Mojo Minnesota Incorporates as a Co-op

Co-founder Ernest Grumbles said that Mojo was a bit hesitant to adopt a formal structure, but the co-op structure allows it to move forward with its mission to fuel entrepreneurship in Minnesota.

Two years after it was formed, local innovation advocacy group Mojo Minnesota has gained legal status as a Minnesota co-operative.

Mojo is a group of 12 business leaders-including attorneys, advisors, investors, and entrepreneurs-that was formed by Brad Lehrman and Ernest Grumbles in 2009.

The group works together to promote and fuel entrepreneurship and innovation in Minnesota through lobbying and creating and hosting community and mentoring events. The group also focuses on translating state policies and programs into “plain-English” guides for entrepreneurs, which it posts on its Web site.

Mojo was among many groups lobbying the Minnesota Legislature for an angel-investor tax credit-which was signed into law on April 1, 2010-and it has been working to complete an updated guide reflecting the changes to the program that were approved by the state last month.

Grumbles, an attorney with Minneapolis law firm Adams Monahan, LLP, told Twin Cities Business that the group was a bit hesitant to adopt a formal structure because it wanted to remain nimble and agile, and one of the benefits of Mojo has been the “distributed nature of the group.”

“The desire of the group was to not focus so much on structure as we did on action,” Grumbles said.

But after a year of on-and-off research and investigation, the group decided to incorporate as a co-op-which is defined by the International Co-operative Alliance as “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.”

According to Grumbles, incorporating as a co-op allows the group to retain its current “flat” structure in which everyone is involved on the same level. It also allows the group to remain lean and efficient because the board of a co-op is comprised of the group's members rather than outsiders-which would not be the case with a nonprofit.

Grumbles added that a nonprofit structure would entail significant oversight and restrictions in terms of lobbying, and the group may want to engage in for-profit activities in the future-activities that could have potentially put the group's tax-exempt status in jeopardy if it was a nonprofit.

“We want to be able to use all the tools in our toolbox, including lobbying,” Grumbles said.

Mojo also wants to set an example and push other similarly-focused groups to take advantage of the benefits of co-op status.

“[Co-op structure] has the benefits of an enterprise while also recognizing the independent nature of [an organization],” Grumbles said.