Fantastic read, thanks for making the ominous market slightly less opaque. Am curious how often co-ops get big enough to be competing for investor money that would otherwise be going to trad firms?
First, I don't think co-ops need to be big to compete for investor money. Small firms get money all the time (see: angels; VCs). As far as, "how often do co-ops get funded?" I'm honestly not sure. My guess is that Mondragon co-ops have no problem getting funding. I also imagine a lot of small firms---especially VCs---are often co-ops by default. A three-person team getting funding for a tech project will often have an equal, or near-equal, equity split. The problem is that they morph into the standard-issue management-owned firms, likely due to a mix of investor preference, founder preference, and founder indifference, depending on the case. So I think a lot of the story here would have to do with forming a new ideological hegemony (Gramsci).
Perhaps the challenge is spreading awareness about something counter-intuitive being true, like the fact that workers/customers/profits may tend to prefer co-ops? REI may only qualify in the loosest sense, but I did just get to vote for a board member and I have no clue what's going on over there, yet it makes me willing to shell out those REI prices for the good guys.
Totally... one issue is that "co-op" can mean so many different things. REI is a consumer co-op, which (famously) doesn't align with their workers' incentives. Still, a worker-owned version of REI may not be competitive (REI started as a consumer co-op because people who wanted things could buy them in bulk - that advantage may dissipate if workers alone make the rules, as workers are incented to extract margin on products sold). Then you get into a two-sided co-op... where different owners have different incentives! This happens in co-ops like Akash (https://akash.network/), where there are server providers (who want prices high) and server users (who want prices low). Tricky! FWIW, DAO DAO is meant, in part, to help people be more experimental in co-op design: https://www.else.how/p/what-and-why-is-dao-dao
This exploration of co-ops truly is thought provoking, in the case of Akash or other two+ sided co-ops, the governance variables start to pile up fast (thinking internal competition, how to distribute voting power, maintaining common goals..) Not that the trickiness can't be managed, but maybe a co-op is a fragile/brittle thing depending on trust and thriving on simple shared goals. Plenty to percolate on, thank you for the dialogue!
Totally - almost all stable co-ops involve people meeting physically to raise their hands... but, so did all enterprises before the advent of the modern corporation. If tools could make co-ops as scaleable as corporations, how cool would that be?
Fantastic read, thanks for making the ominous market slightly less opaque. Am curious how often co-ops get big enough to be competing for investor money that would otherwise be going to trad firms?
First, I don't think co-ops need to be big to compete for investor money. Small firms get money all the time (see: angels; VCs). As far as, "how often do co-ops get funded?" I'm honestly not sure. My guess is that Mondragon co-ops have no problem getting funding. I also imagine a lot of small firms---especially VCs---are often co-ops by default. A three-person team getting funding for a tech project will often have an equal, or near-equal, equity split. The problem is that they morph into the standard-issue management-owned firms, likely due to a mix of investor preference, founder preference, and founder indifference, depending on the case. So I think a lot of the story here would have to do with forming a new ideological hegemony (Gramsci).
Perhaps the challenge is spreading awareness about something counter-intuitive being true, like the fact that workers/customers/profits may tend to prefer co-ops? REI may only qualify in the loosest sense, but I did just get to vote for a board member and I have no clue what's going on over there, yet it makes me willing to shell out those REI prices for the good guys.
Totally... one issue is that "co-op" can mean so many different things. REI is a consumer co-op, which (famously) doesn't align with their workers' incentives. Still, a worker-owned version of REI may not be competitive (REI started as a consumer co-op because people who wanted things could buy them in bulk - that advantage may dissipate if workers alone make the rules, as workers are incented to extract margin on products sold). Then you get into a two-sided co-op... where different owners have different incentives! This happens in co-ops like Akash (https://akash.network/), where there are server providers (who want prices high) and server users (who want prices low). Tricky! FWIW, DAO DAO is meant, in part, to help people be more experimental in co-op design: https://www.else.how/p/what-and-why-is-dao-dao
This exploration of co-ops truly is thought provoking, in the case of Akash or other two+ sided co-ops, the governance variables start to pile up fast (thinking internal competition, how to distribute voting power, maintaining common goals..) Not that the trickiness can't be managed, but maybe a co-op is a fragile/brittle thing depending on trust and thriving on simple shared goals. Plenty to percolate on, thank you for the dialogue!
Totally - almost all stable co-ops involve people meeting physically to raise their hands... but, so did all enterprises before the advent of the modern corporation. If tools could make co-ops as scaleable as corporations, how cool would that be?
Thought-provoking and clear, as always.