I don’t know the full history of corporate shenanigans, but it’s my understanding that the beginning of it all was to help form businesses that no individual could afford to start. No single person should reasonably have the funds to build a factory with all of the expensive equipment and parts needed to make cell phones. So you get people together who think cell phones are a good idea, they all pitch in, and now you can afford to build it and they get to share in the profits when it succeeds.
I like the employee-owned idea, but it seems like it would be hard to get off the ground in industries that require huge upfront investments. Imagine you want to build a grocery store, but the land and the building and the initial stock all takes money so you have to ask the cashier for $10,000 up front before you can actually build the thing and later start paying them. I legitimately don’t know, are there proposed ways to build these businesses but make them employee-owned?
Financing is one of the major hurdles of employee owned businesses trying to compete against investor owned businesses, so you’re right to identify that. I have 4 main solutions to this problem:
Investment isn’t the only way to raise capital. There’s also loans. In a fully co-op economy, the financial infrastructure for loans would likely be more robust. This is already how a lot of businesses get off the ground.
A company doesn’t have to be 100% employee owned for the employees to have a controlling stake. An employee-owned company could decide to sell off 49% of its value to raise capital. They could do this at any time, including during startup.
The average worker would have more money to do as they please. In 2023, American companies earned a profit of $22k per worker. In a co-op economy, that’s an average of $22k each worker has control over that they currently don’t. Your average worker would be more capable of making the type of investment that you described.
Companies don’t necessarily have to start as employee owned. A normal path for an entrepreneur is to start a business, grow it until it’s sustainable and later sell it to somebody. Instead of selling it to an investor, they could sell it to their employees. In a co-op economy, this would probably be required in some way or another.
I don’t know the full history of corporate shenanigans, but it’s my understanding that the beginning of it all was to help form businesses that no individual could afford to start. No single person should reasonably have the funds to build a factory with all of the expensive equipment and parts needed to make cell phones. So you get people together who think cell phones are a good idea, they all pitch in, and now you can afford to build it and they get to share in the profits when it succeeds.
I like the employee-owned idea, but it seems like it would be hard to get off the ground in industries that require huge upfront investments. Imagine you want to build a grocery store, but the land and the building and the initial stock all takes money so you have to ask the cashier for $10,000 up front before you can actually build the thing and later start paying them. I legitimately don’t know, are there proposed ways to build these businesses but make them employee-owned?
A group with access to a lot of capital that it makes sense to invest in companies making products… the government?
Financing is one of the major hurdles of employee owned businesses trying to compete against investor owned businesses, so you’re right to identify that. I have 4 main solutions to this problem:
Investment isn’t the only way to raise capital. There’s also loans. In a fully co-op economy, the financial infrastructure for loans would likely be more robust. This is already how a lot of businesses get off the ground.
A company doesn’t have to be 100% employee owned for the employees to have a controlling stake. An employee-owned company could decide to sell off 49% of its value to raise capital. They could do this at any time, including during startup.
The average worker would have more money to do as they please. In 2023, American companies earned a profit of $22k per worker. In a co-op economy, that’s an average of $22k each worker has control over that they currently don’t. Your average worker would be more capable of making the type of investment that you described.
Companies don’t necessarily have to start as employee owned. A normal path for an entrepreneur is to start a business, grow it until it’s sustainable and later sell it to somebody. Instead of selling it to an investor, they could sell it to their employees. In a co-op economy, this would probably be required in some way or another.