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The 'co-op' startup - will it work?

Some friends and I have started a company. We're not your typical start-up set-up...

We are three experienced entrepreneurs with day jobs, mortgages, insurance and school runs. We also live on three different continents! The company is a mobile app with a site - we've got to this point through distributed collaboration. We've seen some growth and would like to continue.

Working collaboratively we believe we can continue to build a successful company built by passionate, smart people around the world..."on the ground".

We want to recruit people "where they are" to join the company in different capacities from Marketing so Development to Sales ...to grow the company even further. We're thinking of a "co-op" idea...everyone owns a share of the company.

Will it work do you think?
Has this been done before with a start-up?

31 Replies

Elise Connors
2
0
Elise Connors Entrepreneur
Full-Stack Digital Marketer and Customer Acquisition Specialist
It could work if the level of ownership is right (assuming you wouldn't be paying that person a salary) but you have to find the right person who is willing to take on the risk/reward. Sent from my iPhone
Justin Jameson
3
0
Justin Jameson Advisor
CEO at Venture Consulting | We focus on the media, telco & tech space | Helping companies to profit from disruption
Check out Tim Ferris blog interview with the founder of Wordpress founder - he runs Automatic on exactly this basis. fourhourworkweek.com/2015/02/09/matt-mullenweg/ Justin Jameson | CEO T +61 2 9279 0072 | M +61 410 445367 @Twitter | LinkedIn [2015-Venture-Consulting-LOGO-LIGHT_Colour] [http://www.ventureconsulting.com/assets/icon_twitter.gif] [http://www.ventureconsulting.com/assets/padding.gif] [http://www.ventureconsulting.com/assets/icon_linkedin.gif] [http://www.ventureconsulting.com/assets/icon.gif] Read our latest blog: Subscription VOD in Australia Where to from here?
Colin Vincent
2
0
Colin Vincent Entrepreneur
TEDx Speaker | Co-Founder at Equity Directory
Anton, yes it can work. I have built two companies with remote co-founders. When there is a shared vision, commitment and trust, you can move mountains.
I suggest you look at www.slicingpie.com for help sorting out equity and if you want to connect w people to help, check out ourinvite-only network of entrepreneurs andstartup talent exchanging work for equity at www.equitydirectory.com


Zohar Hirshfeld
1
0
Zohar Hirshfeld Advisor
Sr. Director Business Operations, Product Globalization and Chief of Staff for Central Engineering
I believe it can work. There are somebedouin companies which I have seen in the past 10 years. Also, if you look at the open source world, this is sort of the model that they use. The only difference is that you will be working towards profits and the open source projects don't always have it in mind. Operationallythought it is the same.
Taj Sateesh
0
0
Taj Sateesh Entrepreneur
CEO at Sphinx Resources--The Preferred Recruitment Partners in Hi-Technology R&D & Manufacturing
It surely can work Anton....like Justin & Colin have mentioned.
The key here would be 'sharing' of the same vision & goals rather than pure & just technical competence.

There are quite a few Indian Startups that work on this model......with some startups having co-founders spread across continents [with the expertise & role of each of them being very clearly defined].
When I spoke to the CEO of one of such startup in a Seminar, the reason he gave for such a choice......the remote co-founders being spread across continents.....was to take advantage of the time-zone differences to speed-up the work. It does make a lot of sense to me. What would be achievable in a 24 hrs span would be much higher.

However, this model does entail a lot of syncing between the partners.......so emotional & working style bonding needs to be much higher than in situations where all the co-founders are in a single location.
Jim Murray
2
1
Jim Murray Advisor
Communication Strategist. Writer. Blogger. beBee Brand Ambassador
Sure it can be done. I'm working in much the same way with an associate in Sweden to create an on line learning experience for sales professionals. We will be recruiting re-sellers from all over the world. Email. Skype. Facetime. There is no such thing as distance anymore. Good luck.
Bruce Carpenter
1
0
Bruce Carpenter Advisor
Co-founder and Principal, Harbour Bridge Ventures
Anton, Yes it can work, however the model certainly has both its challenges and potential strengths. I am presuming that given your progress to date you share a common vision and have clearly defined the roles of each participant. The challenges will arise as the opportunity you have launched grows in size and additional resources and people must be brought in to support that growth. You will need to think carefully about how to distinguish what role or roles each location in the enterprise will fulfill and how to manage effectively the coordination of the teams and their functions. The right command and control mechanisms will need to be put in place. A common corporate culture and ethic shared by the original founders will need to effectively shared and promoted amongst all who join in the future and moderated by the founders. The diversity of the founders can also be a strength if you understand how to use it effectively. I wish you luck. My own history saw my partners and I quickly grow a small technology company to be a global leader in its space with an extensive network of over 1500 employees on five continents and many countries in each. The challenges in managing that growth were extensive but the diversity of our workforce was also an important strength that helped us become a global leader. Good luck and I wish you great success.

Rob La Gesse
0
0
Rob La Gesse Advisor
VP, Global Social Strategy at Rackspace, the #1 managed cloud company
Of course it can work. As others have said, there are many examples. I tried this model once and it was extended to there not really being a "boss" - equal votes - it failed fast (thankfully). Every business needs a decision maker. We were so often locked in indecision that our stubbornness outlasted our funding.

It can certainly work - but it does need a leader.
Ray Cone
0
0
Ray Cone Entrepreneur • Advisor
Director of Information Security (GRC) at TeleTech
Anton...a coop is more of an equity model for all stakeholders versus a functional or hierarchical arrangement. Ownership doesn't necessarily directly align with strategy or tactical decision making. I fully endorse and promote the various coop types. You might reach out to the NCBA if your looking to connect with other firms in the coop economy...you can also drop me a line and we can chat.

Best,

Ray Cone
Rand Strauss
2
0
Rand Strauss Entrepreneur
Transforming politics and government, Visionary at PeopleCount.org
You can do a search for: worker owned businesses
or: employee owned cooperatives
You can also add "reich" to the search- Robert Reich advocates these.
There are some resources at the bottom of:http://www.entrepreneur.com/article/241522
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