The Solution

The following pages lays out a general structure for worker cooperatives, though the technical details of implementing certain aspects of that structure still need to be worked out. This section present a template of options available to worker cooperatives. Not all of them will be applicable to each cooperative. Coops will need to choose which features are beneficial in their specific case.

The main emphasis is making the worker cooperative model a more desirable choice for startups by not penalizing the founding members. The current structure is intrinsically unfair to the founders. While what is fair is harder to say and can only be determined by discussion and mutual agreement, the structure of what a fair solution would look like can be laid out clearly. This will require a reexamination and perhaps rewriting of the cooperative principles. Closely related to the issue of fairness are mechanisms that will provide a natural incentive for membership growth.

A second goals is to create a structure that facilitates larger more capital intensive businesses. This can be done by making the worker coop financial structure more robust. It will involve deleveraging the member owners and again reexamining the cooperative values regarding profits and labor. The proposed solution removes once class of time horizon problem.

The interesting part of any theory is how it fares in practice. While the general structure of the solution is presented here, a number of technical solutions needed for implementation can only be discovers with trial and error. A lot of experimentation will be needed to see what works in the current environment.  This will require active coop participants willing to take risks to pioneer a new structure, with potentially sizable benefits.