Infrastructure for Shared Ownership: A Research Program

Authors: Derek Razo, Chelsea Robinson & Jay Standish

In 2022-23, Purpose completed a fund manager fellowship program which helped community leaders raise over $50M for community and employee ownership funds. Patagonia transitioned to steward ownership, which sparked a new level of interest in alternative ownership worldwide. Purpose also launched Common Trust to help more businesses transition to employee and steward ownership.

Across all this work, and for hundreds of collaborators, activists and builders, one thing has become clear to everyone working in this space: the default financial and legal systems that support the functioning of the economy are simply not aligned with long-term stewardship and shared prosperity.

Introducing: Infrastructure for Shared Ownership

In order to solve this problem, we are launching a new program of research in 2023-2024: Infrastructure for Shared Ownership. This is generously supported by One Project.

In the research, our aim is uncovering the success factors behind real-world examples of deeply networked economic cooperation at scale. We are investigating ways of doing business that weave multiple firms together toward shared prosperity. This sounds simpler than it is. Unsurprisingly, most of the default legal and financial infrastructure is oriented around competition outside an organization and aligning incentives inside an organization. But shared prosperity requires successful cooperation across organizations, missions, financial partners, etc.

Cooperation of this nature involves interlinked legal and financial structures that strengthen not only individual projects, but the resilience of stakeholders and competitiveness of the network as a whole. From researching these stories and case studies, our goal is to share actionable insights on how to build the missing infrastructure necessary for the shared ownership movement to expand by an order of magnitude.

What does this look like?

Many examples exist at scale, and through time, that demonstrate how to build extremely competitive, mutually beneficial financial and legally interconnected entities. Long standing and well-studied examples like Mondragon and the Japanese Keiretsu are joined by more recent examples such as the Industrial Commons, Sardex and Obran.

These networked entities can become large enough to offer competitive alternatives to traditional capital. This is the kind of architecture which can help prevent small to medium businesses being consolidated into monopolies, keeping wealth and stewardship in the hands of those who care and benefit most from it.

A simple example we’re looking at is shared services cooperatives. In this example, instead of hiring a 3rd party vendor to run HR or bookkeeping, multiple small companies pool expenses together and start an HR & bookkeeping service that they time-share, at cost. This ensures the service is totally focused and designed for their exact needs, and they get quality, affordable outcomes. Practically, this kind of thing reduces all the members’ expenses, and increases their resilience and value. It’s a true win-win. This enmeshment of legal and economic infrastructure becomes a stepping stone for deeper forms of cooperation and membership..

In another approach, we’re looking at ways for real estate and business owners to pool their assets to achieve diversification and resilience, while maintaining community control and benefit. This can be achieved through repurposing traditional Holding Companies and Roll Ups to integrate shared ownership. Putting small and medium businesses together under one financial system, managed by a group of involved people, or connecting these businesses more, can help them have more money available for their needs.

You’ll see results in 2024

We're about halfway through our research - we've done the initial legwork, and now we're starting to make sense of what we've found. We will share outcomes and findings throughout early 2024.