Here’s the problem: The founders of “Mietshäuser Syndikat” (tenements syndicate), a network of cohousing projects in Germany, observed many self-organized cohousing projects struggle and fail. Some couldn’t overcome the challenges in the critical early phases, in terms of dealing with legal issues, finances, and group dynamics, while others created commercially exploited housing projects against their original intentions. At the same time, many cohousing projects did not have the capacity to support each other.

Here’s how one organization is working on the problem: The Mietshäuser Syndikat was launched to support self-organized, social housing projects. It connects successful, established projects with emerging ones to provide help, while at the same time reducing re-commercialization by ensuring all inhabitants co-own all real estate assets of all cohousing projects.

A legal construct stipulates that each cohousing project is considered an autonomous enterprise that owns its real estate, with the legal status of a limited liability company (LLC or “GmbH” in German). This GmbH consists of two partners: the cohousing association itself and the Mietshäuser Syndikat GmbH. The form of limited liability companies allows the property assets to be interconnected, since decisions cannot be made unilaterally. Finally, the single associate of the network’s GmbH is the MHS Association, which all inhabitants are part of.

For a cohousing initiative to join MHS, some requirements must be met: The cohousing project needs to be self-organized by its residents, and a house and a financing plan must be on hand. Once the cohousing project establishes a secure financial basis, it needs to support new projects that are in the critical, cost-intensive early phases, the same way it received help when it began. The MHS Association represents all inhabitants of all cohousing projects and has a veto right when it comes to reprivatization and commercial exploitation of individual projects. Regarding any other issue concerning the residents, loans, rents, and renovation, the co-residents themselves make decisions on behalf of their own cohousing association.

Results:

• Since 1983, the network has grown to consist of 111 cohousing projects with a total of about 3,000 residents.
• Twenty-one initiatives throughout the country are in the process of joining the network.
• Spin-offs like “habiTat” in Linz, Austria, have been established in other countries.

Learn more from:

• Mietshäuser Syndikat
• Habitat (German)

This case study is adapted from our latest book, “Sharing Cities: Activating the Urban Commons.” Get a copy today.

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Neal Gorenflo: When I began writing about the sharing economy in 2009, the eclectic array of struggling, communitarian-minded tech start-ups in San Francisco, California, were just one small part of a vast number of sharing innovations that made up what we at Shareable saw as an era-defining transformation in how people create value. This included open-source software, all the open X movements inspired by open source, Creative Commons, the resurgence of an economy based on solidarity, the rise of carsharing, bikesharing, coworking, cohousing, open government, participatory budgeting, crowdsourcing, crowdfunding, hackerspaces, and more. We were in the midst of a sharing transformation.

Soon, however, money began to pour into a handful of these tech start-ups, most notably Airbnb, Lyft, and Uber. The media quickly shifted its attention to them, and they became synonymous with the sharing economy. However, as the money rolled in, the communitarian element rolled out. Exploiting peer providers, purposely breaking regulations, strong-arming local governments, and unethical competitive tactics became the norm. The very thing that earned these start-ups traction in the first place — how they recast relationships between strangers in radically constructive terms — was sacrificed to growth. Instead, they became a particularly aggressive extension of business as usual.

Despite this, the real sharing economy did not disappear. We at Shareable helped catalyse two related movements to help draw resources to this real sharing economy. In 2011, we hosted Share San Francisco, the first event framing cities as platforms for sharing. The city of San Francisco incorporated our thinking into their Sharing Economy Working Group, which then inspired a former social justice activist and human rights lawyer, Mayor Park Won-soon of Seoul, South Korea, to launch Sharing Cities Seoul in 2012. Sharing City Seoul’s comprehensive package of regulations and programmes supported a localized version of the sharing economy where the commons, government, and market work together to promote sharing and the common good. Many cities have followed suit, including Amsterdam, London, Milan, Lisbon, Warsaw, five cities in Japan, and at least six other cities in South Korea. Last year, Mayor Park won the Gothenburg Award for Sustainable Development for his sharing cities work.

In late 2014, we published a feature story by Nathan Schneider, “Owning is the New Sharing,” which reported on an emerging trend — tech start-ups organizing themselves as cooperatives. This, together with a conference about platform cooperatives, proved the stimulus for a new movement. One of the cornerstone examples of this movement is Stocksy United, a growing online stock photo marketplace where the photographers own and control the business. In other words, Stocksy is a 21st-century worker cooperative. Another example is Fairmondo, a German eBay-like site for ethical products owned and controlled by sellers. It’s expanding by recruiting cooperatives in other countries to a federation of cooperatives that, together, will maintain local control of each country’s market through a single technology platform. Fairmondo exemplifies an approach to impact that philanthropists ignore because, too often, they are as obsessed with scale as any Silicon Valley venture capitalist and don’t see the virtue of impact through replication instead.

In this regard, philanthropists today should follow the instructive example of Edward Filene. Filene played a leading role in developing an institution that allowed ordinary people to build their own wealth — credit unions, a high-impact model that could be and has been replicated. Philanthropists should use their resources to help do the same across a whole range of new institutions including sharing cities, platform cooperatives, and much more. This will help ordinary people build and access wealth, reduce resource consumption, and reweave the social fabric. Now, that’s what I’d call a real sharing economy.

This piece was originally published on Alliance Magazine.

Photo by Avariel Falcon

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