DEMYSTIFYING FUND STRUCTURES FOR ALTERNATIVE OWNERSHIP ENTERPRISES

Transform Finance (TF) is a research, education, and implementation partner that supports its stakeholders to challenge legacy investment approaches, seed transformative investment models, and build movement power. Traditional business operations enrich investors to the detriment of asset-building opportunities for workers and underserved communities, contributing to the wealth gap, particularly along racial lines. TF enlisted the Capstone team to study and catalog Alternative Ownership Enterprises (AOEs) to understand these alternative models and undergird TF's investor-facing effort. The Capstone team compiled, researched, and confirmed a database of known AOE funds, which the client published both on ImpactAlpha and the TF website. The team created investor-specific materials on the financing needs of these AOEs, related to employee stock ownership plans, employee ownership trusts, and worker cooperatives (both conversion and startup). Building on the database of known AOE funds, the team developed four in-depth guides aimed at demystifying the funding structures of the identified AOEs.