CoTech CoBudget


#1

Some time last year following the Wortley Hall event there was an instance of CoBudget setup for CoTech use - you can access it at fund.coops.tech. I understand a few projects were put on but didn’t get funded. It’s been managed by Outlandish but seems a bit dormant now.

There was a thread on mastodon that reinvented the idea of a CoTech CoBudget.

So, I’m just wondering if anybody has interest/motivation/time/etc to continue with it. If it was a good enough idea to set up an instance, seems a good enough idea to continue with, no? Any thoughts? Insights?

If it doesn’t work for some reason, it’d be good to know why.


OnlyOffice on Nextcloud
#2

I think what would make it work and give it life would be if all members of CoTech had to pool a % of revenues/ profits and then that money was allocated via CoBudget.

I really REALLY think the systematic pooling of resources within CoTech is needed for the network to be successful (it is what pretty much every single successful co-op network does).

Perhaps we could start with something like what the Valley Alliance of Worker Co-ops do? i.e. pay dues of 1/8 of 1% (i.e. 0.00125%) of their revenue to cover CoTech’s operating expenses and pool 5% of their profits into a co-operative development fund/ CoBudget.

We could of course choose different %s to those, but I suggest those as one of the lowest %s I’m aware of in other successful co-op networks.


CoTech Space4 gathering 29-30th November 2018
#3

Good idea – but how do we define “profits”? In an LLP, almost all the revenue is technically “profit”. In a business with wages, profits might be a very much lower proportion of revenue. We would need a model that was appreciated as equitable by all. I don’t know how to do that.


#4

Indeed - the problem I came up with last time I tried to do a push on this idea was that pretty much none of the co-ops had any disbursable profits.

There’s a surprising amount of underemployment seeing as it’s the tech sector, but not so much when you consider that 90% of employment in the sector is amoral and 5% is immoral - leaving only 5% of nice work for the good folks of CoTech. Unfortunately the people giving out the 5% nice work seem to think that capitalists must be more red in tooth and claw, or they like funding holiday homes and fast cars or something.

I think Outlandish would be willing to pool at least 1% of revenue (~£8,000) through co-budgeting. We’d be less inclined to put it into a centrally/democratically-administered fund due to the admin overhead that would have.


#5

That sounds like it might be a viable way forward, I expect that all the CoTech co-ops would need some time to consider this as a proposal, so would it make sense to put a proposal on Loomio to propose that a decision be taken on a proposal of this nature first thing in the New Year or something like that? Or perhaps a proposal could come out of the CoTech Space4 gathering 29-30th November 2018? I’d suggest that if we use Loomio for making a decision around this that we should decide in advance that perhaps all co-ops have to vote for the decision to be valid since the end result could be that some co-ops are deemed to have their CoTech membership terminated if they don’t pay in?


#6

I’m coming to this late, so sorry if this has been covered - but what’s the need for this? Do we have a clear idea of projects we would fund if only the money was there? I can’t access the website @nick mentions but he also says “didn’t get funded”, so what’s that about?

(The only example on this thread and the Mastodon thread is donating to Open Source projects we use, and while I’m personally fully in favour of that, I’d question which ones - maybe this is something each co-op is better doing individually, and then they can donate directly to the projects they use.)

So is there a way to avoid this harsh cliff-edge; because that’s quite a big thing. Maybe start with a voluntary fund and assume some but not all would put in? And then with that, prove there is good things we can do with this? And then with that proof, discuss compulsion and termination of membership?

(I’m not sure if I’ll be at the upcoming gathering yet - I’d like to come and meet everyone, but it’s a long way from Scotland)


#7

That doesn’t sound right to me and I’ve been a Designated Member of an LLP since 2002. Either you’re doing some funny accounting or not claiming enough expenses! :stuck_out_tongue:

Surely it’s just an incredibly simply matter of looking at whatever the profit lines on each co-ops’ annual accounts says, no?

Although looking at your most recent accounts it seems you’ve got zero profits recorded there, and so perhaps it is us who are doing funny accounting! :thinking:


#8

As @asimong says LLPs are ‘tax transparent’ meaning that all the members pay income tax an all the company’s income as if it was profits.

In terms of how we define profit:
If outlandish pays everyone £100k salary but no bonus, and make zero net profit it would not be fair to compare it to United Diversity if you paid each person a £10k pay, £10k dividend and posted a £20k net profit. I personally think you’d need to agree a rate card to work out comparible profit, which would be hard, but useful,


#9

Well, @jdaviescoates, perhaps “almost all” is a bit misleading. However, our LLP has no office, no equipment, and most of our work is done from our homes. So we do count a large majority as “profit”. Maybe we should be putting more partner’s home working expenses through our accounts, but, hey, many of us are self-employed anyway and do some of that in any case.

The point here, is that “profit” looks very different depending on how you account for people’s pay. If wages, in a traditional company setup, then “profits” tend to be much smaller than if it is the profits that partners divide up as their pay. That makes sense, doesn’t it? Isn’t that how you do it?

So, no, to me it’s not just a matter of looking at accounts and seeing what is labelled “profit”.


#10

You could perhaps get something roughly comparable by starting with turnover, and subtracting expenses or costs that are not wage or salary-related? Of course you could simply work on turnover, but that might end up being to the advantage of people like consultants, who have relatively low input expenditure.


#11

I had the same thought: start with turnover, and a tiny percentage based on that.

Whether it’s optional or compulsory is vital of course; it could perhaps be dealt with in one of 2 ways:

Either a decision on CoTech-wide pooling in (say in November meeting, or via Loomio)

Or any co-ops can choose to put into it, in return for a consensus-based decision by the (subset of) co-ops who donated in any year or round of projects. And/Or co-ops which cannot afford even a tiny % could (optionally) request to be involved in decision making (they would have no financial stake at that stage, but could put their case to those who did, especially if there’s a project they want to see happen, or could help with?)


#12

Good. So – what’s the proposal that is most likely to reach the best consensus around the whole of CoTech? What do we need to do to find that out? What kind of consultation or discussion, and how? Obviously we could start at the November meeting.


#13

To put teeth on the network and make it far more likely to succeed. AFAIK pretty much ever single successful co-operative network in the world systematically pools resources.

Given principle 6 “co-operation amongst co-operatives”, and given what a proven model it is, I personally find it to be completely bonkers that more UK co-ops do it so little.

(BTW: as a related aside: are another co-ops CoTech co-ops already members of the Worker Co-op Solidarity Fund?)

+1

I only mentions the VAWC model as that is one of the smallest %s I’m aware of - but personally I’ve always the idea of 1% of revenue.

They also have less security. So six of one, half a dozen of the other imho.

My view is that it should absolutely be compulsory for all member co-ops. Either we’re systematically pooling resources (because that is what all successful co-op networks do), or we’re not.

Although of course it needn’t necessarily be a fixed % of revenue, or even a % of revenue at all. I believe that within the Enspiral network all member ventures have to contribute to shared costs but each venture has their own mutually agreeable agreement as to what that looks like:

“Each venture defines how they wish to contribute to the network, financially and otherwise. This could be a flat monthly fee, a percentage of revenue, discounts on services, or any other contribution they wish to make. The basis of the Enspiral model is reciprocity and generosity - the expectation is to contribute at a level reasonable to the resources and stage of the venture.”

https://handbook.enspiral.com/agreements/venture.html (although I note this is marked as out of date).

Another example might be Radical Routes, who are probably the best existing example of a UK co-operative network with a decent track record. They don’t pool money, they pool time, i.e. all member co-ops have to commit to spending a certain amount of time (based on how many members they have) working of Radical Routes tasks.


#14

To be clear, I’m speaking personally here and not for my co-op.

I’m not really keen to establish this just because everyone else does it. Especially if there was previously an attempt at this that failed, I’d really want to see an analysis of what went wrong last time and what will be different to try and address that next time first.

I’m aware of the co-op principles - my co-op recently did a round of donations: https://twitter.com/djangogirls/status/1032145343918440448 for instance.

But I’d much rather see a positive case made for what explicitly can be done with a central fund that co-op’s can’t do individually.

For instance, to return to the one concrete example of Open Source donations; let’s say 10 co-ops all use Python and want to donate £100 each to the Python Software Foundation. To the Python Software Foundation, it gets £1000 either way - whether it comes through a central fund or in pieces from each co-op directly. So in that example, I don’t see what the advantage of this is.

So what I’m curious about is: what are the opportunities that a central fund can address that can’t be addressed individually? And why did it go dormant last time, and what will we do this time to try and fix that?

(I’m not against this - honest! I’m aware places like Enspiral do this. My position is: yet to be convinced)


#15

I think another key aspect of the way that Enspiral does it is that

There are more barriers to the former than the latter. A way of Cobudgeting time would be for us all to second some of our time into a new central co-op (CoTech Services, or whatever)


#16

The main issues were (IMHO):

  • Most co-ops didn’t have much/any spare cash
  • The complexity of one co-op paying the main bill and then invoicing all the other co-ops made the overhead too high

The latter could be solved by having a common entity with a bank account. The former could be solved by more co-operation (maybe)

I think the issue is that there’s a danger that free-rider syndrome will develop if we continue just to rely on the ad-hoc ‘generosity’ of some co-ops. E.g. Outlandish did most of the organising for the first Wortley Hall, Go Free Range and Agile did most of last years organising, and this year we’re not doing it.

It might be ODS’s turn? :slight_smile:


#17

Alana’s overview is really interesting, thanks.

The billing overhead certainly sounds like a good point. Was the fund mainly used for the yearly retreats then? But yes, using the fund for the yearly retreats sounds like a good positive example though! (And the article mentions that to - I’d be interested in reading more on that, having been involved in some group [and not group] event organising in the past.)


#18

There’s never been a main fund - that’s what’s being discussed here I believe.

For Wortley Hall one or more co-ops took on the work of organising (probably a couple of weeks work). They underwrote the cost of booking the venue, and then “sold tickets” to other co-ops at cost price (not including any cost for their labour).

They then had to invoice each other co-op for the price of the rooms they used, plus the shared facilitation costs and sundries.

It worked fine, but was a fairly big cost to the co-ops involved. A central fund where each co-op had to pay in enough to cover at least one person to attend might reduce the work and risk.

In terms of things that have actually been co-budgeted - they’ve been smaller, and more problematic due to the multiple payment thing. We raised about £2k for a CoTech party bar bill at Open Conference. But the results was that Go Free Range who kindly actually paid the bill and manged the co-budget had to send out and process 30 invoices, which isn’t practical when some are for £25.

Those smaller costs (e.g. paying for the Loomio, hosting the site, getting banners and flyers printed, sharing the cost of travel to an event to promote the network, etc.) would be most helped by co-budget or central funds.


#19

I have an admin accout on fund.coops.tech now, hit me up (with an email address) if you want an invite so you can have a poke around :slight_smile: (current admins on it are me and Joaquim d’Souza).


#20

I think the Enspiral model sounds fine (“Each venture defines how they wish to contribute to the network, financially and otherwise. This could be a flat monthly fee, a percentage of revenue, discounts on services, or any other contribution they wish to make. The basis of the Enspiral model is reciprocity and generosity - the expectation is to contribute at a level reasonable to the resources and stage of the venture.”)

Also I guess we’re talking about a fund which would keep the money within the (our) co-op movement, this is an important point. I’d humbly like to mention, in response to https://community.coops.tech/u/ODSCJames - Django Girls https://twitter.com/djangogirls/status/1032145343918440448 I’m sure is doing great work, but it’s a charity and therefore ‘external’ to the donors by definition.