Where Does a Worker-Owned Collective Business Get a Loan?

Don’t try to ask for the manager at Red Emma’s in Baltimore. That’s because there isn’t one. The self-described “worker cooperative radical bookstore, vegan/vegetarian restaurant, and coffee roaster,” is proud of its radical and anarchist roots, as demonstrated by its organization as a non-hierarchical workers’ co-operative. All of this was fine, until it wanted to expand and discovered that most traditional banks didn’t want to draft loan paperwork including all of the shop’s 12 worker-owners. Instead, Red Emma’s turned to BRED, the Baltimore Roundtable for Economic Democracy. BRED is part of a new model of investment focused on supporting worker-owned and co-operative business models.

“In practice it looks a lot like patient capital,” says Kate Khatib, a co-founder of BRED, “because it is an investment that doesn’t come with an ownership stake.”

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