Insights into the world of small business lending and development
Finding Crowdfunding Success with the Support of Community
Kateri Gutierrez co-founded Collective Avenue Coffee in Lynwood in 2016 with big dreams of what the business could do for her community. As her business has grown, this commitment to community has become the foundation of Collective Avenue Coffee, from it business structure to its mission and even how it's funded its growth.
Kateri and her co-founder Jonathan Robles organized their business to be the first worker-owned coffee shop in L.A, meaning the business is owned and operated by its members and employees. They felt that the cooperative model was a way for them to start and own a small business together when they lacked the means to do it alone, building a collaborative approach into the organizational structure of the business. The co-op model allowed Collective Avenue Coffee to get off the ground, first by serving pour-over coffee in local restaurant BALAM Mexican Kitchen and then with other pop-ups throughout the community.
The team also weaved a community focus into the mission of Collective Avenue Coffee, aiming to facilitate a strong sense of civic engagement by offering music and art events and hosting a Last Friday monthly at BALAM (read more about their commitment to community engagement on their Small Business Profile).
As Collective Avenue Coffee’s role in the community grew, it needed to expand its physical footprint as well. To start, Kateri and her co-founder needed to purchase an espresso machine to expand their products, adding lattes and espresso to their cold-brew and pour-over offerings. Kateri knew that having an espresso machine would help exponentially with their business sales and revenue but they struggled to find a traditional source of capital. So Kateri turned to crowdfunding. In her words, “We were young and had little financial or business history. We urgently needed to get the espresso machine, so we opted to utilize our social capital and the community engagement that we had built over a couple months.”
Collective Avenue Coffee launched a crowdfunding campaign on GoFundMe to raise the necessary money for their espresso machine. When creating their campaign, they showcased what they have done to serve their local community and how the funds would help them not only grow their business but help to further their mission. Then, they turned to their network—they sent “constant messaging” though social media, emails, calls and more, contacting the same connections multiple times throughout the campaign.
They suggested contribution levels that were named for streets in Lynwood to tie the community to the story of Collective Avenue Coffee. These contribution levels offered incentives, with prizes like t-shirts, stickers and mugs. Top donors were also offered the chance to have their names written on Collective Avenue Coffee’s “Wall of Community.” Kateri made sure to update their followers and networks on the campaign’s progress and how the money was being used to show transparency.
With this campaign, they were able to secure $9,065 and purchase their espresso machine. Since then, they’ve been able to grow sales and revenue to a level that allowed them to open their first brick-and-mortar location and are now working on opening their second location. In fact, they’ve turned to crowdfunding via GoFundMe again to help with construction space for this new location, which will be a shared space with other co-ops.
Kateri has this advice for other small business owners thinking about starting a crowdfunding campaign, “Make sure you have your mission and vision clear and concise. You have to know the identity of your business and the clear goals of what you want to do with that money. And after you finish your campaign, you have to maintain follow up with your donors.”
Community involvement is built intricately into the mission of Collective Avenue Coffee, so of course it only made sense for them to turn to their community to grow and build their business. Thanks to a successful crowdfunding campaign, Collective Avenue Coffee will continue to serve the Lynwood community for years to come.