r/cooperatives Apr 10 '15

/r/cooperatives FAQ

111 Upvotes

This post aims to answer a few of the initial questions first-time visitors might have about cooperatives. It will eventually become a sticky post in this sub. Moderator /u/yochaigal and subscriber /u/criticalyeast put it together and we invite your feedback!

What is a Co-op?

A cooperative (co-op) is a democratic business or organization equally owned and controlled by a group of people. Whether the members are the customers, employees, or residents, they have an equal say in what the business does and a share in the profits.

As businesses driven by values not just profit, co-operatives share internationally agreed principles.

Understanding Co-ops

Since co-ops are so flexible, there are many types. These include worker, consumer, food, housing, or hybrid co-ops. Credit unions are cooperative financial institutions. There is no one right way to do a co-op. There are big co-ops with thousands of members and small ones with only a few. Co-ops exist in every industry and geographic area, bringing tremendous value to people and communities around the world.

Forming a Co-op

Any business or organizational entity can be made into a co-op. Start-up businesses and successful existing organizations alike can become cooperatives.

Forming a cooperative requires business skills. Cooperatives are unique and require special attention. They require formal decision-making mechanisms, unique financial instruments, and specific legal knowledge. Be sure to obtain as much assistance as possible in planning your business, including financial, legal, and administrative advice.

Regional, national, and international organizations exist to facilitate forming a cooperative. See the sidebar for links to groups in your area.

Worker Co-op FAQ

How long have worker co-ops been around?

Roughly, how many worker co-ops are there?

  • This varies by nation, and an exact count is difficult. Some statistics conflate ESOPs with co-ops, and others combine worker co-ops with consumer and agricultural co-ops. The largest (Mondragon, in Spain) has 86,000 employees, the vast majority of which are worker-owners. I understand there are some 400 worker-owned co-ops in the US.

What kinds of worker co-ops are there, and what industries do they operate in?

  • Every kind imaginable! Cleaning, bicycle repair, taxi, web design... etc.

How does a worker co-op distribute profits?

  • This varies; many co-ops use a form of patronage, where a surplus is divided amongst the workers depending on how many hours worked/wage. There is no single answer.

What are the rights and responsibilities of membership in a worker co-op?

  • Workers must shoulder the responsibilities of being an owner; this can mean many late nights and stressful days. It also means having an active participation and strong work ethic are essential to making a co-op successful.

What are some ways of raising capital for worker co-ops?

  • Although there are regional organization that cater to co-ops, most worker co-ops are not so fortunate to have such resources. Many seek traditional credit lines & loans. Others rely on a “buy-in” to create starting capital.

How does decision making work in a worker co-op?

  • Typically agendas/proposals are made public as early as possible to encourage suggestions and input from the workforce. Meetings are then regularly scheduled and where all employees are given an opportunity to voice concerns, vote on changes to the business, etc. This is not a one-size-fits-all model. Some vote based on pure majority, others by consensus/modified consensus.

r/cooperatives 27d ago

Monthly /r/Cooperatives beginner question thread

11 Upvotes

This thread is part of an attempt by the moderators to create a series of monthly repeating posts to help aggregate certain kinds of content into single threads.

If you have any basic questions about Cooperatives, feel free to ask them here. Please also remember to visit this thread even if you consider yourself a cooperative veteran so that you can help others!

Note that this thread will be posted on the first and will run throughout the month.


r/cooperatives 6h ago

consumer co-ops From dream to reality: Go-op, Britain’s first cooperative railway

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18 Upvotes

r/cooperatives 4h ago

New podcast on a Data Cooperative

2 Upvotes

r/cooperatives 3d ago

Co-op rideshare business! Lets support it

47 Upvotes

Super cool to see! I dislike using rideshare because it seems so worker extractive. This one seems like a good model. Lets support it!!

https://znetwork.org/znetarticle/a-national-rideshare-cooperative-takes-aim-at-uber-and-lyft/


r/cooperatives 3d ago

Workers buying out their company

42 Upvotes

I was wondering how much precedent (if any) there was for workers forming a coop and collectively buying out the company they work for?

Not to say this would necessarily be a better way to go about things than any other method, but it seemed like an interesting alternative to traditional unionization. Unions are cool, but ownership seems an even better goal, and coops can get startup capital, which would (in a way) sidestep some of the struggles of opposition.

Was just wondering if there was much precedent for people actually doing this.


r/cooperatives 3d ago

worker co-ops A National Rideshare Cooperative Takes Aim At Uber and Lyft

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58 Upvotes

r/cooperatives 4d ago

How to expand a co-op?

24 Upvotes

Hi! About to start a small bookshop with my partner - it's all our own savings, and we're the only workers in the business. We would like to follow a co-op model, but I'm not sure how to go about expanding it outwards when the time comes? We are likely not going to make a wage for the first short while, and while our costs are super low, we are still putting the money up front from our own accounts. A bit pre-emptive, but if the shop goes well and we need more hands/generally if there's interest, I'm just not sure how we will go about expanding and recruiting other cooperative members while also keeping it fair, given the amount of money initially put in/are paying off?


r/cooperatives 5d ago

Cooperative road trip recommendations?

15 Upvotes

Hey everyone,

I'm a cooperative organizer & entrepreneur living in the great state of Rhode Island, USA.

I'm planning to drive out to Arizona this winter, mostly for personal life reasons. But since I'm making the trek, I figure this could be a great opportunity to investigate how people are building so-called "solidarity economy" all across the country.

While we're still working out the details, I intend to take a meandering Southern route.

a commonplace co-op road trip: the route, february/march 2025

South down the Atlantic coast (Hartford CT, NY NY, Philly, Baltimore, DC etc), then west to Ohio (planned stop in Cincinatti), then south through Jackson MS and New Orleans LA before again heading West along the I-10 corridor Phoenix.

I'm a creative-type with some media chops, so I intend to pack audio/video equipment among other essentials for the drive. My intention is to document the trip, and—when I have the opportunity—to in particular shine a light on people and organizations doing interesting work to create more democratic, particatory, and sustainable local economies.

"big spring," my 1998 ford e-150 camper van.

I already have some contacts within the worker co-op network across the country. I'd love to meet folks from other cooperative sectors as well—2025 is the "Year of Cooperatives," so seems a great time to explore those parallels.

I'm also interested in other values-aligned projects like "Libraries of Things," right-to-repair, environmental movements, carceral justice, etc, but co-ops are a real passion of mine (and that's what this sub is for) so I'm here to ask:

What places have the most interesting co-op scenes?

Where are you cooperating from, and what's your co-op community like?

Who or what should I visit?

Who or what would you want to see profiled through photography, videography, and/or interview?

cooperators milling about at 09.2024's national worker co-op conference in Chicago

Thanks in advance for your ideas and advice!

PS - Recommendations on the prescribed route are most helpful, but I invite discussion of other places as well! If this trip goes well and I can figure out the money, I'd love to do more "co-op road trips" in the future. Plus I hope this thread's discussion can be useful to more than just me.


r/cooperatives 6d ago

A Data Cooperative

8 Upvotes

"What if Google was a Data Cooperative?" Benefitting you, the customer, instead of just shareholders.

Imagine: Your data, your profit. Revenue shared with you.

📖 Learn how we, as customers, can own our own tech giant. 👉 https://link.theempoweredcustomer.com/reddit


r/cooperatives 8d ago

worker co-ops Worker owned cooperative resources?

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27 Upvotes

r/cooperatives 9d ago

How to start a Coop (or any business) without going into debt.

18 Upvotes

For those of you who don't know, Dave Ramsey is a media personality, multimillionaire, and conservative capitalist with a presence on Youtube and several other platforms. While he seems like one of the last people who would give advice on how to start and run a cooperative, one of his videos from about a year ago actually helps deal with one of the biggest hurdles that starting a cooperative can face: obtaining financing. Specifically, Ramsey advises eschewing all debt when it comes to starting even some of the most capital intensive industries:

TLDW: Rasmey basically describes two strategies for businesses, in this case an agribusiness, on how they can start with capital requirements:

  1. Start as small as possible as cheaply as possible. Use the proceeds from doing so to slowly but surely expand and upgrade capital over a period of several years starting from the position that requires the least amount of initial overhead.

  2. Do a short-term lease or a lease with an option to buy arrangement. Leasing is basically another term for renting, and like residential renting it can be a lower-cost, lower-risk type of endeavor in the short run.

I'm surprised by how many types of even traditionally capital-intensive businesses can be started without debt, especially given that startup costs can be borne by several key individuals in the case of a coop.

Can You Run a Capital-Intensive Business Debt-Free?


r/cooperatives 9d ago

Online credit union that caters to cooperative businesses? (In the US)

15 Upvotes

Hey all, a group of us are in process of launching an agricultural marketing co-op and looking for banking services. The credit unions in our area (Louisiana) don't seem to have much awareness of or interest in cooperative businesses or the solidarity economy. Anyone know of a credit union that offers online banking services, and which is at least a little co-op centric in terms of its customer base and level of awareness?

(I just heard a podcast on the collaborative farming podcast where they talked about Vancouver City Credit Union. Looking for a similar option within the U.S.)

Thanks in advance for any suggestions or tips!


r/cooperatives 11d ago

I think some markets could convert soon with low resistance.

27 Upvotes

I didn't know what to title this but I think platforms like BetterHelp, DoorDash, Lyft, and Uber should immediately transfer to a cooperative model. In my head it would be easy, but that's just in my head. I think BetterHelp as a co-op would be revolutionary, but maybe that's just idealistic also.


r/cooperatives 11d ago

Pros and cons of a cooperative business

13 Upvotes

what are the pros and cons of a restaurant owned by a cooperative, and if there’s any cons, how will i come up with a solution. Thanks


r/cooperatives 12d ago

consumer co-ops A radical yet practical approach for coopifiying existing corporations.

54 Upvotes

I propose a not-for-profit private equity firm, who performs leveraged buy outs and converts acquired companies into co-ops. This nonprofit would employ lawyers and executives experienced in setting up and operating co-ops, and networking between different co-ops, especially those in it's network.

The nonprofit gives equity to a trust, and consumers are offered a one off or reoccurring membership fee for discounts and voting rights. If it is a one off fee, it may be payed off over multiple payments if the fee is high, possibly financed by the nonprofit. These membership fees are used to pay off the debt and members are able to vote on key decisions and executive hires.

After 5-10 years, once the initial investment of the nonprofit is reimbursed (a small portion of the total acquisition price), the nonprofit private equity firm leaves the co-op to operate independently, as part of it's network of co-ops.

The main problem with this approach is that it leaves the company being converted with alot of debt, which must ultimately be paid off by the consumers, as the consumers are essentially buying the company.

This hypothetical firm would start small, then grow as it becomes more experienced and has access to more capital.


r/cooperatives 14d ago

Legal Status of Member/Owners of Consumer Coops

12 Upvotes

There has been a movement in Washington State for Consumer Coops to insulate coop boards from member interference. From my research I cannot find a a body of case law for coops in general that create precedents for any implicit standing of Members to assert their power over coop boards.

Does anyone know of any legal cases where a Board made it difficult of impossible for coop members to unseat the board or to make it impossible for member to assert influence by fielding insurgent board candidates?

This is especially relevant to REI as there a members who are attempting to become board candidates, but they can only be allowed to be candidates for the board if the Board Nomination and Governance Committee allows them to run.

I would think that there have been cases in the history of cooperatives where there have been conflicts of this kind. I cannot find any cases of this kind and attorneys I have spoken with know of no precedents either way.


r/cooperatives 14d ago

The Commons Economy Reloaded

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12 Upvotes

r/cooperatives 14d ago

Sources of Permanent Capital for Cooperatives

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8 Upvotes

r/cooperatives 14d ago

A Life in Co-ops: Interview with Kate "Sassy" Sassoon

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7 Upvotes

r/cooperatives 16d ago

Could There Be A Society Where The Only Form of Business Allowed Is A Cooperative?

108 Upvotes

I was just wondering what would a society look like if only cooperative businesses were allowed? Would it be better off economically? Could it compete with capitalistic societies and behemoth capitalistic companies? Do you think people in such a society would be more active in government and social policies?

Also, why doesn't a country like China have a purely cooperative model of businesses?


r/cooperatives 17d ago

Do co-op hospitals exist?

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210 Upvotes

r/cooperatives 17d ago

worker co-ops UK: Can a community cooperative run a railway?

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25 Upvotes

r/cooperatives 21d ago

Health insurance cooperatives as a potential solution in the USA

111 Upvotes

There's actually a big history of consumer owned businesses providing health insurance - you don't see them as much, because most of the developed world has just adopted variations on public health care systems. Goes all the way back to 19th century mutual aid societies.

I don't see the US getting public healthcare anytime in the immediate future - funny, because if Trump has a 'populist' agenda, you'd think that would be the first thing on his list. Consumer owned cooperatives are basically non-profit companies that run at cost - the 'profits' they make just go towards lower prices or better services. So they don't have the profit motive driving them to deny claims.

So in many ways consumer co-ops are similar to having the government provide healthcare - they aren't driven by the profit motive in the same way as private insurance firms. To get public healthcare, you have to win elections, then have politicians actually change the system. Health insurance cooperatives, you just have to start them and have them be successful businesses. Only one part of the larger equation, but it seems like a good here and now solution...?


r/cooperatives 22d ago

worker co-ops The humanizing power of worker-owned cooperatives

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71 Upvotes

r/cooperatives 22d ago

Advice of expanding our cooperative

19 Upvotes

Hey everyone,

I am on the board of a co-op, and over the last 10 years, we have acquired four private companies that were our suppliers to diversify and keep money within the co-op. For some reason, the previous board did not want to add them as members. Now, we are looking to open membership to them because it is the right thing to do.

Currently, we have three distinct service-based industries, and we are looking to acquire more local companies. We want to spread the co-op movement locally. We believe that doing so will increase our profit margin, membership, and member loyalty/pride.

Our goal is to double our revenue and have close to 100 members in the next five years.

Do you have any advice on growth and cooperatives? Will it be hard to integrate these new members into the cooperative movement?


r/cooperatives 22d ago

Have any of you ever attended Mondragon University? How Good was it?

14 Upvotes