> I'm fundamentally opposed to making people buy their way into the company, it feels like a scam to me. You don't have to demonstrate your value "to" the company -- we each as individuals hold far more value than this taxable structure that can be dissolved when it no longer benefits the members. Also, whatever value a person has is being brought by their skills, thinking, and experience, not by cash. You aren't creative with cash.
I strongly disagree with this. People who have 'skin in the game' are much more likely to perform well than people for who joining up is a freebie and it's a lot easier to take someone on board than it is to remove them again if they don't work out in a collective like this. In fact, they might demand to be bought out and before you know it you're in court even though your 'collective rules' were made on the assumption that everybody would always be nice and play nice.
This would also allow them to reduce the candidacy period to something more reasonable, now you are essentially asked to give up a year of your life on the gamble you will be accepted. Better to put down some money then, which you can recover if and when you leave, hopefully with a bonus because the company has appreciated in value.
Also: people change over time.
I've seen this in practice in one of my own companies, the people who actually put money down for their shares were all hard workers and super dependable, the people that got their shares 'for free' (or in some cases with money borrowed from the company) were a lot less likely to work hard and were the first to run off when there was a speedbump (which we weathered).
On another note: I'm investing in a company that is a strange cross between a traditional company and a cooperative like this. It's been running for the better part of 10 years now, it's also a consultancy business and it's one of the most interesting companies that I've ever dealt with. The CEO is a very inspiring young man who manages to make all the employees of the company stakeholders, who has made it possible to account for project based income to be fairly distributed amongst the employees and who is now in the process of streamlining all this so the idea can be applied to other companies.
I really should do a write-up on that company and their story one of these days, it's been fascinating to see this idea take root and flourish over the years.