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What are some success stories of coops? I’m thinking United , REI , Winco. I’m curious why aren’t there more and why they generally have mediocre success if no

What are some success stories of coops? I’m thinking United , REI , Winco. I’m curious why aren’t there more and why they generally have mediocre success if not failure

TOGoS 2y ago
Don't forget https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation! (which happens to be featured somewhat prominently in Kim Stanley Robinson novel 'The Ministry For The Future', which I am currently working my way through, and recommend for anyone who (a) likes coops and (b) is feeling overwhelmed by humanity's current situation)
bombcar 2y ago
Coops are basically geared toward mediocre success - because there's really no pressure to risk aiming for amazing/startup-style success. Ownership structure doesn't change many of the business risks, but coops can avoid the "expand or die" that sometimes normal companies experience. The largest coops are mutuals (think: insurance) and banks (think: credit union). Others exist in farmer's coops (Land o' Lakes, Dairy Farmers of America, etc). https://ncbaclusa.coop/blog/2022-world-cooperative-monitor-ranking-largest-cooperatives-now-available/ https://ncbaclusa.coop/blog/2022-world-cooperative-monitor-r... The hardest part is converting an existing corporation into a coop. The vast majority of coops are, like credit unions, relatively small and local. Instead of expanding to new areas, they often "split" into new areas, so you'd expect them to remain just below the noise threshold of the large multinationals.
- kbxogdgkdhop 2y ago
  the phrase you're looking for to describe "mediocre success" is "sustainable business". expand or die is a bullshit concept employed by those more concerned with a quick buck than creating something lasting
  - bombcar 2y ago
    Exactly - it's like the startup vs "lifestyle business" (we have to keep making terms for what just used to be "business") discussion. The sad part is when something on the startup track fails as a startup but is a perfectly workable "lifestyle" business; but it can't switch tracks and instead plows along until destroyed.
- ForTheKidz 2y ago
  > Coops are basically geared toward mediocre success - because there's really no pressure to risk aiming for amazing/startup-style success. I'm just straight-up offended at this. Co-ops are the job most people want. What you refer to as "amazing success" is dismantling our society and the people who run them appear to struggle to empathize with other humans. Granted, i'm sure coops can be equally antisocial and misanthropic. But growth surely isn't what we want to be optimizing for.
  - tonymet 2y ago
    are there any examples?
    - ForTheKidz 2y ago
      Enshittification is the most obvious one—we should be nationalizing efficient processes at the point they fail to yield further productivity gains. I don't really have much energy to argue with true believers today, so all I'll say is "read schumpeter dammit". For an industry allegedly founded by the dude I haven't met a single person working with VCs who's actually read the man. He would not consider today's America to have a healthy economy.
      - tonymet 2y ago
        this doesn't sound like an example, more of a complaint
        ForTheKidz 2y ago
        You didn't bother to articulate what particular claim you wanted an example on. I can't read minds, and you're wasting my time.
        tonymet 2y ago
        > " Co-ops are the job most people want." -- what are some examples?
- surgical_fire 2y ago
  > Coops are basically geared toward mediocre success There's something deeply wrong with a society that can label moderate success as "mediocre". I wish society gave more incentives to healthy, moderately successful, profitable companies instead of "growth and greed at all costs" success. Or, as you put it, "amazing/startup-style success". Fuck that noise.
andbberger 2y ago
REI is not a worker coop they just cosplay as one.
- tonymet 2y ago
  can you explain more to an outsider? i've been a lifelong member and they were very active in their COOP image in all the member comms
  - dv_dt 2y ago
    When you talk about coops, there is a distinction between a consumer coop and a worker coop. A consumer coop is generally where consumers band together to get better prices on consuming some product or group of products. A worker coop is where workers have ownership and make business decisions together. There are actually other coops too - e.g. farming coops are generally capital equipment sharing arrangements - think sharing ownership of the processing center for some crop. (Also ESOP worker coops - but I would say they generally are very weak on workers making significant decisions). REI is a consumer coop. At least some of their employees are actually unionized. https://www.motherjones.com/politics/2022/02/rei-coop-union-busting/ https://www.motherjones.com/politics/2022/02/rei-coop-union-...
    - tonymet 2y ago
      this is a helpful way of looking at it. so it sounds like REI employees are not seeing any dividends?
      - dv_dt 2y ago
        The REI workers are basically employees of a retail company that happens to be a coop. The coop part is for shopper/consumer members of people who buy things at REI.
        tonymet 2y ago
        i see thanks for explaining. i wish they were a bit more clear about that upfront. i had assumed the workers received some of the dividends as well, given their personal investment in the firm.
jawns 2y ago
US economic policy is not very favorable to co-ops. Cooperatives face complex tax structures that can be less advantageous compared to traditional corporations. Unlike C-corporations, which have clear tax advantages and deductions, cooperatives must navigate unique tax rules, such as Subchapter T of the IRS code, which governs patronage refunds. The tax code heavily favors investor-owned firms through incentives such as lower capital gains taxes and deductions for stock-based compensation, which cooperatives do not benefit from in the same way. Beyond that, banks and financial institutions are often hesitant to lend to cooperatives, as their ownership structure does not provide the same level of collateral or control as investor-owned firms. Government-backed loans and grants that support small businesses often don't adequately accommodate cooperatives. For instance, SBA loan programs historically have been difficult for cooperatives to access. And because co-ops are a niche business structure, many federal and state laws are designed with traditional corporate structures in mind, making it difficult for cooperatives to navigate compliance requirements. Cooperative incorporation laws vary by state, leading to inconsistent legal protections and administrative burdens.
- vvpan 2y ago
  I have been extremely excited about cooperatives and doing research but good info is scattered (suggestions welcome!). From what I learned I will echo what you said - laws are stacked against cooperatives. In general the corporation, a structure that is centuries old, gets preferential treatment in all situations. It is like human development has been abolished in that domain in the 1800s and that is the status quo.
  - dv_dt 2y ago
    If you go into history of some nations, e.g. in some regions of Italy, coops go much farther back than the 1800s (the modern form comes about in the 1800s though) and there is an ecosystem of coops to develop and be supported by gov't and each other. In the US though the support legal, financial, and common understanding is much less mature.
- karaterobot 2y ago
  I've been a part of several coops that fizzled out, and in none of these cases was tax law the culprit. Taxes and regulations suck, but I think there are deeper causes for the rarity of success in ventures like this, which are so appealing, and so often attempted. I don't know what they are, but I'd bet that some of the major causes are psychological and logistical in nature!
mharig 2y ago
[dead]
klooney 2y ago
REI is a purchaser coop, not an employee coop.
pabs3 2y ago
Igalia is a pretty successful open source tech consultancy coop. https://www.igalia.com/ https://www.igalia.com/

What are some success stories of coops? I’m thinking United , REI , Winco. I’m curious why aren’t there more and why they generally have mediocre success if not failure

TOGoS 2y ago

Don't forget https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation! (which happens to be featured somewhat prominently in Kim Stanley Robinson novel 'The Ministry For The Future', which I am currently working my way through, and recommend for anyone who (a) likes coops and (b) is feeling overwhelmed by humanity's current situation)

bombcar 2y ago

Coops are basically geared toward mediocre success - because there's really no pressure to risk aiming for amazing/startup-style success. Ownership structure doesn't change many of the business risks, but coops can avoid the "expand or die" that sometimes normal companies experience. The largest coops are mutuals (think: insurance) and banks (think: credit union). Others exist in farmer's coops (Land o' Lakes, Dairy Farmers of America, etc). https://ncbaclusa.coop/blog/2022-world-cooperative-monitor-ranking-largest-cooperatives-now-available/ https://ncbaclusa.coop/blog/2022-world-cooperative-monitor-r... The hardest part is converting an existing corporation into a coop. The vast majority of coops are, like credit unions, relatively small and local. Instead of expanding to new areas, they often "split" into new areas, so you'd expect them to remain just below the noise threshold of the large multinationals.

kbxogdgkdhop 2y ago
the phrase you're looking for to describe "mediocre success" is "sustainable business". expand or die is a bullshit concept employed by those more concerned with a quick buck than creating something lasting
- bombcar 2y ago
  Exactly - it's like the startup vs "lifestyle business" (we have to keep making terms for what just used to be "business") discussion. The sad part is when something on the startup track fails as a startup but is a perfectly workable "lifestyle" business; but it can't switch tracks and instead plows along until destroyed.
ForTheKidz 2y ago
> Coops are basically geared toward mediocre success - because there's really no pressure to risk aiming for amazing/startup-style success. I'm just straight-up offended at this. Co-ops are the job most people want. What you refer to as "amazing success" is dismantling our society and the people who run them appear to struggle to empathize with other humans. Granted, i'm sure coops can be equally antisocial and misanthropic. But growth surely isn't what we want to be optimizing for.
- tonymet 2y ago
  are there any examples?
  - ForTheKidz 2y ago
    Enshittification is the most obvious one—we should be nationalizing efficient processes at the point they fail to yield further productivity gains. I don't really have much energy to argue with true believers today, so all I'll say is "read schumpeter dammit". For an industry allegedly founded by the dude I haven't met a single person working with VCs who's actually read the man. He would not consider today's America to have a healthy economy.
    - tonymet 2y ago
      this doesn't sound like an example, more of a complaint
      - ForTheKidz 2y ago
        You didn't bother to articulate what particular claim you wanted an example on. I can't read minds, and you're wasting my time.
        tonymet 2y ago
        > " Co-ops are the job most people want." -- what are some examples?
surgical_fire 2y ago
> Coops are basically geared toward mediocre success There's something deeply wrong with a society that can label moderate success as "mediocre". I wish society gave more incentives to healthy, moderately successful, profitable companies instead of "growth and greed at all costs" success. Or, as you put it, "amazing/startup-style success". Fuck that noise.

andbberger 2y ago

REI is not a worker coop they just cosplay as one.

tonymet 2y ago
can you explain more to an outsider? i've been a lifelong member and they were very active in their COOP image in all the member comms
- dv_dt 2y ago
  When you talk about coops, there is a distinction between a consumer coop and a worker coop. A consumer coop is generally where consumers band together to get better prices on consuming some product or group of products. A worker coop is where workers have ownership and make business decisions together. There are actually other coops too - e.g. farming coops are generally capital equipment sharing arrangements - think sharing ownership of the processing center for some crop. (Also ESOP worker coops - but I would say they generally are very weak on workers making significant decisions). REI is a consumer coop. At least some of their employees are actually unionized. https://www.motherjones.com/politics/2022/02/rei-coop-union-busting/ https://www.motherjones.com/politics/2022/02/rei-coop-union-...
  - tonymet 2y ago
    this is a helpful way of looking at it. so it sounds like REI employees are not seeing any dividends?
    - dv_dt 2y ago
      The REI workers are basically employees of a retail company that happens to be a coop. The coop part is for shopper/consumer members of people who buy things at REI.
      - tonymet 2y ago
        i see thanks for explaining. i wish they were a bit more clear about that upfront. i had assumed the workers received some of the dividends as well, given their personal investment in the firm.

jawns 2y ago

US economic policy is not very favorable to co-ops. Cooperatives face complex tax structures that can be less advantageous compared to traditional corporations. Unlike C-corporations, which have clear tax advantages and deductions, cooperatives must navigate unique tax rules, such as Subchapter T of the IRS code, which governs patronage refunds. The tax code heavily favors investor-owned firms through incentives such as lower capital gains taxes and deductions for stock-based compensation, which cooperatives do not benefit from in the same way. Beyond that, banks and financial institutions are often hesitant to lend to cooperatives, as their ownership structure does not provide the same level of collateral or control as investor-owned firms. Government-backed loans and grants that support small businesses often don't adequately accommodate cooperatives. For instance, SBA loan programs historically have been difficult for cooperatives to access. And because co-ops are a niche business structure, many federal and state laws are designed with traditional corporate structures in mind, making it difficult for cooperatives to navigate compliance requirements. Cooperative incorporation laws vary by state, leading to inconsistent legal protections and administrative burdens.

vvpan 2y ago
I have been extremely excited about cooperatives and doing research but good info is scattered (suggestions welcome!). From what I learned I will echo what you said - laws are stacked against cooperatives. In general the corporation, a structure that is centuries old, gets preferential treatment in all situations. It is like human development has been abolished in that domain in the 1800s and that is the status quo.
- dv_dt 2y ago
  If you go into history of some nations, e.g. in some regions of Italy, coops go much farther back than the 1800s (the modern form comes about in the 1800s though) and there is an ecosystem of coops to develop and be supported by gov't and each other. In the US though the support legal, financial, and common understanding is much less mature.
karaterobot 2y ago
I've been a part of several coops that fizzled out, and in none of these cases was tax law the culprit. Taxes and regulations suck, but I think there are deeper causes for the rarity of success in ventures like this, which are so appealing, and so often attempted. I don't know what they are, but I'd bet that some of the major causes are psychological and logistical in nature!

mharig 2y ago

[dead]

klooney 2y ago

REI is a purchaser coop, not an employee coop.

pabs3 2y ago

Igalia is a pretty successful open source tech consultancy coop. https://www.igalia.com/ https://www.igalia.com/