Frequently Asked Questions

Welcome to the Frequently Asked Questions section! The following are questions that have been brought up by community leaders involved in creating Opportunity Development Co-operatives (ODCs), participants in our webinars and workshops, as well as the members of the steering committee. ODCs are relatively new, and we are learning more every day about how they can build strong communities. As such we hope to generate more questions that could be useful to other. If you have any questions that do not frequent this page, please drop us a line by contacting us HERE

I’m interested in knowing how to set up a co-op

The ACCA offers a series of workshops ranging from co-operative basics for those new to the structure, to more in-depth support to help move your co-op forward. Our website also has a number of valuable resources to help get you started. To set up a workshop or to receive more information please contact Paul Cabaj, director of co-operative development at


I’m interested in learning how to attract investors/sponsors for an event that I am hosting

In starting an ODC, and assembling your champion team, it is essential that this group can bring people together. Some ways to get people to your event is to make a personal connection beforehand, a chat over coffee is better than a phone call, which is better than an email, and way better than a facebook invite. Unleashing Local Capital, also means unleashing your social capital! Module 2 “Assembling the Champions” in our training guide provides some excellent resources on how to bring people together.

Can a non-profit organization set up an ODC?

An ODC is a for-profit co-operative. However, a non-profit organization can play an important role in supporting the process. Your non-profit organization may play a valuable role in providing resources such as a bank account to hold initial funds, meeting space, photocopying, marketing, invitations, coffee, etc. Further, your non-profit organization could also be essential in finding local champions, community leaders, who could create the ODC.

An ODC is a for-profit co-operative. However, a non-profit organization play an important role in supporting the process. Your non-profit organization may play a valuable role in providing resources such as a bank account to hold initial funds, meeting space, photocopying, marketing, invitations, coffee, etc. Further, your non-profit organization could also be essential in finding local champions, community leaders, who could create the ODC.


What type of businesses can an Opportunity Development Co-operative provide financing for?   

Your ODC can invest any viable business idea in your community. It is the responsibility of the board of the ODC to evaluate potential projects based on their ability to provide a financial, and often social return to the members.  That said, a capital asset, especially bricks and is often the easiest to get started with. Also, it’s something that potential members of the ODC can see and touch. Providing capital to an existing business, to expand, enter a new market, or introduce a new product could also be an option.  Succession planning of an older business to new owners, or repurposing an existing space, could support younger entrepreneurs while ensuring key businesses do not leave a community. A new business idea with strong leadership and a very solid business plan may be considered. The Unleashing Local Capital project will help you learn how to evaluate the viability of the business and make prudent decisions about the business into which you invest.

What do you mean by succession planning?

As many baby boomer business owners are approaching retirement many have not made full plans for how they will bring their business to a close.  In many cases, the children to not want to take the business over.   An why they may have a viable business and try to sell it, less then 1 in 4 small businesses put up for sale do not sell.  The closure of a business can negatively affect a community– one more boarded up building in a community inspires no one.   An ODC can play a role in transitioning to new business  ownership by helping find suitable younger entrepreneurs to take over ownership, provide mentorship and leadership,  and of course provide transition financing, often providing patient favorable buy back terms to the new entrepreneur.

Who decides what to finance?

The investors, or a Board elected by the investors, will determine where the capital will be invested in your community. The Unleashing Local Capital project will support you to make sound decisions based upon a scrutinized business plan.

Is an investment in the Opportunity Development Fund RRSP eligible?

Yes, as long as your ODC is structured as a for-profit co-operative.  The ODC investment is eligible for self-directed RRSP contributions or transfers.  That means you could put new RRSP money into your local ODC or you could transfer existing self-directed RRSPs into the ODC. This allows you and your friends to redirect your RRSPs from funds invested in Toronto, New York, or China back into your own home town. The Unleashing Local Capital project will guide through the entire process and provide any support required for administration.


Will we be involved in running the business we finance?

That depends on the nature of the business that is being invested in.

The purpose of the Opportunity Development Co-operative is to provide a passive investment into a needed business in your community.  Part of your task will be to find the business opportunity and find the entrepreneur(s) who want to own and run the business.  Typically, the entrepreneur(s) is required to be a member and/or investor as well, but that is determined by the investors.   The ODC is somewhat like a bank, except that the investment is all local capital from people who care about the success of their community. The ODC members could provide guidance/mentorship to the business where required, and of course use or promote the business wherever they go.  Some ODCs who have bought buildings take on the responsibilities of landlords.

How do ODC finance local business – equity or debt?

This will depend on your ODC, the opportunity in your community, and the amount of capital that needs to be raised. Typically, ODCs first invest in capital assets (i.e. land, buildings, equipment) which are leased to entrepreneurs (the business).  This tends to provide the greatest security for investors.  The ODC could also provide a loan at fixed-rate or variable-rate to a business (debt), or be a corporate shareholder within the business (equity). Our research indicates that once the first investment is successful, subsequent investments become easier and less securitized.


What is the agreement between the co-op and the entrepreneur(s)?

The quality of the relationships between the investors and the entrepreneurs may determine this. It can be very flexible and structured in a way that provides the entrepreneur the greatest opportunity to succeed, yet still providing the ODC with a healthy return on investment. This is patient, friendly capital. The ACCA can provide you with a variety of examples and options.  The choice will be up to you as a group of investors.


Is the return on my investment based on how much I buy at the business?

No. Ultimately, your return is based upon the success of the business. In the case of a lease or debt agreement, your return on investment is based upon the entrepreneur meeting their financial commitment with the ODC. In the case of an equity investment as preferred shares, your return is based upon the success of the business and what the business chooses to pay to its shareholders. The ODC Board (or your member-investors) determine how much will be paid back to investors and when. The Unleashing Local Capital project will provide the tools and expertise to support these decisions.


As a member of the ODC, do I get any special privileges (such as discounts) at the business into which the ODC invests?

Typically, no.  You own shares in the ODC you do not own shares in the business into which the ODC is invested.


As a member in the ODC, do I get a vote on how the business is run?

As an investor, you vote on how the ODC is managed.  You do not have any say in how the business is run. The ACCA can give you the training you need to understand this relationship.

What rate of return can I expect to receive on my investment?

That is dependent upon the business into which the ODC finances and the agreement between the ODC and the entrepreneur who runs the business.  The ODCs we have supported so far have done better than the average RRSP investment, in some cases much better, and of course they have had a other returns on investment including maintaining a key local business, jobs, supporting new local entrepreneurs, etc.

Is my investment guaranteed?

There is currently no investment guarantee behind ODCs.   A judicious evaluation of the risk of the investment is key.   Traditional venture capital takes large risks but expect very high returns as many of their investments will fail.   Typically, ODCs take on lower risk investments with lower returns.

Will this be fun?

If you think it’s fun to get together with people you trust, and enjoy working with on a meaningful project, then YES.

Can an ODC be set up for the purpose of developing a model where people can invest in a building for the arts?

Most ODCs, especially if they are doing their first public offering, tend to go for bricks and mortar projects, such as building on main-street. There are examples of locally financed arts centres across the country, including the Marigold Cultural Centre in Truro, Nova Scotia. However, along with creating a social-return most ODCs are created with the intention providing at least a small financial return on investment to the members. Given that funding for the arts can be unstable, it might be challenging to make a viable business case for these types of projects. That said, a strong feasibility study and business plan, as well as ample community support could lead to an ODC being formed to support an arts centre in your community. There are also ways to raise funds to support the arts that might be a better fit, which should also be considered.

Very interested in ideas on how we can best catch attention of the public sector to attract support for developing this model for other communities.

Like any new innovation having support to pilot new projects, research the process and its impacts, and developing materials is the key to building strengths and transferring skills to other communities. This is often where government and other groups come into play. The ACCA was incredibly fortunate to have received funding from the Rural Alberta Development Fund to do this.

Based on our experience, and also referred to in our training materials, having connection to local economic development organizations, and good relationships with local government is a tremendous asset. You may also want to identify someone in your champion team to look for funding opportunities. Also, the ODC mobilizes private, human, and social capital to invest in developing the local economy. This show of strength and commitment might also encourage government to also invest with public capital.

Can entrepreneurs who would be receiving the financing from the ODC also invest in the ODC?

Yes! This shows that the entrepreneur has a strong commitment to the business, as well as the ODC.

However, it is important that the entrepreneur, and any other members who are involved in the operation of the business, are not directly involved in any of the decision making related to their business, or sit on the board of the ODC. To achieve this your ODC must have the necessary governance structures in place, and be 100% transparent to the membership to show the decision making process.

I am wondering who you work with as a trustee for your RRSP eligibility? And do they offer RRIFs?

The trustee is the Canadian Worker Co-operative Federation in conjunction with Concentra Financial.

RRIFs are not eligible to be used to purchase shares in an ODC. Further, if you have members who are 67 years old, they should not use RRPS, as they will be converting their RRSPs during the investment period. This could have serious implications for the member as well as the ODC. Please consult the training manual and/or a financial expert.

Are shares eligible for Tax Free Savings Accounts?

Currently Tax Free Savings Accounts are not eligible. However, we are working on this and will keep you posted.

What is the process for an investor to withdraw?

Please consult module 6 in our training manual.