The question of profits has come up in the past few weeks, and it’s been an interesting learning experience, thinking about control as different from profit.
By giving over control/decision-making/
- as sole proprietor of a business legally bound by a Constitution which has term limits, control will pass on to the next main community organizer as sole proprietor/staff… (we knew this)
- and instead of my being powerless and helpless and having to ask to be given compensation, it’s extremely likely: by legal default of contract law, law which is outside of our autonomy limits in the decision-making structure, I’m entitled to receive 100% of profit-sharing, or near to that, to receive fair compensation.
Summary: Instead of my asking to be given a percent of profits, contract law says until there is fair compensation, I receive 100% of profits and can then choose to give some of profits back. I can also sell my interest in profits. I will research structures to sell shares for profit-sharing (not control of decision-making, but only receiving profits) in the coming 120 days, which I think is a reasonable amount of time.
The business will be valued by an ASA (which has started), market rate expenses will be determined.
- 100% of profits will go to me by default, but I will have no say in the business other than as a member. Profits are totally different from control.
- 100% of the control/responsibility/
decision-making I had (autonomy of staffing decisions, budget decisions, rates, choice of entity if any, legal agreements, creative choice, community choice, whether to grow the business, etc.), will go to Fitz… bound by the Constitution, which is legally binding, a decision-making structure which transfers to the people in the roles defined. The amount of control is more than I had when I started here.
What else? As we know, the Constitution is limited by the laws outside of here: city, county, state, federal. I’ll work on defining what the business is. Fair compensation, which is profits as a percentage of gross revenue, needs to go to me, until I’m fairly compensated (bought out by shares of profit-sharing). That’s contract law, outside of the autonomy of me or any other member to decide in our structure.
I was asked by a member yesterday, after talking for a few hours, as he said, shooting the shit, whether, if I had to choose, would I want this to be either many more members who had a blah experience, or would I prefer us to be similar to the number of members we are now, with a great experience like we have now. I said if I had to choose, I would choose fewer people having a great experience. He said he doesn’t think it’s necessary, but it’s good to hear my order of priorities.
And that choice may be a difference between some typical business transactions, and what is happening here as a democracy business. I’ve chosen not to have to make a polarizing choice between making money or doing good, but I’ve chosen for me to only make money by doing good. Money is never the reason I will do something, it is not a motivator for me, but lack of it should not be a deterrent from doing something good. My thesis is in any well run democracy there is a surplus compared to a traditional business. There are about six reasons why, which I could get into. I want starting a democracy to be more profitable for an entrepreneur than starting a traditional business. I want this transition process to be not a bitter experience, which seems to be what people elsewhere might expect in a transition, but a savory experience, which I think is totally reasonable, and already happening here, something we can savor.
Alex Linsker, “Collective Agency” Main Community Organizer June 15th, 2011-June 14th, 2012
June 15th and on: (503) 369-9174 mobile
322 NW Sixth Ave, Suite 200, Portland, Oregon 97209