How to Build Vibrant Cooperative-Nonprofit Relationships

1j5IPXtVia Cultivate.Coop: As part of their Co-op Academy, Worcester Roots and Stacey Cordeiro teamed up with us to address the topic of nonprofits and co-ops in a recent workshop. Below we have distilled the best tips and practices from the activity.

Starting and running a cooperative business is an exciting venture, but none of us can do it alone.

While we have Principle #6—cooperation among cooperators—and that gives us many great chances to learn from and help each other, sometimes we need more specific expertise or technical assistance.

We can, and often do, turn to nonprofits for help. But how many times have you heard a story like this:

A worker co-op had been partnered with a nonprofit for several years and wanted to become fully independent. However, the nonprofit had become reliant on the co-op’s accomplishments for grant proposals. And the nonprofit’s general operating budget relied heavily on income from the co-op. Resentment ensued and a split occurred, where most of the co-op members left and started from scratch.

4 Key Reasons to Build Strong Nonprofit Relationships

How can you keep such issues from happening to your co-op? Avoiding nonprofits altogether isn’t a solution—and it would cut you off from potentially valuable relationships:


Nonprofits and other co-op incubators can direct interested members to the resources they need to start a co-op. Many co-ops might have never gotten started without the help of an incubating organization.


Nonprofits understand the many needs of disadvantaged people, and can provide support that startup co-op members need, such as child care, legal advocacy, food security, resources for English language learners, and more.


Nonprofits are eligible for much-needed funding that can help support the development of cooperatives, and they have experience raising funds from foundations and individual donors.


Even if a co-op does not succeed as a business, its members can gain valuable skills that they can use to advance their economic situation. Some examples include entrepreneurship and job skills, English skills, and resume building.

There are ways to build vibrant, strong, cooperative relationships with nonprofits. I started this post with two scary stories, let me share two happy stories:

WAGES (a nonprofit) in California has successfully trained and brought to independence five immigrant women-led cleaning worker cooperatives. They provide oversight of a manager for 2-3 years and ongoing training in co-op development, financial literacy, and leadership. Dozens of women now have more democratic, safer, and lucrative workplaces.

Dahlia Cleaning Co-op has teamed up with the Austin nonprofit Cooperation Texas. The nonprofit provides training for immigrant-led groups looking to form worker cooperatives. They run a Co-op Business Institute and offer general assistance when co-ops approach them for support. The nonprofit has several bilingual staff and does other movement-building work. 

6 Pitfalls to Avoid

How do you get more of the good stuff and less of the bad stuff in a nonprofit relationship? By knowing what to look out for and being clear about what you will hurt your co-op in the long run, even if in the short term it doesn’t seem that bad.


The nonprofit gets grants to help the co-op, but the co-op doesn’t get a say over or get informed on how that money is spent.


The nonprofit doesn’t allow the co-op to leave and become independent; or the nonprofit doesn’t allow the co-op to have as much decision making power as it wants.


The nonprofit doesn’t have the right kinds of resources to help start a business, and doesn’t seek out the right resources.


The nonprofit helps the wrong people (those who have more privileges already), and leaves out the most needy (those without those privileges). Not being part of the community being served, they might not be able to see the difference.


The nonprofit does things on behalf of the co-op, instead of empowering co-op members to do things themselves. Some examples include: doing market research, writing business plans, doing sales and marketing, and administrative support and bookkeeping.


The nonprofit ends up isolating the co-op from the larger co-op movement, rather than encouraging participation and connection.

Best Practices for Working with Nonprofits

Most co-ops seek out the help of a nonprofit at some point in their development. Here are a few best practices to help you build a good working relationship between your co-op and a nonprofit:

  • Seek out assistance and expertise of those who can help with your co-op. See yourselves as consumers of these services.

  • Shop around for the best quality, price, and expertise for the goal you are trying to reach.

  • Utilize co-op connections and knowledge.

  • Always participate in peer networks, such as local co-op associations and the US Federation of Worker Cooperatives.

  • Talk to others who make their living in cooperative businesses, they are your best resource.

  • Be communicative with sponsoring organizations.

  • Be clear about your expectations for the work the nonprofit does for you, and hold them accountable.

Tweak them. Tailor them to your business. Share your new learning with other cooperators, in person or on the cooperative hub, Cultivate.Coop.

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