Originally this post was titled “the future is non-profit” … but then I realized I had stepped into a trap. The more I think about it the more I realize that the current vocabulary used to express business/money is a biased and limiting. A debate around profit/non-profit assumes that profit is a quantifiable indicator expressed in monetary terms. But that is not an assumption I subscribe to or care to proliferate. With that in mind …
For a a few years now I’ve been living with a belief that the only kind of sustainable business in the future is one where is there are no financial profits. There can be large profits … just not financially accumulative ones. I believe financial profits are at best an illusion (that is destroyed by a wider scope of valuation … for example ecological impact), but more importantly a sign of dysfuction (indicating that the scope of valuation is too narrow and is mising out key factors that are at least, if not more important then the factors that have been valued – that there may be negative value involved indicating destructive impacts that are not being considered).
Therefore I enjoyed the article The Sharing Economy Just Got Real which touches on thish subject in (1) in concrete examples that are (2) from the emerging technology industry and (3) uses existing legal/financial constructs to outline alternative business configurations and (4) a path of transformation for existing business.
“You can’t truly remedy today’s economic problems by using the same business structures that created the economic problems. Because of their current ownership structure, Airbnb, Lyft, Über, and TaskRabbit could be bought out by ever larger and more centralized companies that won’t necessarily care about the well-being of people using the services, or about the overall abundance of jobs in our economy.
There is only one way to ensure that a company will make decisions in the interests of the people it serves: Put those people in control of the company. So let me introduce the T corporation … have been around for a long time, and they have a major benefit of not paying tax if 1) they are governed democratically by the shareholders (i.e., everyone gets one vote in the election of the board, regardless of share value) and 2) the earnings of the company are distributed to the shareholders on the basis of how much they patronize (i.e. do business with) the company.
… it’s basically a way of saying “cooperative” without the cultural baggage that comes with the word “cooperative.” …
But, at the core of cooperatives is a very simple legal concept that turns the conventional business structure on its head. In a cooperative, money doesn’t buy votes in board elections and money doesn’t buy future profits. Rather, each member of the cooperative gets a vote and earns money based on the efforts they contribute. There is no single individual or group driving the company for their own profit. Many of the incentives for exploitation are simply absent in cooperatives.
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To convert the sharing economy companies into cooperatives, each company and its shareholders could voluntarily enter into a legally binding agreement to begin the process of selling the company to its customers as a cooperative, even if it takes 10 years or more to complete the buy-out.”