Platform Cooperative Report

TREBOR SCHOLZ, Dec 2021

“Platform co-ops are thus a viable alternative to venture capital-funded, centralized platforms, putting stakeholders before shareholders. Through the platform co-op model, individuals can wear both hats of worker and business owner. This model allows them to aspire for greater income equality, dignified labor, democratic decision-making, financial returns from business success based on their contributions to their workplaces, and ease of access to the data collected about them. The platform co-op model offers an innovative approach with tangible benefits, empowering stakeholders over shareholders.

Currently, over 500 projects in 34 countries incorporate cooperative ownership of digital platforms. This white paper uses the term “platform cooperative” to describe worker co-ops, data co-ops, multi-stakeholder co-ops, and producer co-ops for whom their digital business is central to their operation. It is an emerging area with some companies generating around €200 million in revenue, while others are medium-sized or smaller in scale. Platform co-ops are not only relevant for advanced industrial economies: there are also new developments in the Global South, which could lead to these co-ops providing a wide range of services.”

Platform cooperatives are democratically-governed organizations owned by workers, customers, and other stakeholders. These entities match workers and customers and return a greater share of income to workers, increase worker protections, and build communities. Though still early in their development, platform cooperatives build on the proven business models of cooperatives to establish alternatives to the gig economy and its supporting digital infrastructure.

Platform cooperatives are critical to creating a fairer economy and building back better from the pandemic. However, they require active government intervention to be able to compete with well-funded and established private platforms.

This report suggests that governments on every level, from national to municipal, can take measures to empower platform cooperatives through actions including but not limited to:

Procurement policies to provide preferential treatment of platform cooperatives over privately-owned platforms.
Public solidarity lending to finance early-stage platform cooperatives as part of national, regional, and municipal development strategies.
Public participation in multi-stakeholder cooperatives via direct state ownership of co-op shares that provide a public voice in cooperative management.
Conduct legal research and review to ensure that laws governing cooperative enterprises reflect the changing realities brought by digital technology.
Create a system of public benefits available to the workers of platform cooperatives such as healthcare, childcare, and worker training.
Establish a network of public spaces that can be used explicitly by platform cooperatives to serve as hubs.

The ultimate goal of these policy prescriptions is to create a more level playing field for platform cooperatives by reducing the risks their members bear through the provision of collective goods.

Such basic services allow alternative economic institutions to compete with often unprofitable platform companies flush with venture capital funds.