Coop Data Club: Democratic governance and equitable point system

We have not yet set in stone how Coop Data Club is governed and how the point system will work. This is a preliminary plan, which we want feedback on. You can contact us with questions, thoughts and ideas.

The Basic Idea

The Coop Data Club includes two spaces. 

  • A directory of cooperatives that want to promote other cooperatives in their email newsletters, almost like a simple phonebook. Cooperatives that want to mention other cooperatives in their emails can add themselves to a directory where cooperatives that want to reach more people can find them.
  • A shared email mailing list for all cooperatives, and only cooperatives. The idea is for many cooperatives to recruit a small portion of members with the strongest preference towards cooperatives to subscribe to a shared email newsletter that promotes cooperatives for them. Cooperatives can earn free promotions in the shared mailing list by recruiting more people to join it or by paying the Coop Data Club. The surplus is distributed back to the members of the club.

Giving cooperatives edge over other firms

These two spaces are based on two advantages cooperatives possess:

  • Many cooperatives, especially small and medium sized ones, want to promote other cooperatives out of a sense of solidarity and shared purpose. Effectively no capitalist firms see any point in promoting another firm on the basis that it shares their ownership structure.
  • Most people prefer cooperatives over shareholder firms. All else being equal, effectively no one has an explicit preference of shareholder firms over cooperatives. This means that while an email newsletter with a defined purpose to promote cooperatives might only attract a minority of people with the strongest preference for cooperatives, an email newsletter with a defined purpose to make shareholder owned businesses more prominent would attract effectively no one.

Governance and the point system

The Coop Data Club is owned and governed by three membership classes:

Worker members

To become a worker member, one must contribute labour to produce regular content to the shared email list and maintain the directory. All workers have one vote in electing one third of the members of the board.

Cooperative members

For cooperative members, there are many possible ways to arrange membership. For example, becoming a member could require the cooperative to promote another cooperative or/and the shared mailing list in its email newsletter at least once a year. Cooperative members could earn membership points in many different ways. The most simple option could be that they would earn a point each time they promote another cooperative or/and the shared email list. A more sophisticated option would be to give points according to how many people have opened the email with the promotion of another cooperative, or how many people the cooperative has recruited to subscribe to the shared email list.

There are many potential ways to use the points. The most simple one is giving annual awards or maintaining a “hall of fame” ranking of cooperatives with the most points. One simple variation to this could be to require cooperative members to each year give away all their points to other cooperatives, and give an award to the cooperative that has received most points from others. The points could potentially be also used to buy promotions in the shared email list. For example, a cooperative could be rewarded with a free promotion in the shared email list if they earn 20 points by recruiting 20 new readers to join the list.

In addition to promoting other cooperatives, cooperatives that want to be promoted by others could also be made into members. Their requirements could include making a one-off payment or a monthly membership fee to access the directory of cooperatives that might want to help with email promotions.

The earnings generated from this could be distributed to cooperative members according to how many points they have collected. In this case, the cooperatives that would have promoted other cooperatives the most or/and recruited the most new readers to join the shared email list would receive the largest dividend.

Reader members

The simplest membership requirement for readers could be to verify their identity. One can subscribe to the shared mailing list without verifying their identity, but in that case they are not members. The benefit of reader membership is receiving a portion of the earnings made from advertisement in the shared mailing list.

A simple point system would be for members to earn a point for every email they have opened. The membership requirement might be to have opened enough emails regularly enough for long enough. For example, readers might be required to have opened at least 10 of the last 12 monthly newsletters to become members. This could encourage opening the emails, making the list more valuable as a whole.

Cooperatives can choose to advertise themselves to more regular and long term readers by including their promotion only in emails sent to Coop Data Club members that have above a certain amount of points. A cooperative might pay half the price for a promotion that is sent to only a quarter of the members with the most points. That money is then distributed equally between the quarter of members. If cooperatives want to advertise like this, the more regular and long term readers will receive higher dividends as a result of having accumulated more points. This could further increase the incentive for more members to open their emails more often for long periods of time.

It could also tackle one weakness cooperatives often have compared to conventional companies – incentives for first members. In Coop Data Club, the earlier one joins, the more total lifetime membership points the member can collect. The members who join first and read the emails regularly will accumulate the most overall points, but there is never a situation where anyone can gain a large portion of overall points. Everyone earns an equal one point by opening their email. This means that a member cannot earn more than twelve points a year from a monthly newsletter – the member receiving most points cannot earn hundreds of times more points than the member receiving least points.

Similarly, members can provide information about themselves and their interests in a sign-up, which can help the Coop Data Club send them emails they find more interesting. This is not required, but can help members earn a larger data dividend. For example, if a cooperative includes its advertisement only in emails sent to readers who are located in the UK, the earnings from those advertisements are shared equally between reader members who are located in the UK by propping up their data dividend they receive at the end of the year.

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