Union startup Unit of Work has received $1.4 million in pre-investment funding led by the venture capital arm of billionaire Mike Bloomberg, reports Los Angeles Times.
The startup’s outside investors “have gotten rich backing technologies like artificial intelligence, cryptocurrencies and video games. One of them is one of California’s top critics of public sector unions.” But the head of a leading startup investment firm says that “anytime there’s an unmet need in the community, there’s an opportunity for companies.”
[T]These people, accustomed to multibillion-dollar sales and IPOs, see great opportunity in the fragmented, troubled state of the American workforce and the potential for its transformation through a new era of unionization. “We only invest in areas where we believe we can make a profit,” said Roy Bahat, head of Bloomberg Beta, the venture capital arm of billionaire Mike Bloomberg’s media empire.
Unit’s business model works as follows: startup organizers provide free consultation to groups of workers organizing unions at their workplaces, helping them gain support to win elections, advising them on strategy in contract negotiations, guiding them through paperwork and legal hurdles . Once the contract is in place, members of the new union may choose to pay Unite a monthly fee — similar to traditional union dues — to continue its support…. Once the company starts turning a profit, it plans to buy out its investors and give its capital to the unions it helped organize, effectively ceding corporate control to the customer base.
The approach attracted strange bedfellows. The second investment firm in the round, Draper Associates, is led by Tim Draper, a third-generation venture capitalist, Bitcoin preacher and outspoken critic of organized labor… [H]e launched a ballot initiative to ban public sector unions in California…. “The unit of labor makes unions decentralized,” Draper wrote in an email explaining his investment. “It will be wonderful. Centralized unions tend to hold back trade, while state unions create a bloated bureaucracy and generally poor public service…”
Despite Draper’s enthusiasm for independent unions, as opposed to national labor organizations, Unit executives and its website make it clear that they support their clients if they decide to join a larger union.