CASE STUDY

Cambridge, MA

General Obligation Bonds, 2017 Series A (Minibond Program)

Bond buyer medal
2017 Deal of the Year Winner, Most Innovative Non-Traditional Financing

In February 2017, Cambridge, Massachusetts pioneered the beginning of something truly revolutionary – offering online tradable bonds directly to its constituents.

Bonds have been publicly available for individuals to invest in for 200 years, but over the past few decades the number of households directly investing in municipal bonds has declined due to minimum investment requirements that make them less financially accessible and a lack of access to municipal bonds.

Cambridge decided to take a fresh approach by using Neighborly’s platform to enable a wide range of community members to invest in its bond issuance and engage directly in shaping the future of the city.

Issuance details

Cambridge plans to use the $2 million in proceeds as part of its larger capital plan to:

Renovate school buildings
Upgrade the energy efficiency of municipal facilities
Update city parks
Implement the City’s Complete Streets plan
Cambridge, MA issuance in the news

Cambridge to offer minibonds to small investors


- Boston Globe, January 2017
Connecting to customers

Multi-channel community marketing and engagement.

Neighborly and the City Manager’s office worked together to connect with Cambridge residents, leveraging Neighborly’s multi-channel marketing expertise and the City Manager’s local expertise. The engagement campaign ranged from sophisticated digital platforms, such as social media, search marketing and email, to high-visibility physical marketing assets, such as posters, postcards, door hangers and stickers.

Postcards sent

5,000

Town hall attendees

80+

"We are also creating an opportunity for residents to directly purchase City of Cambridge municipal bonds for the first time…this will not only engage residents, but will make them a financial partner in our infrastructure improvements."*

Louis A. DePasquale, City Manager, Cambridge, MA
Source: 2017 State of the City Address

Increasing market participation
A summary of Cambridge bond orders.
In the first two weeks of the issuance process, more than 500 Cambridge residents applied for Neighborly brokerage accounts. The issuance sold out in less than three business days to more than 230 Cambridge residents.
Individual signups
581
Total number of orders
248+
Democratizing access

Percentage of orders by zip code

Investing in community.

From East Cambridge to Porter Square, Neighbors invested their money back into their community. Community engagement spanned generations, from graduate students to retirees.

Over a third of investors were investing in municipal bonds for the first time. Order sizes were limited to $20K and restricted to the five zip codes of Cambridge. More than half of the bond orders were less than $5k each. In the traditional bond market, these investors would have been locked out, unable to meet the typical minimum denomination threshold.

*Testimonials are no guarantee of future performance or success and may not be representative of the experience of other customers. These are not paid testimonials.

This material is provided solely as a matter of possible interest. The information provided is not intended to be and should not be construed as "advice" under Section 15B of the Securities Exchange Act of 1934 or the municipal advisory rules of the SEC and MSRB. Neighborly Corporation, a Delaware corporation and its wholly-owned broker-dealer Neighborly Securities("Neighborly"), is acting for its own account. Neighborly is not a municipal advisor, financial advisor or agent and has no advisory, agency, or fiduciary duty to any person pursuant to Section 15B of the Securities Exchange Act of 1934 or Section 975 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Securities are offered through Neighborly Securities, member FINRA, SIPC and registered with the MSRB. Learn more at https://neighborly.com/terms

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