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Incubating Sustainable

Worker Co-ops

Meche Sansores, Alex Armenta, and Elena Fairley August 14, 2013

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Today’s Speakers

Hosting:

Sam Frank, Synthesis Partnership Assisting with chat questions: Jamie Maloney, 4Good

Alex Armenta Associate Director

WAGES

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Meche Sansores Executive Director

WAGES

Elena Fairley Communications &

Development Associate

WAGES

INCUBATING SUSTAINABLE WORKER-OWNED CO-OPS

Meche Sansores, Executive Director of WAGES

Alex Armenta, Associate Director of WAGES Elena Fairley, Communications and Development Associate at WAGES

August 14, 2013

Women’s Action to Gain Economic Security

Today’s goal

Our goal for this webinar is to answer the following questions: 1. What are the main challenges creating long-lasting opportunities for low-

income women and immigrant communities? 1. How does WAGES’ model of co-op incubation address these challenges? 1. What functions and conditions are required to be equipped to be a holistic

co-op business developer?

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Part 1: What are the main challenges creating long-

lasting opportunities for low-income women and immigrant communities?

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

What are the challenges?

Part 1: Challenges

Sustainable economic opportunity

Economic integration

Next generation dreams

HIGH BARRIERS TO EMPLOYMENT x Limited English proficiency x Few opportunities that offer good pay and working conditions x Lack of access to educational opportunities

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

HIGH BARRIERS TO ENTREPRENEURSHIP x Understanding business models, market feasibility, US consumer culture x Navigating business regulations and requirements x Stresses and burdens of sole proprietorship over time x Vulnerability to market shocks

Microenterprise or Worker Co-ops?

Higher level of expertise required

Higher start-up costs

Greater control over business

Lower barriers to entry

Lower start-up costs

Less control over business

Part 2: The Co-op Solution

Microenterprise Worker Co-ops

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Part 2: How does WAGES’ model of co-op incubation address these challenges?

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Co-ops in the U.S.

30,000 co-ops in the U.S.

Over 100 million members

There are 5 types of co-ops

Producer Consumer Purchasing Hybrid Worker

Snapshot of Cooperatives

Part 2: The Co-op Solution

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

More on Worker Co-ops

Worker cooperatives are businesses that are owned and democratically governed by their employees.

Key elements:

Democratic Governance

Profit Sharing

Worker Co-op Snapshot:

• 300 worker co-ops in the U.S. • 40 of those are immigrant-owned

Arizmendi Bakery Evergreen Cooperatives Emma’s Eco-Clean

Part 2: The Co-op Solution

Examples:

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Proven Results: Stable, Secure Businesses and Earnings

5 Bay Area Cooperatives

$3.2M combined annual sales

103 jobs

Benefits – ie medical, time off, disability

Average member tenure 4.2 to 6 years

Individual incomes 158%

Median household income 70-86%

Part 2: The Co-op Solution

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Proven Results: Personal, Social, Financial Assets

Median retained earnings asset @ $9,219, w/ no-interest loans

Secure, stable earnings through co-op profit distribution

Personal capability and leadership development

Protection from workplace hazards and abuses

Social support and coherence

Part 2: The Co-op Solution

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Part 3: What functions and conditions are required

to be equipped to be a holistic co-op business developer?

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

What is WAGES’ role?

Part 2: The Co-op Solution

WAGES is a co-op incubator. WAGES builds co-ops that empower low-income

immigrant Latinas to become entrepreneurs, achieve financial security, and exercise leadership.

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Services for co-op members are provided in small group settings as well as individual business consulting, mentoring, and coaching.

Intensive co-op member leadership development

Communications and conflict resolution

Social entrepreneurship and business management

Co-op principles

Co-op governance

Financial inclusion

Co-op shared services

Services provided

Part 3: What is needed

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

There are 5 phases in cooperative development that make WAGES’ model unique.

Business Development And Incubation

Part 3: What is needed

I. Business Planning

II. Business Launch

III. Business Incubation

IV. Business Graduation

V. Post-graduation Support

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

In worker co-ops, the two extremes of business imperatives and social commitments can function synergistically, creating mutually reinforcing positive outcomes.

Building a relational culture in our economy

Part 3: What is needed

Business Imperative

Social Commitment

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Co-op Principles

1. Voluntary and open membership

2. Democratic member control

3. Member economic participation

4. Autonomy and independence

5. Education, training, and information

6. Cooperation among cooperatives

7. Concern for community

Part 2: The Co-op Solution

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Skills Required

In order to succeed in building a worker co-op, incubators must draw from a wide skill set that spans business development and individual leadership development. Co-op incubators must wear many hats, which can at times be in conflict.

Part 3: What is needed

Business Developer Leadership Coach

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Basic Requirements to Launch a Co-op

Part 3: What is needed

1. Skilled and experienced co-op business developer staff and/or consultants

2. Feasible business plan

3. Secured/identified diverse sources of funding

4. Program training and mentoring curriculum for:

• Co-op member development

• Management support

5. Formalized commitment from the Board of Directors as well as a group of founding members

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Conclusion

1. Cooperatives are a viable option to address challenges that immigrants

face.

2. Worker co-ops are a high-resource, high-impact model to help low-income workers and immigrants achieve financial security.

1. Undertaking a worker co-op project requires extensive resources, and a

broad skillset that spans business development and leadership development.

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

www.wagescooperatives.org/learn

See technical assistance page for:

• Downloadable Foundations of WAGES Cooperatives

• Upcoming tools for co-op developers and communities

• Updates on 2014 Co-op Intensive Institute

Thank you!

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES

Any questions?

Incubating Sustainable Worker-Owned Co-ops – presentation by WAGES