Today is a big day. Today, Louder Than Ten Industries Inc. hands over operations to Louder Than Ten Workers’ Cooperative. That means Abby, Rachel, and I are equal partners. It also means new employees have the opportunity to purchase a stake and join us as an equal partner. We know this might sound like a questionable decision to many of you—especially to owners and consultants in our industry. We’re here to tell you that aside from being a more equitable and moral way of doing business, it’s also more practical, sustainable, productive, and financially secure. We’re gonna tell you why.
A little background
Since pivoting from a small scrappy web design shop to a project management and operations-oriented company in 2014, the purpose of Louder Than Ten has been to improve working conditions for digital workers by changing the way we think about work, how it gets done, how it moves through an organization, and who gets a say over what happens to them.
We’ve all seen it. The trendy digital agency website filled with stunning work, an About page filled with photos of cool-looking, happy employees scarfing down tacos and high-fiving around the ping-pong table living their best lives, and a slick homepage that reads, “We are a full-service digital storytelling agency that crafts quality digital experiences.” On the outside, they look like incredible, innovative work communities. They have inspiring copy about how they make the world a better place and have an incredible work culture.
Unfortunately, workers’ lived experiences are often the opposite. Sometimes, they’re a nightmare.
All of us at Louder Than Ten have experienced this firsthand throughout our careers, then, often as trainers and consultants working with other agencies. I’m sure many of you have, too.
Most of the owners we’ve worked with in this industry are good humans. They are nice people who genuinely work hard to create positive working environments and care for their employees and clients. When things are good, leaders seem amiable to being collaborative, are open to feedback, and are happy to distribute some decision-making power. At least as long as those things are lower in stake or line up with the organization’s and its leadership’s mission.
When things get uncomfortable, though, the vibe shifts. When conversions about money or clients or policy come up, transparency and openness tend to fade into the background. Worker opinions become irrelevant. Transparency gets clouded. Ethics fall out the window. Working hours increase. Demands intensify, and guilt festers. When things get extreme, layoffs kick in. When the threat of layoffs fills the air, the environment gets particularly nasty. The colossal weight of downsizing poisons morale and stokes our paranoia, fear, internal competition, and feelings of scarcity more intensely than under normal circumstances.
And it makes sense. When we have ownership over something, it can be taken away. If we care about that thing, our lives depend on its survival. When we’ve invested so much time, money, and attention, we will fight for it and do what we think is best. The more critical or desperate things get, and the more there is at stake and the less willing we are to trust others with our baby. When things feel scarce, of course, our instinct will come from a place of scarcity and not abundance. When things get tough, workers get sacrificed for the company’s survival and, by extension, the owner’s.
Rachel and I started Louder Than Ten because we didn’t want to be subjected to that. We wanted autonomy over our basic needs and the single biggest thing that can offer financial security—our jobs. We believed the only way to control our destiny was to own our company instead of having bosses with so much control and influence over our livelihoods.
We knew we wanted to be different, but it was a move of self-preservation as a reaction to the workplace trauma we had experienced. We thought the only way to survive and thrive was to start our own corporation. And every lawyer, accountant, and piece of business media seemed to agree.
As we evolved and added more team members, we knew they were more than cogs in our machine. We wanted to treat our people better than we had been treated but recognized that the owner/employee relationship carried an inherent dynamic that made each person who worked with us more expendable and, thus, ‘less valuable’ to the corporation.
If the company did well, Rachel and I would do well and could choose how to distribute the profits, regardless of how much labour and energy we put in compared to our employees. If the company did poorly, we would decide the strategy and where to cut expenses to preserve our livelihoods. We had all the choice and agency over our people, and the only ones accountable for our decisions were us.
Abby, our consultant and trainer who’s been with us for over six years, has trained more than half our students, helped develop our material and products, strategized with us, and project-managed us. She’s also supported sharing the joy, intensity, and stress of evolving with the company and rolling with economic change. Abby has always felt like and showed up as a partner more than an employee. In a traditional company, if we had to let her go, all of that investment she made would belong to us, and she would get nothing. That didn’t seem fair to us. Her contributions deserve not only recognition but also fair compensation. We couldn’t be what we are today without her. And what about future employees and their contributions?
Initially, we weren’t sure how to design a business that gave folks like Abby a real voice or say in the company. Then, we stumbled on worker-owned cooperatives.
How and why we became a worker-owned cooperative
Ownership runs deep through our economy and our social fabric. When you own something, it gives you power and control over that thing. And when you depend on that thing for survival, you need it to survive at all costs. It’s the operating system of capitalism, and according to Marjorie Kelly, author of Owning our Future, it’s supported by two fundamental rules:
- Maximize financial gain
- Minimize financial risk
While sensible and seemingly harmless, these rules are overly simplistic and downright destructive in isolation. There’s a concept called instrumental convergence that “posits that an intelligent agent with unbounded but harmless goals can act in surprisingly harmful ways.” Ever hear about the paperclip maximizer thought experiment, where an AI is programmed to carry out the simple task of making as many paperclips as possible? Its simplistic operating parameters and lack of guardrails cause it to consume all matter, including humans, in the process. Yeah, that. We believe that our current economic operating system is a prime example of this. On the largest scale, it resulted in a ruthless competition for total domination and acquisition of earth’s resources and the concentration of power and wealth to a few. All at the expense of our own survival as a species.
On a smaller scale, those same principles materialize in our workplaces. We’re forced to compete with our fellow workers for higher positions and pay to maximize our own financial gain and minimize financial risk. We do this just to keep up with our inflated living costs and scrape up the remnants of the dream we were promised as we entered and continue to navigate the workforce. This creates an antagonistic environment that nurtures individualism, competition, and coercion over cooperation and community. It results in lateral moves for raises and promotions that yield incompetence due to role stagnation, burnout, disillusionment, and a lack of engagement.
The path sounds inevitable because it’s difficult to imagine an alternative. That definitely was the case for us. We started Louder Than Ten to avoid being owned and to own something ourselves. We created a corporation because we didn’t know other possibilities existed. We’d heard of cooperatives before but never took them seriously. We didn’t consider them as serious organizations that would work with our model or our industry or even provide a living wage, let alone something you could build a life from and retire from. And frankly, the idea of being accountable to other workers to the extent that we could lose what we built seemed about as appealing as a punch in the ear.
Then in 2019, I read a book by John Abrams called Companies We Keep. The book chronicles Abrams’ journey of converting his architecture and construction company, South Mountain Company, to a worker-owned cooperative. One where everyone is an owner has a voice, and is financially rewarded. Every employee at South Mountain has the opportunity to become an owner of the company for the price of a used car. With their ownership shares, they get an equal vote in how the organization is run, a proportion of profits based on their contributions, and a growing internal capital account they can cash in when they leave the co-op. For long-term members, this could act as a nice retirement fund. They’ve been going strong for over 45 years with 37 employees, 22 of which are owners. Abrams described everything I always wanted as an organization but never thought possible.
This spark unlocked a rabbit hole of research into other models, companies, interviews, and resources. The more we learned, the more it just made sense. It felt crazy that co-ops weren’t more popular. We reached out to the BC Cooperative Association, who trained us and provided us with two amazing co-op developers named Marty and Chris, who helped us with our conversion.
Rachel and I never wanted to make an exit or to be dictators of a kingdom. We chose to move to a cooperative model because we want to create a healthy and sustainable organization that cooperates, makes our industry better, acts like a community, rewards our team members, and hopefully takes us to retirement and beyond with a team of worker-owners. We want our team to have a real voice and a say in what happens to them. We also want to share the rewards, intensity, and responsibility of being an owner with our team so we can shoulder it together. Most of us will fight like hell for democracy in government but settle for dictatorships in our workplaces. We won’t settle for that. The cooperative model is one component of the larger solidarity economy, which we believe in, ideologically and practically.
What is a worker-owned cooperative?
A worker-owned cooperative is a subset of the solidarity economy. It’s a business that can be either for-profit or not and is owned and democratically controlled by its workers. The structure and operating rules differ from organization to organization, but they all follow seven core principles:
- Voluntary and Open Membership
- Democratic Member Control
- Member Economic Participation
- Autonomy and Independence
- Education, Training, and Information
- Cooperation among Cooperatives
- Concern for Community
The benefits of being a worker-owned co-op
Co-ops are rare in the North-Western Hemisphere, but when you zoom out across the world, they are much more common and scale industries and sizes. There are entire cities built on a cooperative economy, and the impacts on their communities are significant.
Worker cooperatives are more resilient
Co-ops are more resilient than traditional capitalist businesses with concentrated ownership, especially during an economic crisis.
According to an analysis of all businesses in Uruguay between 1997 and 2009, worker cooperatives have a 29% smaller chance of closure after controlling for variables such as industry. In Italy, worker owned cooperatives that have been created by workers buying a business when it is facing a closure or put up to sale have a 3‑year survival rate of 87%, compared to 48% of all Italian businesses. A 2012 study of Spanish and French worker cooperatives found that they “have been more resilient than conventional enterprises during the economic crisis.” In France, the three year survival rate of worker cooperatives is 80%-90%, compared to the 66% overall survival rate for all businesses. During the 2008 economic crisis, the number of workers in worker owned cooperatives in France increased by 4.2%, while employment in other businesses decreased by 0.7%. More than three quarters of UK co-op start-ups (76%) are still flourishing after the difficult first five years, however, other business forms are far less likely to survive, with only 42% of all new UK companies making it through to the end of year five.
We’ve experienced this firsthand as our industry and the economy have undergone and continue to undergo chaos and uncertainty. We’ve had both our best and worst years since the pandemic started. 2022 was particularly tough as industry layoffs intensified and training budgets dried up—but we were able to adapt. We banded together and found creative ways to extend our money, get help, and adapt our services to a rapidly changing industry. All of this without laying off a single team member.
Worker cooperatives have more equal pay and employment stability
Worker members at co-ops also experience much less compensation disparity and employment uncertainty.
A study looking at all firms in Uruguay concluded that when controlling for variables such as industry, firm size, gender, age and tenure, workers employed in a worker-managed firm earn 3 percent higher wages compared with similar workers employed in the conventional firms. However, this wage premium declines significantly with increasing pay and becomes negative for top earners. According to research by Virginie Pérotin, which looked at two decades worth of international data, the tendency for greater wage flexibility and employment stability helps explain why some research observes higher and others lower pay in worker cooperatives relative to conventional businesses. A study by The Democracy Collaborative found that in the US, worker cooperatives can increase worker incomes by 70 to 80 percent.
The average wage of a CEO is now about 670 times the median employee wage in the top 300 US companies. In contrast, in the world’s largest worker-owned cooperative, Mondragon, which employs over 70,000 people, CEOs make no more than 6 times its lowest-paid employee. At Louder Than Ten, we’re building a transparent salary framework that includes similar rules to ensure that our compensation is distributed fairly. In addition, it’s our mandate to collectively and democratically decide how we weather tough economic times. If we can’t afford to pay everyone their ideal salary in tight times, we have options beyond the standard downsizing, which typically sacrifices lower-hierarchy workers to preserve the jobs and lifestyles of the people at the top. We may decide to collectively take less pay for a given period of time and defer salaries or convert them to shares we can realize later or cut other expenses. The point is that we work together and consensually tackle the problem before depriving our team of employment. Many companies offer salary frameworks, profit sharing, and stock options, but none of the equity or profit matters as much as when you offer the power to go with it.
Worker cooperatives are more productive
Cue the jokes about design by committee. Many talking heads in and outside of our industry like to perpetuate myths that democracy and cooperation lead to sluggishness, poor decision-making, and bureaucracy. But when we look at the facts, nothing is further from the truth.
According to Virginie Pérotin’s research which looked at two decades worth of international data, worker cooperatives are more productive than conventional businesses. Another 1987 study of worker cooperatives in Italy, the UK, and France found “positive” relationships with productivity. It also found that worker cooperatives do not become less productive as they get larger. A 1995 study of worker cooperatives in the timber industry in Washington, USA found that “co-ops are more efficient than the principal conventional firms by between 6 and 14 percent”.
Co-ops, the most democratic corporate structure, are some of the most productive and efficiently run enterprises under capitalism. Even as they grow, you can see why once you’ve lived it. We’re not blindly driven by a few people’s egos or desire for personal gain. We’re not mired by internal competition for scarce seats of power. We cooperate and work together for a common goal. When the company does better, we all reap the benefits. How many of you get to reap the rewards and get a say in what those rewards are when you work harder as an employee?
Workers at worker cooperatives have higher satisfaction, trust, health and commitment
What about worker satisfaction? Sick of losing teammates and trying to “fix” your culture? Want a great team that sticks around? Respect their autonomy and give them real power and dividends. When your workers own the thing you’re collectively building and are rewarded proportionally, you will keep and attract the best people.
According to a study drawing on a questionnaire from the population of the Italian province of Trento, worker cooperatives are the only form of enterprise that fosters social trust between employees. A survey conducted in Seoul suggests that in conventional firms, employees become less committed to their job as their work becomes more demanding; however, this was not the case in worker cooperatives. In the US, home health aides in worker cooperatives were significantly more satisfied with their jobs than in other agencies. A study from 2013 about home aid workers found that “Home health aides at the worker-owned, participative decision-making organization were significantly more satisfied with their jobs than those at other agencies.”
Louder Than Ten’s existence depends on attracting and keeping the most talented, respected, and highest-performing consultants, trainers, and support staff to deliver its mission to elevate digital workers and their companies in project management operations. We plan to grow this company and make lasting change by respecting and trusting our team enough to give them real power and ownership. This is understandably scary for many owners and may not work for everyone, but it makes sense for us.
Developing the Louder Than Ten Workers’ Cooperative
We took things slow as Louder Than Ten waited out the pandemic and economic aftermath, but we’re now excited to announce that Louder Than Ten is now officially operating under Louder Than Ten Workers’ Cooperative.
None of this would be possible without the help of the ultra-generous and supportive co-op community. We’ve never felt so much support in over 14 years of doing business—that 6th principle, cooperation among cooperatives, in action.
The BC Co-op Association and Vancity Credit Union graciously provided us with the expert co-op developer, Marty Frost, and his associate, Chris Galloway (who now run Co-Active, a co-op built for helping Canadian corporations convert to co-ops), to guide our conversion. They helped us design the organizational and financial structures, write our bylaws, incorporate, and raise capital to launch.
To start, our founding members are myself, Rachel Gertz, and Abby Fretz. Each of us has an equal vote on all policy matters. We share profit based on how much we work and earn internal capital shares that accumulate annually. And we’re planning to grow. We will need more people to scale the equitable company we’ve always dreamed of.
To qualify to become an owner at Louder Than Ten, you must work for at least one year at a minimum of 1000 hours and buy 10,000 shares, each valued at $1 (which can be deducted from your salary over a year) and be approved by the board. Once you do that, you have an equal vote and a proportional share of profit. Any shares you’ve paid for and accumulated will be paid out to you when you leave. We’ll go over the details of our compensation mechanics in another post.
Read our full operating rules (PDF) if you want to dig into the nitty-gritty.
What this means for our clients and community
The success of our company depends on having the very best trainers, consultants, and support staff in the biz. We’re making a big bet that the smartest folks in our industry want more than just employment but are exhausted by the thought of doing it all on their own. We want to create an environment where they get paid what they’re worth and have real ownership and power. We want members who are ready to build something that takes care of them in the future, where they’re cooperating instead of competing with their coworkers.
For our clients and community, that means getting the best support, training, experience, and advice in our industry. That means more expertise, availability, resources, and an even higher return on investment.
Our services are evolving
We’re also focusing on consulting, coaching, and training entire teams in project management operations. Training is great for individuals, but we find that they often hit roadblocks when bringing back their practices to their teams, and if they leave the company, some of that knowledge leaves with them. We can make a much deeper, longer-term impact when we can create alignment between leadership, project managers, and their delivery teams across all the core project management areas so they can transform how they deliver their work for good.
We’ve been experimenting with new models for a few years now that take the best part of our training, and with the support and guidance of our good friend Nick from Promethean Research, we have designed a savvier model that incorporates a coaching and consulting layer. This allows us to get to know your unique processes and company setup and design a program that not only gives you consultation advice, but helps train your staff to ensure you get a return on investment. Check out our Agency consulting page to learn more and download our learning materials.
We’re already proud of the work we’ve done and believe we have some of the best curricula and training out there, and we’re ready to scale this impact and help even more workers and their companies.
Introducing Louder Than Ten Workers’ Cooperative identity
With our launch comes a new brand. We designed our new logo and identity in-house, representing the solid, interconnected, and supportive structure of the new Louder Than Ten. You can also wear this shiny new mark on your walls, desk, or body with merch from our hot new shop.
Here’s a big shout-out to our good friend, Jon Wood, who designed our original logo, which carried us for almost 10 years. It will always be important to us (and if you need a good designer, hire him). He’s amazing.
The next leg of the journey
Today is one of the most important and gratifying days in the history of Louder Than Ten. Today, we become something bigger than the little company Rachel and I started 14 years ago. Today, we become greater than the sum of our parts. Today, we are a cooperative—one that commits to taking care of its workers and its community for as long as we exist.
Acknowledgements
We couldn’t do all this alone. In the true spirit of cooperation, we had help from a lot of people and organizations along the way. Thank you so much to…
- Marty Frost and Chris Galloway at Co-Active
- Nick Petroski at Promethean Research
- Rachel Cribby
- Emily, Austin, and the team at Rice & Co
- Josh Loewen at Status Bureau
- Elvy Del Bianco and The BC Coop Association
- Canadian Worker Cooperative Federation
- Vancity Credit Union
- The Cooperators
- Ketian Dou
- Marshall Watson
- Anna Coe
- Brett Harned
- Marie Poulin at Notion Mastery
- Bill Martin
- Natalie Semczuk
- Julia Kozlov
- Patti Epstein
- Lina Calin
- Lizz Ehrenpreis
- Sarah Durham
- Our friends and families who have been so supportive and believed us
- And most of all, the entire Louder Than Ten community and the organizations that support them… and us
- Anyone else that we forgot to mention that has helped us along the way
