Contrary to popular belief, there is no one-size-fits-all approach to success in Silicon Valley. Beyond raising traditional venture capital and beyond the pursuing-growth-at-all-costs strategy, there are people in the startup ecosystem that are finding success through less mainstream avenues.
At TechCrunch Disrupt on September 14-18, I’ll be chatting with Conductor CEO Seth Besmertnik, Driver’s Seat CEO Hays Witt and Aniyia Williams of Black & Brown Founders and Zebras Unite. These are not your “traditional” founders and CEOs. All three have taken alternative approaches in their entrepreneurial journeys, whether that’s been forming as a cooperative, buying back a startup from a tech giant and then turning it into a majority employee-owned operation or converting into a cooperative fund that invests in startups tackling social issues.
Besmertik sold Conductor to WeWork in March 2018, but a little more than a year later realized being part of WeWork wasn’t serving them. That’s when Besmertnik started exploring how to spin out Conductor from WeWork. Today, Conductor’s executives and more than 250 employees own about 90% of the company. And, more specifically, those employees are what Besmertnik calls “employee co-founders” who may appoint a representative to the board of directors.
“I want to be in an environment where we can all be owners in a company and participate in the good and bad,” Besmertnik previously told TechCrunch. “That was only made possible because of this situation.”
Conductor is not a co-op, but Driver’s Seat and Zebras Unite are. Depending on how it’s set up, a cooperative model offers workers and users true ownership and control in a company; any profits that are generated are returned to the members or reinvested in the company.
Driver’s Seat, led by Witt, is designed to help gig workers own and use their data so they can maximize their income. It works by requiring ride-hail drivers to install an app that educates them about how the co-op collects and uses their data. In exchange, the app gives them insights about their real hourly wages after expenses and how those wages relate to different driving strategies.
The company has yet to fully work out what percentage of the dividends will go back to drivers, but part of the requirement of operating as a limited cooperative association (LCA) means at least 51% of its surplus profits must go to patron member-owners.
“We incorporated as a cooperative because we want to commit to a business model where a majority of profits go back to drivers and the majority of governance is held by drivers,” Witt says. “We legally committed ourselves to that. That means we seek investors who are on board with that mission.”
Zebras Unite, co-founded by Williams, is focused on supporting startups that build businesses that tackle social issues while generating revenue. It’s a bit newer to the cooperative space and is still working out the classes of ownership, but the company aims to serve the tech ecosystem in a way that founders don’t have to make sacrifices around values.
At Disrupt 2020 on September 14-18, you’ll be able to hear from these founders about how they’ve built companies that prioritize profits, users and employees while putting VCs last. Disrupt is fully virtual this year and we have several Digital Pro pass types available that will allow you to experience Disrupt from the comfort of your home, including a Digital Startup Alley Exhibitor Package that includes access for three people for just $445. There also are discounts available for students and government and NGO employees. You can buy those passes here.