Funding and Revenue Model

This is the third of six weekly articles in the Atlas Urbium pilot season on the Shakers. A pre-release of each article is shared with AU NFT collectors that support the research.

In some of the earlier articles of this season, we’ve touched upon the ways in which groups of Shakers rallied resources to jump start early communities. We’ve also explored how every aspect of life in a Shaker community was as carefully coordinated as an industrial production line. Our objective with this article is to go deeper into the relationship between the Shaker social system and the revenue-generating activities that allowed their communities to perpetuate in time.

How did Shakers gather resources?

It is safe to say that Shaker communities were bootstrapped projects in which members that wanted to belong to them committed whatever resources they could gather in the interest of seeing them come to fruition. When we compare Shakers to other types of communities that sought to retire from the world, one of the salient features of their organization is that they minimized their dependence on charity. Even though Shakers accepted donations from members, they rarely did so from outside patrons. Despite being a non-profit religious organization, from the get go Shakers were looking for ways to use the assets they received to bolster a productive apparatus for the organization. Shaker communities quickly began to run on profits generated from the sale of industrial and agricultural goods that were produced by members. The growth of their economic interest over time was the direct result of properly managing these profits.

The property Shakers accepted from members was carefully screened to ensure that it did not come with any outstanding claims attached to it; be it from inheritors, debtors, or others. In their ascetic, moralistic worldview, Shakers read many aspects of life through binaries. Property was no exception. They either held solid, defensible claims to it, or they were not interested. This is one of the outstanding elements of their model.

Shakers were in many degrees free from the outside world. However, this was not because of politically justified sovereign claims to territory. The forms of autonomy that allowed Shakers to determine their own destiny came from their ability to develop an economic interest without resorting to any form of debt financing, They also made sure that equity contributions were very value-aligned to the project, and that they irretrievable. It proved almost impossible for those that had given to the project to use their gifts in order to steer its direction.

We think the relationship between financing mechanisms and claims to autonomy are generally undervalued in the world of startup communities. Maybe this is because the readily available sources of funding–whether based on debt or equity models–that can give speed and scale to an initiative of the sort feel unavoidable. Perhaps they seem unavoidable because the promise of arriving at concrete results is too seductive for condottieri or explorers at the helm of startup organizations.

Building any sort of entity that engages in power dynamics is surely a careful act of compromise and negotiation. It requires selecting who you want to get in bed with carefully. Every route has its opportunities and challenges. We just see that in the rush to keep treasuries filled and show constant progress in the field, it is easy to go from founder, to condottiere, to vassal lord that stewards a fief in the name of someone else’s interests; specially when that ‘someone else’ manifests as a set of nebulous economic forces.

The Shaker case was a crowdsourced model that relied exclusively on community members. Shakers perhaps had less than others, and perhaps took a bit longer to amass it. However, what they were able to build was more certainly theirs to steward and give direction to. Bringing resources into the ‘joint interest’ of the church, a concept we discussed last week, came in several forms. In some cases it was land or money. In others tools and machinery that Believers employed in their trade. However, in all cases, Believers came to give their talent, skill, and raw labor to the construction of the joint interest. It is this sweat equity, above all else, that allowed Shakerism to stand on its own feet.

Shaker founder Mother Ann discussed work within the sect as a form of prayer in itself. We can interpret this as a simple reframing of the Protestant understanding of work as an important means towards spiritual transcendence. However, we could also see it as a reaction to her own experience with labor in early industrial textile mills, where she worked since she was eight. Shaker working conditions in many ways sought to reframe what an industrial approach to work looked like, and in the interest of which objectives it was pursued. Shaker work was silent. Work environments were clean, luminous and orderly. The utilitarian products that came out of them were crafted with a care that went beyond the demands of the market; for the eyes of God rather than those of men.

What did Shakers do with their profits?

Because Shakers lived a simple, ascetic life, the community’s claims on the output of its productivity were comparatively low. In an age characterized by excesses of all kinds, ballooning debt and growing inequality, it is no wonder that there is a revived interest in the Shakers. They embody a set of cultural values that allowed them to live a good life without the need for luxury, and put the surplus of their industriousness at the service of larger edifying projects. Although Shaker culture was born this way, we can find cases where a society was steered culturally and religiously to shun an addiction to material luxuries. The Tokugawa shogunate in Japan is one such case, in which religious campaigns were deployed to decrease environmental stresses on the island’s almost depleted forests. Japan’s surface today is almost 70% forested, much of which is new growth since the Tokugawa period.

Since Shakers employed a hybrid industrial and agricultural model, they were also self-sufficient in many respects, which reduced the amount of goods and services they had to acquire from the outside world. Shakers produced their own grain, vegetables, meat, dairy, lumber, medicines, textiles, furniture, household tools, industrial machinery, heating systems, buildings, and so on. Not needing that much from the world allowed them to have an overwhelmingly positive trade balance with neighbors, who on their end did need some of these Shaker goods.

As a non-profit, families in the Shaker sect used their surplus principally for three purposes, other than providing for themselves, all of which reinforced their claims to autonomy. Part of a family’s resources were used to reinvest in their productive businesses, which further increased their economic power. Another part was used to acquire hard productive assets like agricultural land. In the 1840s Shakers in New York were investigated by the state due to fears that their fast encroaching purchases of land would come to embrace whole towns, and even counties. Shaker prosperity and subsequent land grabbing was growing so fast that there were concerns that Shakers would acquire a dangerous monopoly of land in the whole state.

The third part of Shaker surplus resources was used for charity. Shakers maintained the poor that the state could not take care of. They made public and private donations for the relief of suffering, and even spent money on local infrastructure–roads, bridges, etc–that served a greater good. This was a second way in which Shakers maintained a positive trade balance with their host country and neighbors. The first was economic, not unlike what developing countries do with incumbent powers, stealthily raising their political standing at the latter’s expense. The second was social. Shakers provided more public goods than they consumed.

What was the Shaker attitude towards innovation?

In the denial of their corrupt earthly nature, Shakers were obviously perfectionists. They believed they could overcome some of the most deep-rooted moral challenges that came with the human condition, and exercise an everyday practice commensurate with this aim. However, inasmuch as their life was in many ways regulated through relatively static rules, Shakers were always working towards a concept of progressive perfection. This is related to their Millennialist worldview, which we discuss in article 001.2. Shakers were always looking for better ways of doing things. They valued efficiency in their productive affairs, and believed that any improvement to the means and methods of their work was a way of reducing human toil. They saw time that was saved from work as time that could be more joyfully given to song, dance and other forms of conviviality.

Progressive perfection implied becoming better every day at performing a specific task. It also meant dedicating human ingenuity and creativity to developing innovations. This resulted in making better performing products, inventing tools that made their manufacture simpler and more satisfactory, and improving industrial processes.

Shakers are credited for simple product designs that acquired widespread adoption, such as the wooden clothespin with metal coils, or the flat brooms, which virtually replaced all round broom designs. They developed tools to increase the precision and simplicity of everyday tasks, such as the now ubiquitous circular saw and an early version of the washing machine. This attitude even translated to architectural design and its impact on production processes.

Shaker barns were some of the largest barns in the country at the time. The solutions to problems of light and ventilation that they came up with were superior for the time, and everything from their siting to the way their programs were arranged within was a subject of constant experimentation. The multi-level Great Stone Barn at Mount Lebanon, for instance, was lodged into a hill, allowing hay to be brought in from the top levels and distributed down through gravity. The barn had an internal rail system around which cows were arranged that continuously moved manure out of the building, keeping it free from contaminating the milk, and directly dropping it off into external vaults that could be easily carted to the field for use as fertilizer.

Shakers were open to constant technological disruption and convinced of its capacity to raise standards of living. This disruption didn’t pose a cultural or social threat for the community, as we find ourselves arguing over today. Maybe this is because the principle of joint interest ensured everyone was an explicit beneficiary of the gains that innovation brought with itself. Today, many are skeptical of who will be the ultimate beneficiary of technical progress. Where some see a trickle down effect of innovation that raises living standards overall, others see a threat to their livelihood, and a future that will leave them and their kin behind.

In Shaker society mechanization surely didn’t threaten anyone’s livelihood, and the impact of technical developments on culture were coherent with the Shakers’ larger ethos. Innovations developed in the work sphere were immediately translated to the sect’s domestic and religious environments, where Shakers lived an equally coordinated and mechanistically organized lifestyle that gave them purpose. When they invented mini-exhausts to avoid soot formation from individual oil lamps that extended productivity in the workplace–remember they believed dirt was evil–they applied them to their homes. When they developed superior furnaces for their metal shops, these were quickly adapted to heat their spaces of worship. There was no divide between life and work; the logic was the same.

In an environment where there was a strong suppression of individual identity, innovation in the work sphere must have been an important outlet through which Shakers expressed their ingenuity and creativity. If someone came up with a better way of doing things, it was adopted by the community. We haven’t come across evidence that individual Believers were praised or received any sort of glory for their inventions. However, these were still ways in which Believers could make unique contributions to the church, which promoted their broader adoption and benefitted from the resulting economic gains.

Perhaps suppressing the ability for individual expression in other aspects of everyday life actually allowed for this individual energy to be channeled into projects that were of greater utility to the society. Shakers kept their education of children tied to skill-building. They were skeptical of fields of knowledge that were not of obvious consequence to everyday life. In the late 1830s they also found that an excessive expression of individual religious experiences was contrary to the social cohesion of the sect.

Shakers began to experience a series of ‘gifts’, whereby Mother Ann spoke through them to deliver important messages. These gifts played an important role in reviving Shaker spirituality at a point in which there was virtually no one left that had experienced direct contact with Mother Ann. However, the Ministry Elders and Eldresses quickly found that these spontaneous forms of individual contact with Mother Ann had to be regulated. They took away power from the church, which was the absolute interpreter of religious affairs. They also created jealousies and perceived unfairness amongst Believers. Work was perhaps a more appropriate space for the expression of those aspects of human nature that relate to individual expression.

Innovation was further encouraged by the fact that everyone in the community was expected to know how to do all trades. Believers were rotated from time to time across the different workshops and agricultural activities. By the time they reached old age, Shakers had racked up expertise across fields, and made contributions to each. This encouraged the development of a form of intelligence not unlike the one many of us find ourselves pursuing today, in a world where conditions change so fast that deep expertise in any one trade is not per se a guarantee of survival; where learning how to learn is much more valuable than acquiring a specific set of skills or knowledge. By keeping Believers moving between trades, it allowed them to look at the way work was performed with fresh eyes, identifying opportunities that someone more accustomed to perform the task naturally missed.

Within a highly regulated and organized way of life, there was always a next degree of perfection or achievement that could keep it all from becoming monotonous. The techno-positivism that was deeply embedded in the Shaker Millennialist metaphysics was one of the core drivers of this. Maybe the turmoil that surrounds our current relationship with technology is driven by the gap between the metaphysics we have developed over centuries, and the violent ways in which technological development has wiped out the contextual conditions in response to which we had designed it.

How was the Shaker network economically beneficial for nodes?

Documenting Shaker inventions is tricky because Shakers rarely patented them. However, Shakers are credited for all sorts of inventions, like the vacuum pan: a machine developed by a Shaker chemist to produce root extracts more efficiently without denaturalizing them. This is the same machine that would be used for the production of condensed milk, a key staple of soldier rations during the American Civil War. Shakers developed early versions of the wheelchair; invented the rotary harrow for tillage, and a threshing machine for grain. Scientific American credited Shakers with the invention of metal pens, as well as tools to efficiently manufacture them. The list goes on. Whether Shakers actually invented all of these, or were just very early adopters of some, is irrelevant for the purposes of our analysis. The point is that Shakers built important businesses that enjoyed economic advantages by virtue of the implementation or sale of these inventions.

This is one of the ways in which belonging to the Shaker network benefitted the family node (for an explanation of the Shakers units of social organization, read article 001.3). These individual innovations in machinery, industrial processes and product design were freely shared between Shaker families. Every family generally counted on less than 100 minds, which means that their ability to develop innovations was rather limited. However, as part of a network that came to have as many as 60 families engaging in knowledge sharing, a single family enjoyed an incredible advantage. There was enough critical mass within the family to perform coordinated labor in this proto-industrial American context. There was also a large enough R&D network of tinkerers to stay ahead of other enterprises.

Being a family node within the network had other advantages in regards to Shaker enterprise. Even though all Shaker communities had an agricultural component, their model was essentially industrial. They manufactured goods and sold them. This was the way they amassed wealth. Even with regards to agriculture, it was an industrial mentality that gave them an advantage.

Thanks to the careful craft that characterized their work and the consistent output that industrial logics granted them, Shaker products became recognizable across the country. Whether it was through their furniture–particularly the chairs–or brooms, mops and hanging pins, ‘Shaker’ became one of the first nationally recognized brand names in the United States. Two lines of products had a particular impact on this: seeds and medicinals.

Shakers were the first to turn agricultural seeds into a packaged product, as we see them in nurseries and supermarkets nowadays. They had their own printing presses, through which they developed packaging designs that people nationwide came to identify with their standards of quality. The same went for their lucrative medicine business. Shakers learned all about medicinal herbs from Native Americans that they came in contact with in the areas where they settled. They then produced and packaged these in an industrial fashion, and sold them across the country.

Maintaining the consistency of Shaker production across villages in all of New England and the Midwest was not an organic phenomenon. Families were highly incentivized to belong to the network because of their ability to capitalize on the Shaker brand. However, keeping the value of this brand high was a steady coordination effort on behalf of the Central Ministry in New Lebanon.

Not all families were focused on the same trades, and this depended on both the skillsets of its members and the resources available to them. Some of these differences within the families of a Shaker village actually facilitated an internal economy that was mediated by the village’s Office of Trustees. Individual families were responsible for their own sustenance and could only exchange goods through the office.

That said, the Central Ministry developed production standards that all families that engaged in a certain product line ought to follow. The Ministry would send product samples to the families across the network so that they could align themselves to one another. Following these, and coordinating further innovations with the Central Ministry brought obvious advantages that the single family alone could have never reached due to an issue of scale. ‘Shaker’ the brand was one more asset that made up the safety net of each individual Shaker. Sales by any one family raised the demand for the products of every other family and the overall commercial reputation of the whole society.

Both of the points described above give pragmatic reasons why each family node had a vested interest in the proliferation of further nodes to grow Shaker society; reasons that go beyond cultural or religious motives. Value alignment and a developed governance/communicational model for the society allowed these small, highly coordinated communistic compacts that Shakers called ‘families’ to benefit from the economies of scale that usually characterize larger systems.

This is not a model unlike what certain web3 network state projects are attempting today: the creation of a protocolized system that can punish or reward behavior by nodes according to a certain value system, ostensibly offering some concrete value to nodes that voluntarily display good behavior. These nodes might run co-livings, co-working spaces, or even host meetups. The principle is the same.

The model is not even that different from centralized web2 platforms like Airbnb, which regulate the quality of outsourced accommodation services by rewarding and punishing hosts according to their social reputation within the network. Who captures the value of the network is different in each case, but they are both closer to a model like that of the Shakers than, say, fully centralized hotel chains. This last group needs to maintain the quality standards of a product delivered at massive scale by directly controlling as many of the functional aspects of a business as possible.

How did context play a role in Shaker economic success?

The coordination incentives that came with belonging to the network must have been effective because of an excess demand around the Shakers for their products. They could have only been effective if Shaker families did not have to compete with one another for existing demand.

In a proto-industrial America, Shakers were significantly ahead in every aspect of life that industry demanded. They had an acutely organized sense of time, valued gains in efficiency, were constantly inventing new products with practical advantages for their users and firmly believed in homogeneity. This must have made it so that they had limited competition. Their decentralized settlement pattern across New England and the Midwest then guaranteed that Shakers had a large enough market to avoid internal competition. Centralized coordination gave them scale, decentralized production and distribution structures gave them a broad enough marketplace at a time when moving goods across territories was non-trivial. Each cluster of families covered a different ground.

That said, the gains that the Shakers derived from this socio-economic organization were short-lived in historical time. As America developed away from an agrarian economy and into an industrial one, Shaker prosperity declined. This is not because Shaker prosperity derived principally from their ample land holdings. Instead, growing competition annihilated the Shaker monopoly over well-crafted industrial goods. When the world caught up to a true capitalist scale of industrial production that required massive centralized scaling, the Shaker family structure proved too small as a functional unit to keep up.

As we have discussed in earlier articles, these large ‘families’ of celibate individuals and their way of life were in many ways essential to Shaker success. However, as the socio-economic context in which Shaker villages inevitably found themselves changed, the same family structure began to be an obstacle. The Shaker social system became synonyms with its belief system. It was an essential aspect of the way of life and the culture. This caused Saker society to ossify as the world around it caught up, and began to compete.

The advantages that this highly ideological way of life granted its members proved to be one of the sources of its demise later on. The American Civil War marked the beginning of these contextual changes, and the peak of the demographic growth of Shaker society. The war and its aftermath brought more and more Shakers back to the world, called by a more pressing purpose, and slowly began to decimate the society, one family at a time.

Collector Creds

This article was produced with the support of the following AU Early Collectors:

0x7061Ed44F568a1a408a3dE397be5066B76F0dCd9, 0xa36b3FC258f12283Fb38E86832965700db828128, @sdalcega, metaverseplayer.eth, @chancecollabs, grantschneider.eth, 0xBcB4dC8c178258B6b4800334F66941B4289b41Af, eczacia.eth, 0x2DBd790553eeB5DA59EfF598758E087632225b2c, 0xcFloki.eth, remaxtr.eth, 0x0cbe02bea5c7884955fb1364fb2451d0f970ba13, 0xb36a051bf399febf6aa30eff9e65ce57288afecc, 0xf948f029b1370aa6bbb07e473b2573aa7d14a4b1, 0x799aa6d5a146adbae47794bf12556eebcc689943, @herdemkefxwes, 0xa2b68941d64e6a7eea45d507c6e385c4791c83e0, 0x9d19fdbc6f5760e72f31b1d3fc32733b50c89080, 0x7e1e7f5e5a3de22207223aebb30bfcd1514039ed, @brunozell, sylksie.eth

Up Next

001.5 The Shakers | Together but Apart: Relations With the World

• PRE-RELEASE: Friday, April 29th, 2022
• COLLECTOR DISCUSSION: 6:00 PM EDT, Tuesday May 3rd, 2022
• RELEASE: Thursday, May 5th, 2022

001.6 The Shakers | An Ascetic Aesthetic: Cultural Consolidation and Decline

• PRE-RELEASE: Friday, May 6th, 2022
• COLLECTOR DISCUSSION: 6:00 PM EDT, Tuesday, May 10th, 2022
• RELEASE: Thursday, May 12th, 2022

If you have any questions about the season or Atlas Urbium more generally DM us on Twitter, or join the conversation on Discord! If you’d like to support the research, become an Early Collector.

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