How to set up a freelance co-operative

Setting up as a freelancer isn’t a straightforward decision and there are risks involved.

In order to respond to some of the pressures of setting up alone, there is a growing trend across the UK where individuals are joining forces to form freelancer co-operatives. These co-operatives, made up of individual traders, provide a range of services from financial advice, web design to music teaching.

Five steps to starting a freelancer co-op

If you are a freelancer – or considering taking the leap to self-employment – read our 5 steps to setting up a freelancer co-operative. Each step includes links to information for how The Hive can help you.

Get your business idea in place

As with any business, it’s essential that you have a strong, marketable business idea. Without an idea that generates a profit, there can be no sustainable co-operative.

  • Once a group of freelancers has agreed to join together as a co-operative, you would first need to test your business idea to ensure it is feasible.
  • As well as the services you will offer as freelancers, you will have to consider yourselves customers of your co-operative, which might provide you with a number of services from a shared workspace, providing back office support, bulk buying products/services or joint marketing.
  • The key is to identify whether there is a real need for the service that you are offering, that you and other self-employed people will pay for.

The Hive gives you the guidance and templates for testing your business idea.

Work out how to finance the co-op

Simply put, finance is lump sums of money that you can quickly and easily use for whatever purposes are required within your business.  It may be in the form of grants and gifts, loans, community investment or even credit.

  • In conventional enterprises, investment and ownership dictate how the business works; in co-operatives it is the members – the people most affected by the enterprise – that are in control, determining the direction of the organisation and the terms on which investment is raised. This simple, but subtle, reversal of power will provide the context for the way in which you finance your co-operative.

The Hive helps you work out the options available for financing your freelancers co-operative.

Write your business plan

Next, you should write a business plan – your document to say how you will set up your freelancers co-operative.

  • A lot of the information will come from your feasibility study. Once it’s ready, and everyone is on board, you can move onto setting up your co-operative by acquiring resources and establishing your legal form.

The Hive gives you the guidance and templates for writing your business plan.

Setting up your freelancers co-operative

Nearly there! There are a few more elements to setting up a co-operative, which The Hive helps you work through, such as:

  • Working out your governance
  • Your co-operative structure
  • Your legal form

The Hive gives you all the information and support you need to get your business registered as a legal entity in setting up a co-operative, including details of the Co-operatives UK registration service.

Start trading!

After registration While it might seem that getting your business registered took a lot of time and effort, it is just the beginning – now you’ve got a business to run! The Hive gives you some simple pointers in this section to help you get started. And once you’re fully up and running, you should look at The Hive’s Growing your business section for more help and advice on how to grow, thrive and be sustainable.

Hear from some existing freelancer co-operatives

Written by Leila O'Sullivan
Updated: 06/04/2016