A time-tested approach to community economic development internationally, worker cooperative businesses are making inroads in the United States with regional initiatives in New York City, Madison, the Bay Area, and rural areas in the South. In this webinar, we aim to introduce worker-cooperative development as an innovative approach to poverty alleviation in U.S. communities through its focus on community wealth-building through worker-ownership and democratic decision-making. We'll explore case studies to explore how funders and citizens can learn from what has been done and take advantage of new opportunities to support real change.

1. POVERTY ALLEVIATION AND SYSTEMS
CHANGE WITH WORKER COOPERATIVES
EPIP Webinar
May 25, 2016
EPIP Host: Biz Ghormley
Presenters: Anh-Thu Nguyen, Brendan Martin, Emma
Yorra, Melissa Hoover, Omar Freilla and Wayne Ho

2. 2
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7. Speakers
Anh-Thu Nguyen, We See Beauty Foundation
Brendan Martin, The Working World
Emma Yorra, Center for Family Life (CFL)
Melissa Hoover, Democracy at Work Institute
Omar Freilla, Green Worker Cooperatives
Wayne Ho, FPWA

8. A Strategy for Inclusive Economic Development
WORKER COOPERATIVES

9. Our mission:
Expand the promise of worker ownership to
communities most directly affected by social
and economic inequality
Focused on STRATEGY, SCALE and EQUITY

10. WHAT IS A WORKER COOPERATIVE?
A worker cooperative is a values-based business that is owned and
controlled by its members, who work in it.
• Members invest and share profits
• Democratic decision-making
Impacts of worker-ownership
• Workers have more say in their working life, creating
higher-quality jobs
• Workers build wealth through business ownership in addition
to wages
• Retained profits keep more dollars within the community

11. Labor-intensive industries
People locked out of the
job market
First-time entrepreneurs Contractors and
contingent workers
Values-based businesses
GROWING INTEREST IN WORKER OWNERSHIP
Grow & retain local business

12. Cooperative
Capacity
1 Business
Development
2 Ecosystem
Development
3
Inside the business
The business
Outside the business
WHAT IS COOPERATIVE DEVELOPMENT?

13. Invests
Time
Invests Capital
LOW TOUCH HIGH TOUCH
COOPERATIVE DEVELOPMENT SPECTRUM
Coop developer as coach
Training & coaching
“Who comes in the door”
Entrepreneur-centered
Broad impact: stability
Coop developer as entrepreneur
Management expertise
“Build and recruit”
Industry/market-centered
Deep impact: mobility

14. Arizmendi Association:
Incubated industry franchise model
DEVELOPMENT MODELS
for worker cooperatives
Investment in Enterprise $850,000
Training labor $150,000
Management labor $100,000
Buildout/equipmt $550,000
Working capital (equity) $50,000
Sources
Member fees $150,000
Business loan $700,000
Timeline:
24-36 months overall, 18 months to maturity
Impact
15-25 living wage jobs, with member capital accts
$2M revenue by Year 5
% of surplus back to the system

15. GROWING INTEREST IN CITIES
• New York City Council: $2.1M for worker cooperative
development 2015-16, up from $1.2M in 2014-15
• Madison, WI: $1M/year for next 5 years for cooperative
development
• Cleveland government agencies, foundations, and anchor
institutions
• Minneapolis, Austin, Rochester and Reading are in pilots
• Vermont and Ohio: state-funded employee ownership centers
• EDOs and SBDCs in Washington, Oregon, Pennsylvania,
Kentucky, and New York offer info about employee ownership

16. OVERVIEW
Growth of worker cooperatives

17. Some examples of worker cooperatives in the US
Namaste Solar, Boulder, CO Isthmus Engineering, Madison, WI
Weaver Street Market, Chapel Hill, NC Coop Home Care Associates, Bronx, NY

18. Q&A
Melissa Hoover, Executive Director
Democracy at Work Institute
www.institute.coop
mhoover@institute.coop
(415) 379-9201 ext. 1

19. COOPERATIVE
DEVELOPMENT PROGRAM
Center for Family Life
Cooperative Development
Program
Emma Yorra
May 25 2016

20. Center for Family Life | Cooperative Development Program
Center for Family Life’s Cooperative
Development Program
• In the Sunset Park community for 38 years
• Currently Supporting 8 existing & 2 new
coops in development, and a network of
cooperatives with 260 worker owners
• CBO training program: 21 organizations
trained, 15 coops developed/ in process
• New projects: political education fellowship,
replication, tech platform

21. Center for Family Life | Cooperative Development Program
What are the successes?
• Provide an alternative in workforce
development for community members
• Empower workers to take ownership over
their business and their lives
– Dignified, stable and secure work
– Higher wages
– Workers have a voice that counts

22. Center for Family Life | Cooperative Development Program
CFL’s Cooperative Development
Program

23. Center for Family Life | Cooperative Development Program
CFL Coop Member Demographics
5
of women are the sole contributors to
their households 22%
23-58 years Age Range:
Average age: 37 years
Range of number of children: 1-4 children
Average number of children: 2 children

24. Center for Family Life | Cooperative Development Program
Safe working environment with 100%
of payment going directly to member
providing the service
PotenLal for exploitaLon and only a
small percentage of the income going
to the person providing the service
Leadership opportunity and voice to
make decisions within the coopera>ve
Low-skilled posiLons
6
Prior to Coopera>ve ABer Joining Coopera>ve
Business Owner who provides services
to clients
Paid employee who works for a boss
Average hourly wage: $20.78
Average hourly wage prior to coop:
$10.76
Environmentally Conscious Cleaning,
Child Care, or Elder Care
Most common jobs/sectors prior to
coop: Factory work, Cleaning, Sewing

25. Center for Family Life | Cooperative Development Program

26. Center for Family Life | Cooperative Development Program
“When I worked alone as a house
cleaner, I was oBen scared about safety
or not gePng paid my full wage. Then,
I earned $8 per hour, but now I average
about $20 and feel safe and supported
by all the women in the coop.”
– Luz, Member
Si Se Puede / We Can Do It!
Housecleaning Coopera@ve

27. Financing & Training!
For Worker-Ownership!

28. Why Worker Ownership Now!

29. • Crisis of inequality!
Why Worker Ownership Now!

30. • Crisis of inequality!
• Crisis of exclusion!
Why Worker Ownership Now!

31. • Crisis of inequality!
• Crisis of exclusion!
• Crisis of “Silver Tsunami"!
Why Worker Ownership Now!

32. TWW Presentation!

33. TWW Presentation!
• Cooperative Financing!
$$

34. • Cooperative Conversion!
TWW Presentation!
!
!
! !
!
! !
• Cooperative Financing!
$$

35. The Working World!
• Over 1,000 investments!

36. The Working World!
• Over 1,000 investments!
• 250 Worker-owned businesses!

37. The Working World!
• Over 1,000 investments!
• 250 Worker-owned businesses!
• 98% Success Rate!

38. Cooperative Finance
Mondragon!

39. Cooperative Finance !

40. Cooperative Finance !
• Key to coop development!

41. Cooperative Finance !
• Key to coop development!
• Community Benefit!

42. Cooperative Finance !
• Key to coop development!
• Community Benefit!
• Active business assistance!

43. Cooperative Finance !
& Philanthropy!

44. Cooperative Finance !
& Philanthropy!
• Grants for business assistance!

45. Cooperative Finance !
& Philanthropy!
• Grants for business assistance!
• Capital to benefit community!

46. Cooperative Conversions!
!
!
! !
!
! !

47. Cooperative Conversions!
• 1M small business closing!

48. Cooperative Conversions!
• 1M small business closing!
• Major creator of good jobs!

49. Cooperative Conversions!
• 1M small business closing!
• Major creator of good jobs!
• Workers are pathway out!

50. Cooperative Conversions!
• Billions of dollars in !
capital is needed!

51. Cooperative Conversions!
!
The economic crisis of our generation!
or !
the opportunity of our future!

58. Since 2003
Building a green and democratic economy in the Bronx

59. Evolution of a Co-op Development Strategy
Create Model Co-ops A Co-op
On Every Block
Raising Awareness;
Co-op Academy & Post-
Academy Support
GWC as
Entrepreneur
GWC Grows
Co-op Entrepreneurs
Coming up with idea;
Planning; Fundraising;
Recruitment & Training;
Management
2012 to Present2003 to 2010

62. Accomplishments
21 worker cooperatives through the Co-op Academy
Food: B Blossom (catering) * Chilerox (mfg) * Ginger Moon (personal chefs) *
White Pine Community Farm (production)
Health: Uptown Village (doulas) * Elevate NYC (massage)
Arts: Ometeotl (crafts) * The House of Spoof Collective (graphic design & photo)*
Revolutionary Seeds (crafts) * Cultural Workers Cooperative (arts educators)
Education: The Bronx Unschool School (K-3rd grade) * Over & Above (nursery
school)
Technology: Bits & Bites Tech Cafe (adult computer skills training & cafe) *
Technum (air conditioning & refrigeration repair) * HTINK (tech ed.)
Personal Services: Bio-Classic Cleaning (residential/commercial cleaning) *
Caracol Interpreters Cooperative (interpretation/translation) *
Diaspora Destinations (travel) * Victory Bus Project (transportation)
Manufacturing/Design: POLIDO (skateboard design) * Syllable (screenprinting)

64. Accomplishments
● Co-op Academy replicated in seven U.S. cities
○ Cooperative Business Institute - Cooperation Texas (Austin, TX)
○ Worker COOP Academy - Sustainable Economies Law Center (Oakland, CA)
○ Co-op Academy - Worcester Roots Project (Worcester, MA)
○ COLORS Co-op Academy - Restaurant Opportunities Center (Detroit, MI)
○ Cooperative Business Academy - Cooperative Dev. Institute (Willimantic, CT)
○ Cooperative Design Lab - Cooperative Fermentation (New Gloucester, ME)
○ Cooperative Business Academy - Center for Workplace Democracy (Chicago, IL)
● Created 1st ever student-owned cooperative based in a high school
○ Syllable - silkscreening business at Bronx Compass High School.

65. What’s Working
● Lean Startup for the Co-op Academy
● Raising public awareness of worker cooperatives
● Partnerships that expand our ability to provide support
● A growing network of older co-ops supporting newer co-
ops

66. Abandon the idea that low-income people of color don’t
have what it takes to start a business and need someone
white, wealthy, and well connected to do it for them.
How Can Philanthropy Help?
Fund Co-op Academies
& Post-Academy Support
Then...

67. Federa&on of Protestant Welfare Agencies
Worker Coopera&ves:
Policy and Advocacy Landscape

68. Building a City of Equal Opportunity
• Strategic Direc+on
• Worker Coop Report
• New Mayoral
Administra+on and City
Council
• Innova+ve solu+ons to
address poverty and income
inequality

69. Promo&ng Collec&ve Impact
• Coali&on of 29 organiza&ons: worker coop
developers, public policy, and community-
based organiza+ons
• Backbone support: energize
the coali+on, create
shared vision/outcomes,
and navigate government

70. Advoca&ng for City Council Funding
• Year 1 (FY14-15): $1.2 million (11 partners)
• Year 2 (FY15-16): $2.1 million (14 partners)
• Year 3 (FY16-17): $3.8 million (22 partners)?

71. Working with Government
• Administering Agency:
– NYC Department of Small Business Services
• Interest from:
– NYC Housing Authority
– Department of Consumer Affairs
– Mayor’s Office of Immigrant Affairs
– Mayor’s Office of Contract Services
– NYC Economic Development Corpora+on

72. Advoca&ng for Policy Changes
• Victory:
– Intro 423 (2015) – repor+ng bill to track city
contracts and TA services for worker coops
• Sample Policy Changes:
– MWBE status vs. Worker Coop status
– Public procurement and contracts
– Capital gains exemp+on and guaranteed public
loan fund for coop conversions

73. Challenges with Public Funding
• Strict Guidelines:
– Direct services only
– Low overhead
• Procurement Process:
– Slow contrac+ng and reimbursements
• Funding Gaps:
– Coali+on coordina+on, administra+on, research,
and policy advocacy

74. How Funders Can Help
• Make connec&ons: Help bring worker coopera+ves
into dialogue with economic, community and
workforce development
• Invest in capacity building: Offer stronger technical
assistance to unlock greater capital investment
• Invest in the ecosystem: Support ins+tu+ons that
are cri+cal to the growth of this young field
• Align investment and impact: Define the impact you
seek, and invest strategically for the long term

75. Funder Perspec,ve | Learnings + Takeaways
Lessons learned as a funder working with worker coops
• No such thing as a silver bullet.
• Worker coopera,ve development and funding is an extended process. Pa,ent capital and a tailored,
context-specific approach are essen,al.
• You’re helping develop (sustainable) businesses. Treat them like one.
Opportuni,es + Challenges
• Suppor,ng cultures of entrepreneurship
• Facilita,ng sustainable business development in low-resource communi,es
• Access to investment capital, customized technical assistance, business exper,se and mentorship
• Mission + market-oriented approach to coopera,ve development.
• Engaging stakeholders and allies to nurture coopera,ve businesses
• Anchor ins,tu,ons, ecosystem development
• Community engagement with coopera,ve businesses—connec,ng to aligned networks

76. • Leveraging procurement/purchasing power
• Low/no-interest loans to worker-coops and support ins,tu,ons
• Technical assistance, organiza,onal advising and leadership development
• Access to networks and leveraging social capital
• Educa,on on worker-coopera,ve businesses within communi,es, movements, industries
and entrepreneurial networks.
Engaging and suppor,ng coopera,ve development: More than just grant $$$

77. What’s Next | Philanthropic Engagement with Worker Coopera,ves
Inquire | Ask ques,ons about con,nuing needs and gaps within the worker-coopera,ve space, as well as failures
and room for improvement both for funders (in measuring impact) and with worker-coopera,ve developers (in
mee,ng objec,ves.)
Connect | Engage and facilitate dialogue between worker-coopera,ves and poten,al allies/stakeholders in
public, private, and philanthropic sectors. Educate yourself, your communi,es and economic development
ini,a,ves on worker coopera,ves and how they can be a good fit for mission.
Align | Make sure mission, impact, and investment are in-sync: If worker-coopera,ve support is an effec,ve
strategy for your organiza,onal mission and goals. Consider challenges and opportuni,es to more deeply engage
with worker-coopera,ves. Define the impact you seek and invest strategically for the long term.
Invest | Not just directly with worker-coopera,ves, and not just with money! Consider mentorship and
leadership development, crea,ng awareness, building networks and ecosystems, suppor,ng growth-oriented
ini,a,ves to nurture this emerging field.