None of these is quite right…

If none of the existing legal structures perfectly fits your needs, you could use ancillary agreements, policies, and covenants. Your values, ethics, and core principles are also a governance layer on top of your business structure. You can combine different structures and governance models to create a business that aligns with your ultimate outcome.

Some questions to ask yourself if you go this route:

  • Is your governance model easy to understand and accessible for diverse stakeholders?
  • How do you make decisions?
  • Who has a right to participate or vote?
  • Who represents whom?
  • How can you solve conflicts?
  • How do you communicate your governance? Who needs to know?

Some inspirational alternatives

  • Distributed co-operative (DisCo)
  • Platform co-operative
  • Community-centered business, where stakeholders who don’t own shares directly can participate in governance, such as through a stockholding trust designed to represent their interests. More info (PDF).
  • For-profit corporation with co-operative decision-making policies… wait, what?!

A co-operative corporation?

Suppose you decide to form a business corporation but wish you had the benefits of collective decision-making. In that case, you can structure it so that everyone is an equal owner with an equal say in the company – nothing prevents a corporation from having employee shares. This flexibility allows a corporation to operate similarly to a co-op without being legally bound to a co-op’s structure. Some examples of corporate-co-op studios include Future Club1 and KO-OP2 (in the process, as of 2023, of converting to a Quebec co-op).

In your shareholders’ agreement, you can include language that prioritizes collectivity, outlines dispute resolution procedures, and details processes for managing a voting deadlock.

You could also consider encouraging your employees to form a union! 👀

Healthy studio culture can be promoted in any organization.

Tip: Establish a founders’ agreement before your company is officially formed. That way, you have processes in place for dispute resolution at every stage of your studio’s development.

Footnotes

  1. A Worker-Owned Game Studio Rises from the Wreckage of Skullgirls Developer
  2. Ko-Op by Name, Co-Op by Nature