The primary purpose of a membership offer is to recruit members rather than to raise investment capital. Building up the membership can be an important starting point for many community businesses, especially those hoping to attract significant amounts of public funding. Members can also contribute significantly to strengthening the business model of the organisation, not only by investing capital but also by contributing to the business as customers, volunteers, supporters, activists, and even suppliers or paid workers.
A membership offer is often appropriate for societies at the pre-start stage that need to raise development finance to test and prove the viability of their business proposal. This development finance will usually take the form of gifts, grants and donations; although some societies may find it easier to raise this finance through a pioneer share offer. Members are more likely to donate than non-members, and although donations should never be a condition of membership, people are more likely to be incentivised to donate to a society if they are members.
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