Ivy House Community Shares

[Sue]

The Ivy House in Nunhead, London's first community-owned pub, is offering more community shares, the first since it opened.

Please consider being a part of this fantastic award-winning pub which has been going from strength to strength since being saved from the developers nearly five years ago!

http://www.ivyhousenunhead.com/shares.php

[Blah Blah]

Looking at the financial records it has struggled to make a profit year on year, making a small loss in 15 and a bigger one in 16. before cancelling out those losses with slightly bigger profit in 17. Seems to be just about breaking even overall (after 5 years). At ?100 a share, seems a bit risky.

[DulwichFox]

4. Can I sell my shares?

Community shares are not transferable and there is no open market for them. Members can withdraw their shares by giving three months? notice to the Management Committee and withdrawal will be subject to the Committee?s approval.

The total that may be withdrawn in any financial year is limited to 10% of the total value of all shares, in order to stabilise working capital.

Shares may only be withdrawn at their original value (i.e. ?100 each) and any surpluses are invested for the benefit of the community.

Really brilliant scheme. No incentive.

[DovertheRoad]

Blah - break even is a real result considering all factors and I think you're missing the point. This is about investing in a valuable community asset that delivers amenity value for many. If you want to invest for a steady positive return buy a dull index linked fund or take out an ISA. I cant guarantee the same satisfaction however!

The team at the Ivy House have done a truly amazing job thus far in saving the pub and offering lots of activities for all. After 5 years they deserve a fresh injection of support for the next. At least if you care about having choice, independent boozers and live music locally.

[Sue]

Obviously they did not make a profit in the initial years, and nor did they predict that they would.

And I doubt very much that anybody buying community shares is doing it to make money.

We are doing it because we think this is a fantastic initiative, on which a lot of people have worked extremely hard over the last five years.

As for "lack of incentive", Dulwich Fox. Just go there and see the diverse range of people enjoying themselves, and the range of activities going on for people of all ages. That's enough return on my money for me.

The predictable people are still being negative. They were negative even before the pub first opened as a community pub, and despite the fact that it's clearly thriving, they are still being negative now.

It's very very sad to see.

[DovertheRoad]

Somewhere on the original Ivy House shares thread (2013?) I remember an amateur builder/footballer/DJ claiming that she had run a bar in the area for 5 years. And that the Ivy House would never work. That dry sales could never hit ?3k a week there. Whilst no doubt it's been a huge challenge, the current team have really proved a lot of doubters/self proclaimed "experts" wrong. And stuck one right up them.

[Sue]

DovertheRoad Wrote:

-------------------------------------------------------

> Somewhere on the original Ivy House shares thread

> (2013?) I remember an amateur

> builder/footballer/DJ claiming that she had run a

> bar in the area for 5 years. And that the Ivy

> House would never work. That dry sales could never

> hit ?3k a week there. Whilst no doubt it's been a

> huge challenge, the current team have really

> proved a lot of doubters/self proclaimed "experts"

> wrong. And stuck one right up them.

Indeed. Well remembered.

[Blah Blah]

But if I want to 'donate' money to something, I can pick any number of charities that do something more meaningful than a pub for example. I don't doubt for one moment the achievement here. Just breaking even in any pub these days seems to be a challenge for a lot of publicans. But when a business seeks to sell more 'shares' there is usually a reason for needing to raise the extra finance. Dismissing my point with comments about dull ISA's and stuff is just infantile. I looked at Sue's link. I looked at the financial reports, and I should be able to say what I think from that.

[sheff]

Fair play...

Consistent year on year growth, a pretty decent EBITDA last year considering the state of the pub and restaurant business and it?s putting circa 250k back into the local economy in wages. Not to mention other local services as suppliers.

And it serving the community in the much wider sense.

Jeeze, it?s a better trading unit than most of the portfolio of a national restaurant chain I did a distressed sale process on last year.

Well done...

[Sue]

Blah Blah Wrote:

-------------------------------------------------------

> But if I want to 'donate' money to something, I

> can pick any number of charities that do something

> more meaningful than a pub for example. I don't

> doubt for one moment the achievement here. Just

> breaking even in any pub these days seems to be a

> challenge for a lot of publicans. But when a

> business seeks to sell more 'shares' there is

> usually a reason for needing to raise the extra

> finance. Dismissing my point with comments about

> dull ISA's and stuff is just infantile. I looked

> at Sue's link. I looked at the financial reports,

> and I should be able to say what I think from

> that.

As the link I posted above clearly states, over the last five years, many of the people who did not buy shares initially have been asking the Ivy House if more shares could be made available for them to buy, as they wished to have a stake in the pub which they use.

The money raised from the community shares is a very small proportion of the pub's finances, as if you have looked at the financial reports I would have thought you would realise.

Perhaps you need to read more widely on the website.

As noted here

https://www.ivyhousenunhead.com/about.php

the community share offer was opened to raise money for necessary repairs and refurbishment, as well as to provide a trading reserve for the pub. These essential repairs and renovations are still ongoing.

I am not sure why a community pub which brings people together in such diverse ways as chess groups, knitting groups, dance classes, live jazz bands playing while you eat Sunday lunch, children's drama classes, Irish sessions and many forms of other live music, should be considered somehow less worthy of support and not "meaningful" because it is a pub.

Many people also book the lovely ballroom for special events including children's parties and wedding receptions.

And quite apart from these benefits to the local community and beyond, the original group of customers who worked so hard to save the pub succeeded in having its beautiful interior listed, so that it could not become flats.

And they give support and advice to other community groups who are involved in similar initiatives.

I despair really.

Anybody would think you did not want this valuable community asset to succeed, Blah Blah.

[Blah Blah]

So now you are assuming to apply motive in yet another of your trademark essays in reply to a simple short post. This is why you get into rows with people on here again and again. Drop the sarcasm at the end and stop jumping down people's throats when they have a different view to your own.

There is information in your post that I did not know, which is useful. But it still remains that it is a pub, orperating as a business. It is not a charity. And there are plenty of organisations that are not business enterprises or pubs, doing all the things you list above in communities everywhere.

I am not telling anyone not to buy shares am I? All I have said is that as an enterprise it is just breaking even (which is true) and that there is no return on buying shares, which is also true. And finally, it is up to the individual where they choose to donate their money. And it is perfectly fine to have a view on that too.

In reply to Sheff....

This is what all businesses do. They feed into the local economy. I'm just not sure what the purpose of the shareholder equity is within the model of a business, when there is neither no return, nor option to cash in the shares when there are rules like DF cites above.

[DovertheRoad]

Blah Blah Wrote:

-----------------------------------------------

>

> In reply to Sheff....

This is what all businesses do. They feed into the local economy. I'm just not sure what the purpose of the shareholder equity is within the model of a business, when there is neither no return, nor option to cash in the shares when >there are rules like DF cites above.

****

The purpose of community shares is to provide a mechanism by which locals can help save independent shops and businesses. Most people who invest in community shares dont care about a financial return. The return comes from feeling part of saving something you value, and in enhancing and preserving a local community asset.

Technically you are incorrect when you say there is no option to caah in the shares. You are also technically incorrect when you say the shares offer no return as shareholders can recieve interest. However, again this is not the reason why people invest in community shares.

[Sue]

Blah Blah said: "I'm just not sure what the purpose of the shareholder equity is within the model of a business, when there is neither no return, nor option to cash in the shares when there are rules like DF cites above."

To add to what DovertheRoad said above, one of the reasons for the new share offer, apart from other people wanting the opportunity to buy shares, is that a number of the original shareholders have left the area and have withdrawn their shares.