VC-backed Unit of Work defends its model against critics

Jamie Earl White grew up in a rural Texas town near Uvalde where there was a clear resources divide between “the ranching class and the non-ranching class.” As an MIT student, he took careful notes during Occupy Boston and helped lead the “Justice for Janitors” campaign—a lesson in how, even with the support of the powerful Service Employees International Union, it could still take workers a year and half to win better contract terms.

So, once White found success in tech a few years later, his mind returned to the problem of workers being under-resourced. He chatted with labor leaders, and presciently in 2020, before the current union movement driven by service-industry employees exploded, launched a new startup called Unit of Work whose solution can sound pretty radical: It provides free consulting to workers trying to organize their workplaces.

If the drive is successful, it then asks the newly minted union to pay fees. In the meantime, would-be organizers get everything from an app and legal advice to tips on bargaining tactics and help filling out the mountains of paperwork. They even get access to hard-to-acquire data on stuff like their employer’s finances. But because clearly these services aren’t free, Unit of Work is doing something even more radical: It’s relying on venture capital from Silicon Valley, a move that’s gotten fist-pumps and raised eyebrows since the startup captured its second union vote victory several weeks ago.

White chatted with Fast Company about his unconventional concept.

Fast Company: Correct us if we’re wrong, but Unit isn’t trying to be like a International Brotherhood of Teamsters 2.0 for the tech age. Rather, you’re more of a software-as-a-service company with a labor mission?

Jamie Earl White: Yeah, our goal is to get resources to workers in underserved workplaces, but not make them a part of our own union. We act more like consultants who help them get where they want to be with unionizing their workplace.

In fact, when we aren’t a good fit, for any number of reasons, we refer workers to other resources. As one example, we’ve had Starbucks locations sign up, and we just refer them to the national unions. Because they’ll have more success there.

You’ll turn down business and say, “We aren’t a good fit for you”?

Yeah, any company that is selecting for customers who aren’t the best fit is asking for a bunch of unhappy customers. There’s also an ethical side to this, where if we were telling individual Starbucks locations that they would have success with us compared to negotiating with Starbucks Workers United on the whole, we’d frankly be lying to them.

But you have had two union victories so far. How do you identify which groups are right to work with?

We’re an especially good fit for private workplaces that want to unionize independently, but can’t find resources elsewhere to do that. Two of the most passionate groups of workers I’ve ever seen are the current unions we support—PEN America’s staff union and the Piedmont Health Services Providers union.

They couldn’t be more different. PEN America is a nonprofit in New York City. Piedmont Health Services is a clinic chain in North Carolina. PEN America’s staff pushed for voluntary recognition, while Piedmont Health workers fought tooth-and-nail to get an NLRB election—with them, we actually set legal precedent in North Carolina, for higher-level providers unionizing.

A big focus now, especially after our success in North Carolina, is to target workers in right-to-work states. That’s often where union density is lowest and workers find the least support to create new unions.

Say I’m a socially conscious investor with money to invest. What’s your pitch to me? What’s the untapped economic opportunity you’re selling?

Everything you do to build a company comes down to creating good incentives, right? You create a positive feedback loop that leads to the impact you want. The way we thought about this is: Software isn’t cheap to design or implement. It’s even more expensive to scale. We needed a financing model that could keep up with that. We made it attractive to investors by tying our revenue and investment strategy to our impact. We only take money from unionized workers—more unions, more fees. Reinvestment creates more unions. Working with VCs, that means if we hit our impact, they’ll pretty reliably provide more funding in the future for that impact.

Do you think these people are investing in Unit primarily to help society? Or are they literally trying to make money?

I think all VCs like to think of themselves as helping society, in some way. But I would argue it’s a primary and a secondary motive. A primary motive of the vast majority of VCs is to make a return on the fund. But they do have discretion, and there’s a difference between investing in a company that destroys rainforests and one that’s building unions. When we raise money, we’re a public-benefit corporation that has one mission written in the charter, which is supporting the rights of workers to organize to improve their places of work.

But it was also important to us that investors have no say in union governance, the campaigns we choose to take on, the workers we support. They also don’t get any data on the workplaces. And investors know if they had that control, they wouldn’t make money because we’d lose the workers we support.

We also make sure investors know our plan is to exit to communities. We see venture-capitalist participation as temporary. The ultimate goal here is for the workers, the unions we support, to buy out their share.

Obviously you’re a long way from that. But can you explain how that “exit to community” plan plays out?

What that might look like is we’re in year 10 of Unit, there are thousands of unions we’re supporting of various sizes, those fees are driving reinvestment in more unions, and the company is building a cash reserve to help with this buyout. Once that cash reserved is sufficient, we take out a loan on behalf of the workers and buy out the financial investors.

The question does come up—if this is so good for investors, why isn’t it done more often? And I go back to the point that the opportunity for investors here is contingent on the trust we build with workers. They know if the plan was to sell to a private-equity company down the road, nobody would use this. Even if they’re purely financially motivated, which is what you always have to assume, they know success depends on us acting ethically.

We need to note, though, that your series A funders have stirred up some controversy. Among them are Bloomberg’s VC arm. There’s Gutter Capital, whose cofounder previously fought off a union drive at his “Uber for offices” startup. And there’s Draper Associates, started by the billionaire Tim Draper, who’s written that government unions create “fewer jobs” and “more homeless.” Honestly, my question doesn’t even concern your ties to them—they invested in you, after all. It’s more what this group saw in Unit that hooked them as early investors?

First, as with many companies out there, my views don’t always match the views of our investors. My views are made pretty public on the website and in articles online. In terms of why investors would invest in our company, I don’t want to speak for them. What I feel comfortable saying is that our lead investor, Bloomberg Beta, is led by Roy Bahat, and he’s been very publicly about labor. People can do their own research there, but I’ve enjoyed working with him tremendously.

I won’t pretend to know why people invest, but what was important to us is that for these folks, it’s a financial investment. They don’t expect, nor are they given, control that could affect the unions we work with. And regardless of their personal views on unions, we have ours and we live by those. This skepticism about Unit as a whole I think shows we still have a lot to prove. Which is totally expected at this stage. We shouldn’t get the benefit of the doubt from Day One. We should be out there winning contracts.

OK, so what’s in the pipeline for Unit right now?

The big thing is more unions. We’re working on multiple campaigns. Our goal with those is to build them slowly enough so they’re very powerful, but fast enough so they can make the changes they want. We also have those two ongoing negotiations that we’re extensively supporting. We’re learning as we go—learning to scale this, and how to make it better. After that, larger workplaces? The largest workplaces that we support today are about 200 people. But we want to take that to 500 people, or even a thousand people plus.

Disclosure: Unit of Work’s current director of organizing was previously a rep for Fast Company’s unit within the Writers Guild of America, East.

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