Our non-profit has been running for over 13 years delivering tech workshops across South Yorkshire and online, but we’re still heavily reliant on grant funding as our revenue streams are still quite weak! It’s mostly small grants, predominantly National Lottery funding.
However, there is the age-old issue of our board of directors who kindly volunteer their time being separate from the freelancers who essentially run the company day-to-day; it’s just the nature of the beast with bureaucracy and hierarchy. We’ve been exploring the possibilities of becoming a co-op for years but still struggle with the potential challenge of a) access to grants through funding bodies who seem very keen on hierarchies and boards rather than workers running stuff themselves, and b) a lack of revenue streams.
I was just wondering if anyone has insight to this? Are we missing something obvious? What chance would we have on survival on grant funding if we became a co-op? Have funding bodies changed their thinking on non-profit models? If workers took on responsibilities a board of directors had, would this require more work for them at lower rates? Does anyone have experience of being part of a co-op which is predominantly grant funded in absence of significant commercial revenue streams?
I don’t have any answers for you but have you considered having two organisations, perhaps a charity for receiving the grants and a workers co-op for delivering the service? Of course this would probably result in doubling the admin overhead so it might be a terrible idea .
It’s not possible to be a not-for-profit charity and a co-op at the same time? It’s not clear to me exactly what the grant funding requires (e.g. if it requires having a chair then it’s not the ideal but you could register all members as directors, and nominate a chair)
I think lots of groups experience a force willing them to fit into a mould set by bureaucratic/hierarchical infrastructure. I don’t like to hear myself say “compromise with it”, but I’m wondering if it’s possible to take on a co-op structure whilst checking the boxes the grant funding wants you to check
If a charity can own a company that it has created, then a co-op should be no different.
One way of working with the fraud prevention mechanisms that were designed to stop people setting up legal shells to loot the charity’s assets, would be to have specific clauses in the co-op constitution that defines what happens to the assets of the co-op if it has to wind up, so that the assets will return to the charity.
This is the mechanic used by some co-op’s to prevent carpetbagger’s joining the co-op just to loot the bank accounts.
Thanks for the answers, friends! Lots of food for thought. I appreciate you taking the time to give me such considered and helpful responses!
It’s definitely a challenge. I agree that it’s best to avoid bureaucracy, especially as it’s tough enough as it is finding directors. And if the workers become directors, with an elected chair, some grant funding organisations still frown upon that because the applicants are being paid.
We really believe in co-ops and are really wanting that model, but it’s a challenge to make the leap for sure…!
Hey Jay, not sure if you ever came to a conclusion / solution, but if you are still trying to work things out you could drop a line to Mark Simmonds in Yorkshire, he’s really great on governance questions and could probably direct you to support so you’re not having to work it out on your own: mark@culture.coop.
Hope it worked/works out for you.
Dropping this here in case it is useful for others. As Russ from the Hackspace foundation posted this a few years back and it might be useful to others.
Hi! I’m logging back in for the first time in a while. By coincidence, we met at the workers.coop Own the Future drop-in on Monday and I must say, you were so helpful! I had no idea you were the same person, ha.
Suffice to say it became too great a challenge to convert the existing organisation, not least with all that history and culture that’s tough to change. So that is winding down this year, and I’m starting from scratch.
With that said, I’m looking at starting a co-op from scratch, entirely focused on promoting tech use at the intersection of privacy, security, sustainability and inclusivity. I’ve been a bit surprised at the demand for such services already but really want to deliver such support as a co-op, and thanks to your pointers I’d probably lean towards a CIC or Ltd company with co-operative rules, as I still believe we’ll be delivering a lot that is worth grant funding too.
Thanks to everyone who has offered advice and support so far!
Not a co-op, but it might be worth taking a look at the project I run, Pau&Company. It’s an Ethical Tech Consultancy specialising in privacy, cybersecurity, the environmental impact of IT and the use of AI. I’ve recently built a tool for checking the diversity of a team, currently in beta. So quite a lot of overlap with your idea, let me know if you want to have a chat.
Hi! I remember we discussed setting up a meeting when I was still battling away in the preexisting organisation, but obviously that hasn’t been successful for me, so I’m starting from scratch. It would be good to chat, yes! I’ll drop you an email soon. Thanks!
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