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Socialism: test help before the first loan, and ask founders for a stake

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Add before-launch.md: a founding lottery testing whether serious
pre-launch help (a founder's stipend, a feasibility study, legal setup)
creates more co-ops that last, measured independently of the bank, and
a 5% founder stake payable in verified unpaid work. Fund it from the
loan budget, and correct the pilot's growth arithmetic.

Co-Authored-By: Claude Opus 5.5 <[email protected]>
Claude-Session: https://claude.ai/code/session_01QWPs69B8nQZjtPEUXMKzZx
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jheaps
2026-09-24 06:31:46 -06:00
co-authored by Claude Opus 5.5
parent 1f297c244d
commit 8305c72843
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JoshHeaps.Net/Content/Socialism/pilot-spec.md
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@@ -51,8 +51,8 @@ Private co-op lenders exist and do good work, but they're small. Shared Capital
It breaks down like this:
- **About $300 million for loans.** Around 400 co-ops with a typical first loan of about $500,000 is roughly $200 million. The rest is for follow-on loans to co-ops that grow. For comparison, Shared Capital's average loan is about $230,000. The pilot's loans are larger because it's meant to fund real businesses with real payrolls, not only very small ones.
- **$20 million, capped, for business help:** bookkeeping, governance training, legal setup, and more intensive help for half the co-ops, chosen by lottery (see [the support lottery](#the-support-lottery)). Venezuela's census blamed many of its failures on the lack of exactly this. This money is a public cost, stated openly and capped, and it's counted in the pilot's total cost to taxpayers. It isn't allowed to hide inside loan pricing.
- **About $290 million for loans.** Around 400 co-ops with a typical first loan of about $500,000 is roughly $200 million. The rest is for follow-on loans to co-ops that grow. For comparison, Shared Capital's average loan is about $230,000. The pilot's loans are larger because it's meant to fund real businesses with real payrolls, not only very small ones.
- **$30 million, capped, for business help:** $20 million after the first loan (bookkeeping, governance training, legal setup, and more intensive help for half the co-ops, chosen by lottery; see [the support lottery](#the-support-lottery)), and $10 million before it, taken from the loan budget, for a lottery testing whether serious help makes more groups succeed in starting a co-op that lasts ([Help Before the First Loan](before-launch.md)). Venezuela's census blamed many of its failures on the lack of exactly this. This money is a public cost, stated openly and capped, and it's counted in the pilot's total cost to taxpayers. It isn't allowed to hide inside loan pricing.
- **The remainder** is a cash cushion and running costs.
## Why about 400 co-ops
@@ -65,7 +65,7 @@ To be confident that co-ops do "at least about as well" as conventional firms, y
That also means a roughly 10% chance of shutting down a pilot that was actually working. That's the cost of putting the burden of proof on the co-ops, and it's stated openly.
**The honest problem with 400.** The whole US worker co-op sector was about 751 firms in 2023, roughly triple what it was a decade earlier ([NCEO summary of the Democracy at Work Institute census](https://www.nceo.org/employee-ownership-blog/democracy-at-work-institute-releases-its-2023-worker-cooperative-state-of-the-sector-report)). That's about 50 new co-ops a year. Reaching 400 in five years means roughly doubling the rate at which co-ops get founded.
**The honest problem with 400.** The whole US worker co-op sector was about 751 firms in 2023, roughly triple what it was a decade earlier ([NCEO summary of the Democracy at Work Institute census](https://www.nceo.org/employee-ownership-blog/democracy-at-work-institute-releases-its-2023-worker-cooperative-state-of-the-sector-report)). That's net growth of about 50 co-ops a year, after counting the ones that closed. Reaching 400 in five years means about 80 a year, roughly 1.6 times that pace, on top of whatever else the sector adds.
That creates exactly the pressure that sank Venezuela: an institution with a target lowers its standards to hit it. So:
@@ -168,7 +168,7 @@ Mondragon's bank gave its co-ops far more than loans. It gave them a salaried ma
**What it can and can't show.** Assume about 200 co-ops in each group and closures in line with new businesses generally. Then the pilot can reliably detect only a large effect, something like 30 to 40% fewer closures in the intensive group. So its main outcome is survival and fair pay at year four, when the help's effect should be clearest, with year twelve reported as well. The result is reported as a range, with a cost per closure avoided, and it counts as exploratory. **A result that isn't statistically significant doesn't prove the help is useless.** It means only that a large effect has been ruled out.
**What it doesn't test.** Mondragon's help started *before* a co-op existed: studying the idea, paying the manager, covering early losses. This lottery starts after the loan, so it can't say whether help before launch creates more good co-ops. That's logged as an open question.
**What it doesn't test.** Mondragon's help started *before* a co-op existed: studying the idea, paying the manager, lending to cover early losses. This lottery starts after the loan, so a second lottery, among groups that want to start a co-op, tests help before launch ([Help Before the First Loan](before-launch.md)).
**If intensive help works,** that's an argument for building it into [the federation](federation.md), paid for by the co-ops out of their shared fund the way Italy's Coopfond is, not for a permanent federal advisory office.