Less than 1% of startups secure venture capital funding. At Limeleaf, we're part of that 99% – but by choice.
Since founding our company, a few people have asked how we plan to fund product development. Most assume we'll try to raise VC money. Today, we'll explain why we aren’t taking that approach and what we’re doing instead.
Worker cooperatives ("co-ops") are a growing alternative to traditional hierarchical tech company structures, which often rely on venture capital funding. Unlike conventional startups that take VC money in exchange for an equity stake, co-ops prioritize worker ownership, democratic decision-making, and profit sharing and strive to embody the 7 Cooperative Principles established by the International Co-operative Alliance.
When we started Limeleaf, we wanted to do things differently. We wanted to create a democratically managed business where every worker had a voice and a stake in the company's success. In short, we wanted to start a worker cooperative (even though we don’t call ourselves that, for reasons we covered in Part 1).
In this second installment of our series on starting a tech company as a cooperative business, we’ll discuss how we wrote our Operating Agreement (OA).
At Limeleaf, how we do our work is equally important as the work itself. As we explained in a previous post, Limeleaf operates as a worker cooperative, and we are dedicated to embodying the Seven Cooperative Principles.
Cooperatives have gotten a bad rap over the years. They’ve been portrayed as impractical, plagued by decision paralysis, and insufferably hippy-dippy.