Prefigurative Community Building (Part 20)

Worker Cooperatives: A Power With Blueprint for Collective Ownership

Image Credit: Janelle Orsi

Worker cooperatives are enterprises collectively owned and democratically managed by the people who work in them. They represent a living, practical alternative to exploitative business models rooted in hierarchy and profit extraction. Instead of concentrating power in the hands of investors or executives, worker co-ops distribute it among workers, aligning decision-making with those most affected by it. This essay explores how to start a worker cooperative or convert an existing business into one, following a Power With model of coordination that avoids all forms of Power Over. It concludes with two real-world examples and links to resources to support each step of the process.

Why Worker Cooperatives?

While I advocate for the development of worker cooperatives as a necessary and urgent intervention in the current economic landscape, I do not view them as the final destination. Rather, I see them as transitional formations, seeds planted within hostile soil that contain within them the potential to shift the very conditions that make them necessary. In a world ravaged by income inequality, wealth extraction, and disempowerment, worker co-ops offer a practical mechanism for redistributing power and resources. But their true power lies in their catalytic potential, not just in changing ownership structures, but in expanding our collective imagination.

Worker co-ops, at their best, are prefigurative: they model what it looks like to live and work beyond domination, competition, and hierarchy. But they still operate within markets that demand profit, within legal structures that privilege capital, and within broader systems that remain deeply unjust. As such, they are not the revolution itself, but scaffolding for it. A worker cooperative can offer stable income, dignity, and voice to its members, but more importantly, it can become a hub for further experimentation: mutual credit systems, solidarity housing, food sovereignty, collective childcare, and other forms of interdependent livelihood.

Ultimately, the goal is not to have every business converted into a co-op, but to create the conditions in which the logic of business itself becomes unnecessary. In a world where needs are met through relational coordination rather than commodified labor, the cooperative becomes obsolete, not through failure, but through success. In this view, worker co-ops are a step toward degrowth, toward decommodification, toward a commons-based economy where care and creativity take precedence over productivity and profit. They are tools for now, not temples for forever. What matters is not the endurance of the model, but the transformation it enables.

Step-by-Step Guide: Starting a Worker Cooperative

1. Gather a Core Group of Committed People

Power With begins with shared intention. Bring together 3–15 people who are aligned around a common vision and values. Meet regularly to discuss goals, skills, and shared capacity.

• Avoiding Power Over: Rotate facilitation, ensure all voices are heard, and develop shared norms for equitable dialogue.

• Helpful Resource: The Toolbox for Education and Social Action (TESA) offers workshops and games to build cooperative culture.

2. Define the Business Model Together

Choose a type of enterprise rooted in your group’s existing knowledge, community needs, and sustainable demand. Some co-ops start in cleaning, food service, child care, translation, tech, or construction.

• Avoiding Power Over: Use consensus or consent-based processes for key decisions. Use “rounds” in discussions to equalize airtime.

• Helpful Resource: Co-op Feasibility Study Guide (USFWC)

3. Incorporate as a Cooperative

Register your co-op as a legal business. Some jurisdictions offer special cooperative statutes; others may require creative structuring.

• Avoiding Power Over: Choose bylaws that hard-code democratic governance (e.g., one member, one vote).

• Helpful Resource: Democracy at Work Institute's Legal Resources

4. Design Internal Governance

Create a constitution or operating agreement that specifies:

• Membership requirements

• Decision-making processes

• Conflict resolution mechanisms

• Pay equity guidelines

• Accountability structures

• Avoiding Power Over: Build-in review cycles and transparent feedback loops.

• Helpful Resource: Sustainable Economies Law Center (SELC) Co-op Governance Resources

5. Capitalize the Cooperative

Develop a collective budget and decide how to raise startup capital. Options include:

• Member contributions

• Community loans

• Grants for cooperatives

• Non-extractive lending sources

• Avoiding Power Over: Avoid funders who demand control. Favor mutual aid and grassroots fundraising.

• Helpful Resource: Seed Commons – a financial cooperative

6. Launch the Enterprise

Start operations with a pilot phase. Review workflows, adapt quickly, and prioritize learning. Celebrate small wins together.

• Avoiding Power Over: Practice transparent accounting, shared decision-making on expenses, and rotating leadership in operations.

• Helpful Resource: Start.coop Accelerator

7. Join the Cooperative Ecosystem

Connect with other co-ops for mutual aid, mentorship, and resource sharing.

• Helpful Resource: U.S. Federation of Worker Cooperatives

Converting a Traditional Business into a Worker Co-op

This path allows retiring owners, values-driven entrepreneurs, or movement-aligned businesses to pass ownership to the people who sustain them. Workers.

Step 1: Owner Agreement

Secure buy-in from the existing owner(s) to sell or transfer ownership to workers. This often starts with trust and shared vision.

• Resource: Project Equity's Owner Readiness Guide

Step 2: Worker Organizing and Education

Educate the workforce about cooperatives, democratic governance, and collective responsibility.

• Avoiding Power Over: Facilitate open discussion about fears, desires, and motivations.

• Resource: DAWI's Employee Buyout Toolkit

Step 3: Business Valuation and Financing

Conduct an independent valuation and explore cooperative-friendly financing options such as:

• Seller financing

• Community capital

• Cooperative development funds

• Resource: Shared Capital Cooperative

Step 4: Legal Conversion

Create a new entity structured as a cooperative. Transfer assets from the old business to the new co-op under the agreed terms.

• Resource: Sustainable Economies Law Center's Legal Guide

Step 5: Ongoing Training

Support a long-term learning plan around facilitation, financial literacy, and cooperative culture.

• Resource: CoFED – Cooperative Food Empowerment Directive

Real-World Examples

1. ChiFresh Kitchen (Chicago, IL)
A worker-owned cooperative formed by formerly incarcerated women, ChiFresh provides healthy meals to schools and communities in need. It combines food justice, worker empowerment, and cooperative economics.

https://www.chifreshkitchen.com

2. A Yard and a Half Landscaping Cooperative (Waltham, MA)
Originally a woman-owned business, this landscaping company transitioned into a worker-owned cooperative. It supports living wages, environmental sustainability, and leadership from within the Latinx community.

https://www.ayardandahalf.com

Final Thoughts

Worker cooperatives remind us that ownership is not just about shares or equity, it’s about stewardship, dignity, and participation. In the face of extractive labor systems, co-ops build living alternatives where power is not taken, but generated together. They don't just redistribute wealth, they rewire how it is created. Starting or converting to a worker co-op is not easy, but it is deeply transformative. It’s how we seed a future rooted in solidarity, not scarcity.