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platform cooperative

Contributor(s): Ivy Wigmore

A platform cooperative is an employee-owned and operated business that typically runs its operations through a website or mobile app. The platform business model is based on exchange of goods and services between interdependent individuals or groups. 

Democracy is integral to platform co-ops, which operate for the benefit of their members. The cooperative is a type of holacracy, a flat management structure that distributes authority. Platform cooperatives are distinguished from other cooperatives by the integral role of digital technologies to support the business and also an emphasis on contributing to the larger community.  

Trebor Scholz coined the term “platform cooperativism” in a 2014 article: “Platform Cooperativism vs. the Sharing Economy.” Scholz criticized many sharing economy businesses for exploiting employees. Platform co-ops developed in response to the call for more democratic models where workers could “exchange their labor without the manipulation of the middleman.”

Critics of the existing sharing economy model argue that its name is misleading. IT guru Don Tappscott suggests that the model would be more aptly referred to as "service aggregates" because their emphasis is making money rather than sharing services. Platform cooperatives and supporting technologies such as blockchain may offer the possibility of a more equitable sharing economy.

This was last updated in August 2017

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