[2023] How to start a real coop game on Console Edition?

I just can't get it to work. How do I start a coop game on the console? On the PC, when I created the game in the lobby, I had a "+" sign under my character picture, which I can use to get other players on my team/picture. But this is missing on console.

I have only the 4 free slots, where I can then invite 3 other players and then define team 1-4. 

Example yesterday: I invited a friend, defined team 1 for both of us and started. Yet everyone starts with their own island/resources etc. This is not a co-op after all.

Does anyone have any ideas?

Thanks