[robocat]

People start businesses because they want to make money. Co-ops and charities are usually set up for other purposes, and have other constraints.

People also start businesses because that is the simpler default that you will be pushed towards: by your clients, your accountant, your suppliers, your lawyers, your mother, your bank, and most everybody else.

> The roadblocks to worker-owned co-ops taking off are money and capital.

That cliché just doesn’t apply much to many professionals, because the biggest expense is salaries. Watch a new business form, and professionals can often afford to self-finance during the initial period. A few professions need to rent, but say lawyers and some doctors have cheap chambers and clinics to service the market for individuals starting out.

And lawyers and accountants do form a type of co-op: they call them partnerships.

There are a huge number of self-funded software startups because so long as founders can pay their bills, they can afford their salary. Most self-funding software startups could just as easily be formed as co-ops, yet they are not. The reason is not because they are forced to become a business because they need capital. Note I am talking about self-funded startups - funded startups are obviously different.

Finally, co-ops are fundamentally unfair to the founders. Starting a business costs a lot more than money, and businesses are how we try to fairly repay that.

And the #1 reason why co-ops don’t exist? Because people have seen them and they don’t want to join them.

[robocat]

> Finally, co-ops are fundamentally unfair to the founders. Starting a business costs a lot more than money, and businesses are how we try to fairly repay that.

Here’s a fantastic article about this point: https://www.startups.com/library/expert-advice/emotional-cos...

Also a quote from https://michaelafreemanmd.com/Research_files/Are%20Entrepren... about startup founders:

  Who in their right mind would choose to be an entrepreneur? The barriers to success are virtually unlimited and most startups fail as a result. Entrepreneurs have lower initial earnings, lower earnings growth, lower long-term earnings [32], greater work stress, and more psychosomatic health problems than employees [33]. Why would anyone voluntarily accept the longer work hours, fewer weekends and holidays, more responsibility, chronic uncertainty, greater personal risk and struggle, and greater investment of emotional and physical resources required to be an entrepreneur instead of the security and long-term rewards of having a career[34]?

Although some of it is selection bias versus cause: the paper seems to suggest many founders are literally mad before they start a business.

[jasode]

>That cliché just doesn’t apply much to many professionals, because the biggest expense is salaries.

The context of my reply was this thread's article: IBM laying off a middle-manager employee like MaryKathryn Doheny.

There isn't a co-op of "middle managers" charging an hourly rate. I previously explained that a "freelancers consultants co-op" doesn't apply to her situation: https://news.ycombinator.com/item?id=35930165

>And lawyers and accountants do form a type of co-op: they call them partnerships.

No, the professional partnerships like law firms are not "100% workers' owned co-ops" that people are thinking of as I've explained before: https://news.ycombinator.com/item?id=31459215

>Most self-funding software startups could just as easily be formed as co-ops, yet they are not. The reason is not because they are forced to become a business because they need capital. [...] And the #1 reason why co-ops don’t exist? Because people have seen them and they don’t want to join them.

Your chain of reasons is overcomplicating things and doesn't answer the mystery for the workers who already know what a co-op is and want one. On the other hand, I'm explaining that the workers who already bought into the concept of co-ops -- are not the ones creating new companies as co-ops. Why can't those pro-coop workers "Be The Change They Want To See" , as the proverb advises and create those co-ops?!? Because they have no money.

[robocat]

> Because they have no money.

My point is that money is not the reason co-ops are not created - it is just the clichéd reason.

Pick an industry where money is not the issue, such as self-funded software startups, and co-ops don’t usually form. QED: needing money is not the reason. There must be other dominating reasons why co-ops are not formed - I have suggested what could be the reasons but I don’t know I have hit the central reasons.

Even with capital, you could structure a business to have co-op like features through share-classes or loans or structured contracts, i.e. even if you need money you could still form an equivalent of a co-op. That rarely happens. QED: needing money is not the reason.

> law firms are not "100% workers' owned co-ops

Obviously. My usage of “type of” was too subtle? But also co-ops are not ‘100% workers’ as per https://news.ycombinator.com/item?id=31460457 simply because co-ops can employ people that are not members, directly, or indirectly.

Finally, look at historical large co-ops and large societies: again and again we see members sell-out and the organisation become a business (at least that is my experience in New Zealand). They have enough capital, so the reason for deciding against a membership ownership structure isn’t because they lack capital. QED: needing money is not the reason.

It feels like déjà vu making such an obvious argument: why do you cling so tightly to your beliefs about capital?

Perhaps our governments cover most of the purpose for a co-op: many countries have 40% to 60% GDP devoted to government (including the USA) and large amounts of that are infrastructure, social welfare, and shared services for every member (citizen).

I want to add one last perhaps-irrelevant quote talking about the VC ecosystem (most severely capitalist):

  one very real truth: the most talented, value-additive people in any industry are virtually never in it just for the money

- https://siliconhillslawyer.com/2018/11/09/dont-be-an-asshole...

[jasode]

>Pick an industry where money is not the issue, such as self-funded software startups, and co-ops don’t form.

Because the owner/founder of the self-funded software company doesn't want to dilute their ownership with workers. Owning 100% of a self-funded startup and just hire employees with 0% ownership is seen as a bigger financial reward from the owner's perspective. The employees get a salary and the owners get the excess profits. This thinking of how to split the pie is rooted in money.

There may be some minor employee-ownership benefits such as ESOP (employee stock option plan) for retirement plans or ISO (incentive stock options) but the core reasons for co-ops not being popular is still based on money. Co-ops are not just arbitrary administrative slicing of a corporation; it is about dividing the economic pie a different way that benefits some at the expense of others. The founders of new companies must be willing to give up significant and meaningful ownership percentage to potential employees who have no leverage to fulfill the vision of a workers-owned co-op. Most founders won't do it because of money.

A bunch of lawyers and farmers forming "professional co-ops" are not relevant to this discussion that got triggered by an IBM middle-manager getting laid off because she wasn't a part-owner of a co-op.

[robocat]

I am arguing that the need for capital is not the primary reason co-ops don’t form.

You are talking about something else (I am not actually sure what you are trying to say - you appear to be agreeing with me).

I also gave you two other independent reasons (see QEDs) to fortify my primary argument: I did not give you a three legged chair where you could knock one leg out.