An introduction to platform co-ops

Prepared as part of the Platform Co-ops Now! course

22nd November 2020

What does 'platform' mean here?

"The word ‘platform’ is often used to describe an internet service which brings together suppliers and consumers in an online marketplace. But platforms don’t necessarily provide traditional ‘products’; they often facilitate the trade of services, like taxis or temporary accommodation. Most people have heard of Uber and Airbnb, whose platforms have disrupted the minicab and short-term lettings industries while generating enormous profits for their shareholders."

An introduction to platform co-ops

Platform capitalism

"The rise of the platform economy over the last decade promised to boost flexible employment, extra income, and collaborative consumption. Instead, the ‘disruption’ of the digital economy has removed regulations, increased precariousness of work, and created the conditions for market monopolies dominated by a handful of digital giants."

Why platform co-ops?

"More and more people are organising their work and resources through digital platforms. The marketplace for these is dominated by a small number of large corporations: be it Uber drivers, freelancers on TaskRabbit or Amazon’s Mechanical Turk marketplace, home rentals on Airbnb or food deliveries using Deliveroo.

These digital platforms offer people unprecedented flexibility and independence. The barriers to entry to becoming a taxi driver, a holiday apartment landlord, or freelance worker are now incredibly low, and it’s never been easier to be a consumer on the other side of these markets. But while these positives are acknowledged, large platform companies have also been criticised for being exploitative, monopolistic and extractivist.

As a result, this system has been described as platform capitalism. In this system a large number of consumers and vendors generate profits which accrue to a comparatively small number of people… Ordinary users who rely on these platforms typically find they have little control over their personal data and have no say about how they are run. It has led to the formation of monopolies that encourage financial extraction and the monetisation of personal data."

Platform co-operatives – solving the capital conundrum, Why we need platform co-operatives in the digital economy

What is a platform co-op?

"A platform cooperative, or platform co-op, is a cooperatively owned, democratically governed business that establishes a computing platform, and uses a website, mobile app or a protocol to facilitate the sale of goods and services. Platform cooperatives are an alternative to venture capital-funded platforms insofar as they are owned and governed by those who depend on them most—workers, users, and other relevant stakeholders."

Platform and Data Co-Operatives Amidst European Pandemic Citizenship

"A platform co-op is a digital platform that is designed to provide a service or sell a product, and that is collectively owned and governed by the people who depend on and participate in it."

Platform co-operatives – solving the capital conundrum, The origins of platform co-operatives

"Just like traditional co-ops, platform co-ops are organisations that are owned and managed by their members. While traditional co-ops are normally based around a physical community of members, platform co-ops live online and are normally populated by online communities of members."

An introduction to platform co-ops

Two types of co-op, as platforms

Worker co-ops

"A workers’ co-op [is] a business owned and managed collectively by its workers for their mutual benefit. It’s organised democratically and fairly by (and only by) its members."

Seeds for Change: How to set up a Workers' Co-op

Stocksy United: a platform worker co-op where the members are individuals

Stocksy United provides curated stock photography and video footage with almost 1000 photographer member-owners, across 63 countries. The members license creative content and receive 50% royalties on standard license sales and 75% on extended license sales – they also receive dividends which equated to $300,000 in 2016 on $10.7m in sales.

Up & Go: a platform worker co-op where the members are organisations (a platform consortia)

Up & Go is a platform that offers on-demand cleaning services at guaranteed fair wages launched by four worker co-operatives, based in New York City. The worker-owned cleaning businesses, which are all majority women owned, earn 95% of the cost of every Up & Go cleaning job. The remaining 5% supports the costs to maintain the platform.

Multi-stakeholder co-ops

"Multi-stakeholder cooperatives are co-ops that formally allow for governance by representatives of two or more “stakeholder” groups within the same organization, including consumers, producers, workers, volunteers or general community supporters. Rather than being organized around a single class of members the way that most cooperatives are, multi-stakeholder cooperatives enjoy a heterogeneous membership base. The common mission that is the central organizing principle of a multi-stakeholder cooperative is also generally broader than the kind of mission statement needed to capture the interests and benefits of only a single stakeholder group, and will often reflect the interdependence of interests of each stakeholder group in its articulation."

"Rather than being organised around a single class of members the way that most co-operatives are, a multi-stakeholder co-operative is any co-op that draws its membership from two or more different classes of stakeholders. After two decades of local experimentation, Italy was the first country to adopt a multi-stakeholder statute in 1991. Over 14,000 ‘social co-ops’ now exist across Italy and provide social care, health and educational services to over 5 million people. In Quebec, home to one of the most productive and vibrant co-operative development sectors in the world, multi-stakeholder co-ops are now the fastest growing type of co-op, with more than 50% of all new co-ops opting to register what they refer to as ‘Solidarity Coops.’ The movement is just getting here in the UK, but there are now over 20 multi-stakeholder co-ops who have incorporated using the Somerset Rules."

Multi-Stakeholder Cooperatives - P2P Foundation

"Multi-stakeholder cooperatives present a departure in ownership structure from the more familiar consumer-owned and worker-owned co-ops. Also known as solidarity co-ops, hybrid co-ops or social co-ops, multi-stakeholder cooperatives welcome a variety of groups to become owners, including employees, producers, customers and clients, and community members (including investors). These co-ops may appear to operate similarly to corporations, but as Shareable’s David Boiler points out, while they have “a keen focus on profit and loss, social co-ops are committed to meeting social goals such as healthcare, eldercare, social services, and workforce integration for former prisoners. They are able to blend market activity with social services provisioning and democratic participation, all in one swoop.”"

Multi-stakeholder co-operatives - USDN

Multi-stakeholder platform co-ops

Resonate is a stream-to-own music platform harnessing blockchain technology. It is a multi-stakeholder co-operative giving democratic control to artists (45%), listeners (35%) and workers (20%). Through its model, it pays up to 2.5 times more revenue to artists than other streaming services.

Equal Care Co-op are building a new, co-owned social care platform that puts care givers and receivers in charge. By incorporating as a multi-stakeholder co-operative, their digital product and accompanying service is owned by and accountable to the communities using and sustaining it. They arrived at the platform co-op model as a response to systemic inequities within the social care system, seeing it as a practical route to centering choice, power and ownership with the two most important people in care – the person giving and the person getting support.

Supported member: You are being regularly supported by Equal Care Co-op (whether that's voluntary or paid support)

Advocate member: Your relative or friend is being supported by Equal Care Co-op but they cannot be a Member themselves.

Investor member: You support our aims and have invested in our Community Share Offer.

Worker member: You are regularly contributing your labour to Equal Care Co-op, whether that's paid or voluntary work.

Somerset Rules: creating multi-stakeholder co-ops in the UK

"Launched in 2009, the Somerset Rules were one of the UK’s first set of model rules for a multi-stakeholder co-op, and they’re arguably still the best. Packed full of best practice gleaned from decades of co-operative development experience, they’re structured to closely follow co-op principles, written in relatively plain English, and are cleverly drafted to allow for a wide range of different configurations. You can define the percentage of overall control each stakeholder group has. They are also ‘social accounting ready’ and are designed to enable the widest range of options for financing. In 2012 they were fully revised and overhauled and a version for use as a Community Interest Company limited by guarantee was developed."

P2P Foundation: Somerset Rules

(Check out the latest version at Somerset Rules registrations)

Graphic guides

Introduction to platform co-ops

Why platform co-ops?