Chapter three — the build
A model built from existing New Zealand law. A pilot, then a system.
Translates the global precedent into NZ legal machinery. Then opens to Join In.
This is the missing financial layer underneath the advocacy work already being done. Not a replacement for IMVA or the policy conversations in progress, but the structural mechanism that makes those conversations land somewhere permanent.
Section 01
What we're building and why
The Neck of the Woods community raised over $157k in under a week from 3,035 supporters, with an average donation of about $52. This structure is what captures that energy before the next crisis, not after it. The crowdfunder that saved the venue was an extraordinary act of community solidarity. It was also, in structural terms, a workaround for the absence of a better system. The money cleared debts and bought time. It did not change the underlying conditions: the landlord relationship, the bar take dependency, the absence of patient capital, the lack of ownership security.
The Venue Project proposes to make backing places like Neck of the Woods a structural choice, not an emergency response.
Owner Jonah Merchant acknowledged this directly: the venue needs to move toward "more sustainable models of operation not so tied to bar takes," and the process of working that out will involve genuine community consultation about what the next version of Neck of the Woods looks like. NYMPHO's ATARANGI, who watched the fundraiser unfold from Melbourne, put what's at stake plainly: "It's about protecting the spaces that let creativity, connection and new talent grow. If we want the next generation of artists to have the same opportunities we've had, places like Neck of the Woods are worth backing."
Section 02
Where IMVA fits, and where this fits
None of this starts from zero. The Venue Project is one piece of a broader movement. The PropCo, OpCo and National Fund structure described below is the financial and ownership layer, sitting beneath the advocacy work IMVA is already doing and the policy reforms pushing through Parliament. Different work, same outcome.
IMVA is a national, member-led organisation representing grassroots venues across the country, the evolution of the Save Our Venues campaign that began during Covid. IMVA's statement during the Neck of the Woods crisis was explicit: "We cannot rely on crisis fundraising to sustain the infrastructure that supports live music in Aotearoa. The effort to save venues like Neck of the Woods must be part of a broader movement."
A ticket levy requires a policy campaign. Community ownership requires a legal structure and capital. Sustainable operations require a business model. All three need to happen, and they are not in competition with each other.
Section 03
Three parts, not one
The mistake most "save the venue" efforts make is treating it as one problem needing one entity. It isn't. There are three different jobs, and trying to make one organisation do all three is why these things collapse under their own complexity.
- PropCo — holds the building and protects its cultural use, permanently.
- OpCo — runs the venue day to day, with crew, promoters, musicians and community as owners.
- The National Fund — sits above individual venues, redistributing industry contributions.
Section 04
PropCo — the property trust
A charitable trust under the Charitable Trusts Act 1957, registered with Charities Services. Its sole purpose: acquiring freeholds (or long leaseholds) of at-risk grassroots cultural venues and holding them permanently for community benefit.
- Charitable status unlocks grants, lower borrowing costs, and tax treatment a commercial property company can't access.
- Bricks only. PropCo never runs a bar or sells a ticket. It owns buildings and collects rent. Nothing else.
- Cultural covenant. Every title is legally bound to remain a live music or cultural venue, permanently.
- Funded by philanthropic grants, patient impact loans, and PledgeMe equity crowdfunding.
Why charitable status matters. It unlocks doors a commercial property company simply cannot walk through: philanthropic grants, ring-fenced government cultural-infrastructure funding, potential income tax exemption on rental income, and standing with the Lottery Grants Board, community trusts and philanthropic foundations. "Advancement of culture and the arts for the benefit of the community" is an accepted charitable purpose in Aotearoa, already recognised for the arts trusts that receive Creative NZ funding.
Critical design choice. The moment a charity starts running a commercial hospitality operation as its main activity, Charities Services and IRD start asking hard questions. Keep PropCo boring and purely about bricks, that risk disappears.
The cultural covenant. If the operating venue closes, the asset doesn't get sold to the highest bidder, it gets re-leased to a new community operator. Once a building is inside PropCo, it can survive any number of operator failures underneath it without ever reverting to ordinary commercial property.
The capital playbook. PledgeMe is FMA-licensed for up to $2M in 12 months. Food Connect Shed raised $2.1M through PledgeMe for exactly this kind of building acquisition. PledgeMe's equity crowdfunding is built around company shares, so the trust will likely need a small co-operative or charitable company subsidiary to hold the crowdfunded capital and pass it up. A lawyer will know the cleanest way to wire that.
Section 05
OpCo — the cooperative venue company
New Zealand has its own purpose-built cooperative structure: the Co-operative Companies Act 1996. Same legal machinery underneath Fonterra, Silver Fern Farms and Farmlands — just never applied to a live music venue.
Five seats around the wheel
- Crew members. Sound techs, bar, production, door. Modest sweat-equity buy-in.
- Creative members. Musicians, DJs, promoters who programme and use the space.
- Community investors. Open to anyone via PledgeMe — one member, one vote.
- Founding / anchor members. Distinct class for a defined transition period — sunsets over time.
- Supplier members. Local breweries and suppliers turning a cost line into a partner.
Cross-class voting, patronage rebates, and the three-way profit split.
Crew supply labour. Community investors and patrons purchase tickets, drinks and memberships. Both are "transacting shareholders" under the Act. A cooperative company can pay rebates of surplus back to those shareholders, patronage, not passive dividends.
Governance. A board with reserved seats across the classes, not a free-for-all election where the largest capital base wins. A working model: two crew/creative seats, two community investor seats, one founding or independent seat. Any structural decision (a capital raise, a change to the cultural covenant trigger, a wind-up) requires support across more than one class. That cross-class requirement is what actually prevents capture.
How the money flows. Trading profit, after fair wages, reserves and rent to PropCo, splits three ways: a capital reserve so a single bad month doesn't threaten the lease; a small artist development fund for emerging acts and shared equipment; and a patronage rebate distributed to active crew and creative members based on participation, paid for showing up, not for owning capital. Community investor members get a modest, capped return.
Section 06
The National Fund
A charitable trust or incorporated society sitting above individual venues. Its job: collect contributions from the profitable end of live entertainment and redistribute to grassroots venues and PropCo acquisitions.
Start voluntary, not mandatory. Massey modelling sets the opening reference point: $4.8M a year at $1 flat, or $13.4M at a French-style 3.5%.
The UK's approach is the template: a small per-ticket contribution from arena and stadium shows, framed as industry self-investment in its own pipeline rather than a tax.
- Capital grants & low-interest loans to PropCo. Up-front capital that turns at-risk buildings into permanently protected cultural infrastructure.
- Direct operating grants to OpCos in distress. Targeted bridging support when a venue is structurally sound but cashflow-stressed.
- A small advocacy and legal function. Reusable governance documents, so each venue isn't reinventing the wheel.
Section 07
The legal toolkit
None of this is exotic. Every piece already exists and already has a working NZ precedent — a dairy or meat cooperative for the OpCo structure, an arts or land-holding trust for PropCo, Food Connect Shed for the crowdfunding route. The innovation isn't inventing new legal machinery. It's combining four existing, proven tools around one purpose for the first time.
| Entity | NZ legal vehicle | Core purpose |
|---|---|---|
| PropCo | Charitable Trust (Charitable Trusts Act 1957) | Owns freeholds, holds the cultural covenant |
| OpCo | Co-operative Company (Co-operative Companies Act 1996) | Runs the venue, multi-class membership, patronage rebates |
| Capital raise | Equity crowdfunding via PledgeMe (FMC Act 2013) | Up to $2M in 12 months without a full prospectus |
| National Fund | Charitable Trust or Incorporated Society (2022 Act) | Collects industry contributions, redistributes as grants & loans |
Section 08
What a pilot looks like
One venue, one city, proof of concept, then a national model. The pilot does not need to be Neck of the Woods. It could be any venue in Auckland, Wellington, Christchurch or regional Aotearoa where the conditions are right: an operator who wants cooperative structure, a community with enough density to support a share offer, and a property situation where freehold acquisition or long-term lease security is achievable. The point is to demonstrate the model works before it is scaled. The UK did it from £50 per investor.
- 01
Phase one — foundations
Engage a lawyer with charities and cooperative company experience. Draft the PropCo trust deed and cultural covenant. Draft the OpCo constitution with membership classes baked in from day one.
- 02
Phase two — pilot
One venue. Not a national rollout. Ideally one already in distress where closure is the alternative anyway.
- 03
Phase three — capital
PledgeMe raise for PropCo's first acquisition. Simultaneously open the voluntary levy conversation with Live Nation NZ, TEG and the Promoters Association — Massey numbers as the opening reference.
- 04
Phase four — replicate
A second and third venue in different cities. Prove this is national cultural infrastructure, not an Auckland or K Road specific fix.
Section 09
Open questions
- One venue or a small portfolio from day one? A single venue is faster to prove but more fragile. Two venues is slower to set up but far more resilient as a proof of concept.
- Sweat equity vs cash for crew & creative members? A small nominal cash component, even $50–$100, makes the legal mechanics cleaner without pricing anyone out.
- Voluntary levy first, or build the legislative case in parallel? Treat voluntary as phase one of a two-phase strategy from the outset — not as the permanent end state.
This is a structural blueprint, not legal advice. Every piece needs proper sign-off from a New Zealand lawyer experienced in charities, cooperative companies and financial markets law before anything gets registered or any capital gets raised.