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> Cooperatives are a much better wealth producing arrangement Why is that? > but they don't make a few people very rich. I don't think I understand what this

> Cooperatives are a much better wealth producing arrangement Why is that? > but they don't make a few people very rich. I don't think I understand what this means either. Care to explain your comment? Genuinely curious.

Konnstann 7y ago
With Coops, the company is owned collectively by the workers, as opposed to overwhelmingly by the founders and investors, which results in automatic profit-sharing and distributing success relatively equally amongst the people who created it. This is contrary to a traditional startup where the top few people get obscene amounts of money, and the lower level employees get little, if any, apart from their salary.
- zozbot234 7y ago
  Co-op arrangements are only feasible for low-capital-intensity enterprises - of the sort that's sometimes ridiculed as a "lifestyle business". The moment your startup takes any external equity funding, you've basically gone beyond the "stuff that's feasible in a co-op" territory. Yes, you could self-fund organically, and maybe being a co-op opens up some more opportunities there, but it's still quite hard. No one takes external funding because they like giving up control.
  - steveklabnik 7y ago
    Mondragon is, in my understanding, in some pretty capital intensive businesses. That said they’re a huge outlier as far as I know. But it can be done.
    - severine 7y ago
      From https://www.mondragon-corporation.com/en/about-us/governance/organization/ https://www.mondragon-corporation.com/en/about-us/governance... As a co-operative enterprise, in organisational terms MONDRAGON is divided into four areas: Finance, Industry, Retail and Knowledge, which operate independently within the framework of an overall strategy, all in line with the strategic policies established at the Co-operative Congress. As far as the different areas are concerned, Finance includes banking, social welfare and insurance activities. Industry is grouped into twelve industrial divisions engaged in the production of goods and services. Retail brings together the retail and food and agriculture co-operatives and businesses. And the Knowledge area includes the network of MONDRAGON technology centres and R&D units, our university, Mondragon Unibertsitatea, as well as a number of vocational training and education centres. Co-operative bodies General Assembly. this is the supreme body in the co-operative and is the vehicle for expressing the social will of all members. Governing Council. the representative and governing body of the co-operative. Members are elected at the General Assembly. Social Council. a consultative body, which represents members as a whole internally within the co-operative. Monitoring Commission. a consultative body whose purpose is to pass judgement on correct compliance with accounting principles and any other areas which require consideration. Management Council. this is the managerial and executive team that comprises the manager and managerial members, and is responsible for the executive management of the co-operative. MONDRAGON bodies Co-operative Congress: its function is to establish the strategic criteria by which MONDRAGON is to be administered via the planning and co-ordination of its business units. It is made up of 650 members who are delegated by the co-operatives, and it meets on an annual basis. Divisions: these are associations set up within the framework of MONDRAGON between co-operatives operating in the same area, which coordinate the management of their co-operatives. Standing Committee: governed by delegation from the Co-operative Congress. Its basic function is to promote and control the implementing of policies and decisions adopted by the Congress, by monitoring the evolution of MONDRAGON on a permanent basis. General Council: it is responsible for drawing up and applying corporate strategies and objectives. It coordinates the policies pursued by the different Divisions and Co-operatives. Industrial Council: it is the co-ordinating body for the Industry area’s Divisions.
  - vincent-toups 7y ago
    A cool idea would be to increase taxes on the very wealthy and on non-cooperatively owned businesses and use that largess to fund and tax-incentivize cooperatively owned businesses.
    - zozbot234 7y ago
      Increasing taxes on the very wealthy would make the problem worse, by making people a lot less willing to invest for long-term projects of all sorts. "The very wealthy" are doing that pretty much by definition - "wealth" is just money that's being kept around as an asset and invested for a return, instead of being spent for final consumption.
  - snowwrestler 7y ago
    Co-ops can theoretically access capital through debt, which does not require trading equity for cash. This is how republican governments like the U.S. (which are cooperative enterprises) finance capital-intensive projects, for example. That said, debt financing is typically harder and scarier than equity for start-ups.
vincent-toups 7y ago
Others have adequately given the short form. Check out this book: https://nathanschneider.info/books/everything-for-everyone/ https://nathanschneider.info/books/everything-for-everyone/

Konnstann 7y ago

With Coops, the company is owned collectively by the workers, as opposed to overwhelmingly by the founders and investors, which results in automatic profit-sharing and distributing success relatively equally amongst the people who created it. This is contrary to a traditional startup where the top few people get obscene amounts of money, and the lower level employees get little, if any, apart from their salary.

zozbot234 7y ago
Co-op arrangements are only feasible for low-capital-intensity enterprises - of the sort that's sometimes ridiculed as a "lifestyle business". The moment your startup takes any external equity funding, you've basically gone beyond the "stuff that's feasible in a co-op" territory. Yes, you could self-fund organically, and maybe being a co-op opens up some more opportunities there, but it's still quite hard. No one takes external funding because they like giving up control.
- steveklabnik 7y ago
  Mondragon is, in my understanding, in some pretty capital intensive businesses. That said they’re a huge outlier as far as I know. But it can be done.
  - severine 7y ago
    From https://www.mondragon-corporation.com/en/about-us/governance/organization/ https://www.mondragon-corporation.com/en/about-us/governance... As a co-operative enterprise, in organisational terms MONDRAGON is divided into four areas: Finance, Industry, Retail and Knowledge, which operate independently within the framework of an overall strategy, all in line with the strategic policies established at the Co-operative Congress. As far as the different areas are concerned, Finance includes banking, social welfare and insurance activities. Industry is grouped into twelve industrial divisions engaged in the production of goods and services. Retail brings together the retail and food and agriculture co-operatives and businesses. And the Knowledge area includes the network of MONDRAGON technology centres and R&D units, our university, Mondragon Unibertsitatea, as well as a number of vocational training and education centres. Co-operative bodies General Assembly. this is the supreme body in the co-operative and is the vehicle for expressing the social will of all members. Governing Council. the representative and governing body of the co-operative. Members are elected at the General Assembly. Social Council. a consultative body, which represents members as a whole internally within the co-operative. Monitoring Commission. a consultative body whose purpose is to pass judgement on correct compliance with accounting principles and any other areas which require consideration. Management Council. this is the managerial and executive team that comprises the manager and managerial members, and is responsible for the executive management of the co-operative. MONDRAGON bodies Co-operative Congress: its function is to establish the strategic criteria by which MONDRAGON is to be administered via the planning and co-ordination of its business units. It is made up of 650 members who are delegated by the co-operatives, and it meets on an annual basis. Divisions: these are associations set up within the framework of MONDRAGON between co-operatives operating in the same area, which coordinate the management of their co-operatives. Standing Committee: governed by delegation from the Co-operative Congress. Its basic function is to promote and control the implementing of policies and decisions adopted by the Congress, by monitoring the evolution of MONDRAGON on a permanent basis. General Council: it is responsible for drawing up and applying corporate strategies and objectives. It coordinates the policies pursued by the different Divisions and Co-operatives. Industrial Council: it is the co-ordinating body for the Industry area’s Divisions.
- vincent-toups 7y ago
  A cool idea would be to increase taxes on the very wealthy and on non-cooperatively owned businesses and use that largess to fund and tax-incentivize cooperatively owned businesses.
  - zozbot234 7y ago
    Increasing taxes on the very wealthy would make the problem worse, by making people a lot less willing to invest for long-term projects of all sorts. "The very wealthy" are doing that pretty much by definition - "wealth" is just money that's being kept around as an asset and invested for a return, instead of being spent for final consumption.
- snowwrestler 7y ago
  Co-ops can theoretically access capital through debt, which does not require trading equity for cash. This is how republican governments like the U.S. (which are cooperative enterprises) finance capital-intensive projects, for example. That said, debt financing is typically harder and scarier than equity for start-ups.

vincent-toups 7y ago

Others have adequately given the short form. Check out this book: https://nathanschneider.info/books/everything-for-everyone/ https://nathanschneider.info/books/everything-for-everyone/