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So the main problem that co-ops have is that they don’t have access to traditional forms of capital. You can’t get VC funding as you can’t give out equity, obvi
by vertex-four 9y ago
So the main problem that co-ops have is that they don’t have access to traditional forms of capital. You can’t get VC funding as you can’t give out equity, obviously, and banks won’t lend to you. The co-ops that I’ve seen in recent years have been started on Kickstarter funding based on support for e.g. pop-up stalls that the co-ops ran in early days, and that only goes so far and only works for certain types of companies.
- skookumchuck 9y agoNot being able to buy or sell equity sounds like a crippling problem for coops. One coop cannot even invest in another coop.
- vertex-four 9y agoI'm not sure why it's a crippling problem. (Most SMEs outside the tech industry do not sell equity to raise funds, and the general point of a co-op tends to be to provide a living for its workers, not to take over the world.) The crippling problem is that nobody will lend to you even where traditional businesses could borrow.