Cooperatives

The International Cooperative Alliance (ICA) defines a cooperative as “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise” [1].

The cooperative model is an ownership model that can work with various business models.

The seven cooperative principles are:

1. Voluntary and Open Membership,
2. Democratic Member Control,
3. Member Economic Participation,
4. Autonomy and Independence,
5. Education, Training, and Information,
6. Cooperation among Cooperatives, and
7. Concern for Community [1].

A cooperative is distinguished from other organizations based on democratic governance, member-ownership, and operating for the benefit of members.

Platform Cooperatives

Platform cooperatives are businesses that use a website, mobile app, or protocol to sell goods or services. They rely on democratic decision-making and shared ownership of the platform by workers and users [3].

There are four types of platform cooperatives:

1. Data,
2. Worker,
3. Producer, and
4. Multi-stakeholder [2].

Bottlenecks in Platform Cooperative Development

Developing platform cooperatives and growing the ecosystem unfortunately faces some obstacles.

Generally, where relationships are fleeting or transactional or the financial capital requirements are high, the answer has been less likely to be a co-operative. This would explain the lack of co-operatives in industries such as the pharmaceutical or automotive industry. Today platform co-ops face similar difficulties in trying to move into sectors already dominated by Big Tech companies [4].

According to Simon Borkin in Platform co-operatives — solving the capital conundrum, the four pressing challenges faced by platform cooperatives are:

1. “Governance: Platform co-operatives usually lack a geographically-rooted community, and can have divergent stakeholder interests, which create organizational problems.”

2. “Technology: Platform co-operatives may not want to adopt some of the technologies that have become synonymous with Big Tech and surveillance capitalism such as data analytics and artificial intelligence. Their lack of capital also hampers their ability to build platforms and supporting infrastructure to the same standard as commercial platforms — making it difficult to meet consumer expectations in terms of user experience.”

3. “Growth: Platform co-operatives are unlikely to be able to follow the established growth strategies of incumbents and so will find it difficult to build the natural network effects that fuel market penetration and consolidation.”

4. “Capital: The lack of a pure profit-driven business model means platform co-operatives struggle to access capital to grow, as financing in the start-up sector is predicated largely on venture capital, which generally requires investor control and the potential for large future returns” [4].

The biggest problem platform cooperatives face is raising capital because the “[current] venture capital model … is characterized by several features which co-operatives are either uncomfortable with or simply cannot accommodate” [4].

Crucially, co-ops don’t have comparable mechanisms for risk taking/sharing or for converting anticipated future profit flows into present value. As a result there is a distinct lack of co-operatives trading at significant scale in capital-intensive industries, like the latest high-growth, tech platform models, because of the difficulty in finding large-scale investment [4].

Some possible solutions to solve the capital problem include:

1. no-code,
2. Web3 infrastructure,
3. community/complementary currencies,
4. accelerators and start-up funds, and
5. new funding models such as revenue-based financing.

In this article, I will briefly discuss how no-code can help tackle the technology and capital challenges faced by platform cooperative developers.

No-code

No-code refers to software development tools designed for non-developers to develop apps primarily through visual tools to interact with a library of components, rather than through coding [5, 6].

“No-code has four characteristics, which include:

1. Simple filters can be used to instantly customize certain elements.
2. Drag and drop elements that can be visually structured to create websites or other web and mobile applications.
3. Easy functionality for non-technical users.
4. Easy-to-use APIs to integrate data from other applications” [5].

There are three types of no-code platforms:

1. UI generation software: “Users can quickly create user interfaces that interact with data stored in tables on the platform”,
2. integration software: “ Users create connections between software applications and triggers to move data through those connections”, and
3. transformation software: “main purpose is to add value to data as it moves between applications.” [7].

No-code’s benefits include:

1. No-code is designed for non-developers to develop apps primarily through visual tools rather than programming languages,
2. potential cost-savings from not needing to hire a developer permanently or temporarily,
3. increase in efficiency as the timeline for developing apps is shortened, and
4. supports collaboration between creators and between end-users and creators [5, 6]

No-code’s risks include:

1. lack of customization to meet a business’s specific needs,
2. the new product not meeting expectations,
3. costly services that may be more expensive than outsourcing, and
4. the team also needs to spend time learning how to use the no-code tool [5].

As long as the app or website idea is not too complicated and can be developed quickly (because no-code services can be expensive in the long run), platform cooperative developers can use no-code tools to test the waters with their idea to see whether to invest more time, money and energy into the idea to get more support (collaboration, followers, funding, joining an accelerator, etc.).

For example, a platform cooperative developer can learn how to use no-code tools on a site like Makerpad and use no-code tools like Glide or Webflow to make their entry-level app [8, 9, 10].

Lastly, this is also an opportunity or area for platform cooperative developers to work on as providing no-code tools to other developers can help grow the movement.

References

[1] https://www.ica.coop/en/cooperatives/cooperative-identity

[2] Calzada, I. Platform and Data Co-Operatives amidst European Pandemic Citizenship. Sustainability 2020, 12, 8309. https://doi.org/10.3390/su12208309

[3] https://platform.coop/

[4] https://media.nesta.org.uk/documents/Nesta_Platform_Report_FINAL-WEB_b1qZGj7.pdf

[5] https://www.thedailymba.com/2020/01/24/how-the-no-code-movement-can-help-startups-and-developers/

[6] https://www.infoq.com/news/2021/01/no-code-digital-transformation/

[7] https://www.infoq.com/articles/low-code-community-developer/?itm_campaign=rightbar_v2&itm_source=infoq&itm_medium=articles_link&itm_content=link_text

[8] https://www.makerpad.co/tool/glide

[9] https://www.makerpad.co/tool/webflow

[10] https://www.makerpad.co/tutorials

Originally published here: https://medium.com/p/no-code-for-platform-cooperative-developers-6b969f195900