A Worker Ownership Solution for Colorado’s Failed Mushroom Farm
Media production is a dog-eat-dog industry.
At least that’s what Brandon Naughton, President & Founding Member of Truce Media, says. After 20 years of working with companies like Lionsgate / Starz, HBO, and NBC Universal, he would know.
“People always want to go to LA,” he said. “But you’re starting from the bottom, making no money. That’s why many actors are waiters out there.”
Brandon saw firsthand how people with money in the industry dictate the rules for everyone else. That’s when he decided to start Truce Media, a media production collective in Denver, CO.
In this story we’ll explore why Brandon and the Truce Media team believes a better way isn’t just possible, but necessary — and how employee ownership is helping his company lead the way toward an economy that works for everyone.
Note: Curious about whether employee ownership is right for your business? Schedule a free consultation to talk to RMEOC today.
A new approach in an old industry
Everyone knows there’s big money in the media and entertainment industry. Incredible luxuries and lavish lifestyles are common among executives at the top.
Brandon put Truce Media together because he believes Colorado needs something different than a traditional company leading the way in this industry. The difference? Truce bakes equality into the very structure of how they operate day to day.
“Rather than saying I want ten Ferraris and a yacht, I’m saying we’re going to put that money back into the people and share in the profits,” he said. “We can all still have Teslas and nice things. That just makes your company grow that much faster!”
It’s true. When employees have an ownership stake in their company, the business tends to grow faster, survive longer, and provide for a significantly higher median household wealth, among many other benefits.
The company name itself captures Brandon’s ambition. In battle, he explains, a truce is called when people on opposing sides come together to create a solution. The vision is bigger than what any one party could create on their own.
“We’re all very talented, but time is short,” Brandon reminds us. “Let’s build something bigger.”
He actually prefers to use the word “collective” over “co-op” in his business. At its core, Truce Media is a collective of people who are skilled at their craft, tired of doing everything, and don’t want to continue doing it on their own.
In film and television especially, people wear too many hats. After they get through the cycle of landing projects, finding a set, renting equipment, delivering client services, and running the day-to-day operations inherent in any business, they don’t have work lined up for them at the end.
That often leads to a loss of income, unpredictable revenue, and the dreaded feast or famine cycle that creators know all too well.
In a collective, on the other hand, media producers can pool resources and work together to save costs and boost productivity. Everyone ultimately contributes to having a functioning studio that benefits everyone involved.
An employee ownership structure to fit their needs
For the first couple months, Truce Media operated without any kind of legal entity. When they began the incorporation process, Brandon knew that they wanted something to safeguard equitable ownership among everyone who worked there together.
In April 2019, Brandon decided to incorporate the business as an Article 58 cooperative public benefit corporation.
Cooperatives function under the imperative of “one member, one vote.” And while Article 58 in particular mandates that co-op members possess equitable ownership in the form of a share and a vote, it also allows for more variety than the typical cooperative legal structures.
Truce Media is able to take outside investments, for instance, in order to finance constructing a production studio, a movie lot, office space, and more. Additionally, membership is open not just to individuals, but to LLCs, affiliates, and distributors.
Regardless, employees must always retain at least 51% control of the cooperative, and there can’t be overrepresentation of investors on the board, among other protections. Incorporating in this way keeps control and integrity in the hands of creators and people producing the content.
Crossing the finish line with RMEOC
Even after the incorporation process, Brandon and his team had a few loose ends to tie up. They hadn’t drafted any bylaws, and they weren’t sure how to complete the process and move on.
“RMEOC came in and helped narrow down what we wanted,” Brandon said. “How do we make this simple rather than very complicated upfront? They really helped in that aspect.”
After refining their systems and finalizing their internal governance structure, RMEOC provided the proper legal resources with Jason Wiener | p.c. to refile all of Truce Media’s documents to make sure everything stayed up to speed on the state level.
“The best part [of working with RMEOC] was getting to the finish line. Now we’re official!”
And by the looks of things, it’s only upward from here. In less than two years of coming together as a collective, Truce Media has already generated seven figures in revenue… as a startup… in film and television… in Colorado!
Colorado might not yet be a mecca of film production, but Truce Media is well on their way to accomplishing their mission of building something big.
Cultivating an ownership culture
Brandon says being able to work together and having constant positive interactions, especially while working from home, has been empowering.
“People are kind of shell-shocked from their previous experience in this industry,” he said, “This [Truce Media] is something completely different.”
He says breaking that passive mindset and sense of subordination is the most important part in making ownership a focal part of the business’s culture.
That’s why new members spend the first few weeks engaging in a lot of co-op education. It’s part of a six-month “intention of membership” period, after which prospective members can become part of the cooperative and begin the vesting period.
During the first three months, it’s mostly training and getting to know everyone. The last three months are more hands-on experiences showing prospective members what it’s like to be an owner: how to bring in sales, make decisions, and carry themselves as leaders of the company.
And because sales are essential to any business owner, employee-owned or otherwise, each prospective member receives a commission and the opportunity to shorten the window to membership based on the revenue they bring to the collective.
Everyone’s success depends on being up front with each incoming member about the importance of having an ownership mentality.
Coming up next
Brandon says producing virtual graduations for schools really helped them launch the company. Post-COVID, they’re set up to do hybrid events from anywhere in the world, in addition to offering post-production services for companies who need a quick turnaround.
“In Colorado, we have the opportunity to be a big fish in a little pond — with the mindset of growing the pond into an ocean,” he said.
Brandon sees Truce Media beyond simply being a production company. They’re brand builders and leaders in infrastructure and technology.
To that end, they recently launched RemoteLive.io, a proprietary software designed to solve industry-wide problems regarding remote interviews.
By selling software-as-a-service (SaaS) subscriptions, Brandon hopes to build a recurring revenue model that allows them to grow the creative industry in Colorado by investing the profits into people and original content.
Regardless of the services they provide now or in the future, their mission will always be to build equity for producers and to put people first.
“I’m tired of seeing creators taken advantage of,” Brandon said. “They’re being used for their creativity and then being tossed aside.”
“We want to create content that everyone on the set can share ownership in.”
***
Join our email list to get more articles like this delivered straight to your inbox.
Curious about whether employee ownership is right for your business? Schedule a free consultation to talk to an RMEOC specialist today.
Related posts