Baystate Health - Wellspring Cooperative

Overview

The mission of the Wellspring Cooperative Corporation (WCC) is to develop a network of worker-owned cooperatives, business entities that are owned and controlled by their members, formerly underemployed and unemployed inner-city residents who work in them in Springfield, Mass. Worker-owners share in company profits so they can build wealth to invest in housing, education, and other assets that enable families to move out of poverty. Wellspring cooperatives provide urgently needed entry-level jobs in inner city neighborhoods where fewer than 40 percent of adults are employed. Wellspring businesses are designed to meet the purchasing needs of local anchor institution partners including Baystate Health, Sisters of Providence Health System, Springfield Technical Community College, University of Massachusetts, and Western New England University. While anchor institutions purchase more than $1.5 billion of goods and services a year in western Massachusetts, less than 10 percent of those dollars are spent locally. WCC’s current and planned businesses are anchored by Baystate Health’s new business practices and purchasing power.

Impact

Wellspring Upholstery Cooperative was the first cooperative launched in December 2013. The company broke even by the end of its second year, and now employs six people with the potential to double employment over the next five years. A Baystate Health letter of intent to purchase greens from an emerging hydroponic greenhouse business to provide year-round local produce in the food deserts of Springfield, to be launched this summer, made it possible to leverage other commitments. The greenhouse will employ five people at first and grow to nine employees, while serving as the hub of a network of food businesses that will create more than 50 jobs. Wellspring’s goal is to create more than 100 jobs in 10 cooperatives in the next five years.

Lessons Learned

Wellspring has learned important lessons about business planning, development and financing, as well as low-income worker recruitment and training in its first five years of operation. Given the challenges of raising capital for startup businesses, Wellspring has just launched an Investment Fund to raise a pool of investment dollars. One important lesson of the greenhouse development, which is a capital-intensive project that has taken two years to launch, is the value of focusing on less-expensive, high-job-creation service businesses that can be developed more quickly.

Future Goals

Wellspring is diversifying the range of cooperative development strategies to pursue. In addition to new business startups, they are supporting groups to create their own companies, seeking sole proprietors who want to convert to coops by selling to their workers, and looking for regional opportunities to collaborate on multi-store cooperatives.

Contact: Frank Robinson, Ph.D.
Vice President, Public Health and Community Relations
Telephone: 413-794-1016
Email: frank.robinson@baystatehealth.org