Procedure, and wishes to contribute financially to the achievement of its above-mentioned objectives.
The subscriptions may be of a regular nature or may be given irregularly at a frequency and amount chosen by the subscriber. The minimum amount of contribution is set at five (5) euros. The subscription is in the form of donation and does not necessarily imply a reciprocation of the company to the subscriber. However, the company seeks to build participatory or reciprocatory relationships with its subscribers, depending on the degree of their engagement. In addition, the company aims mainly to attract regular subscribers, in order to secure stable revenues.
1.2. Regular subscriptions
The company encourages its subscribers to make subscriptions on a regular and long-term basis, at a constant rate and regular periods, by registering in the subscriber register on the company’s online platform and by paying via direct debit to the company’s account. The company offers the subscriber the payment options of monthly, semi-annual and annual subscriptions. Τhe subscriber can choose the payment option, but it cannot be less than 5 euros per month (or 30 euros per semester or 60 euros per year).
1.3 Regular subscribers
A regular subscriber is considered the individual who completes one full year and one day of regular subscriptions without any interruption, from the date of their initial registration (having completed at least 13 monthly or 3 semi-annual or 2 annual donations). Regular subscribers acquire the right to participate in certain decisions, in a manner decided by the company and specified in these Rules of Procedure.
A supporter is considered the individual who has donated at least one time to the company, or an individual who donates at a varying frequency and rate of their choice (in any case the amount of the subscription must be equal to or greater than the minimum subscription rate, as this is specified in paragraph 1.2). Supporters have no further involvement in the operation or decision-making of the company, nor do they receive any reciprocation for their subscription.
1.5 Changes to regular subscriptions
The amount and frequency of the regular subscription may be subject to changes by the subscriber according to their preferences (provided that this change complies with the subscription amount specified in paragraph 1.2). If a regular subscriber discontinues their subscription, they are considered as an inactive subscriber and lose their regular subscriber rights. A subscriber automatically regains their status and participation rights, if they re-activate their regular subscription within six months from the date of the initial discontinuation. After the period of six months, the subscriber shall be deleted from the subscriber register of the company. To become a regular subscriber again, the regular subscription period will have to be renewed (as it is specified in paragraph 1.3).
1.6 Revenue management
The company’s income is solely used to finance SSE projects and to cover the company’s operating expenses. The operating expenses of the company, cannot exceed the upper limit (35% of its annual turnover) as it is defined in its Statute (no.10, paragraph 7).
1.7. Transparency measures
The company undertakes to publish a detailed expense report on an annual basis, and a summary of its revenues, while protecting the personal data of its subscribers.
2. Financing of SSE projects by Co-Fund
The company publishes a call for financing within a time and money framework of its choice. As part of this financial call, each group of individuals or partnership of SSE ventures, who wants to set up a new SSE project and does not have sufficient capital, will have the opportunity to file a financing application to the company. The same opportunity shall be given to any existing SSE project that is planning an increase in its turnover. The company examines and assesses the financing applications which have been submitted as part of this process, on stages and criteria set out in these Rules of Procedure, and decides whether to proceed or not with the financing of each application. Every approved SSE project undertakes to repay the capital received, in installments of frequency and amount according to its capacity, and is encouraged to participate as a regular funder of the company after the repayment has been completed.
2.1. Call for financing
The company publishes a financing call, in the frame of which receives financing applications. The issuing of such a call is made at a time chosen by the company, taking into account the accumulated capital available at all times, in combination with the short-term revenue forecast, based on the regular subscriptions expected from all the regular subscribers and the operating expenses of the company. In each of these calls, the company specifies the total capital which is to be allocated in the frame of the call, its approximate size for a single successful application and the time span during which applications are open.
2.2 Conditions of eligibility for a financing application
A financing application, in order to qualify as adequate for further examination, must meet the following requirements:
a) a draft statute to be lodged or a statute already lodged by the applicant venture, which proves its cooperative structure, and declares the participation of any legal entities in it.
b) a resume of the members of the applicant venture, or at least the Board of Directors or any other administrative body provided by its statute, if the venture consists of a large number of members. The resume must include any participation of this member in other legal entities.
c) in case of participation of legal entities in the applicant venture, or participation of individuals in other legal entities, the financing application must provide information on the activity of these legal entities (area of activities, sources of revenues, legal status, shareholding or any other information that the company may require).
d) a clear explanation of the planned scope of work, for the accomplishment of which the particular financing application is being filed.
e) a viable business plan of the planned (new) venture, or the planned increase of turnover (of an existing venture). The business plan must sufficiently specify and outline the proposed investment (e.g. purchase of specific equipment), the location of its head office and the geographical area that the planned business will cover.
f) the balance sheets of the applicant venture covering the total period of its activities, for a maximum of the last three years, if this venture is already established.
g) participation of the members of the applicant venture in the financing of the company as regular subscribers, starting at least on the application date.
2.3. Evaluation criteria for financing applications
As long as a financing application meets the requirements of paragraph 2.2., the company shall evaluate it based on the following criteria:
a) The degree of business maturity; the company shall determine whether a business plan is well prepared, detailed and runs low risk. The company encourages the collaboration of the applicant venture with trustful consulting entities, intending to assist in bringing maturity to the business proposal.
b) The social utility of the proposed project. Businesses in the primary and secondary sector whose activities are considered to be closer to the basic societal needs (food, clothing, machines), are more likely to be approved.
c) The ecological footprint of the business as it is described in the business plan. Applications for an eco-friendly business plan that contribute to protecting the environment or expect a milder environmental impact than others, are more likely to be approved.
d) The ratio between fixed capital and variable capital for which the requested financing is planned. The company is encouraging high-end fixed capital financing applications so that it can be compensated, in the event of a failure, by withholding assets and thus reducing the risk.
e) The ratio between the number of jobs that, according to the submitted business plan, are projected to be created during the full development of the project, and the funding capital requested. Financing applications with a view to creating more jobs are considered more favourable than applications with a view to creating fewer.
f) The nature of jobs which the applicant venture is expected to create. The company favors the financing of cooperative jobs with full, equal legal integration of the employee in the requested venture, and the effective participation of the former in the collective management of the latter. Employment jobs may be approved only by exception, provided that they are adequately justified and that decent working hours, salary and other working conditions apply.
g) The degree of partnership with other SSE ventures or the degree of integration into SSE networks. If the business plan of a financing application is the result of collective decision-making and design of an SSE ventures’ group, the application is more likely to be approved.
h) The existence or not of other SSE ventures with the same object of activity in the same geographical area. If the object of activity of the applicant venture is not covered by other SSE ventures in the same geographical area as the area of economic activity of the applicant venture, then the application is more likely to be approved.
i) The amount of requested financing by the application, compared with the amount of capital available to the company, the number of financing applications the company decides to approve in this context, and the total amount of funding resulting from the sum of to-be-approved applications.
2.4 Steps for examining funding applications
The company reviews and evaluates the funding applications it receives in three stages.
a) In the first stage, each application shall be examined in relation to the eligibility criteria referred to in paragraph 2.2. If an application does not meet these criteria, it is rejected without further evaluation. Otherwise, the application is considered sufficient and goes to the next evaluation stage. The company’s General Assembly is responsible for examining the first stage.
b) In the second stage, each application passing through the first stage shall be examined on the basis of the criteria set out in paragraph 2.3. In particular, a request for funding may be rejected on the basis of criteria (a), (b), (c), (d), (f) and (h). In this case, the company may propose changes to the business plan of the applicant(s) in order to be further in line with the above criteria. If the applicant(s) accepts the changes, the company may reconsider the financing request. The General Assembly of the company is responsible for examining the second stage.
c) Financing applications approved by the second examination stage shall be considered applications for implementation and go to the third evaluation stage. In the third evaluation stage the order of implementation is being set. Financing applications are posted on the company’s online platform and then the company informs its regular subscribers, accordingly. In the third stage, applications are re-evaluated by the General Assembly on the basis of the criteria in paragraph 2.3. They are also evaluated by the company’s regular subscribers via electronic voting. The members of the company (50%) and its regular subscribers (50%) will decide the final order of implementation, through a voting process, calculating, for each application, the average of the percentages it received in each of the two votes. The time of the two votes shall be set by the company when it completes the first two stages of the examination of applications. The voting of the members of the company precedes the voting of its regular subscribers. The latter begins with the announcement of the results of the voting of the members and lasts one week.
2.5 Other requirements during the processing of funding applications
During the three stages of reviewing a funding request, the applicant(s) should provide the company with any additional information or documents concerning itself or the natural and legal persons involved in it, if the competent body of the company deems it necessary.
2.6 Final approval of funding applications and the completion of the call
All funding requests passing through the third evaluation stage shall be implemented in the order of implementation, as determined by the result of the votes during the third evaluation stage. The final number of applications to be implemented under each call is determined by the company’s General Assembly, depending on the amount of funding involved in each call and the amount of funds available under the call. The company may approve such a number of applications, that the cumulative financing amount exceeds the total financing capital underlined in the call. In that case, the company adds the additional capital required to the total amount of the call, either directly or after some time, required for its collection. The call for funds is completed when all the applications approved by the company, have been implemented in the order of implementation.
2.7 Implementation of the financing
Implementation of a funding request is made in two parts. One concerns the financing of the acquisition of fixed capital (equipment, property, etc.) and the other (if included in the approved application), concerns the financing of variable capital. Both parts of the financing are implemented through contracts signed between the company and the requested SSE venture.
2.8 Repayment of the financing amount
When repaying the amount of funding, it is possible, with the agreement of the company, to review the amount and the number of tranches to ensure the viability of the SSE venture that has received funding, if deemed necessary by itself.