WOTICETT companies: worker-owned, tapered-investment, compensation-equal, tapered-time

I’ve been thinking about economic systems and the huge problems with the way we handle work, employment, pay, and profit in the United States. Another way is possible.

The model of work I am here envisioning recognizes that:

• Sustainable societies are built on sustainable economies which are built on sustainable lives of the workers in them.

• Personal time is the key finite resource, not an abstract like money.
(If worker time is treated as the resource of greatest availability, workers are exploited.)

• Extractive capitalism is built on an unrealistic model of eternal growth and payment of ever-growing returns to investors. This is inherently unsustainable as it continually removes value from companies and their workers. Alternatively, worker ownership retains value within the company and among workers, and as a by-product strengthens local economies, which usually helps with long-term company success.

• Investment is still needed to start companies, though, so the initial extractive return on investment must be tapered to allow the company to become sustainable. One possibility: companies start with 52% worker-ownership, 48% investor ownership. Every three years 1% of investor ownership shifts to worker-ownership (dividends shifting to compensation, usually to new workers as the company grows). After 16 years the company is 100% worker-owned.

• Every human deserves dignity in their work and an equal opportunity for time away from work. Early attempts to legislate this fundamental right gave us the weekend and a cap on workday length. The next step is to pry apart compensation from hours labored; we live in a time of great prosperity and there is enough to go around if we divide it equitably. Therefore, this model assumes that the total company amount of compensation to workers is divided evenly among them so that all have at least a livable wage. There are no tiers of pay. All worker-owners benefit from company success or feel the squeeze equally when the business or economy is struggling.

• The minimum time a worker has to spend at work in a given week is the distinguishing difference between workers at different levels. An entry level worker commits 35 hours a week to the company. As they grow in experience and efficiency, this time tapers down. Every two years worked with the company reduces the minimum hours required by 1 hour. Every eighth year this drops an extra hour. Thus, after six years with the company, a worker’s minimum hours are 32. After eight years, they are 30. After sixteen years with the company, a worker only needs to work half-days (or however it makes sense to allocate their 25 hours). After thirty-two years, they’re involved a couple days a week. After forty-eight years, just 5 hours a week. This is enough for their wealth of experience to still benefit the business and for them to still be engaged in public life, but at a level that respects their reduced energy for work at their age. After fifty-six years as a worker, they have no further obligation and pensions kick in.

• Workers moving from one job to another will enter at a time level reflective of their experience with that kind of work AND the age of the new company. For example, a worker who has 20 years experience leaves to join a 10 year old company and instead of working their old minimum of 23 hours a week, they will work a minimum of 29 because the new company is still growing and everyone there works that many hours.

• Workers are incentivized to remain with a company and help it grow because switching to a new, younger company will generally mean committing more hours of time per week and delaying their pension (unless they subsequently switch to a more established company and are able to negotiate recognition of all their experience).

• Workers are incentivized to be more efficient (because they want to work only their minimum hours) and companies are incentivized to right-size their business to match their market (because they want to keep worker compensation good while those workers put in just the minimum hours).

• Some businesses will be more profitable than others as economic factors fluctuate. Their worker-owners will decide how to use those profits, either applying them to the company for improvements or growth, sharing them out to the current worker-owners, or adding new worker-owners to diffuse the compensation across more people (enabling further profit or growth and possibly allowing all worker-owners to commit below minimum weekly hours, thus realizing the benefits of long-term employment sooner).

A common pattern which might emerge under the WOTICETT model is that of workers of medium experience temporarily becoming involved in two companies (or double roles at one company) to increase their resources before dropping back to just one when they become parents or need to be more available for elder care.

For example, Chris started work young and joined a company at age 17. At age 27, with ten years experience and working 29 hours a week, Chris gets invited to participate in a friend’s new company. The first couple years are intense, working 64 hours a week, but then that number begins to drop until at age 37, Chris is working a total of 52 hours a week (23 hours a week at the first company and 29 hours a week at the friend’s company).

Chris’s partner, Devin, is five years younger. Devin helped care for child siblings when young and didn’t join a company until age 22. Now, at age 32, Devin is working 29 hours a week. Thanks to the resources they’ve built up through Chris’s decade of double pay, the couple has enormous flexibility should they decide to have children.

They might choose that Devin will become a full-time parent. In that case, when their kid is ten years old, Chris will be 47 and working 40 hours a week (17 hours a week at one job and 23 at the other), and Devin will be 42 and fully available for parenting and life admin tasks.

Or maybe after all those years of double work, Chris becomes the full-time parent. Then when the kid is ten years old, Chris at age 47 is fully available and Devin at age 42 is working 23 hours a week. They’re living on one income instead of two, but they have a lot of free time to make living cheaper more possible.

Or if they carry on as they had been, when the kid is ten, Chris at age 47 is working 40 hours a week (17 hours a week at one job and 23 at the other), and Devin at age 42 is working 23 hours a week. They still have three incomes and though they still probably need some assistance with childcare, they do have considerable family time.

In those three scenarios, when the kid is twenty, Chris is 57 and Devin is 52, and they’re either:

  • working 27 hours a week (10 at one job and 17 at the other) and not committed to company work, respectively, and living on two incomes;
  • not committed to company work and working 17 hours a week, respectively, and living on one income;
  • working 27 and 17 hours a week, respectively, and living on three incomes.

All of these scenarios—along with the variants in which Chris drops back down to just one job or where one of them returns to work when the kid is 15 or 20 years old—are vastly more appealing than the average options most families are facing today.

They become even more appealing as we roll out the scenarios into later years of life. At ages 67 and 62, Chris and Devin are either:

  • working 14 hours a week (4 at one job and 10 at the other) and not committed to company work, respectively, and living on two incomes;
  • not committed to company work and working 10 hours a week, respectively, and living on one income;
  • working 14 and 10 hours a week, respectively, and living on three incomes.

At ages 73 and 68, they are either:

  • working 7 hours a week (pensioned at one job and 7 at the other) and not committed to company work, respectively, and living on two incomes (or one income plus whatever level a pension is set at);
  • not committed to company work and working 7 hours a week, respectively, and living on one income;
  • working 7 hours a week, each, and living on three incomes (or two incomes plus whatever level a pension is set at).

At ages 83 and 78, they are either:

  • pensioned from two jobs and not committed to company work, respectively, and living on two incomes (or two times whatever level a pension is set at);
  • not committed to company work and pensioned, respectively, and living on one income (or whatever level a pension is set at);
  • pensioned from two jobs and pensioned, respectively, and living on three incomes (or three times whatever level a pension is set at).

That is a healthier life than most have now.

Would a model like this require some major changes from how things currently work? Yes. Is it realistically possible? Absolutely.

The current model has been staggering along for decades with a few exploiters buying IMAX screens for their superyachts (or whatever that decade’s equivalent of gross excess happens to be) while an alarming percentage of people struggle and suffer, working three jobs to be able to pay for childcare.

If we can limp along with this broken system, we can certainly afford a different one which, even if not ideal, lifts millions of people up to vastly better lives.

Familiar lessons from closing a business

Thanks so much for sharing this Bryan! I’m a huge fan of Makeshift Society even though I’ve figured out that I’m one of those folks who gets more work done alone at home. Very glad you all took the opportunity to create this experience—and glad you were able to make this experiment and extricate yourselves from it with relatively minimal pain.

Seems as though about two years is the right amount of time to figure out that the plan isn’t going to work. When I had my one-woman bookstore in San Jose in the mid-1990s I spent roughly that time in site prep (built-in bookcases, signage) and being open. By a couple months before the end I had determined that though the store could pay for itself, it could not pay me. My initial runway was shortened radically when the long-term relationship I’d been in while planning and opening the store and during its first year ended, leaving me with a need to pay my own security deposit and rent for a new apartment, and thus needing the paychecks I’d been getting by without.

Thinking through “What if we learn we’re wrong about something and we need to close in a year or two?” is a great exercise for anyone planning a business. I was able to safely walk away from the end of my grand adventure because I’d planned my payments to my major investor such that I could continue making them while working a post-adventure full-time job. Sure, a painful expense comparable to car payments or hefty student loans, but doable—and enabling me to keep both my honor and my credit rating.

There’s certainly no defeatism in doing this planning. Something hard to predict could turn out to be a major factor—as with the differences between SF and Brooklyn you found—or a huge influence on your market could appear after opening—as occurred for me when Barnes & Noble opened 30,000 square feet of bookstore space in the south bay within a few months of my 400 square foot store opening, or when after I’d managed to pivot to add games to my offering as a funny little sideline called Magic: The Gathering came out, quickly becoming 70% of my business, the supply of Magic: The Gathering dried up for a couple months. You just never know. You make your best guesses, work up a range of spreadsheets, and go for it.

The best thing about sharing experiences like this is how it helps everyone guess better.

Small Business
Planning
PostMortem

[This was a comment on the article “The mystery of the white dress shirt: Death and life of a Brooklyn coworking space” by Bryan Boyer on Medium.]

Beware the UPS Store (or Mailboxes Etc or similar) mailbox

NOTE: THE BLOG POST BELOW IS FROM 2014. THE INFO IT CONTAINS MAY NO LONGER BE CURRENT. CHECK THE POLICIES OF WHATEVER MAILBOX (OR OTHER) SERVICE YOU’RE SIGNING UP FOR TO SEE HOW LEAVING THAT SERVICE WORKS. DON’T TRUST COMPANIES THAT MAKE IT NEEDLESSLY HARD FOR YOU TO FIND THE RIGHT FIT FOR YOUR NEEDS.
–Dinah, January 30, 2019

Warning: If you sign up for a mailbox at a non-USPS location, you will not ever be able to file a change of address for it with the postal service.

Also, it’s probably a franchise, meaning UPS (with their potentially-consumer-benefiting concerns about maintaining their brand) has no control over pricing, meaning the store might decide to double the fee for that mailbox at some point and leave you with a tough choice.

CRMAs are required to offer mail forwarding services for six months, but they can (and do) charge for them. So far as I am aware UPS Stores do not offer forwarding for a closed box for longer than that six month minimum.

Yes, it’s nice to have a non-home-address to use for business or other purposes, but be aware that there are serious flexibility issues with signing up for CRMA (Commercial Mail Receiving Agency) services.

Update July 25, 2014: Just spent 51 minutes on the phone with USPS. The person I spoke with said her supervisor told her that you can put in a change of address from a CRMA address to a street address or USPS P.O. box. I’m going to try that and hope it works.

My particular UPS Store, while not bending on their pricing which is now 4x the cost a USPS box, did say that it is their policy to hold mail from terminated boxes for a little while and to turn it over to the former box owner if they check in, after which they return it to the postal service. It is unclear what would happen to that mail then. It’s already been delivered, but maybe a change of address could kick in.

But no. After trying to submit the change of address, I got this on the USPS website:

“Mail addressed to an addressee at commercial mail receiving agency (CMRA) is not forwarded through the USPS. The CMRA customer may make special arrangements for the CMRA operator to re-mail the mail with payment of new postage. A CMRA must accept and re-mail mail to former customers for at least 6 months after termination of the agency relationship. After the 6-month period, the CMRA may refuse mail addressed to a former customer. The Application for Delivery of Mail through Agent (PS Form 1583) requires an addressee and agent to comply with all applicable postal rules and regulations relative to delivery of mail through an agent. For more information on mail forwarding regulations, contact your local Postmaster.”

I have not been offered any mail forwarding service from the UPS Store and it sounds as though they would immediately put in a termination notice with USPS for accepting my mail. Not sure what that means would happen to any of my mail, but seems as if it would be destroyed or returned to sender.

Announcing The Art of the Shim—a new book from Dinah!

Hooray! My second book, The Art of the Shim: Low-Alcohol Cocktails to Keep You Level, is now out in hardcover and ebook.

Building this book has been a fun time and—due to an aggressive sub-one-year production schedule—a challenge, but the results are beautiful. Kelly Puleio's photography is even better than my high hopes and the production quality on this, the first offset printed title from Sanders & Gratz, is excellent. I'm very happy that the book has the sturdiness to serve its readers many years on their bar shelves.

Along the way I've been expanding my skills even further into the publisher realm. (Discardia: More Life, Less Stuff is print-on-demand in its paperback form, so inventory management and distribution is a new adventure.)

Some of the lessons have been painful. I've now learned the hard way that Amazon's record of a book can apparently get messed up if the release date is before Ingram has their copies on hand—or at least that's the only explanation I can find for Amazon suddenly switching the book's status to "Out of Print–Limited Availability" sometime between midday Saturday and midday Sunday last weekend. We're now on day four of no order button for the hardcover, which is enough to make anyone trying to launch a book tear their hair out.

In the meantime, I'm keeping fans of Bibulo.us and the book updated on Twitter and Facebook. Also taking deep breaths and saying "calm blue ocean" a lot.

Copies of the book are now in stock at Ingram's Oregon distribution center and lots more will be arriving at their Tennessee one today or tomorrow. Perhaps that will help kick the Amazon status back to normal (though I fear that if their techs don't identify and eliminate the bug, the problem would just come back the next time Ingram or their on hand count hits zero).

Next Tuesday (9/17) will be the New York launch at Pouring Ribbons bar and a week from Monday (9/23) will be the San Francisco celebration at The Booksmith bookstore. Looking forward to those events very much!

Even with bumps on the road, I'm having a great time as an author and a publisher!

The Week Behind

It's been a good week, with much satisfaction arising from the current book project, The Art of the Shim: Low-Alcohol Cocktails to Keep You Level. All the amazing conversations of the week before and much digging in old cocktail books, thinking about principles of drink creation have been percolating in my head. This resulted on Tuesday in my finalizing the first draft of the Bibulo.us Cocktail Taxonomy and posting it for comment. Mostly Twitter chatter in reaction so far, but the process of articulating my principles for others has, as usual, clarified them and this structure is performing well as I continue to research old recipes and organize the book's recipe candidates.

This pleasant creative burbling all week was accompanied by a big experiential spike in the form of an amazing concert Sunday at the new SF Jazz Center in honor of Bobby Hutcherson. Wonderful sound and great performers! Such a joy to have this resource so close to our home.

Around those themes the week swirled along quite well with a nice mix of home life and time out on the town and up in Napa county for Joe's work.

Proud: I have been keeping up my exercise routine! Between the Fitbit, the treadmill desk, and Zombies, Run! I am able to make myself put in the effort and seeing my strength and endurance grow as a result. Very pleasing!

Completed: I think I can now say I've achieved mastery on maintaining a beautiful, uncluttered living space with minimal effort. Still projects to be completed and undulation in tidiness from day to day, but in general the place is within ten minutes of "company-ready" pretty much all the time. The fortnightly visit from the maid who does my most-hated chores (vacuuming and scrubbing porcelain) has helped tremendously in letting me put my energy into things that pay off without driving me nuts.

Learned: Twitter may not seem like it eats much time to quickly check now and then, but it is a huge time-suck if not constrained. Trying out a Pomodoro method timer to help keep me on track and not ducking into email/Twitter/etc every 10 or 15 minutes. Getting better at managing this will help me not only with completing the current to-do's but also with staying focused on work as my social media activity grows when the book comes out.

Inspired: The barfolk I've been talking to as I research the book have been just marvelous; generous, enthusiastic, customer-focused. Really looking forward to working with them a lot this year.

A few more thoughts on self-publishing

I'm deeply involved in work on my next books (one on cocktails, one on history), but I do want to take a few minutes to share some more of what I learned putting out Discardia: More Life, Less Stuff.

  • Scrivener and OmniFocus continue to be invaluable in my book writing and publishing process.
  • Amazon's Kindle store sales represent just over 51% of the number of copies sold and just over 34% of the money earned, despite the $2.99 price tag. KDP first, last, and always; hugely important for self-publishers.
  • iTunes sales represent nearly 21% of copies and nearly 16% of income. Their management interfaces may be a pain, but it's worth it.
  • Createspace is great for selling print-on-demand copies through Amazon, but only use them for that. Lightning Source (LSI) is your better method for print-on-demand sales to distributors and thus bookstores and libraries. LSI allows you to set your terms and you will need to make sure they are attractive enough to bookstores. Make at least your U.S. terms (if you're in the U.S.) returnable and with a wholesale discount of 60% in LSI's interface so that after Ingram or Baker & Taylor takes their cut, the bookstore still sees a discount that allows them to make some profit to keep their lights on. That means you need to think about those terms as you set the book price so it doesn't actually cost you to sell the book wholesale. International terms may have other constraints, costs, or reduced payments to you, so read those details carefully as you go through your contract agreements and adjust your discount percentage accordingly.
  • Promotion is a lot of hard work. Plan it and don't burn yourself out too early. It is a marathon. You should plan on beginning your work 3 months before you put the book out (e.g., setting up the book's website, creating your Amazon Author page, etc.) and continuing at least 9 months after the release date. If you're continuing writing in the same subject area, it doesn't really stop, but can wind down so you can focus on the next book.
  • It took 15 months for Discardia: More Life, Less Stuff to reach 3000 sales, which is actually quite good for non-fiction from what I hear.
  • Always always always carry some of your Moo cards with the book cover and details. People frequently ask "What do you do?" and it's great to be able to hand someone the card when they perk up after you tell them you're an author and describe your book. This makes sales and recommendation happen.
  • Plan on doing a "second printing" about a month after release which updates your master files and corrects the inevitable few typos that you and your editor miss. I fixed around 13. Since then only a handful more have turned up and they are of the "missing period after that parenthesis in that one bulleted list" caliber of problem, i.e., fine to wait until I do a second edition (with content changes, and thus a new ISBN) years down the road. It'll never be perfect, but it needs to be near to garner great reviews.
  • Make your book available in international markets as your ebook and print-on-demand services allow. You'll earn less per copy, usually, but it's worth it and is a whole other market in which your work might take off.
  • Don't obsess over charts and stats; focus on getting the word out and tracking your actual sales numbers. List positions and similar data are worth looking at quarterly or so to understand trends over time. For example, here's the page on BookChart.info for Discardia: More Life, Less Stuff.
  • Do pay attention to your costs; remember that you're going to be earning them back a couple bucks at a time and that you don't start getting paid for your actual time writing and promoting until you're in the black.
  • One caveat regarding tracking sales: Apple's interface is a true pain in the rear and their fiscal calendar does not correspond to actual calendar months. I track sales in a spreadsheet and actually just enter the iTunes number for a month for each day (e.g., the KDP cell for last month has the value 47 while the iTunes cell has the value =0+1+2+1+1+0+2+0+1+1+1+1+0+0+0+2+2+0+0+3+1+0+0+2+0+0+0+0+1+2+0
    Sigh.)
  • You do need to track your sales, though, or you won't be able to tell when the book has paid its costs or confirm you're receiving your share. (I will note that the only problems I've seen on the latter front working with these big vendors is where I wasn't getting payments at all due to an error in the bank account number they put in for direct deposit.)
  • I find it useful to have a spreadsheet file per book (or other writing project with income or costs) and separate sheets within that file for costs, income, sales tracking, and consignment details.
  • Though I have not sold a huge quantity through local consignment, it still represents about 4% of the copies and, because of the higher per-copy profit, about 10.5% of the money earned. That money comes at a high cost of my time and effort, though, so choose your consignment locations carefully. Select places where the book is likely to do well for both you and the store, and where it is not inconvenient for you to visit to restock them or retrieve unsold copies. In general, if they are willing to order through Ingram or Baker & Taylor (whoever you're able to get distribution through) it's going to be less work for both of you.

 

Happy writing and publishing! As usual, I'm happy to answer questions in the comments.