Q&A's
Table of contents
Overview. We use this page to answer questions about the material aspects of User Co-op. Please contact us if we've missed anything you'd like to know.
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Yes. We operate day-to-day just like a regular company does with, for example, full-time employees and a board of directors that oversees them. It's the same operational structure as the large recreational equipment cooperative that inspired our member-ownership model.
Is User Co-op a regular company that's owned by members instead of shareholders?
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No. Ownership rights are reserved for members, and the founder and employees are members just like everyone else. However, in lieu of equity, we offer our employees competitive cash incentives based on both individual and company performance criteria. You can access the founder's employment agreement to learn more about our general approach to compensation.
Does User Co-op grant equity to its founder and employees?
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Our legal name is "User Cooperative," and we're incorporated in the State of Washington as a "miscellaneous and mutual corporation." If you'd like to verify this, you can go to Washington Corporations and Charities Filing System and, under "Corporation Search," search "User Cooperative."
What is User Co-op's legal entity?
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Billions who are dissatisfied with today's data deal. We hope to recruit as members those who are dissatisfied with today's data deal. We estimate that such dissatisfaction is globally pervasive and independent of demographics: somewhere between 75% and 90% of all tech users worldwide, which translates to somewhere between four and five billion of us.
Who are User Co-op's target members?
Some exhibits of consumer sentiment:
(a) 85% of Americans are “very/somewhat,” versus "not very/not at all," concerned about the "size and power of large technology companies." 77% say they “believe that major internet technology companies like Facebook, Google, Amazon and Apple have too much power.” 88% (of the 77%) say they have too much power because "they may misuse customers' data, and 87% (of the 77%) say they have too much power because "they possess a lot of data on people who use their websites, apps and products." Source: Gallup-Knight, Techlash? America’s Growing Concern With Major Technology Companies, March 2020
(b) 75% of Americans and 78% of a sample of ROW believe "businesses currently benefit the most from personal data exchange," not "consumers e.g. me." Source: Data & Marketing Association, Data privacy: What the consumer really thinks, June 2018
(c) 76% of Canada, China, India, UK, and USA "call sharing personal information with companies a ‘necessary evil.’” Source: PwC Consumer Intelligence Series, Trusted Tech survey 2020
(d) 81% of Americans believe "potential risks of companies collecting data about them outweigh the benefits.” Source: Pew, Americans and Privacy: Concerned, Confused and Feeling Lack of Control Over Their Personal Information, 11/15/2019
(e) 72% of Americans believe they "benefit 'none' or 'very little' from the data collected about them by companies." Source: Pew, Americans and Privacy: Concerned, Confused and Feeling Lack of Control Over Their Personal Information, 11/15/2019
(f) 84% of Americans and 83% of a sample of ROW say "I would like more control over the personal information I give companies and the way in which it is stored" Source: Data & Marketing Association, Data privacy: What the consumer really thinks, June 2018
(g) 91% of American "adults agree or strongly agree that consumers have lost control of how personal information is collected and used by companies.” Source: Pew, The state of privacy in post-Snowden America, 11/12/14
(h) 87% of the world says “stakeholders, not shareholders, are the most important to long-term company success." Source: 2020 Edelman Trust Barometer Global Report, January 2020
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User Co-op members get:
What are the powers and privileges of User Co-op members?
(a) The power to elect the board of directors. User Co-op's board of directors manages everything User Co-op does. And each member gets one (1) vote in electing each board member, except for the CEO (currently the founder), who's a board member by virtue of the office.
(b) The power to propose and decide on any matter of business. Each member gets one (1) vote on each User Co-op business item voted on by members and the power to propose any such item.
(c) Exclusive access to User Co-op's consumer services. User Co-op's consumer services, like a web browser and a search engine, are only for members. And each member gets automatic access to User Co-op's consumer services as they go online.
(d) User Co-op's profits. User Co-op pays out its profits to members in proportion to their individual use of User Co-op's consumer services.
Other key features of membership:
(a) No expiration date. A membership only expires if a member doesn't use any of User Co-op's consumer services for three (3) years.
(b) Non-transferable. A membership can't be sold, traded, or transferred.
(c) One per person. Membership is limited to one (1) membership per natural person.
(d) Liability shield. No member is, or will be, personally liable for any debt, obligation, or any other liability of User Co-op.
Documents that authorize members' powers and privileges: Articles of Incorporation, Bylaws
Note: User Co-op defers granting governance rights to members until it meets the conditions of its "early hostile takeover protection."
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Member dividends. User Co-op pays out its profits to its members in the form of patronage dividends. They can be in cash, in kind, or both, depending on the circumstances at the time of each dividend.
How does User Co-op distribute its profit to members?
Calculation of a member's dividend. Each member's patronage dividend is equal to User Co-op's profit multiplied by the ratio of their individual use to all members' use:
Member's patronage dividend = profit x (member’s use ÷ all members’ use)
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"Profit" includes:
What is "profit" for the purpose of distributing profit to members?
(a) Earnings minus reserves. This is User Co-op's calendar-year earnings minus the cash reserves that User Co-op retains for business purposes. For this purpose, calendar-year earnings exclude member donations.
(b) Purchase price in an acquisition. This is the net consideration paid for User Co-op if it gets acquired.
(c) Net assets remaining if User Co-op dissolves. This is any money that remains in a dissolution or liquidation after User Co-op has paid its obligations.
Note: In our documentation, we refer to item (a) above as "Surplus Funds," which is defined in Article 7 of our Articles of Incorporation and, by extension, Article 5 of our Bylaws. Surplus Funds are determined by our board of directors, which our members elect. Lastly, profit isn't guaranteed, and it depends on how much our members engage in, for example, building the membership community, governing us, and using our consumer services as they come online.
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"Use" (noun) is defined in Article 9 of our Articles of Incorporation as a member's use of User Co-op's consumer services, and it's quantified as both:
What is "use" (noun) for the purpose of distributing profit to members?
(a) Outgoing service calls. This is the sum of unique member-to-service calls, like a member’s clicks, taps, and swipes on an app or website.
(b) Incoming service calls. This is the sum of unique service-to-member calls, like automatic pings to a member’s mobile device to retrieve GPS data for a navigation app.
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Procedures. When User Co-op meets the conditions of the "early hostile takeover protection," members democratically govern User Co-op according to the procedures in our Articles of Incorporation and Bylaws.
How do members govern User Co-op?
We make governance as easy as possible for our members. For every governance matter that concerns members, User Co-op will email each member well in advance all of the necessary information and materials so that they can participate with relative ease.
Members must vote for themselves. User Co-op doesn't allow voting proxies or designees, so members must vote for themselves.
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There's no established market for membership in a consumer-owned cooperative tech company, and we're not willing to subject our members to the price fluctuations that are necessary to "home in" on the market-clearing price, if any, in a competitive environment. Doing so would be unfair to our members. A model of free membership and member donations is optimal because it captures a member's true willingness to "pay," it leaves no aspiring member behind, and, because of those things, stands, in our estimation, to provide User Co-op a far, far greater capital foundation than a fixed-price membership would. However, such a model will understandably cause some members to not donate simply because they know that other members aren't required to do so. But non-donating members are extremely valuable members too because they too contribute to evidence that User Co-op is trending, and evidence of a trend attracts a great deal of capital, in the form of money or otherwise, from all sorts of places.
Why is membership free?
Note: Because member donations are vital, we encourage each member to donate if or when they can in any amount, even if it's $1.
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We recommend $5, but we're thrilled with any amount a member gives, even if it's $1. Our rationale for $5 is simple: it's affordable for most of our members and, considering the billions of consumers who are ready for a better data deal, we believe that individual donations of this size can add up to more than enough capital to build an epic membership community and web browser business whose profits will end our need for member donations and finance our future growth. Please know that each member has the same powers and privileges regardless of the amount they donate.
Is there a recommended donation amount?
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Yes. If you're not ready to donate when you become a member, you can fill out the membership form again to donate when you're ready. If you want to donate money again, you can fill out the membership form again to do so.
Can I donate later or multiple times?
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No. To maintain the integrity of our "one member one vote" governance, we only allow one (1) membership per natural person. Also, it should be noted here that, at this point, our membership form has basic functionality, and it won't prevent someone from registering multiple times under, for example, the same name or different email addresses. We're going to modernize this as soon as we can. But for now, we reconcile multiple memberships per person on the backend.
Can I have more than one membership?
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$100 million. We estimate that we need $100 million in voluntary cash contributions from our members for our business to become profitable enough to no longer need member contributions. All of this $100 million will be used to develop, deploy, grow, and maintain a mainstream web browser business, which, we believe, could generate tens of billions of dollars of annual profit for User Co-op. And, as long as we reinvest such profit to build more profitable tech businesses, like a search engine, we won’t need member contributions anymore.
How much does User Co-op need to raise in voluntary member contributions to become a viable tech company?
A few dollars per member. $100 million is a ton of money. But our “market” is the four or five billion of us who want a better data deal, and we’re the only company that offers one. So, if we can capitalize on this big blue ocean of ours, a few dollars per member should be enough.
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Our $100 million is based on a close market comparable, Brave. They’re a relatively young and stable browser company, they used open-source browser code to build their browser, and their browser serves targeted ads. (Note: they have a crypto currency wallet and payments layer that we won’t.) Brave has raised about $60 million in today's dollars, according to public data from Crunchbase. We estimate that, of the $60 million, $10 million went toward developing, deploying, and marketing their browser and $50 million went mostly toward ramping up their advertising business. To get to our $100 million, we started with Brave’s $60 million and added a $40 million "fund" for community-building efforts, future inflation, and contingencies.
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Highest value, lowest switching costs. We’re starting with web browser, which will be free and members-only, because (1) it could generate tens of billions of dollars of profit per year, (2) it’s the primary gateway to the internet for almost five billion people, (3) its form and functions are well-established and require no tinkering, (4) it’s very easy and cost-free for someone to switch browsers, and, at about $10 million to make, (5) it promises more bang for our buck than any other tech product in existence.
Why does User Co-op start with a browser?
Multi billion-user potential. Our market is the four or five billion of us who want a better data deal, and we’re the only company that offers one. So, if we can capitalize on this big blue ocean of ours, our browser can become the standard browser whose market share overtakes Google Chrome’s 65% by a long shot.
Billion-dollar potential revenue streams. A browser has two principal revenue streams that we’ll use: (1) the search bar, where this website’s address currently appears, and (2) targeted ads that are served in new tabs, browser notifications, etc. We’ll have both streams. You know that targeted ads are big business and the principal revenue source for major tech businesses. The revenue opportunity with the search bar is lesser known. Suffice it to say that Google pays Apple, a competitor, $15 billion per year to be their default search engine on Safari, Apple’s browser, which has 15% market share, and Google pays Mozilla, another competitor, $500 million per year to be their default search engine on Firefox, which has 3% browser market share. We believe that Google, or another search engine, like Microsoft's Bing, would be interested in a similar deal to distribute its service through our browser, even as it begins to ramp up.
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We start with this website, which enables us to raise the members, money, and morale we need to develop an ongoing sequence of "core" tech services for members and businesses. Income from such services will phase out our need for member donations and allow us to develop and deploy more products in the future. Our first tech service will be a free, members-only web browser, which will incorporate a traditional targeted ads platform that we make available to businesses. We're not 100% certain on where we take our services beyond that, but we believe that a free, members-only search engine would be a logical next step for us as a complement to our web browser and an extension of our ads platform.
What is User Co-op's product roadmap?
Estimated product release sequence
1 // Company website (live)
2 // Web browser
2 // Targeted ads
3 // Search engine
TBD
Time
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Yes. Browsers and search engines are product complements, like ketchup and mustard, and the targeted search ads business is a very big one that's capitalized by our data. So, a search engine is a logical next step for us.
Then, search?
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None of our competitors, including the companies that comprise "Big Tech," are consumer-owned cooperatives like us. Therefore, none of our competitors are structurally capable of providing consumers a fair data deal. All we need to do is stand on the shoulders of our tech giants as much as we can in how we develop and deploy tech products and services to ensure that they're world-class.
How does User Co-op expect to outcompete Big Tech?
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It's too early to tell, but we have cause to think big. We're the only consumer-owned and -governed tech company operating in an industry that's capitalized by consumer data. Considering the tech industry's multi trillion-dollar size and extremely far-reaching ramifications, we believe that we could pay some decent dividends down the road and not only monetary ones.
How much can I expect to get in member dividends?
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No. Members are the principal source of cooperative startup funding. Traditional startup capital sources, like angel investors and venture capitalists aren't available to us, and we're too early stage for a loan. If other sources of non-equity startup funding, like grants and subsidies, become available, we'll consider those.
Has User Co-op raised any money from institutions, like venture capitalists, companies, endowments, and foundations?
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Yes, we have an "early hostile takeover protection" in place. To help prevent a hostile takeover when we're most vulnerable, Article 2, Section 1d of our Bylaws defers granting governance rights to members until we (1) reach, for the first time, ten thousand (10,000) members and (2) collect in cash one million dollars ($1,000,000) of cumulative gross revenue, which includes, but isn't limited to, member donations. Until those conditions are met, the founder is the sole governing member. This isn't a perfect setup, but it does provide us at least some protection against those who might attempt to gain, either directly or indirectly, enough votes and/or influence over votes to commandeer us as we ramp up. We'll email our members the moment we meet the conditions above.
Does User Co-op have any protection against a hostile takeover?
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Welcome to User Co-op! Our top priority right now is new members. The good news is that our target members reside almost everywhere, and we believe that they're waiting to hear from us. But, we've got a lot of ground to cover, and we won't make it with paid ads alone. So, we encourage you to share our homepage with your communities and let them decide for themselves if membership is right for them. It doesn't matter if you share to text messages, post to social media, forward your membership confirmation email, or whatever. Every member counts!
What do I do after I join?
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To update your first name, last name, and/or email address, please submit the Email Form and make sure to: (a) Select "Update member info" in the "Subject" field and (b) Include in the "message" field both (i) your current first name, last name, and email address and (ii) your updated first name, last name, and email address. We'll reply to your current email address to verify the update. We realize that this is a clunky process, and we're going to modernize it as soon as we can.
How do I update my member info?
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We've only just begun, and these numbers are lightyears away from where we're going to be. Also, we value any contribution from our members, even if it's $1. The median contribution shown below and the implied average contribution (not shown) are factual at this point in time, and they are, in no way, meant to indicate the level of contributions we expect from our members.
Members
33
Total contributions
$3,217
Contributing members
21
Median contribution
$50
As of August 18, 2023:
Next update: August 25, 2023
Absolutely. We're starting down the same path other major tech companies have taken in building consumer-facing, ad-funded products. We've included a chart below that shows our best estimates, based on public information, of the inflation-adjusted amounts certain "core" tech platforms needed to raise in order to become self-sufficient with ad revenue. User Co-op responds directly to the vexations expressed by about 75% to 90% of the individuals who use internet tech services. So, we can see a scenario in which the average voluntary contribution per member, based on the figures below, is exceedingly low, even if we were to build social, search, and browsing platforms at the same time. But we won't do that. Our product roadmap has us starting at the bottom rung of this chart.
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Estimated External Funding for "Core" Tech
($ amounts are inflation-adjusted)
Source: Crunchbase, company filings
Facebook | $3.5B
Twitter | $2.4B
DuckDuckGo | $121M
Google | $106M
Brave Browser | $52M
The table below shows our best estimates, based entirely on public information, of how much and how long it took for tech business in core categories to become more or less profitable, get acquired, or IPO. Unfortunately, these figures can only be indicative because (1) there are many services, like Google's Chrome browser and targeted ads business, that are excluded because there's no publicly available information on them; (2) the publicly available information may be incomplete; and (3) each of these services have their own highly nuanced set of circumstances that inform their numbers. We aren't touching any of these, except for the browser, until we've made billions. We are certain that we need a browser and a search engine. Regardless, we start with a browser business, akin to Brave before we move on to any of the others. May or may not be accurate even from an order of magnitude standpoint. We can't know how much they cost but we know that our browser business can pay for them once it's ramped up. Also that these are the kinds of services out there, like a menu and to show that, as long as we focus on the browser business, they're all within reach.
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Estimated External Funding for Selected Services
($ in millions and inflation-adjusted)
Source: Crunchbase, company filings
Total $
Over __ years
Browser
$57
5
Brave
$69
4
Signal
100
6
Chat
7
9
ProtonMail
$11
1
Hotmail
GenAI
$12,300
8
OpenAI
Maps
$126
5
Waze
Search
$198
11
DuckDuckGo
116
7
89
2
Neeva
Social
$3,836
9
101
2
325
9
3,861
6
Snapchat
2,611
8
Video
$36
8
Tubi
195
1
YouTube
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The data we (consumers) stream through our tech use is the capital foundation of consumer internet technology companies, and it exposes us to risks, like those to our autonomy and livelihood, that we can’t practically fathom, let alone quantify or hedge. That gives us a "fair-market" right to wholly own and control the tech companies we use. Yet, ownership of these companies is already spoken for, and the most we can possibly claim to get in return for capitalizing these companies with our data is free access to their services—access that perpetuates our data streams, compounds our personal exposure, and shoots their profits to the stars...
Why aren't we (consumers) getting a fair deal for our data?
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We're a consumer-owned internet technology startup whose mission is to provide all internet technology consumers, or "users," a fair data deal through cooperative ownership. To do this, we combine a "member"-ownership model inspired by a large recreational equipment cooperative and a business model inspired by a tech company whose name sounds like "googol." We’re democratically governed on a “one member, one vote” basis, and we pay out any profits that we don't reinvest to each member in proportion to their individual data streams, which we measure in use. Our membership is free for all natural people, but we ask our members to make small donations for our initial capital needs. Our adventure begins with this website. Its sole purpose is to raise the members, money, and morale we need to build a billion-dollar browser business, our beachhead in the tech industry. Then, we go from there.
What is User Co-op in a nutshell?
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The purpose of a cooperative. A cooperative company, also called a "cooperative" or a "co-op," is, as a corporate entity, a tool that enables any group of people to accomplish their common economic, social, and/or cultural goals through business activities.
What is a cooperative?
A cooperative is user-owned company. A cooperative is 100% owned and democratically governed by those who regularly transact with, or "use," it, like customers, employees, suppliers, or some other group of patrons. Such patron-owners are often called "members." A cooperative either reinvests its profits or distributes them in the form of "patronage dividends" to their patron-owners in proportion to their individual transactions with the cooperative, and each patron-owner gets an equal vote corporate governance. Also, like a conventional for-profit corporation or a limited liability corporation, a cooperative is a distinct legal entity from its owners; therefore, the "corporate shield" applies to each patron-owner of a cooperative.
How a cooperative gets started. Like conventional companies, a cooperative starts with a group of people who decide to pool their resources in accordance with a business plan and go into business together as its common owners. Unlike conventional companies, however, a cooperative can't have investors, like venture capitalists, because cooperatives apportion their profits based on patronage (use), not investments of money. Initial capital for a cooperative necessarily comes in the form of de facto payments from patron-owners, like membership fees, loans, and grants.