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A document to help you start a tech cooperative

294 points by morisy 9y ago

jacquesm 9y ago
From one of the annotations: > I'm fundamentally opposed to making people buy their way into the company, it feels like a scam to me. You don't have to demonstrate your value "to" the company -- we each as individuals hold far more value than this taxable structure that can be dissolved when it no longer benefits the members. Also, whatever value a person has is being brought by their skills, thinking, and experience, not by cash. You aren't creative with cash. I strongly disagree with this. People who have 'skin in the game' are much more likely to perform well than people for who joining up is a freebie and it's a lot easier to take someone on board than it is to remove them again if they don't work out in a collective like this. In fact, they might demand to be bought out and before you know it you're in court even though your 'collective rules' were made on the assumption that everybody would always be nice and play nice. This would also allow them to reduce the candidacy period to something more reasonable, now you are essentially asked to give up a year of your life on the gamble you will be accepted. Better to put down some money then, which you can recover if and when you leave, hopefully with a bonus because the company has appreciated in value. Also: people change over time. I've seen this in practice in one of my own companies, the people who actually put money down for their shares were all hard workers and super dependable, the people that got their shares 'for free' (or in some cases with money borrowed from the company) were a lot less likely to work hard and were the first to run off when there was a speedbump (which we weathered). On another note: I'm investing in a company that is a strange cross between a traditional company and a cooperative like this. It's been running for the better part of 10 years now, it's also a consultancy business and it's one of the most interesting companies that I've ever dealt with. The CEO is a very inspiring young man who manages to make all the employees of the company stakeholders, who has made it possible to account for project based income to be fairly distributed amongst the employees and who is now in the process of streamlining all this so the idea can be applied to other companies. I really should do a write-up on that company and their story one of these days, it's been fascinating to see this idea take root and flourish over the years.
- josephg 9y ago
  Wouldn't this effect be much stronger in a worker-owned cooperative? Having an equal 20% stake seems much more motivating to me than the 0.4% that you might get as an early employee of a traditional tech startup, even if the shares diminish after you leave.
  - jacquesm 9y ago
    It's pretty normal for co-founders to have equal (large) stakes. If there are 8 co-founders (such as in this case, which is a very large number but fine) then each could have 12.5%. 20% would be impossible. And that's pretty much what any 'traditional' (as in bootstrapped) company would do, and its working capital would be the initial buy-in. That way the company can open a bank account before the first customer pays and has a way to rent and office and get an internet connection. Later, after operating the company for 5 or 10 years the value of the brand would be reflected in the value of the company (or goodwill, if you wish). This is actually fairly common with architects, dentist collectives and legal offices where partners are brought in over the years and rotate back out again when they reach their pensionable age. This collective the way it is described here is just a way for a bunch of individual to operate under a common brand without assigning any value whatsoever to their creations other than the money flowing through the company, the company is deemed to be worthless (which they may very well be right about at the founding date, but which I would be surprised would still be the case after a decade with a nice fat portfolio of customers and a steady stream of income). And then someone wants to retire and suddenly that lack of 'buy-in' from the next partner looks like a major stumbling block. So this is a fairly idealistic document without much in terms of future proofing as far as I can see.
  - Kalium 9y ago
    By this logic, worker-owned cooperatives can and should be expected to out-perform traditionally structured businesses. Do I interpret correctly? If that's true, then why do you think traditionally structured businesses generally out-perform cooperatives? People have tried.
    - 9y ago
bpchaps 9y ago
I'd be very interested if something like this could work well to complement the existing "civic tech" field. It has some pretty substantial problems in its current form and a movement towards co-ops looks pretty damn appealing. Anyone know if any civic tech co-ops exist? Or would folks be willing to start some up? ;)
- thistle 9y ago
  We do a lot of civic tech work re election monitoring software: sassafras.coop
amingilani 9y ago
I mean absolutely no offense by this, but the logo has an uncanny resemblance to DickButt. Maybe change the logo? Or, not, if it's not a problem. I don't know what I would do if I were in your position and someone pointed this out to me.
- Mz 9y ago
  Some brands do that on purpose. I remember a paint stripper product called EZ Stripper where all the commercials had some very busty woman in a very tight T-shirt with EZ Stripper emblazoned across her boobs. Sex sells and all that.
- wingerlang 9y ago
  For what it's worth, I disagree. I can't even see it even if I try. Is it because they both have a "round" top part? It is quite clearly a stylised human head.
- tomcam 9y ago
  Says a lot more about you than the logo
  - amingilani 9y ago
    Shoot the messenger, why don't you.
_delirium 9y ago
It's fairly normal among workers' cooperatives to assign equity to people in proportion to how much work they currently put into the company. This is the basic premise, not some kind of new innovation. If you object, may I humbly recommend considering the alternate diagnosis, that it is you who is a parasite leeching off the workers?
- jacquesm 9y ago
  That must be why this cooperative reserves the right to hire others to do their work and making a profit on that, and requires a year of 'apprenticeship' after which the current cooperative members will decide your fate. After all, some workers are more equal than others. Or did you in your haste to put in a veiled insult skip that bit of TFA?
  - _delirium 9y ago
    Was the comment veiled? That was not the intent, my apologies if it was perceived that way. ;-)
- sctb 9y ago
  This veers into the realm of personal attacks—please don't do this here. We detached this flagged subthread from https://news.ycombinator.com/item?id=14135706 https://news.ycombinator.com/item?id=14135706.
scaredtotalk1 9y ago
As interesting as this idea is, there isn't something under this most people would call a serious cooperative. Feel Train a 2 employee wife-husband mom and pop that does random contract work. They moved to Portland a couple years ago. Amazingly in that short time, they already have a well established reputation of hostile and abusive behavior towards people in the Portland tech community that don't share their extremist political views. I've heard no less than 3 accounts from people documenting their generally hostile, harassing and abusive behavior. These aren't "the other side" political people telling me this, they're warm, friendly, moderate, generally apolitical people. I'm hearing this in passing, so I wouldn't be surprised if there were even more incidents I havent heard about. Portland tech used to be a uniquely wonderful, well knit community, but it's gotten a lot more toxic over the last few years. The result has been a lot of people leaving out of both disgust of the politics and genuine fear that they will be singled out for a political witch hunt. These two exemplify the absolute worst of it.
marricks 9y ago
Back in 19th century USA, during industrialization, the idea of working for someone came across to many as a form of wage-slavery. Going from farming or trade-skills to factories working, one gave up any control in their own worker rights and planning of their business. It seems fundamentally unfair that in most industries you don't have any real share of the company, or any say in the direction of it. People who control those companies are solely executives or wall street share holders, not the people who spend countless hours making the company run and function, thinking about it for even a moment reveals how messed up our system is. Things have only gotten worse recently too with the decline of unions, workers rarely even get a say in their own rights, wages, or working conditions! In short, sharing information like this is great, I'm all for more co-ops!
- hn_throwaway_99 9y ago
  I have a close family member who is a doctor, and I've always said how envious I am of her company's structure. All new doctors that come in are on partnership track, and it only takes two years to make partner (but there is a buy-in period). It is a large practice with over 80 doctors, and the practice is wholly owned by the doctors (it also employs a large number of technicians and support staff). Being in a situation where you're both "the boss" and "the worker" is rare these days, but it can be incredibly satisfying.
  - closeparen 9y ago
    True, but medical practices are not quite in the egalitarian spirit of co-ops. The physician's assistants, nurses, billing staff, typing pool (yes dictaphones are still a thing), IT staff, equipment repair contractors, and cleaning crew don't tend to also be owners.
- Alex3917 9y ago
  > People who control those companies are solely executives or wall street share holders, not the people who spend countless hours making the company run and function As an entrepreneur, it's actually pretty difficult to find folks who prefer getting compensated primarily in shares rather than cash. If you want to have significant ownership in a company that usually isn't much of a challenge.
RunawayGalaxy 9y ago
If you somehow automated organization and payment through blockchain contracts and had a way to describe requirements by code, I think it would be killer.
- jacquesm 9y ago
  These guys are doing something along those lines: https://ico.iconomi.net/login https://ico.iconomi.net/login
- Animats 9y ago
  That worked out great for Etherium and the DAO.
  - gmt2027 9y ago
    In pursuing radical new ideas, costly failures are inevitable. This is hardly reason to quit and never try again.
ryanmarsh 9y ago
Is a co-op really best for tech work? If so why? Don't studies show that when there's a profit motive creative people perform more poorly than when they're just paid enough to make money not a distraction? I have so many questions seriously. How do decisions get made? What if it's really successful and people get lazy and decide to chill on a boat? So many more... where can I find a great argument explaining the benefits and tradeoffs of starting a tech cooperative?
- nathan_f77 9y ago
  > Don't studies show that when there's a profit motive creative people perform more poorly than when they're just paid enough to make money not a distraction? Whoever did that study, they didn't interview me. I mean, it's true that I care more about doing good work, learning new things, and making an impact. But I can do that on my own, and I've been self-employed for the last few years. The only reason I would join or start a new company is for the money. > How do decisions get made? What if it's really successful and people get lazy and decide to chill on a boat? If I started a coop, that would actually be our goal. I think it's funny that people don't admit this.
  - dahauns 9y ago
    >Whoever did that study, they didn't interview me. More like decades of studies. Read "Drive" by Dan Pink.
    - nathan_f77 9y ago
      That looks like a good recommendation, thankyou. > he asserts that the secret to high performance and satisfaction-at work, at school, and at home—is the deeply human need to direct our own lives, to learn and create new things, and to do better by ourselves and our world. > He examines the three elements of true motivation—autonomy, mastery, and purpose I totally agree with that. I guess I am in the very fortunate position where I feel like I can achieve all of these things without being an employee at a company. I've been freelancing for a few years now (sometimes very part-time), so I feel like I'm "out of the system", and I have no desire to become an employee at a company. I feel like money is the only thing that would make me change my mind (and it would have to be a lot.) I admit that I am using a strange definition of "work". To me, work is something that is boring and difficult. When I am "working" 12 hours per day on my own apps, or if I'm volunteering full-time for a cause that I care about, then I don't consider that to be work. Yes, I know it's still work, but it doesn't feel like it. I suppose if I found the right company, where I have a high degree of autonomy, I had access to a lot of resources, and I can learn and invent things all day, then I would consider that. But in my mind, when I think of "company", I'm picturing "yet another SaaS or mobile app". And so I guess that might be the gist of these studies.
rmason 9y ago
Whether you're planning a worker cooperative or just open to sharing the businesses financials with the workers there's a book you should read, Jack Stack's the great game of business: https://www.amazon.com/Great-Game-Business-Expanded-Updated/dp/0385348339/ref=sr_1_1_twi_pap_1?s=books&ie=UTF8&qid=1492483380&sr=1-1&keywords=jack+stack https://www.amazon.com/Great-Game-Business-Expanded-Updated/... He practices what he preaches and hundreds visit his company every year to see how it works in practice.
ksdale 9y ago
This operating agreement doesn't really differ from a regular LLC agreement except that it does away with members putting capital into the business, which is usually where the entire difference in voting rights comes into play. Minor nitpick with the note about forming in Oregon vs Delaware - Businesses generally pay tax where they do business instead of/in addition to where they are incorporated. The discussion of corporate taxes also isn't particularly relevant to a usual LLC situation where all the income is passed through, and the members will just pay tax where they live. In addition Delaware has a very complete body of business case law that is a major reason businesses choose to incorporate there. It's not generally for dodgy tax reasons. I will definitely concede that a lot of people start business in Delaware when they definitely don't need to because of some magical perceived advantage but there are real benefits for some businesses that don't involve ripping off your home state. I also take slight issue with the note about the business not existing to make a profit for itself. Every business exists for the benefit of the people who own it. Obviously not all businesses are owned by the people who work in it, but nowhere is there a business that exists solely for the purpose of loading up a corporate bank account with no shareholder as the ultimate recipient. The note as it's written points more to the distinction between big C-Corps and every other entity than it does to the distinction between business as it's done today and co-ops. It's basically a justification for self employment rather than a justification for a co-op specifically. Quick edit: I love the spirit this is written in but I feel like it's unnecessarily critical of the way businesses are formed today. In my experience, people who run small businesses think a lot about fairness, and just because that doesn't always manifest itself in all equal everything doesn't mean it's not fair.
- decasia 9y ago
  Some of these points are fair but I want to clarify the co-op idea has less to do with an argument that "all small business owners aren't fair," and more about wanting to get rid of the very distinction between labor, ownership and management. In other words, fair management is one thing; abolishing management as such is something else. Like you point out, "Obviously not all businesses are owned by the people who work in it" -- I think that's the heart of this issue. (That said, in what I've seen of the co-operative movement, there do end up being some sort of specialized managerial people much of the time. So it's far from clearcut on the ground, as you're pointing out.)
BucketSort 9y ago
Excellent topic and resource. A friend and I were discussing this prospect today. What we are thinking of is something of: University + NPO + Business. I think having a cooperative tandemed to some sort of training system is important... for many reasons if anyone is interested in discussing this further. See ELSE[1] for something similar in spirit ( which I just learned about today from a professor that used to run it ), but still quite different. [1]http://www.elseinstitute.org/ http://www.elseinstitute.org/
im3w1l 9y ago
Regarding the bullet point lists in 3.2 and 4.2. They don't explicitly state that whether it's an "and" or an "or" condition list. Is that really safe? Are lists like this by convention assumed to be of the "and" type?
- Gaelan 9y ago
  There is an "and" in the list.
sriharis 9y ago
If someone is interested in doing this in India, here's our LLP agreement: - https://github.com/nilenso/cooperative-agreement https://github.com/nilenso/cooperative-agreement. We've also written and talked about it a bit: - https://blog.nilenso.com/blog/2014/11/19/huh-a-software-cooperative/ https://blog.nilenso.com/blog/2014/11/19/huh-a-software-coop... - https://www.youtube.com/watch?v=b7K3E1Q_MBk https://www.youtube.com/watch?v=b7K3E1Q_MBk
- stefek99 9y ago
  Nice! Added as a reference to our incorporation documents: https://github.com/astralship/astralship.github.io/issues/47 https://github.com/astralship/astralship.github.io/issues/47 Our rules: 1 page max. If something more complicated - create a separate 1 page document.
  - deobald 9y ago
    We would love a rule like that. Unfortunately, Indian LLP (Limited Liability Partnerships -- the only way of creating a technology co-op in India at the moment) Partnership Agreements are easily 6 pages at a bare legal minimum. :)
- wz1000 9y ago
  I checked out your website and I really like what you are doing. I'm a student in India and would love to work with you. I mainly write Haskell and other functional languages like Scheme/Racket and some Clojure.
  - deobald 9y ago
    Super cool. We're primarily looking for senior folks at the moment, but it never hurts to start a conversation. We do contribute to open source projects commercially as well and sometimes we staff newer members of the team on these projects. Give us a shout at careers@nilenso.com
FlyingSnake 9y ago
Has anyone tried this in Germany/EU? What would be the appropriate term for this in the EU/Germany?
- tiatia 9y ago
  The equivalent to a COOP could be many things, depending what you want to do and achieve. I would look into GmbH/AG (inc/LLC), gGmbH (non profit Inc), eingetragener Verein e.V. (not sure there is such a thing in the US), or, most likely, Genossenschaft e.G. https://de.wikipedia.org/wiki/Genossenschaft https://de.wikipedia.org/wiki/Genossenschaft
- rmc 9y ago
  The UK (which is a EU member for the next ~22 months) has co-ops, and basically invented the modern legal co-op.
nathan_f77 9y ago
This is so awesome: https://feeltrain.com/blog/hello-feel-train/ https://feeltrain.com/blog/hello-feel-train/ I've had the same ideas over the last few years, even the hard limit on the number of people. It sounds like they are just doing some paid consulting work and sharing profits. But what I would like to do, is that everyone only works around 10 hours per week on consulting work, and we spend the rest of the time working on our own app or website ideas. Then we could share in all the risk / reward. So it would be like a self-funding startup incubator. And if we came up with a couple of things that were really successful, then everyone could just retire, or at least switch to "maintenance mode" where we only release bugfixes and minor updates. No need to take over the world, I would just love to have a few little apps bringing in some passive income. I guess that's the tricky part though.. what happens if someone wants to leave? Do they keep some shares and continue to share profits, or do they have to give up everything? I couldn't find anything in the linked operating agreement.
- andreareina 9y ago
  They're a consulting shop, so it would be natural to say that people who leave don't share in the future profits. For your idea where considerable income is expected to come from past work, I'd say it makes more sense to have ownership of the app assigned to an ad-hoc company that owns just the app, owned by the people there at the time the app was written. The coöp might take a hand in marketing the app and performing other administrativa, in which case it would collect a fee from each sale. App_1_Co is owned by A, B, C, D and owns App_1. App_2_Co is owned by A, C, E, F and owns App_2. Coöp_Co is owned by C, E, F, G and sells App_1 and App_2 (taking a 10% cut) as well as providing consulting services.
  - bisRepetita 9y ago
    Interesting ideas. One challenge is when App 1 needs an update, F and G doing some of the work. Or when App 1 becomes a building block of App 3.
deleted 9y ago
[deleted]
scandox 9y ago
I met some guys from a Spanish software coop called Igalia and as I understood it they have a kind of apprenticeship/ probation period after which you get voted on as a partner - or in some cases NOT. It was quite a long process but I got the impression that people knew after a reasonable time if things were going in the right direction.
yochaigal 9y ago
I have founded two worker co-ops; both in the tech sector. Whenever one of these posts hits reddit or this website, there is a surge of interest - and then nothing. Our rate of growth (400 or so worker co-ops in the US) is abysmally slow; if anything I've seen more co-ops fold than start anew! Our conferences seem to bring more and more each year, though - just not workers; instead we get specialists, folks from social justice and non-profits... Just very few workers. At the East coast conference two years ago, 75% of the speakers were non-owners, just co-op specialists; do-gooders and SJWs. The only new co-ops I seem to see are those that get created by top-down institutions; non-profits and the like. I'm talking Evergreen, WAGES, etc. Once in a while we get web co-ops (like the one liked here); more often than not, they too have a political bent (beyond worker-ownership). Not sure why I'm saying all this here; I suppose I just wanted to offer a different perspective on all this. I love worker co-ops, and think they should be everywhere. But I'm not sure culture in the US is yet compatible! Checkout http://reddit.com/r/cooperatives http://reddit.com/r/cooperatives it you want to know more.
- morisy 9y ago
  I seriously considered it for my organization a little over a year ago, and while ultimately it wasn't the right fit I think a clear document and explanation of how someone else would do it would have been very useful to think about. I think part of the reason that they haven't succeeded is the necessary capital and scale of technology organizations these days. It seems there's a hollowing out of the mid-tier of bootstrapped organizations where a co-op would be feasible, and if you're a founder who is going to put in years of unpaid or low paid work and funding, giving up ownership is a tough sell.
  - yochaigal 9y ago
    Yeah, this is one of the reasons why it is so important to start as a co-op, rather than convert later.
- woah 9y ago
  Does it offer distinct advantages compared to a regular job (aka employees get paid more)? I've been around a lot of communitarian stuff in my life, like cohousing and hackerspaces, and a lot of it seems to be driven by people who enjoy meetings.
vinceguidry 9y ago
I've tried starting a few companies and it eventually became clear that without significant revenue coming in, the cofounders need to be either particularly motivated by the vision and capable of putting aside personal politics to achieve it, the former being easier to achieve than the latter, immediate personal goals are going to slowly take priority and your startup will die a sad death. Once revenue is there, everybody can buy in. The enterprise does not need to actually be profitable or even have a workable plan to profit or exit or anything like that. What it needs is revenue. Someone has to be the pig that gets the enterprise from zero to revenue. Smart pigs become politically-adroit capitalist "pigs", dumb pigs get slaughtered. But someone has to take the lead, and the rest have to follow. Uniting collectively behind a vision seems to be one of those things humans just can't do very well. They can unite behind a person with a vision, but not the vision by itself. Workers cooperatives were a big thing back in the heady days of the early 1800s. Most died out fairly quickly but a few caught on and lasted for a good while. The story was the same throughout, the cooperative eventually ossified and could not retain the magic in the face of broader economic change.
- dragonwriter 9y ago
  > Workers cooperatives were a big thing back in the heady days of the early 1800s. Most died out fairly quickly but a few caught on and lasted for a good while. The story was the same throughout, the cooperative eventually ossified and could not retain the magic in the face of broader economic change. Ossification and failure to remain vital in the face of changing market conditions is a pervasive problem for businesses that become established, not something special affecting labor coops. OTOH, Mondragon still seems to be going strong.
- ci5er 9y ago
  > Uniting collectively behind a vision seems to be one of those things humans just can't do very well. They can unite behind a person with a vision, but not the vision by itself. That's insightful. Can you speak more about this?
  - vinceguidry 9y ago

294 points by morisy 9y ago

From one of the annotations: > I'm fundamentally opposed to making people buy their way into the company, it feels like a scam to me. You don't have to demonstrate your value "to" the company -- we each as individuals hold far more value than this taxable structure that can be dissolved when it no longer benefits the members. Also, whatever value a person has is being brought by their skills, thinking, and experience, not by cash. You aren't creative with cash. I strongly disagree with this. People who have 'skin in the game' are much more likely to perform well than people for who joining up is a freebie and it's a lot easier to take someone on board than it is to remove them again if they don't work out in a collective like this. In fact, they might demand to be bought out and before you know it you're in court even though your 'collective rules' were made on the assumption that everybody would always be nice and play nice. This would also allow them to reduce the candidacy period to something more reasonable, now you are essentially asked to give up a year of your life on the gamble you will be accepted. Better to put down some money then, which you can recover if and when you leave, hopefully with a bonus because the company has appreciated in value. Also: people change over time. I've seen this in practice in one of my own companies, the people who actually put money down for their shares were all hard workers and super dependable, the people that got their shares 'for free' (or in some cases with money borrowed from the company) were a lot less likely to work hard and were the first to run off when there was a speedbump (which we weathered). On another note: I'm investing in a company that is a strange cross between a traditional company and a cooperative like this. It's been running for the better part of 10 years now, it's also a consultancy business and it's one of the most interesting companies that I've ever dealt with. The CEO is a very inspiring young man who manages to make all the employees of the company stakeholders, who has made it possible to account for project based income to be fairly distributed amongst the employees and who is now in the process of streamlining all this so the idea can be applied to other companies. I really should do a write-up on that company and their story one of these days, it's been fascinating to see this idea take root and flourish over the years.

josephg 9y ago
Wouldn't this effect be much stronger in a worker-owned cooperative? Having an equal 20% stake seems much more motivating to me than the 0.4% that you might get as an early employee of a traditional tech startup, even if the shares diminish after you leave.
- jacquesm 9y ago
  It's pretty normal for co-founders to have equal (large) stakes. If there are 8 co-founders (such as in this case, which is a very large number but fine) then each could have 12.5%. 20% would be impossible. And that's pretty much what any 'traditional' (as in bootstrapped) company would do, and its working capital would be the initial buy-in. That way the company can open a bank account before the first customer pays and has a way to rent and office and get an internet connection. Later, after operating the company for 5 or 10 years the value of the brand would be reflected in the value of the company (or goodwill, if you wish). This is actually fairly common with architects, dentist collectives and legal offices where partners are brought in over the years and rotate back out again when they reach their pensionable age. This collective the way it is described here is just a way for a bunch of individual to operate under a common brand without assigning any value whatsoever to their creations other than the money flowing through the company, the company is deemed to be worthless (which they may very well be right about at the founding date, but which I would be surprised would still be the case after a decade with a nice fat portfolio of customers and a steady stream of income). And then someone wants to retire and suddenly that lack of 'buy-in' from the next partner looks like a major stumbling block. So this is a fairly idealistic document without much in terms of future proofing as far as I can see.
- Kalium 9y ago
  By this logic, worker-owned cooperatives can and should be expected to out-perform traditionally structured businesses. Do I interpret correctly? If that's true, then why do you think traditionally structured businesses generally out-perform cooperatives? People have tried.
  - 9y ago

bpchaps 9y ago

I'd be very interested if something like this could work well to complement the existing "civic tech" field. It has some pretty substantial problems in its current form and a movement towards co-ops looks pretty damn appealing. Anyone know if any civic tech co-ops exist? Or would folks be willing to start some up? ;)

thistle 9y ago
We do a lot of civic tech work re election monitoring software: sassafras.coop

amingilani 9y ago

I mean absolutely no offense by this, but the logo has an uncanny resemblance to DickButt. Maybe change the logo? Or, not, if it's not a problem. I don't know what I would do if I were in your position and someone pointed this out to me.

Mz 9y ago
Some brands do that on purpose. I remember a paint stripper product called EZ Stripper where all the commercials had some very busty woman in a very tight T-shirt with EZ Stripper emblazoned across her boobs. Sex sells and all that.
wingerlang 9y ago
For what it's worth, I disagree. I can't even see it even if I try. Is it because they both have a "round" top part? It is quite clearly a stylised human head.
tomcam 9y ago
Says a lot more about you than the logo
- amingilani 9y ago
  Shoot the messenger, why don't you.

_delirium 9y ago

It's fairly normal among workers' cooperatives to assign equity to people in proportion to how much work they currently put into the company. This is the basic premise, not some kind of new innovation. If you object, may I humbly recommend considering the alternate diagnosis, that it is you who is a parasite leeching off the workers?

jacquesm 9y ago
That must be why this cooperative reserves the right to hire others to do their work and making a profit on that, and requires a year of 'apprenticeship' after which the current cooperative members will decide your fate. After all, some workers are more equal than others. Or did you in your haste to put in a veiled insult skip that bit of TFA?
- _delirium 9y ago
  Was the comment veiled? That was not the intent, my apologies if it was perceived that way. ;-)
sctb 9y ago
This veers into the realm of personal attacks—please don't do this here. We detached this flagged subthread from https://news.ycombinator.com/item?id=14135706 https://news.ycombinator.com/item?id=14135706.

scaredtotalk1 9y ago

As interesting as this idea is, there isn't something under this most people would call a serious cooperative. Feel Train a 2 employee wife-husband mom and pop that does random contract work. They moved to Portland a couple years ago. Amazingly in that short time, they already have a well established reputation of hostile and abusive behavior towards people in the Portland tech community that don't share their extremist political views. I've heard no less than 3 accounts from people documenting their generally hostile, harassing and abusive behavior. These aren't "the other side" political people telling me this, they're warm, friendly, moderate, generally apolitical people. I'm hearing this in passing, so I wouldn't be surprised if there were even more incidents I havent heard about. Portland tech used to be a uniquely wonderful, well knit community, but it's gotten a lot more toxic over the last few years. The result has been a lot of people leaving out of both disgust of the politics and genuine fear that they will be singled out for a political witch hunt. These two exemplify the absolute worst of it.

marricks 9y ago

Back in 19th century USA, during industrialization, the idea of working for someone came across to many as a form of wage-slavery. Going from farming or trade-skills to factories working, one gave up any control in their own worker rights and planning of their business. It seems fundamentally unfair that in most industries you don't have any real share of the company, or any say in the direction of it. People who control those companies are solely executives or wall street share holders, not the people who spend countless hours making the company run and function, thinking about it for even a moment reveals how messed up our system is. Things have only gotten worse recently too with the decline of unions, workers rarely even get a say in their own rights, wages, or working conditions! In short, sharing information like this is great, I'm all for more co-ops!

hn_throwaway_99 9y ago
I have a close family member who is a doctor, and I've always said how envious I am of her company's structure. All new doctors that come in are on partnership track, and it only takes two years to make partner (but there is a buy-in period). It is a large practice with over 80 doctors, and the practice is wholly owned by the doctors (it also employs a large number of technicians and support staff). Being in a situation where you're both "the boss" and "the worker" is rare these days, but it can be incredibly satisfying.
- closeparen 9y ago
  True, but medical practices are not quite in the egalitarian spirit of co-ops. The physician's assistants, nurses, billing staff, typing pool (yes dictaphones are still a thing), IT staff, equipment repair contractors, and cleaning crew don't tend to also be owners.
Alex3917 9y ago
> People who control those companies are solely executives or wall street share holders, not the people who spend countless hours making the company run and function As an entrepreneur, it's actually pretty difficult to find folks who prefer getting compensated primarily in shares rather than cash. If you want to have significant ownership in a company that usually isn't much of a challenge.

RunawayGalaxy 9y ago

If you somehow automated organization and payment through blockchain contracts and had a way to describe requirements by code, I think it would be killer.

jacquesm 9y ago
These guys are doing something along those lines: https://ico.iconomi.net/login https://ico.iconomi.net/login
Animats 9y ago
That worked out great for Etherium and the DAO.
- gmt2027 9y ago
  In pursuing radical new ideas, costly failures are inevitable. This is hardly reason to quit and never try again.

ryanmarsh 9y ago

Is a co-op really best for tech work? If so why? Don't studies show that when there's a profit motive creative people perform more poorly than when they're just paid enough to make money not a distraction? I have so many questions seriously. How do decisions get made? What if it's really successful and people get lazy and decide to chill on a boat? So many more... where can I find a great argument explaining the benefits and tradeoffs of starting a tech cooperative?

nathan_f77 9y ago
> Don't studies show that when there's a profit motive creative people perform more poorly than when they're just paid enough to make money not a distraction? Whoever did that study, they didn't interview me. I mean, it's true that I care more about doing good work, learning new things, and making an impact. But I can do that on my own, and I've been self-employed for the last few years. The only reason I would join or start a new company is for the money. > How do decisions get made? What if it's really successful and people get lazy and decide to chill on a boat? If I started a coop, that would actually be our goal. I think it's funny that people don't admit this.
- dahauns 9y ago
  >Whoever did that study, they didn't interview me. More like decades of studies. Read "Drive" by Dan Pink.
  - nathan_f77 9y ago
    That looks like a good recommendation, thankyou. > he asserts that the secret to high performance and satisfaction-at work, at school, and at home—is the deeply human need to direct our own lives, to learn and create new things, and to do better by ourselves and our world. > He examines the three elements of true motivation—autonomy, mastery, and purpose I totally agree with that. I guess I am in the very fortunate position where I feel like I can achieve all of these things without being an employee at a company. I've been freelancing for a few years now (sometimes very part-time), so I feel like I'm "out of the system", and I have no desire to become an employee at a company. I feel like money is the only thing that would make me change my mind (and it would have to be a lot.) I admit that I am using a strange definition of "work". To me, work is something that is boring and difficult. When I am "working" 12 hours per day on my own apps, or if I'm volunteering full-time for a cause that I care about, then I don't consider that to be work. Yes, I know it's still work, but it doesn't feel like it. I suppose if I found the right company, where I have a high degree of autonomy, I had access to a lot of resources, and I can learn and invent things all day, then I would consider that. But in my mind, when I think of "company", I'm picturing "yet another SaaS or mobile app". And so I guess that might be the gist of these studies.

rmason 9y ago

Whether you're planning a worker cooperative or just open to sharing the businesses financials with the workers there's a book you should read, Jack Stack's the great game of business: https://www.amazon.com/Great-Game-Business-Expanded-Updated/dp/0385348339/ref=sr_1_1_twi_pap_1?s=books&ie=UTF8&qid=1492483380&sr=1-1&keywords=jack+stack https://www.amazon.com/Great-Game-Business-Expanded-Updated/... He practices what he preaches and hundreds visit his company every year to see how it works in practice.

ksdale 9y ago

This operating agreement doesn't really differ from a regular LLC agreement except that it does away with members putting capital into the business, which is usually where the entire difference in voting rights comes into play. Minor nitpick with the note about forming in Oregon vs Delaware - Businesses generally pay tax where they do business instead of/in addition to where they are incorporated. The discussion of corporate taxes also isn't particularly relevant to a usual LLC situation where all the income is passed through, and the members will just pay tax where they live. In addition Delaware has a very complete body of business case law that is a major reason businesses choose to incorporate there. It's not generally for dodgy tax reasons. I will definitely concede that a lot of people start business in Delaware when they definitely don't need to because of some magical perceived advantage but there are real benefits for some businesses that don't involve ripping off your home state. I also take slight issue with the note about the business not existing to make a profit for itself. Every business exists for the benefit of the people who own it. Obviously not all businesses are owned by the people who work in it, but nowhere is there a business that exists solely for the purpose of loading up a corporate bank account with no shareholder as the ultimate recipient. The note as it's written points more to the distinction between big C-Corps and every other entity than it does to the distinction between business as it's done today and co-ops. It's basically a justification for self employment rather than a justification for a co-op specifically. Quick edit: I love the spirit this is written in but I feel like it's unnecessarily critical of the way businesses are formed today. In my experience, people who run small businesses think a lot about fairness, and just because that doesn't always manifest itself in all equal everything doesn't mean it's not fair.

decasia 9y ago
Some of these points are fair but I want to clarify the co-op idea has less to do with an argument that "all small business owners aren't fair," and more about wanting to get rid of the very distinction between labor, ownership and management. In other words, fair management is one thing; abolishing management as such is something else. Like you point out, "Obviously not all businesses are owned by the people who work in it" -- I think that's the heart of this issue. (That said, in what I've seen of the co-operative movement, there do end up being some sort of specialized managerial people much of the time. So it's far from clearcut on the ground, as you're pointing out.)

BucketSort 9y ago

Excellent topic and resource. A friend and I were discussing this prospect today. What we are thinking of is something of: University + NPO + Business. I think having a cooperative tandemed to some sort of training system is important... for many reasons if anyone is interested in discussing this further. See ELSE[1] for something similar in spirit ( which I just learned about today from a professor that used to run it ), but still quite different. [1]http://www.elseinstitute.org/ http://www.elseinstitute.org/

im3w1l 9y ago

Regarding the bullet point lists in 3.2 and 4.2. They don't explicitly state that whether it's an "and" or an "or" condition list. Is that really safe? Are lists like this by convention assumed to be of the "and" type?

Gaelan 9y ago
There is an "and" in the list.

sriharis 9y ago

If someone is interested in doing this in India, here's our LLP agreement: - https://github.com/nilenso/cooperative-agreement https://github.com/nilenso/cooperative-agreement. We've also written and talked about it a bit: - https://blog.nilenso.com/blog/2014/11/19/huh-a-software-cooperative/ https://blog.nilenso.com/blog/2014/11/19/huh-a-software-coop... - https://www.youtube.com/watch?v=b7K3E1Q_MBk https://www.youtube.com/watch?v=b7K3E1Q_MBk

stefek99 9y ago
Nice! Added as a reference to our incorporation documents: https://github.com/astralship/astralship.github.io/issues/47 https://github.com/astralship/astralship.github.io/issues/47 Our rules: 1 page max. If something more complicated - create a separate 1 page document.
- deobald 9y ago
  We would love a rule like that. Unfortunately, Indian LLP (Limited Liability Partnerships -- the only way of creating a technology co-op in India at the moment) Partnership Agreements are easily 6 pages at a bare legal minimum. :)
wz1000 9y ago
I checked out your website and I really like what you are doing. I'm a student in India and would love to work with you. I mainly write Haskell and other functional languages like Scheme/Racket and some Clojure.
- deobald 9y ago
  Super cool. We're primarily looking for senior folks at the moment, but it never hurts to start a conversation. We do contribute to open source projects commercially as well and sometimes we staff newer members of the team on these projects. Give us a shout at careers@nilenso.com

FlyingSnake 9y ago

Has anyone tried this in Germany/EU? What would be the appropriate term for this in the EU/Germany?

tiatia 9y ago
The equivalent to a COOP could be many things, depending what you want to do and achieve. I would look into GmbH/AG (inc/LLC), gGmbH (non profit Inc), eingetragener Verein e.V. (not sure there is such a thing in the US), or, most likely, Genossenschaft e.G. https://de.wikipedia.org/wiki/Genossenschaft https://de.wikipedia.org/wiki/Genossenschaft
rmc 9y ago
The UK (which is a EU member for the next ~22 months) has co-ops, and basically invented the modern legal co-op.

nathan_f77 9y ago

This is so awesome: https://feeltrain.com/blog/hello-feel-train/ https://feeltrain.com/blog/hello-feel-train/ I've had the same ideas over the last few years, even the hard limit on the number of people. It sounds like they are just doing some paid consulting work and sharing profits. But what I would like to do, is that everyone only works around 10 hours per week on consulting work, and we spend the rest of the time working on our own app or website ideas. Then we could share in all the risk / reward. So it would be like a self-funding startup incubator. And if we came up with a couple of things that were really successful, then everyone could just retire, or at least switch to "maintenance mode" where we only release bugfixes and minor updates. No need to take over the world, I would just love to have a few little apps bringing in some passive income. I guess that's the tricky part though.. what happens if someone wants to leave? Do they keep some shares and continue to share profits, or do they have to give up everything? I couldn't find anything in the linked operating agreement.

andreareina 9y ago
They're a consulting shop, so it would be natural to say that people who leave don't share in the future profits. For your idea where considerable income is expected to come from past work, I'd say it makes more sense to have ownership of the app assigned to an ad-hoc company that owns just the app, owned by the people there at the time the app was written. The coöp might take a hand in marketing the app and performing other administrativa, in which case it would collect a fee from each sale. App_1_Co is owned by A, B, C, D and owns App_1. App_2_Co is owned by A, C, E, F and owns App_2. Coöp_Co is owned by C, E, F, G and sells App_1 and App_2 (taking a 10% cut) as well as providing consulting services.
- bisRepetita 9y ago
  Interesting ideas. One challenge is when App 1 needs an update, F and G doing some of the work. Or when App 1 becomes a building block of App 3.

deleted 9y ago

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scandox 9y ago

I met some guys from a Spanish software coop called Igalia and as I understood it they have a kind of apprenticeship/ probation period after which you get voted on as a partner - or in some cases NOT. It was quite a long process but I got the impression that people knew after a reasonable time if things were going in the right direction.

yochaigal 9y ago

I have founded two worker co-ops; both in the tech sector. Whenever one of these posts hits reddit or this website, there is a surge of interest - and then nothing. Our rate of growth (400 or so worker co-ops in the US) is abysmally slow; if anything I've seen more co-ops fold than start anew! Our conferences seem to bring more and more each year, though - just not workers; instead we get specialists, folks from social justice and non-profits... Just very few workers. At the East coast conference two years ago, 75% of the speakers were non-owners, just co-op specialists; do-gooders and SJWs. The only new co-ops I seem to see are those that get created by top-down institutions; non-profits and the like. I'm talking Evergreen, WAGES, etc. Once in a while we get web co-ops (like the one liked here); more often than not, they too have a political bent (beyond worker-ownership). Not sure why I'm saying all this here; I suppose I just wanted to offer a different perspective on all this. I love worker co-ops, and think they should be everywhere. But I'm not sure culture in the US is yet compatible! Checkout http://reddit.com/r/cooperatives http://reddit.com/r/cooperatives it you want to know more.

morisy 9y ago
I seriously considered it for my organization a little over a year ago, and while ultimately it wasn't the right fit I think a clear document and explanation of how someone else would do it would have been very useful to think about. I think part of the reason that they haven't succeeded is the necessary capital and scale of technology organizations these days. It seems there's a hollowing out of the mid-tier of bootstrapped organizations where a co-op would be feasible, and if you're a founder who is going to put in years of unpaid or low paid work and funding, giving up ownership is a tough sell.
- yochaigal 9y ago
  Yeah, this is one of the reasons why it is so important to start as a co-op, rather than convert later.
woah 9y ago
Does it offer distinct advantages compared to a regular job (aka employees get paid more)? I've been around a lot of communitarian stuff in my life, like cohousing and hackerspaces, and a lot of it seems to be driven by people who enjoy meetings.

vinceguidry 9y ago

I've tried starting a few companies and it eventually became clear that without significant revenue coming in, the cofounders need to be either particularly motivated by the vision and capable of putting aside personal politics to achieve it, the former being easier to achieve than the latter, immediate personal goals are going to slowly take priority and your startup will die a sad death. Once revenue is there, everybody can buy in. The enterprise does not need to actually be profitable or even have a workable plan to profit or exit or anything like that. What it needs is revenue. Someone has to be the pig that gets the enterprise from zero to revenue. Smart pigs become politically-adroit capitalist "pigs", dumb pigs get slaughtered. But someone has to take the lead, and the rest have to follow. Uniting collectively behind a vision seems to be one of those things humans just can't do very well. They can unite behind a person with a vision, but not the vision by itself. Workers cooperatives were a big thing back in the heady days of the early 1800s. Most died out fairly quickly but a few caught on and lasted for a good while. The story was the same throughout, the cooperative eventually ossified and could not retain the magic in the face of broader economic change.

dragonwriter 9y ago
> Workers cooperatives were a big thing back in the heady days of the early 1800s. Most died out fairly quickly but a few caught on and lasted for a good while. The story was the same throughout, the cooperative eventually ossified and could not retain the magic in the face of broader economic change. Ossification and failure to remain vital in the face of changing market conditions is a pervasive problem for businesses that become established, not something special affecting labor coops. OTOH, Mondragon still seems to be going strong.
ci5er 9y ago
> Uniting collectively behind a vision seems to be one of those things humans just can't do very well. They can unite behind a person with a vision, but not the vision by itself. That's insightful. Can you speak more about this?
- vinceguidry 9y ago