Can one imagine an economy in which labor hires capital? Where workers have a legal right to the profits and legal responsibility for the liabilities because they are the owners, where workers jointly manage the firm and themselves in a democratic fashion?
—William Greider, national correspondent for The Nation, in his introduction to The Real World of Employee Ownership
On a blustering snowy weekend in late January, a group of men and women gathered in front of a bedsheet and projector in a timber-framed cabin in Eagles Mere, Pa., to discuss how to become a cooperatively owned business. In between breaks for venison stew, toboggan sledding and heating snow for water, those in attendance heard impassioned speeches about governance and power. Debates over fairness, dignity, and responsibility flared and simmered. A sample policy and procedures manual was presented and picked apart as each person was asked to truly consider Greider’s question.
Over the past several months, the 15 employees of Greensaw Design & Build have decided—for better or worse—to answer yes to Greider’s call to action. The small Northern Liberties architectural salvage construction company has set out to become one of an estimated 300 worker cooperatives in the country and what the employees call “Philadelphia’s first new-generation co-op.”
“It’s a huge risk,” says Brendan Jones, Greensaw’s former sole owner. “The thing with a co-op is that they’re significantly more profitable than regular businesses. But those are only the ones that work.”
Built from scratch by Jones in 2006, Greensaw is known for transforming salvaged materials into immaculately elegant, hand-crafted and sometimes funky coffee tables, kitchens and houses.
But in one of the worst economic periods for the hard-hit construction industry, the stakes for everyone involved are high—financially and philosophically.
Greensaw—a rapidly expanding company with slim profits and growing pains—is betting on a vision it believes in: that workers should be able to have a say and earn more than just an hourly wage.
But if the company fails in the process, Jones’ “life’s work” may go down the drain, and all of Greensaw’s employees with it.
A Center City Philadelphia native with the build of a lumberjack and a soft, drooping voice, Jones discovered his love for architectural salvage at a family-owned Eagles Mere cabin that used to be a horse carriage. As a kid, he scoured the surrounding woods, collecting bricks, glasses, pots and other remnants of the Raymond hotel that once stood near the site.
His first real construction gig came in the summer after his freshman year of college; Jones fled school and a girlfriend to live in a small fishing town in southeastern Alaska, where he built himself a little lean-to in the woods.
Over the next decade, after eventually finishing school, Jones—a writer and French and English literature graduate of Oxford—continued to build things while writing on the side. He apprenticed at an Alaskan carpenters union, worked on barn-building crews in Kentucky, California and Michigan, and built homes in Nantucket, Vermont and New Hampshire, among other jobs.
In 2006, he returned to Philadelphia and, on Craigslist, offered his carpentry services in exchange for room and board. Jones renovated a woman’s bathroom in Overbrook using old materials at her request.
Then something clicked.
“Salvaged material doesn’t cost anything,” says Jones. There was an awful lot of it in Philadelphia, and the writer in him was deeply attracted to the stories behind the material.
He set up shop, originally calling his company Bluesaw. Then, after recognizing the business’ s inherent sustainability, he changed it to Greensaw, with a motto of “Reclaiming Green.”
Though the company’s path to success has been rocky—during the height of the recession in 2008, Jones had to lay off all four of his then-employees—the small company has tripled its revenue in the last three years and is on track to do more than a million and half dollars in business in 2011.
But Jones—who’d already begun leaving on month-long writing excursions and vacations in Cuba—itched to return to Alaska to finish his second novel and work on a tugboat he’d bought from a friend. He was reluctant to sell the business.
“At best, the culture would have been watered down,” Jones says. “At worst, everybody would just have walked and there wouldn’t be a Geensaw anymore.”
Last fall, Jones read a B-Lab newsletter profiling John Abrams and his South Mountain Company’s experience of becoming a worker-owned cooperative on Martha’s Vineyard. Here was a solution that would allow him to go back to Alaska while continuing Greensaw and giving his employees the chance to reap the benefits of a company they already ran.
“Everyone’s been working cooperatively for so long,” says Jones, who describes his team as “somewhere between a bunch of Navy Seals, traveling dance company and a knitting club.”
He bought Abrams’ book The Company We Keep, and began discussing employee ownership with local attorney and financial advisor Jim Steiker, Alex Moss from Praxis Consulting, and the owners of Bensonwood, a New Hampshire timber-framing worker cooperative Jones worked for briefly.
It seemed like a natural fit. With a structure that allows five project managers to make executive decisions about everything from design and working on site to speaking with clients and invoicing, Greensaw’s day-to-day decisions are never made unilaterally.
“The greatest secret about Greensaw becoming a co-op,” says Jones, “is that nothing’s really going to change.”
Jones publicly mentioned the co-op idea for the first time at a company meeting to mainly blank stares. He assigned The Company We Keep as unofficial homework and formed a Founder’s Committee, charged with the task of investigating further. For a while, copies of the book floated through the shop and Abrams’ speeches played during lunch on computers or through ear buds while employees sanded wood.
Ginni Stiles, Greensaw’s business manager, was immediately excited by the model. For most employees in most companies, “you don’t have a say. You simply do what you’re told,” says Stiles, who spent her formative years attending Glenmoore’s Upattinas School, where everyone from kindergarteners to the most senior staff make collaborative decisions, such as the cafeteria’s lunch menu. “To have a structure in place where you do vote on the things that affect you, it honors a basic human right.”
Even those who aren’t pursuing ownership in the immediate future are excited for the possibilities. Carpenter and former intern Samir Patel is thinking about going back to architecture school then, returning to Greensaw to become an employee-owner. In the meantime, Patel sees the co-op as an opportunity to move the company in a new direction. Patel is the unofficial head of Greensaw’s community service arm, whose most recent pro bono project involved building a timber frame structure for the Kensington Compost Co-op with other Greensaw volunteers. With the co-op, he says, “people’s personalities and their goals will shine a little bit more.”
Project manager Jason Pemberton believes it is a change that needed to happen. “Through the co-op, there’s a way for us all to shine,” says Pemberton, who cited the company’s current website as an example of insufficient recognition to the group of “diverse, highly educated, overqualified people” making Greensaw successful. “We’re all type-A people. We all could probably own our own company if we wanted to… So why not allow us to run it the way we believe and know we can?”
For others, the co-op model simply made good business sense. “It’s not just this altruistic thing where a bunch of hippies dance around smoking weed and want something good to happen,” says project manager David Wing, who joined Greensaw in 2008 and paints in his art studio above company headquarters. For Wing, in addition to incentivizing worker productivity and efficiency, worker cooperatives can also encourage employee retention – a lesson he took from Abrams’ book. In the instructive tale, Abrams’ ’s father starts his own hardware store after being refused a raise from his boss. He’s successful, puts his former boss out of business, and then repeats the very same mistake with two young, valuable employees.
Even after several founder’s Committee sessions and a co-op retreat, most of the hard work and questions remained:
- How does one become an employee-owner?
- Who’s allowed to become one?
- What will the cooperative entity look like?
- How will it buy the business from Jones?
- How much is the company worth?
- How will the cooperative be governed?
Greensaw would have been entirely unable to answer these questions or afford the co-op conversion, says Jones, without the pro bono help of Jim Steiker, the Penn Entrepreneurship Legal Clinic, and financial consultant Terrence Buckley.
But it wasn’t just a matter of legalese and accounting—it was also deeply personal.
“The whole process has been like a 360 degree peer review,” says Jones, who still plans to work part-time for Greensaw as an employee-owner in Alaska and Philadelphia, writing promotional materials, finding clients and acting as a salesman. “It puts a lot of people’s dirty laundry out there.”
In a French café near the company’s headquarters one afternoon in March, Jones had delivered a rousing “trust me” speech, defending his integrity and commitment to the company in response to the suggestion that he had a conflict of interest in deciding what to do with annual profits—reinvest in tools versus getting his installment of the company’s buy-out.
Eventually, the Founder’s Committee agreed on a $100,000 payment to Jones for Greensaw—tied to the company’s profitability; an employee-owner buy-in amount of $3,500 made in annual installments of $500; and a “farmer in the dell” method of choosing new co-op members, where current owners build consensus to invite the next member. A board of directors, elected by the employee-owners, would make business decisions, with employee-owners each having one vote and membership share and the final say altogether.
Still, the most important question remained: Who exactly should become the founding members of Greensaw Co-op?
This would prove to be a complicated question, exemplified by two Greensaw employees under consideration. Project manager Niko Dyshniku was considered a strong candidate. He had contributed significant work to Greensaw, but his plans to attend graduate school and concern over the deep level of commitment required gave him pause.
Stiles, who came to Greensaw less than a year ago, was the other most likely potential employee-owner, but her short tenure with the company raised concerns about her suitability as a founding member of the co-op. The café meeting had come to an uncomfortable standstill after Jones said he wouldn’t go forward with the co-op transition unless Stiles, Greensaw’s business manager, was one of the founding members.
"It was always very important to me that Brendan wasn't just hand-picking people," says Stiles. "I trust the process."
There was also the basic challenge of carving time out of the day for working on the co-op transition, a task piled on top of everyone’s normal job duties. And with a busy summer of jobs lined up, others were worried that the co-op would affect Greensaw’s actual business.
“I think overall the idea is great, but I’m not 100 percent sure the timing is right,” says Dyshniku. “I’m afraid as soon as everything comes together, something clips it,” snapping his finger.
The day of the inauguration ceremony, Greensaw’s workshop was transformed. After four hours of moving tools and sweeping sawdust, employees had put together a makeshift stage and propped together rows of pews with wooden planks that were waiting to be worked into projects.
“I couldn’t miss today,” said South Mountain Company’s John Abrams, through a mouthful of roasted root salad. The author of what Jones calls Greensaw’s “Bible” had just flown in from Martha’s Vineyard for the night. This was perhaps the sixth co-op kickoff Abrams had ever attended—a process he undertook with his own design-build company 22 years ago. “I didn’t know what the hell I was doing. I thought we were confirming something that already was. And nothing could have been further from the truth.”
An hour before the scheduled ceremony, it had still not been decided who would be the founding members of the co-op.
Abrams delivered his keynote speech under darkening skies, and finally, Brendan Jones and David Wing ascended the stage as the co-op’s founding members, to sign a mission statement printed in vaguely 18th century font. Then, in cold-call fashion, the other employees were also summoned to the stage to sign the document declaring Greensaw Co-op into being.
The pews, heartfelt declarations, last-minute negotiations and airy, white button-up Jones wore recalled the blushing, anxious formality of a wedding ceremony. But in reality, the co-op kickoff was more like an engagement party—with tentative promises made and nothing yet in legal writing.
“There’s lots and lots of things left to think about and negotiate,” says Wing. “Niko and I have been talking about part of the buy-out of Brendan being the fact that everybody in this company has put in so many amounts of volunteer hours to keep this successful”—something they hadn’t yet mentioned to Jones.
A month later, Dyshniku had backed out to take more time and think and Stiles had not been asked to join—she and Wing had agreed to wait a few more months. But the papers were finally signed. Now on his way to Alaska, Jones had officially transferred ownership of Greensaw to another entity, of which he and Wing were employee-owners.
“I was hoping to have another person besides just Brendan right at the beginning,” says Wing, who plans with Jones to invite more employee-owners once Greensaw makes it through the hectic summer. “It seems a bit like shooting from the hip… Hopefully the strongest person around will want to say yes and jump in full force.”
“Three other folks are in line,” adds Jones, “and we hope to have four or five on by September.”
For Jones—though he will miss having the final word and the liberty of a company truck and phone—the main challenge will be learning to step back and unbraid himself from the company he had built. A few weeks earlier, Jones spent a few hours spray-painting his tools a light blue, to separate them from Greensaw’s.
“It’s going to be a mind-bender for sure, and it already is,” says Jones. “It’s kind of like raising a kid in the woods in a cabin, and then all of a sudden flying to some African village, and then that kid becomes the property of the entire village.”
In the mean time, he’s crossing his fingers that Greensaw gets raised right.