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Comment by sigmoid10 | Hacker News Reader

There's a reason why worker owned companies (which were quite prevalent and a key factor in the 20th century's socialist movements) did not survive in our capitalist world. If we want to see these kinds of companies thrive, we need to change the entire market philosophy. Otherwise they will always be out-competed by companies that favour revenue/profit over worker benefits. In fact they will not even take off in the first place, because that needs capital and investors who own capital will want shares in return, which goes against the core principle of worker-ownership.

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They did survive. There are thousands in Spain and Italy especially.

One of the most well-known is the Mondragon Corporation from the Basque country, one of Spain's largest comanies:

https://en.wikipedia.org/wiki/Mondragon_Corporation

I am particularly interested in coops as a model for a tech startup. How would one go about structuring a new corporation to best ensure it remains a coop?

Plenty of worker owned software consultancies in germany, and specially in Hamburg for some reason.

From the site of one that I that I used to work for(they are very friendly so you can hit them up if you want some advice on setting up one)

> How exactly are you structured?

> In our search for a structure that consistently implements the principles of responsible ownership, we came across the veto-share model. First, the principles are enshrined in the company's articles of association. Then, company shares are transferred to a controlling shareholder. This controlling shareholder is granted veto rights, which must be used to prevent any future deviation from the principles. We are delighted to have the Purpose Foundation on board as our controlling shareholder!

> We want to offer every (new) team member the long-term prospect of assuming entrepreneurial responsibility as a co-owner. The criteria for this are already defined in the articles of association. To simplify joining and leaving, we have established dyve Trust eGbR, a partnership that holds 99% of the voting rights in dyve.

https://dyve.agency/warum-wir-es-tun

Thanks!

Mondragon is a federation of worker cooperatives.

You sound like you might be interested in distributism [0][1][2][3][4]. The author, John Médaille, also spoke at Google [5].

[0] https://theimaginativeconservative.org/2010/09/economics-of-...

[1] https://theimaginativeconservative.org/2010/09/economics-of-...

[2] https://theimaginativeconservative.org/2010/09/economics-of-...

[3] https://theimaginativeconservative.org/2010/09/economics-of-...

[4] https://theimaginativeconservative.org/2010/09/economics-of-...

[5] https://www.youtube.com/watch?v=X1PtStipIsc

Thank you for the links!

Look for successful models I guess

https://duckduckgo.com/?q=tech-startup+cooperatives&ia=web

Igalia (https://www.igalia.com), also Spanish, is a fairly prominent tech company that is also a co-op.

Galois, Inc. (https://www.galois.com) is employee-owned, and they do lots of great formal methods work.

But not sure whether this model is appropriate for a startup. I guess splitting stock more evenly is a good starting point.

Mondragon is often used by people who don't know much about the subject as a counter example, but if you look under the hood, you'll see it doesn't even compare: Less than half the workers own shares and the majority of shares is held by a small circle of executives in the richest branches. That's basically a standard capitalist pig with some socialist lipstick to give pseudo-Marxists an argument in these discussions, when there is none to be had in the first place. In fact Nvidia has a higher percentage of employees owning shares than Mondragon. Would you call that "worker-owned" too?

None of this should be surprising either, because anything that truly benefits workers will be at odds with things that benefit the business. In society there are always people who primarily get paid and people who primarily work. Even the real Marx realized that. If you really want to defeat capitalism, then you have to do more than just play pretend.

> anything that truly benefits workers will be at odds with things that benefit the business.

Generally yes, unless the workers own the business.

In which case the business will have a harder time competing. Not sure why we needed to circle back to that. This is not rocket science. If you believe you can somehow bypass the way the world works and create a socialist utopia using such a trivial approach, you should check if your opinions are based on facts or on dogmatic beliefs. Because the facts are quite clear once you really get into the material.

There are many successful co-ops all over the world, including in the US. You just don't hear about them because they don't look much different from corporations from the perspective of the average person.

Such companies are more common than you think.

The main they don't survive is not due to capitalism. (Capitalism is just trade without use of force at the end of the day) but due to the lobbying power of corporations. Corporations constantly lobby the government for more regulation and rules, which they just budget for, but smaller companies don't have the funds to meet so they cannot stay in business. Look at the first couple of years of COVID for example, Walmart, Target and the big box stores lobbied the government to stay open because they were "essential" while all the small businesses got wiped out due to their lack of lobbying power.

The solution is to stop giving corporations the ability to lobby governments, and stop using the government to control/fund markets. Not to blame it on capitalism.

That's not what capitalism is... or it's a very elementary understanding of it. Trade without force existed prior to and contemporary to capitalism. (See markets and mercantilism for more history there.) Capitalism is specifically the sort of mercantilism under which maximizing one's capital (typically the money commodity) becomes the aim.

Historically, money commodity was used to mediate exchange between two other commodities - I sell my wheat, get money, use money to buy pork. I'm buying commodities because I intend to use them or share them. Commodity -> money -> commodity. Capitalism inverts this -- the goal is to maximize money. I start with money, I convert it to a commodity that I can sell for a greater value, to get larger money. Money -> commodity -> money. You see Amazon operate this way: "if we can put one dollar in and get $1.01 out, do it".

Highly recommend this book on the transition in England and France from agrarian and feudal mercantilism into capitalism in the 18th and 19th centuries: https://en.wikipedia.org/wiki/The_Origin_of_Capitalism

Not sure about the currency vs commodity argument, but I agree with this argument linked article:

> Thus it argues that the origin of capitalism lies fundamentally in social property relations rather than in trade and commerce.

Capitalism is fundamentally a framework for ownership and property.

Thank you for that correction, I did oversimplify it.

> Capitalism inverts this -- the goal is to maximize money. I start with money, I convert it to a commodity that I can sell for a greater value, to get larger money. Money -> commodity -> money. You see Amazon operate this way: "if we can put one dollar in and get $1.01 out, do it".

Yes, that is correct and there is nothing wrong with this as long as there is no coercion happening (eg. Government involvement, lobbying and over regulation).

Every person on earth should have the right to put in $1 into something and try to get $1.01 from it. You and I and every other individual get to then decide if we want to give that business owner that $1.01 or go to a competitor. In a truly free market, that business owner only earns that $1.01 profit by providing a good or service that voluntary customers value at more than the price they pay. The profit is the reward for creating value for others

We currently live in a crony-capitalist world which has a lot of issues, but it's still much better than the 200m+ that have died under Marxism and Communism in the last 100 years.

> the small businesses got wiped out due to their lack of lobbying power

Small businesses have a lot if lobbying power (NFIB, US Chamber of Commerce to a certain extent) especially during the pandemic. The PPP loan forgiveness program was ridiculously generous. Despite it being marketed as a way to save jobs, only a third of the money ended up going towards jobs that were at risk.

Those are good points, but it again shows how government getting involved does more harm than good. The government forced the lockdowns instead of letting people make their decisions about their health, then they tries to aid the businesses they caused to suffer, and most of the money didn't end up where it was supposed to. So many examples of this over and over when you look at government involvement. > The fantastic 7 tech companies, get billions of dollars from the government grants, tax breaks, business > We have 4 ISP's that monopolize the market, due to the government giving them billions of dollars to expand infrastructure, which they misappropriated and then uses for lobbying against small ISP's > The SNAP program subsidizes big companies like Walmart, target, etc due to them being able to eat the costs of all the massive regulatiom around it. > etc. etc. etc.

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