Switching from non-profit Ltd Co. to Co-op?

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?

Opinions welcome! Thanks so much in advance.


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 :person_shrugging:.


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…!

You might get a more detailed answer to your question regarding legal structures if you ask it on the workers.coop Discourse forum.


Ooh thanks so much for this, Chris!

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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.