I watched some of the films of the other local co-ops…It was storytelling: how they got started, what were the rough edges, how did they get through it, why was being a co-op the best decision for them. And it is kind of cool hearing that because they are all relatable situations.
Vincent Green, Co-Owner, Taharka Brothers worker co-op, Baltimore
In the past decade, worker cooperatives—that is, businesses co-owned and co-governed by worker-owners, each of whom hold an equal ownership share of their firms—have gone from being a somewhat esoteric niche strategy to a common community economic development tool.
As Courtney Berner of the Center for Cooperatives wrote in NPQ earlier this year, between 2016 and 2019, 47 percent of new co-ops formed in the US were worker co-ops. If one considers a longer period stretching from 2011 to 2019, nearly one in three newly formed co-ops in which the ownership type is known (253 of 771) were worker co-ops, an extraordinary development given that historically fewer than one in 100 co-ops nationally have been worker owned. And while the current decade is still young, the pace of worker co-op development—especially in BIPOC communities—has only accelerated.
The need for educational infrastructure to support this growth is evident. Indeed, a half-dozen years ago, Melissa Hoover, Executive Director of DAWI, and Hilary Abell—co-founder of Project Equity, an employee ownership technical assistance nonprofit—identified education as a key element of what they labelled a cooperative growth ecosystem.
Now, with financial support from the W.K. Kellogg Foundation, the Democracy at Work institute (DAWI) has developed an online worker cooperative education curriculum, hosted by the New Jersey/New York Employee Ownership Center at Rutgers University, to fill a portion of that gap.
Course instructors include Vincent Green, who became a worker-owner in November 2020, when the nonprofit-owned Baltimore-based social enterprise ice cream business where he worked, Taharka Brothers, converted into a worker co-op. He is now one of five worker-owners of that business.
Green insists that he is not a teacher, explaining, “I am only 26 years old. I am kind of still new to this co-op world.” Green is an instructor nonetheless in the newly developed, online seven-module course, in which he shares the lessons he has learned at Taharka, where he has worked since he was a high school freshman.
When Green started working at Taharka Brothers 12 years ago, the business—then a for-profit subsidiary of the nonprofit Sylvan Beach—had “little to no accounts, one machine, hardly enough money to afford a blender.” The goals of the business at the time, notes Green, were to work with Black youth like himself to build skills and become leaders in their communities.
As a worker co-op, the business maintains those goals. But the scope of the enterprise has expanded. Today, the business operates retail stores, a catering company, a home delivery business, and over 30 wholesale accounts with local markets, which combined generate over a million dollars in annual revenues. Green adds that the firm’s ambition is to become “the next Ben & Jerry’s.” A small step in that direction: the firm aims to start regional distribution beyond Baltimore in November.
How Is the Curriculum Organized?
The worker cooperative curriculum is organized into seven modules. The first module is led by Roodline Volcy of Seed Commons, a national community development financial institution (CDFI) that supports local funds that finance worker cooperatives in over two dozen cities. Volcy’s module provides a general introduction to worker co-ops, covering basic structural elements and outlining different paths through which worker cooperatives are formed.
The next six modules cover specific areas: origin stories of specific co-ops; discussion of how to capitalize on the “cooperative advantage” of operating values-aligned businesses; democratic management; governance; legal choices in terms of business incorporation and structure; and raising capital.
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The modules are designed to be short, between 15 and 25 minutes each, except for the ones on origin stories (split into two parts, each over 30 minutes in length) and the one on cooperative advantage (45 minutes). Each module ends with a set of learning questions, speaking to the fact that, although the website indicates that “there are no interactive activities with other learners,” the usefulness of the web materials would be greatly enhanced when employed as a springboard for community-based discussion.
Supporting a New Wave of Black Co-op Development
The curriculum developed focuses especially on co-ops in Black communities. One reason for doing so, as indicated by Dr. Jessica Gordon Nembhard in one of her interventions in the recorded videos, is that “the period we are in now, starting with the Great Recession of 2007-2009 through COVID, there’s been a rise in Black people being much more interested and much more connected again to working through and creating worker cooperatives and other kinds of cooperatives.”
According to Gordon Nembhard—author of Collective Courage, the leading historical account of Black co-ops in the US—the current period marks a “fourth wave” of Black co-op development, with the three prior waves occurring during the 1880s (marked by the Knights of Labor and the Colored Farmers National Alliance and Cooperative Union), the 1930s-1940s (marked by the Young Negroes Co-op League and the Brotherhood of Sleeping Car Porters), and the 1960s-1970s (marked by the Black Panthers and the Federation of Southern Cooperatives).
Green’s story about Taharka Brothers is part of the broader wave of Black co-op development that Gordon Nembhard highlights. Other Black-led worker co-ops featured in the curriculum include Mandela Grocery in Oakland, CA, a food co-op that has operated in the city’s largely African American “West Oakland” neighborhood since 2009; and ChiFresh Kitchen in Chicago, IL, a co-op founded during the pandemic by formerly incarcerated people that prepares hundreds of meals a day for schools and social service nonprofits and aims to expand production to 5,000 meals per day by 2023.
While the educational curriculum is meant to be an introduction to the field, a few key themes stand out.
- Defining democratic management: Figuring out what democratic management means remains a challenge, even if there is increasing agreement around focusing on what are known as the four cornerstones of democratic management—namely, the development of people, money sharing, information sharing, and power sharing.
In her video presentation, Ngozi Okaro of Custom Collaborative emphasizes that democratic management requires a balance of worker rights and responsibilities. Worker rights might include the right to vote on key issues, participate in strategic conversations, share opinions, and receive sufficient workplace education to be able to meaningfully participate in decision-making. Key responsibilities might include a commitment to quality work, to speak up in meetings, and to consider the needs of the whole business. Okaro emphasizes that the balance of rights and responsibilities may differ depending on the business and, in part for that reason, it is important to create a document that outlines worker rights and responsibilities.
- Clarifying governance norms: As Jamila Medley, who served as Executive Director of the Philadelphia Area Cooperative Alliance from 2012 to 2021, notes in her presentation, while the dividing lines between workers, managers, and board members in worker co-ops are supposed to parallel norms at non-cooperative businesses, gray areas persist. To address these areas, Medley offers a couple of tests to help worker co-ops more clearly decide where decision-making authority should reside.
One is what Medley calls the extensiveness test. In other words, does the decision affect a large percentage of the membership, involve a substantial portion of financial resources, and/or affect operations over an extended period of time? If so, then the Board should weigh in. If not, then the decision should lie in the hands of management.
A second test Medley offers to clarify the line between board and all-member decisions is what she calls the significance test. In other words, does the decision affect the likely survival of the co-op, policies for hiring or terminating members, or the basic character of the cooperative? If the answer is yes, then members should weigh in. If not, then the proper level of decision-making is at the board level.
- Not all worker co-ops are incorporated as cooperatives: It is well known among worker co-op experts that not all worker co-ops incorporate as worker cooperatives. A brief presentation by Georgetown social enterprise and nonprofit law fellow Julian Hill lays out some of the key considerations in terms of governance, membership, tax law, liability, and employment law.
- Capital options for worker cooperatives are improving but remain limited: A video conversation with Todd Leverette of Apis & Heritage Capital Partners and Jennifer Bryant, formerly of the Greater Washington Center on Employee Ownership, provided an overview of the range of capital options, including debt (loans), equity (ownership investments), and options that blend the two. Leverett and Bryant noted that bank financing for conversions to worker cooperatives remains rare, but increasingly CDFIs are stepping in to fill the gap. They offered Yard-and-a-Half Landscaping, based in Massachusetts, and Island Employee Cooperative in Maine as two prominent examples of this emerging financing approach.
- Partnerships are critical for growth: In the video on cooperative advantage, Adria Powell of Cooperative Home Care Associates (CHCA)—the nation’s largest worker cooperative, with over 2,000 mostly Black and Latinx employees working in home health care, based in the Bronx—emphasized the importance of partnerships. So too did Maru Bautista, former director of the Cooperative Development Program at the Center for Family Life in Brooklyn, which has incubated co-ops among Latinx immigrants. Each co-op used a different approach to partner and grow. CHCA has focused on creating affiliated nonprofits and partnerships with the union, United Healthcare Workers East (1199 SEIU), and city government. The Center for Family Life has focused on developing a franchise model, known as Brightly.
- The importance of cultural grounding: In his discussion of cooperative advantage, management professor Dr. Leon Prieto of Clayton State University notes that Black co-op development succeeds when it is grounded in African American cultural values. Prieto cited the work of two early 20th century Black cooperative leaders: Charles C. Spaulding and Maggie Lena Walker.
Spaulding, who Prieto calls “Mr. Cooperation,” was head of the North Carolina Mutual Insurance Company, which he led from 1923 to 1952.
Interestingly, conventional accounts ignore the member-run nature of the business he led, even though mutual insurance companies, by definition, are member run and “apply the co-op business model in their focus on policyholders.” In 1903, Walker, an advocate of “Black cooperative enterprise and economic independence from whites,” became the first woman in the US to start a bank, the St. Luke Penny Savings Bank of Richmond, VA. Black cooperativism, emphasizes Prieto, is rooted in “African humanism.”
Inspiring the Next Generation
Green tells NPQ that he has already seen first-hand the benefits of cooperation, including the mutual support it fosters among workers. When the pandemic hit, Taharka Brothers’ conversion to co-op ownership was in process but hadn’t yet been completed. “When the pandemic hit us, we lost 70 percent of our accounts.” Green says. “A lot of businesses were getting shut down. It should have been us.”
Instead, workers at Taharka created a home deliveries department, which helped save the business. “It was so successful; it is now a permanent department,” Green explains. After wholesale business, it now generates more revenue than any other business line.
At the end of his presentation, Green said he hoped his story would inspire others to launch cooperatives. In his closing testimonial, he offered: “It benefitted me and my family” and every business owner. Co-op ownership, Green added, means that every day he gets to wake up and come to work and know that everyone is working “hand in hand, to build something together.”