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Can a worker-owned restaurant work?

• wahnfrieden 3y ago
  Toronto has a good and popular seafood restaurant downtown that I understand operates as a worker-owned cooperative. Of course hierarchy is unnecessary, but there are a lot of people with resources and vested interest in it appearing otherwise. The group in the article take the approach of consensus-based decision making. For high velocity work like in a software company, I am more interested in the consent-based decision making processes pioneered by the Quakers and formalized in frameworks like Sociocracy.
  • lnxg33k1 3y ago
    Also in Italy there is a region where a lot of "companies" are cooperatives, (Emilia-Romagna), I'd say it's one of the wealthiest regions in Italy, I've lived there and was one of my happiest time in my life. I'd say a restaurant owned by workers can work, but as everything depends who do you work with, more than class, is personalities that make the difference, that's why I don't like these kind of articles, I think they are most useful to push a narrative and please a segment of the people, some "newspapers" would find a restaurant going bankrupt due to being owned by people, some other one would find a restaurant working being owned by people, they're just cases, people are diverse. In the end regardless of what happens to businesses funded by workers or by rich daddyskids we need better wealth redistribution, more taxes and better worker protections
    • seanmcdirmid 3y ago
      Switzerland has a retail/grocery chain called co-op, I always wondered if it was an actual coop or not, I’m guessing it is.
      • astrange 3y ago
        It's probably a customer co-op. A funny thing about this is that every kind of alternative ownership structure is considered leftist and somehow "publicly owned". But in a customer co-op that doesn't include the workers and in a worker co-op that doesn't include you.
        • orwin 3y ago
          Actually, customer co-op often include the workers, at least in France. They either get the same share as customers once they start working, or they have preferential price to get bigger shares. You can even have co-op without workers (there was one in Stain, northwest of Paris when I lived there) with really good food at really good price, but you had to work there like 4-8 hours a month to be customer.
      • vidarh 3y ago
        Many countries have co-op grocery chains or other outcrops of the cooperative movement using that name, but most of them (including in Switzerland) are member (customer) owned rather than worker owned.
      • wahnfrieden 3y ago
        Sometimes coops are customer-owned which still subjects the workers to wage labor, such as REI. Customer-owned coops are not aligned with the anarchist principles that inspired OP
      • dgb23 3y ago
        Both of the largest grocery chains in Switzerland are coops, there is also a prevalent bank and a large agricultural federation and more. But most of these are primarily consumer coops not worker coops.
• jeffbee 3y ago
  Why doesn't the word "rent" appear in here anywhere? If the landlord becomes aware that the restaurant pays way above industry norms, it will raise the rents at the earliest opportunity to squeeze that money back out of the business. Either they own the building or have an existing long-term lease.
  • scotty79 3y ago
    That's the exactly the same reason why basic income can't work if it's introduced on its own. This money will immediately land in the hands of landlords who'll just increase rent.
    • tech_ken 3y ago
      Doesn't any landlord who defects from colluding stand to gain though? Like how Georgists argue that their land tax won't get passed directly on to renters because if it's applied to the whole market at once then absent perfect and universal collusion on behalf of the landlords renters will arb out those with the highest rent spikes.
      • ajkjk 3y ago
        Not if they wait to raise the rent until after they have a tenant who has a large cost to move already.
        • tech_ken 3y ago
          Don't most leases prohibit rent hikes for some period of time though?
          • ajkjk 3y ago
            Well yes but then the lease ends and that's when they get you.
    • tracker1 3y ago
      Considering a handful of companies already control most rental pricing, and already extract "maximum value" from those properties, I'm not sure it would be any different in any direction. I don't get why there isn't some level of Trust Busting going on regarding the rental property pricing management at all.
• wcerfgba 3y ago
  Wonderful story, thanks for sharing. Do you know any worker-owned food businesses? Share in the comments! In Preston, UK, we have The Larder. Not sure about the ownership model but it is a social enterprise working on food justice: https://larder.org.uk/ https://larder.org.uk/
  • jeffbee 3y ago
    We have tons of worker-owned cooperatives in Berkeley, including Cheese Board Collective that is successful, and one block from that The Local Butcher, also worker-owned. A few blocks down was the worker-owned bike shop but it went under for reasons related to having admitted a notorious bozo into the co-op. We also have Nabolom Bakery that failed after decades as a worker co-op but survives today as an owner-owned business.
    • yodon 3y ago
      Is Zachary's Pizza in the same category? (I seem to recall being told there was something unusual about their structure but I can't recall the details)
      • uoaei 3y ago
        You might be thinking of Arizmendi, which is a spin-off of Cheeseboard. Zachary's is family-owned, not really an uncommon setup.
        • benzible 3y ago
          Zachary's has been employee-owned for 20 years: > Zachary’s was founded in 1983 by Zach Zachowski and Barbara Gabel. Our employee ownership program began in 2003 via an ESOP (Employee Stock Ownership Plan). Through the vision of our founders, Zachary’s is now a 100% employee owned company. https://zacharys.com/about-us/our-people/ https://zacharys.com/about-us/our-people/ Also, the specifics of the relationship between Cheeseboard and Arizmendi are interesting: https://www.sfweekly.com/dining/arizmendi-bakery-s-bread-based-worker-owned-movement/article_bd4bc31b-4e5a-599e-83d2-0ef9e3c575ae.html https://www.sfweekly.com/dining/arizmendi-bakery-s-bread-bas...
• SenoraRaton 3y ago
  One thing that I never understood was, if an employees wages are tied to the success of the company, would that not incentivize better work ethic as a whole? That is how it works in the start-up world. You get equity, you have literally invested in the company, and you know that your work should (in theory) directly benefit you financially. Instead we end up in a system where the employee/employer relationship is inherently antagonistic. If you work at McDonalds, in is 100% in your interest to do the absolute bare minimum possible to not be fired, and in your employers interest to pay you as little as legally possible. This costs more overhead and resources from managers, and dealing with angry customers, and food loss/waste, which could largely be avoided if the employees were invested in the success of the workplace.
  • deegles 3y ago
    I (naively) think a restaurant would have an easier time detecting people who are doing the bare minimum. The issue becomes how to "punish" freeloaders who are also owners? Imagine the nightmare scenario of a restaurant where every employee is a part of the LLC that owns it. "Firing" someone becomes an onerous legal process.
    • SenoraRaton 3y ago
      Does it? If the rest of the community doesn't want you there, seems pretty cut and dry. There are no "managers" at Valve, yet they fire people all the time. You would simply receive your pay, and whatever your portion of the dividends owed to you up until your date of firing.
      • pc86 3y ago
        There is a lot more legal overhead to buying out an LLC owner against their will compared to firing an at-will employee.
        • username332211 3y ago
          Should a worker-owned company be an LLC? An LLC[1] is a union of assets put together for a common purpose. It's not a union of people. A worker-owned company should have a different legal structure, usually something created specifically for such an organization, though one would imagine partnerships would be suitable if the law doesn't provide for a special structure. [1]Granted, I'm thinking of European definitions here, because I get really confused when I try to educate myself about American ones. An GmbH is more or less an AG with stakes rather than shares, whereas an American LLCs seem to behave somewhat differently (taxation, for example is pass-trough).
• jebarker 3y ago
  Left Hand Brewery in CO is majority employee owned but not 100%. https://www.brewbound.com/news/left-hand-brewing-now-majority-owned-by-employees https://www.brewbound.com/news/left-hand-brewing-now-majorit... (2015)
  • tech_ken 3y ago
    IIRC BeauJo's is going this way as well after the original owner is retiring.
  • FFP999 3y ago
    [dead]
  • hinkley 3y ago
    New Belgium Brewery (Also CO... what's going on in CO?) was employee owned but a few years ago they sold and now Kirin owns them now. Not sure how you can be employee owned and have a parent company. I think the Wikipedia page needs some edits.
• aogaili 3y ago
  Any good examples of something like that implemented in the software domain?
  • wcerfgba 3y ago
    Yes, in UK we have a network of tech workers co-ops: https://www.coops.tech/about https://www.coops.tech/about
    • astrange 3y ago
      This is a bad sign. The UK is like Argentina - if they've adopted an economic idea that means it doesn't work and you need to run away from it. https://twitter.com/JosephPolitano/status/1691242176401854464 https://twitter.com/JosephPolitano/status/169124217640185446...
      • the-smug-one 3y ago
        Burn your fiat money then, pretty sure they've got that back in good ole Argentina.
        • astrange 3y ago
          They're about to elect a guy who wants to do that, so you can see the technique still works. (And he dresses like a 60s BBC presenter.)
      • toyg 3y ago
        Couple of notes: - the UK, or rather UK trade unions, basically invented the concept of modern cooperatives 150 years ago. - by now, cooperatives have effectively been out of fashion for decades. Even the flagship Cooperative Bank has recently been de-facto "normalized" into a regular business. - the cooperative model can, however, still be attractive for small groups of artisans, like software developers. Hence the link from parent poster. This doesn't mean that it's been "adopted" at large scale, or seen a mainstream resurgence - it has not.
      • 3y ago
• fallingknife 3y ago
  > The bylaws are 10 pages long and cover just about every eventuality the group might encounter I predict they will find out this is very much not true. I have seen 1000 pages fail to do this.
  • wcerfgba 3y ago
    It's less important to cover every eventuality, and more inportant to outline the decision making process for handling the unexpected.
• IndoorPatio 3y ago
  - https://mirisata.com/ https://mirisata.com/ - https://www.bobsredmill.com/whole-grain-store.html https://www.bobsredmill.com/whole-grain-store.html
• tech_ken 3y ago
  >Because it can be hard to get everyone in the same room, most votes are held via a Discord server. People respond to proposals with a thumbs-up emoji for yes, a thumbs-down for no, and a monocle to signal they want further discussion — a closer look, if you will I would love a retrospective on the role of Slack and Discord as tools of revolutionary politics in the last decade or so. Seems like no matter where you fall ideologically, there's a Slack channel or Discord server for you and it's doing the emoji vote thing.
  • wcerfgba 3y ago
    Thomas Swann's Anarchist Cybernetics and Rhiannon Firth's Disaster Anarchy both touch on this at points. https://www.plutobooks.com/9780745340463/disaster-anarchy/ https://www.plutobooks.com/9780745340463/disaster-anarchy/ https://academic.oup.com/policy-press-scholarship-online/book/37843 https://academic.oup.com/policy-press-scholarship-online/boo...
  • candiddevmike 3y ago
    Is the crying laughing emoji a yes vote or a no vote???
• dllthomas 3y ago
  I'm pretty sure it's impossible, and the several I've eaten at are merely figments of my imagination.
• raybb 3y ago
  If anyone wants to start a coop there is an accelerator for them based in NYC called start.coop. I've joined a few of their calls and it seems like they're pushing for pretty great stuff. https://www.start.coop/accelerator https://www.start.coop/accelerator Also in NYC is "The Drivers Cooperative" which is Uber but owned by drivers and they're doing pretty well so far (based on the last annual report). https://en.wikipedia.org/wiki/The_Drivers_Cooperative https://en.wikipedia.org/wiki/The_Drivers_Cooperative
  • Gaessaki 3y ago
    Our coop took part in start.coop. Open to answering questions from anyone interested in starting a cooperative startup!
    • greenie_beans 3y ago
      how does outside investment work - do they just get a share of the profits, similar to worker-owners but without voting rights? and what about sweat equity - how do founders get compensated for starting the thing and working for free?
      • Gaessaki 3y ago
        This was a fundamental question for me before taking the plunge into starting a coop. Long story short, I did a lot of research and there wasn’t anything that really compensated risk in early stage startups hence the dearth of platform coops. We ended up structuring our coop to have equity split from voting rights to allow employees to have ESOPs and investors to invest as they do in traditional corporation minus their control of the board. In theory we would be able to IPO down the line, and perhaps become the first coop to do so without demutualizing or a separate investment vehicle on the side.
• aaronbrethorst 3y ago
  The Seward Cafe in Minneapolis has running successfully as a "cooperatively owned, collectively operated restaurant and community-oriented venue" for 49 years. https://www.sewardcafe.com https://www.sewardcafe.com
  • ccheney 3y ago
    also Hell's Kitchen (since 2020), downtown MPLS https://www.hellskitcheninc.com/#about-us-employee-owned-section https://www.hellskitcheninc.com/#about-us-employee-owned-sec...
    • PartiallyTyped 3y ago
      I love the vibes :D
    • gokhan 3y ago
      "All dine-in checks include a 15% service charge, and all to-go, delivery and curbside pick-up orders include a 20% service charge. 100% of these charges are distributed to our employees in order to keep compensation as fair as possible to everyone" I guess this is mentioned on the page to signal that menu price is the final, no need to tip? US' tipping culture is so strange. Normally you don't need to mention anything, people would pay the menu price and you'd include whatever you'd need for paying the staff. That's how it is in the rest of the world.
      • bscphil 3y ago
        I've been to restaurants that do this, and the menu price typically does not cover service charges, unfortunately. You just expect to see it tacked on the check.
      • midoridensha 3y ago
        A built-in "service charge" is a scam: it just lets the restaurant advertise lower prices than what the meal truly costs. Same goes for not showing the after-tax prices. If they really wanted to "keep compensation as fair as possible to everyone", they'd simply pay them a proper hourly wage, and adjust their prices to suit, instead of making their pay dependent on that day's sales. A lot of US business practices are all about scamming people with deception, and restaurants are the epitome of this.
• epgui 3y ago
  Answer: yes. It’s what teamshares.com does.
  • brnaftr361 3y ago
    I don't think it's fair to say that. Teamshares will sell up to 80% to the employees. Many worker-owned cooperatives have laws specifying that shares can only be exchanged internally. Teamshares isn't particularly transparent on their actual structure. So for instance, an employee(s) might sell their shares back to Teamshares or another agency, at which point the worker agency is diminished. Particularly in the former case.
    • epgui 3y ago
      I'm not sure what you're trying to say or how it's relevant to the question. I work for Teamshares, and while not everything about the company is public, what we do is buy small local companies when their owners retire, and transition the companies to an employee-owned model. Everyone gets to keep their jobs, workers get a share of the profits, and local communities benefit from business continuity. It seems to work very well, and there's no catch.
      • brnaftr361 3y ago
        I don't really know how to state it more clearly. The appeal of a worker-owned coop is the fact that the workers in aggregate have complete control. Relinquishing 20% of that by default, and one might surmise 25% due to the installed president, runs contrary to the purpose of a worker-owned cooperative. And that's where things are unclear. That 25% can mean a lot of things. Is it simple tribute, or rent-seeking, which WOCs seek to dismantle? Does Teamshares vote with that? What sort of contracts exist to subordinate the companies to Teamshares? How are the shares traded? Does/can the employee sell them back to Teamshares? Can they sell them to Yum! Brands? If so they're selling current and future employees' agency. If they can only be exchanged between the worker and the company - that would be more closely aligned with the idea of WOCs. I just don't think it's fair to really draw the comparison without being completely transparent about how it works. However, I do like the idea and have an appreciation for what Teamshares is attempting to do, but I think they should seal the deal and completely abdicate if they're going to front like they're facilitating the development of WOCs.
• theogravity 3y ago
  San Jose and Sunnyvale in California has "A Slice of New York" which is a co-op pizza operation: https://asliceofny.com/about/ https://asliceofny.com/about/ Video about the co-op https://www.youtube.com/watch?v=mhbupz-iuhU https://www.youtube.com/watch?v=mhbupz-iuhU
  • skavi 3y ago
    Had no idea. They’ve got great pizza with very reasonable prices. (and some huge sizes)
    • reducesuffering 3y ago
      Very reasonable prices are $40 + 8% coop fee for a standard large pizza? That's almost $50 after tax. https://asliceofny.com/sunnyvale/menu/ https://asliceofny.com/sunnyvale/menu/
      • laweijfmvo 3y ago
        A large cheese is $25, and 18” is quite large. Expensive maybe but it’s legitimately good pizza as other have said.
        • reducesuffering 3y ago
          Sure, i'm not commenting on the tastiness. Just that I remember balking at the $40 I spent for a pizza there, and am surprised that anyone thinks the prices are "reasonable" when it's likely one of the most expensive pizza places in the entire country.
          • magicalist 3y ago
            I mean: http://www.pizzamyheart.com/menu/ http://www.pizzamyheart.com/menu/ Maybe there's more to the prices than the co-op structure?
            • 3y ago
• sharts 3y ago
  Worker-owned anything can work. It's democracy in the workplace.
  • version_five 3y ago
    Democracy only works when just about everyone wants the same thing. And even then leaders generally abuse power. The lower the stakes, the worse it gets.
    • gochi 3y ago
      Democracy works when most involved disagree actually, that's its primary function over other formats. Otherwise just go with a king since everyone wants the same thing.
    • Swenrekcah 3y ago
      I think I agree with the point but people don’t need to want all the same things so I think I’d rather phrase it this way: “Democracy fails when the people and their leaders fail to realise that the thing they want above all is peace and general prosperity, and that neither of those is a naturally occurring phenomenon.” Because the peaceful transfer of power as well as respect for the truth, and equality before the law is the absolute foundation that any prosperous democracy needs.
      • version_five 3y ago
        Doesn't that just kick the problem down the road to the definition of peace and general prosperity? If people have irreconcilable differences over what those mean, they still may not be able to find the common ground needed for running a business or country. With something more nimble like a business it's easy to imagine vastly different views on how the business can prosper, which makes the benevolent dictator (business owner) model all the more attractive.
        • Swenrekcah 3y ago
          Well, I don't think people around the world have vastly different definitions of peace and prosperity. For example, Ukraine is definitely not experiencing that at this stage in time. Neither is Sudan, Ecuador, etc.
• deleted 3y ago
  [deleted]
• exabrial 3y ago
  Yes, absolutely, but there are pitfalls: * Somehow finances have to work, which is usually a harsh reality for some. Ex: Hey we can't pay workers $250/hr without raises prices to above what customers are willing to pay * Consumers despite "Least common denominator" which is often the result of "design by committee". Usually consumers are after something niche, unique, artistic, and creative, which is the inspiration or vision of an individual. > As for making business decisions, it’s done democratically. The entirety of the member-owner group votes on major decisions, and the bylaws outline scenarios where employees are authorized to act independently of a vote I don't see this working in the long term unfortunately unless a majority of the workers have a lot experience with business, especially something as cashflow-sensitive as a restaurant (which typically operate on razor-thin margins). But I do wish them luck in their experiment.
  • 8f2ab37a-ed6c 3y ago
    It would be interesting to see reports of long-term experiments of this sort, see how businesses run this way fare over time and whether this sort of model is unsustainable, or if these people are onto something effective that stands the test of time. Any other restaurants who have tried this sort of model in the past and stuck with it?
    • kikokikokiko 3y ago
      The simple fact that you never ever heard about something like that, tells you all you need to know aboit the long term prospect of business owned by "the collective". In my part of the world we have a saying " what fattens the cows is the owner's gaze". A company that belongs to everyone working there belongs to no one, and it will eventually become a freeloader's dream. I have heard of one or two examples of this things being tried, one even a restaurant close tomy home town. It never lasts.
      • ska 3y ago
        >The simple fact that you never ever heard about something like that actually there are lots of examples, so it can't be that simple.
• markandrewj 3y ago
  The answer is yes. It has also been well studied (https://en.wikipedia.org/wiki/Workplace_democracy https://en.wikipedia.org/wiki/Workplace_democracy). If you want to understand more of the history, look at the IWW, or other resources such as the Chomsky's book A People's History. Usually the idea that it will not work is a capitalist view pushed from the top down onto workers. I.E. You are not smart enough, or you are too lazy, to be productive without a figure of authority making decisions for you. Even the concept of what is considered productive use of time can be a topic of discussion in this regard. Anarchy is largely misunderstood also, it is a philosophy that focuses on the collective making decisions, instead of a central figure of authority. Ref: Noam Chomsky on Worker Ownership and Markets https://www.youtube.com/watch?v=RafTFDwImrU https://www.youtube.com/watch?v=RafTFDwImrU
  • markandrewj 3y ago
    Correction,'A People's History'is authored by Howard Zinn. I was thinking about both authors.
• deleted 3y ago
  [deleted]
• willyt 3y ago
  There’s a whole chain of department stores and supermarkets in the UK that’s ‘worker owned’ John Lewis which also operates Waitrose supermarkets. It’s a partnership, everyone that works there becomes a partner in the firm after a probation period. It’s a successful business; there’s a John Lewis in every big city in Britain and Waitrose is in many large towns and cities.
  • realjhol 3y ago
    [dead]
• NoMoreNicksLeft 3y ago
  Is this a chain-style restaurant? Fine dining haute cuisine? Fast food? What happens when they don't want to do the actual work anymore? Do they still keep their partial ownership of the restaurant and hire wagies? What if they can't work anymore? It's not easy to step and fetch for 10 hours a day at age 50. What if they just need to reduce their schedule to 10 hours a week (and not pull their weight)? What if most people willing to do grunt work also aren't very good at managing a restaurant? At menus, at book keeping? What if people prefer to be served by the cute young things that you tend to see at many chains (even if they're dressed more modestly than those at Hooters)? You know, the same sort of people who are just unlikely to want to become invested in such a place, where they'll be tied down to it?
• amelius 3y ago
  Not in any successful way, because the entire profit margin is being eaten by delivery companies like Uber Eats. There is no financial future in restaurants, worker-owned or not.
  • kristopolous 3y ago
    Is intentional "no delivery" a thing? It should be.
    • SoftTalker 3y ago
      Of course. There is no requirement for a restaurant to provide carry-out. Or to lose money providing it. I don't know why they let Uber push them around on that.
    • hot_gril 3y ago
      Lots of restaurants are dine-in only. If you provide takeout, nothing's stopping the customer from then delivering it to a secondary customer, but also idk why you'd want to prevent that.
  • carlosjobim 3y ago
    The restaurant industry is a top contender for worst investment of time, money and effort. Wether you're opening a restaurant or want to work in one. Low profitability coupled with high demand on worker skill and efficiency makes sure you can never relax. Yes, restaurant work is highly skilled in order to deliver high quality food at acceptable speed. Restaurants not requiring skills do not offer any career advancement, but top restaurants requiring skills do not offer much of a career either. Restaurant work is easy to get in to without having to submit yourself to academic humiliation and corporate humiliation, and since good workers are always wanted, you'll always have a job if you show good work ethic, whereas in other industries your job mostly depends on politicizing at the workplace. But honestly, the restaurant sector I wouldn't recommend for anybody. The only way to expect a reasonable return on your efforts is to have your own place - and then you'll be working for your landlords who'll keep increasing the rent if they see you're being successful, or wasting decades paying interest on a mortgage. And since customers don't accept higher prices, you can't offer higher salaries. Then you start resenting your employees because they won't stay with you for a long time, and you're always rotating the roster. Or maybe you have the money to buy a restaurant property in a good location outright. But then the question is: If you have that money, why not continue doing the thing that made you that money instead of investing in the worst sector? Covid was the wake-up call. A huge part of remaining restaurant workers got laid off or put on "pause" without a salary. They realized that they were expendable to the employers and to the industry, so got new jobs and new careers. No matter what jobs they got, it was guaranteed better than their former restaurant job. With the added bonus that you can actually advance in your career and pay when you're getting more skilled at the job. I don't know what the future holds for restaurants and eating. Maybe more mix-in with show business, so that people have more incentive to visit and don't mind paying a higher price? Maybe people start learning better to cook? It's not difficult. Maybe better quality microwave/air fryer food, in refrigerators instead of in freezers at the supermarket?
• Archit3ch 3y ago
  Wouldn't a family-owned business also qualify?
  • timbit42 3y ago
    Only until they hire an employee with no buy in or profit sharing.
  • hot_gril 3y ago
    I said the same thing. Guess that's the "trivial case" and worker-owned implies they've managed to scale outside the family.
  • TulliusCicero 3y ago
    A very small one might. But a lot of family owned businesses employ their kids or other employees as regular, wage-base staff, without having a say in decisions.
• SamWhited 3y ago
  This makes me miss Blackstar Co-op in Austin, TX. Great microbrewery with excellent food that has a hybrid worker/consumer ownership model. If you're ever in the area (and if it's still around, it's been years since I've lived there) look it up!
• e1g 3y ago
  “Approval of any proposal or purchase has to be unanimous. Either the proposal is revised to be agreeable to everyone or it’s scrapped.” RIP.
  • TulliusCicero 3y ago
    This probably works fine at a small scale. With a small number of employees, you can cajole people into voting for something they're not 100% on board with, with the understanding that they'll get something they particularly want later on. There can be give and take. But if you had a large, 1000+ person company, unanimity would obviously never work. You would have to go by majorities or supermajorities instead.
• kepler1 3y ago
  Like so many idealistic things, this kind of setup works only as long as the people joining or taking responsibility for the thing continue to have and practice the same ideals as what started it. Start to lose that just a little bit, where responsibility gets diffuse, the original intention gets lost, or you start hiring people who don't have the same understanding, and it all falls apart. Not every worker wants to have an equal share of the grunt work. Not every worker believes that they contribute equally to the success of the restaurant and are willing to split the proceeds in that way. Not every worker wants to have to live the restaurant as if it's their life. Worker owned coops have as many failure modes as "evil" corporate ones do. And in some senses are all the more disappointing because of it.
  • timbit42 3y ago
    If it is worker owned, then each worker has their own money invested. This is enough to ensure everyone will take responsibility for the success of the business. If someone did fail to do so, they would be voted out and their investment would be returned and someone else would be brought in to invest and replace them.
• hot_gril 3y ago
  Family businesses are common and can be classified as worker-owned.
  • timbit42 3y ago
    Only until they hire their first employee.
• cat_plus_plus 3y ago
  It can, but it will have problem scaling - If the business grows and starts needing management skills beyond what a cook or a waiter would have, you will have trouble hiring a qualified manager for same wages you pay to waiters - If you need a loan to expand, lender is likely to want some control over how a restaurant is run rather than leaving it up to workers If you are content to stay at a small scale where these factors do not matter, sure go ahead.
  • timbit42 3y ago
    Mondragon, the largest worker cooperative in the world, hires top level people with the skills to manage the company. Those people, instead of reporting to public shareholders, report to the worker/owners who decide the company direction.
  • cmh89 3y ago
    >- If the business grows and starts needing management skills beyond what a cook or a waiter would have, you will have trouble hiring a qualified manager for same wages you pay to waiters Waiters generally make more than managers in restaurants in the United States at least. >If you need a loan to expand, lender is likely to want some control over how a restaurant is run rather than leaving it up to workers Co-ops get loans all the time. You just need a governance structure of some sort and collateral for a loan.
  • thescriptkiddie 3y ago
    Not every employee at a coop has to make the same wage.
• x0ul 3y ago
  Oh, I've been to that restaurant before --it was fantastic. I had no idea it was worker-owned. And yes, obviously worker-owned (x) can work. There are many examples among the comments.
• Waterluvian 3y ago
  It reminds me of when people complain about stuff like Electron apps. If you hate it, go do it yourself. You’ll either a) succeed and solve your problem or b) develop a much more complete understanding of the problems being faced by someone in a different role. I think every worker would benefit from being more involved in the business operations, or really any other jobs that help their company/project function. (of course it’s probably not practical to do so)
  • geodel 3y ago
    > If you hate it, go do it yourself. Exactly right. All large enterprises I have worked give full freedom to devs to develop alternative to any SAAS product they dislike. As simple as that.
    • Waterluvian 3y ago
      Hahaha. Okay but seriously, I’m reminded of the four months I spent as a dishwasher and the hundred times the half drunk line cook ranted about how he could run a better restaurant. Then do it! Quit and start your own SAAS app! To be clear I don’t mean to take your ball and go home the moment people aren’t doing things your way. Everyone has a responsibility to communicate and raise concerns productively. But if one finds themselves constantly thinking everyone else is a clown and they could actually do it better… go do it!
      • ericjmorey 3y ago
        You know why they don't. The people who have started the organization they're complaining about had more resources and opportunities than the person complaining.
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• nicechianti 3y ago
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• bobthepanda 3y ago
  Side note: we can trace the dictatorship style of cooking to August Escoffier, who introduced the brigade de cuisine to French cooking and is credited with popularizing French cooking at the Ritz-Carlton. https://en.wikipedia.org/wiki/Auguste_Escoffier https://en.wikipedia.org/wiki/Auguste_Escoffier
  • declan_roberts 3y ago
    I would trace it back much further than that. Restaurants are often started as a family business with a “boss” who simply continues to be a boss even as more employees come on board.
• JackFr 3y ago
  I’m curious about how the partnership works and would have liked more details on how it works. In particular after 6 months, do people still have to put in $1000? If the staffing level increases does everyone’s stake get diluted? When you stop working there what happens to your invested capital? Do you maintain profit sharing? Do you get bought out? Does it work like law firms and other professional partnerships?
• tachyons 3y ago
  Indian coffee house is a worker owned restaurant chain in India. It has been operating for last 65 years.
  • boruto 3y ago
    I visited the one in Thiruvananthapuram, did not knew the history behind it till the below wiki link. Honestly, I won't recommend. The quality is sub par.
  • georgeoliver 3y ago
    Thanks for mentioning it, really interesting! https://en.wikipedia.org/wiki/Indian_Coffee_House https://en.wikipedia.org/wiki/Indian_Coffee_House
• 1letterunixname 3y ago
  There's a startup betting in this space: Teamshares. https://techcrunch.com/2023/08/24/this-venture-backed-startup-has-quietly-bought-more-than-80-mom-and-pop-shops/ https://techcrunch.com/2023/08/24/this-venture-backed-startu... Also, if you're interested in the intersection between economics and employee-owned co-ops, there is https://www.democracyatwork.info https://www.democracyatwork.info
• marcusverus 3y ago
  This is a really fascinating idea. At its heart, it’s a charity in which the person risking their capital assumes all the risks, while gifting the potential rewards. Big kudos to the beautiful, big-souled gentleman who put it together.
  • alkonaut 3y ago
    > assumes all the risks, while gifting the potential rewards. Why would worker ownership be a charity and why would owners not be sharing the profits regardless of whether they also work there?
    • hot_gril 3y ago
      Because someone had to put up the original capital, and it's not necessarily the same people working there. And if non-workers hold onto ownership, it's not a worker co-op.
      • alkonaut 3y ago
        If something is owned by workers then that means they are the ones who put in the capital. They could have bought the business from the original investors, or made the initial investment with common funds. If there are other investors still owning a part of the business then it’s not worker owned (at least not fully worker owned).
        • hot_gril 3y ago
          Yes, and that's what happens sometimes. But it requires the workers to have a lot of capital in the first place, which is rare. Or they'll rely on family and friends for the funding. Then they're being charitable again if they give more out to hire new employees. Other times, the owner will distribute the business for some charitably low price to the workers, like the Avedisyans did with Cheeseboard. No matter how it's done, someone somewhere has to be extra generous.
          • 3y ago
• the_af 3y ago
  The pizza restaurant (gourmet pizza, not crap) around the corner where I live is workers owned. The previous owner went bankrupt and left his employees hanging out to dry, so they took ownership of the place. Not sure about the legal situation (e.g. whether they bought the restaurant from the owner or what) but it's been workers owned for the past few years and doing well, judging by how full it always is. I eat and take out from there and it's pretty good quality. This is not the first decent workers owned restaurant I've known, so I'm going to answer: yes, it can work.
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  • mitchbob 3y ago
    Zachary's? https://zacharys.com/ https://zacharys.com/
    • the_af 3y ago
      I live in South America, so no :)
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    • klooney 3y ago
      https://cheeseboardcollective.coop/pizza/ https://cheeseboardcollective.coop/pizza/ and https://www.arizmendibakery.com https://www.arizmendibakery.com are coops.
    • kemitchell 3y ago
      Also good pizza! And there's more than one location. I believe I read that Nick's, up north, is also heading worker-owned. And of course worker-owned doesn't just mean pizza in Oakland.
  • andsoitis 3y ago
    In this example, someone else had to get it off the ground. The sibling commenter's example of Zachary's is similarly the product of entrepreneurs who got it started https://zacharys.com/about-us/our-story/ https://zacharys.com/about-us/our-story/
• asdff 3y ago
  This model really should be expanded to just about everything. Revenue per employee ratio at Apple is $2.4 million a person or so. If that company were to shift from the present shareholder model to a cooperative model, its not hard to imagine labor seeing some substantial gains. Having more money in the part of the economy that actually circulates more of their income would probably bring on wider economic benefits as well, compared to the present where some of that revenue might go on to be parked in unproductive, perhaps even unhelpful, speculative investments like gold or oil.
  • nraynaud 3y ago
    It’s a bit complicated, those companies can’t really borrow money (because the bank can’t seize the capital and fire the management of things go south). A friend of mine had her coop buy its HQ, that means the workers/owners had to personally borrow the money.
  • randomdata 3y ago
    > Revenue per employee ratio at Apple is $2.4 million a person or so. Seems net income per employee is only ~$120,000, though. The way you put it might leave people thinking they have $2.4 million to give to each employee, when in reality they have bills to pay.
    • CogitoCogito 3y ago
      > Seems net income per employee is only ~$120,000, though. Isn't that _after_ they paid the employees though?
    • georgeoliver 3y ago
      I think doing any math on this number has issues when you consider Apple is sitting on 60+ billion in cash.
  • declan_roberts 3y ago
    Don’t many apple employees get stock grants
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• kazinator 3y ago
  Restaurants in which the owners do all the work without hired help have existed for probably thousands of years. Yes, they can work.
• Lamad123 3y ago
  Pay in my own restaurant??!! WTF!!
• CMCDragonkai 3y ago
  I'd argue the traditional worker owned business is the family business. From there extended family - tribe - confederation... Etc. If anybody is gunho about a worker owned business, just go and start one. It's a free market and we can let the empirical results show us what is possible.
  • ericjmorey 3y ago
    Is this satire or simply a disingenuous suggestion?
• padheyam 3y ago
  Yes; worker-owned restaurant chain has been running successfully in India since 1958 (https://en.wikipedia.org/wiki/Indian_Coffee_House https://en.wikipedia.org/wiki/Indian_Coffee_House)
• Joel_Mckay 3y ago
  It is a low margin business with irrationally competitive franchise investors surrounding every market. The answer is "no" unless all staff work for free. https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headlines https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headline...
• nraynaud 3y ago
  https://www.letempsdescerisescoop.com/ https://www.letempsdescerisescoop.com/ It works since at least 1976.
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• canistel 3y ago
  Indian Coffee House is a chain of restaurants owned by its workers (through co-operative societies), that has thrived for more than half a century and has somehow managed to maintain its fanbase... https://en.wikipedia.org/wiki/Indian_Coffee_House https://en.wikipedia.org/wiki/Indian_Coffee_House
• bentt 3y ago
  I'd prefer the term Owner-Worked... because once you're an owner, you shouldn't be able to just think of yourself as a "worker". It's about taking responsibility for more than your assigned role. That's what owners do.
• myman 3y ago
  Reads like a convoluted business which has rolled into a near scam. $1,000 to own a part of the business. That business doesn't generate profits... Are they surviving because people inject $1,000 of their money to the business?
  • timbit42 3y ago
    Mondragon started in 1956 and currently has over 81,000 owners. It's not a scam. Source: https://en.wikipedia.org/wiki/Mondragon_Corporation https://en.wikipedia.org/wiki/Mondragon_Corporation
• swaggyBoatswain 3y ago
  Benign dictatorships are almost always easier to pull off than board management models. Board management models generally only work if it the restaurant was individually owned at one point and then that owner left Starting a worker owned restaurant from the ground up is a terrible idea because the end customer doesn't really care and your artificially creating additional managerial barriers to entry when you have to move fast early on If someone has the capability of leading a worker owned restaurant (there is always a leader even in these models - e.g. a board chair), they are also equally capable of running a simpler ran benign dictatorship with less red tape. The other issue with board management runned operations is if you want to expand operations (e.g. opening up a second restaurant). It will get political very fast and not work because there will be disagreements on how money should be spent and allocated A worker owned business is just a more complicated business. It can work but it needs very specific conditions and it's prone to political issues I have seen though however a benign dictatorship take on funds from investors to expand operations, but that only works if there is a well established culture (e.g. usually the restaurant has built a few successful stores on their own). It's not very that far off from startups taking investor funding There's a reason we call restaurant entrepreneur as restauranteurs I run my own nonprofit currently (board management) and have done startup consulting for the restaurant space for over a decade. Restaurants and startups operates on similar principles
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  • onethought 3y ago
    I don't see how any of your points don't apply to 'having shareholders' equally. A board management can elect a leader/ceo/dictator if they wanted (and from the sounds of it probably should). Just like having a company run directly by shareholders is probably a bad idea. Having a company that is 100% Owned by the same people that it employs does not make a decision on how it's run, it just aligns workers and shareholder interests completely.
  • zem 3y ago
    you could have a worker-owned business where one person is appointed "benevolent dictator for now" when things need moving fast. "worker-owned" doesn't mean "every decision has to be collective"
• sh34r 3y ago
  Employee-owned co-ops are extremely common in Southern Europe. The Mondragon Corporation has 81,000 employees. Your ideological bias is showing if you think this is even a question. Empirically speaking, the answer is a resounding yes.
• declan_roberts 3y ago
  The answer is halfway down the article for this particular restaurant: ”they haven’t made a profit yet” You can pay workers a million dollars an hour. If you can’t turn a profit then it won’t “work”
  • titanomachy 3y ago
    Profit isn’t the only indicator of success for a company like this. If they can break even while paying generous wages and providing value to their community, that’s still a success.
    • yoyohello13 3y ago
      I think that’s what op was pointing out.
  • Scarblac 3y ago
    As long as you also don't make losses, it's fine. Profit is a goal for investors, not of employees.
• yoyohello13 3y ago
  I find it hilarious (and sad) that people are surprised organizations like this can work. “You mean the peasants are capable of ruling themselves?” Turns out, yes.
• renewiltord 3y ago
  How do coops structure comp? That's what I'm most curious about. When you leave do you retain a profits interest?
  • timbit42 3y ago
    When you leave, you take the value of your investment with you, whether it has gone up or down in value while you worked there.
• n3storm 3y ago
  In my country (Spain) and city they exist and work for many years. They are called "cooperativas" (cooperative association)
• larsrc 3y ago
  Coming from the Socialist Republic of Denmark, this seems like a very silly question. Why should ownership be a problem for restaurants? If a restaurant is owned by an investment fund, the fund will try to get as much money out of it as possible, regardless of the restaurant's long-term fate. But owned by the workers, they have a common interest in having good and secure jobs for a long time to come, and so can set up running parameters to best ensure that. Now the _leadership_ is a different matter. If everybody tries to be the head chef,.you get a confusion. But that is distinct from ownership and can be arranged in many different ways, some of which work. If all business were worker-owned, one would be right to ask whether a nom-worker-owned business could work.
  • Closi 3y ago
    Agree - although in the model described in the article there isn’t a leadership element so I struggle to see how this would work long term. It says any decision needs a 100% vote from all owners on a discord server.
    • timbit42 3y ago
      The largest worker cooperative in the world, Mondragon, hires someone to head the company. Big decisions are democratic but decisions on how to execute the big decisions are left to the executive.
      • Closi 3y ago
        Yes, I just mean that’s not the method described in the article.
• aneeshnl 3y ago
  Indian Coffee House is a prime example of worker owned restaurant chain, which is successful.
• chaverma 3y ago
  Curious about how the business responds to workers leaving/joining. I expect that a worker wanting to leave needs to find someone to buy in, and the new worker has to be approved by the collective. This sounds like a recipe for inflexible departure. Next, expansion. I expect expansion is a tricky proposition because it means dilution, which is both a hard sell and a risk to the workers.
  • timbit42 3y ago
    The worker leaving doesn't have to find someone else to buy in. They just leave and receive the value of their investment. The cooperative finds someone else to buy in. Usually there are lots of people looking to do so. People save up for years so they can apply to buy in and work at Mondragon.
• clarionbell 3y ago
  Isn't that literally what family restaurants are?
  • dagw 3y ago
    Family restaurants almost always come with a lot of built in hierarchy, even beyond the owner structure. Non-family members always rank below family members and the internal family hierarchy tends to become the restaurant hierarchy, almost regardless of what the formal ownership and leadership structure on paper is. 4 waiters and 2 line chefs will never be able to vote down 'mom' no matter what the paperwork says.
    • timbit42 3y ago
      Worker cooperatives still have some kind of hierarchical structure because each owner has a different job, but major business decisions are still democratically voted on by every owner.
• __loam 3y ago
  Worker ownership leads to more stable companies that tend to put more wealth in the pockets of workers and fuck customers less. The problem is getting enough startup capital from people who despise the idea.
• iamflimflam1 3y ago
  Very interesting reading the comments. My impression is that a lot of people saying this can’t possibly work are in the camp of “one day I’ll found a business and this kind of thing could ruin that”. It’s the same thinking that says “don’t tax billionaires - one day I might be one!”.
  • hot_gril 3y ago
    Hey, I'd be fine if the business next to mine were a co-op. I'd just not found a co-op.
• ralferoo 3y ago
  This seems fine during the good times, but I can imagine a big problem of having a no-hierarchy worker-owned operation is what happens when the market shrinks and you can't afford to pay everyone the promised minimum salary. Do you all just collectively agree to take less money? What about the one person who actually can't afford to do that because they'd already budgeted assuming that money was coming in? What about if you need to reduce headcount? Do you just all vote on who should be fired in effectively a popularity contest that will cause build up of resentment later on? Draw the shortest straw? In this case, an "owner" is probably best because they can all collectively "hate" the owner and bond together as staff. What about if someone is secretly planning to leave in the next few months and wants their money now as salary rather than investing in long term projects for the company, etc... They might destabilise the long-term success of the company if they vote not to invest, but be unmotivated and work poorly if they know some of "their money" was invested and they're never going to see it. There seem to be so many edge cases where the traditional hierarchy structure seems like the best viable solution. There are some examples of co-operatives in the UK, the most famous is John Lewis. I think they work around it by just running mostly like a normal business, paying fairly normal salaries for different roles, but then bonuses for profit sharing.
  • badcppdev 3y ago
    More info about John Lewis and its current situation [0] and [1]. Most interesting to me is: "Insiders claim that some years’ borrowings were ramped up in order to avoid having to think the unthinkable and cut the hallowed John Lewis staff bonus, as profits failed to keep up with the pace of store openings." It only takes a few years of mismanagement for a partner owned company like Waitrose to borrow too much and step on the landmine of unserviceable debt. The company is then has to be sold and metastasises into a normal company. Obviously the most unjust thing in that story is that upper management probably not only get paid too much while causing the situation but likely negotiate a personally beneficial settlement for themselves as the ship burns and sinks. 0 - https://www.telegraph.co.uk/business/2023/07/12/john-lewis-rebound-waitrose-dame-sharon-white-bonus-debt/ https://www.telegraph.co.uk/business/2023/07/12/john-lewis-r... 1 - https://www.telegraph.co.uk/business/2023/05/11/can-dame-sharon-white-save-john-lewis/ https://www.telegraph.co.uk/business/2023/05/11/can-dame-sha... (Apologies for linking to that website)
• vincnetas 3y ago
  tangential, but what happens to worker-owner who leaves. Does he have to sell his share in business? When you employ a new worked does he have to buy part of the business to start working?
  • timbit42 3y ago
    Yes, an owner/worker who leaves get their share back, whether it has increased or decreased in value. A new worker has to buy in. I watched a documentary on YT about Mondragon and a new employee talked about how he saved up the money so he could afford the shares to get a position at Mondragon.
• 666lumberjack 3y ago
  This reads to me like it's written to evangelize the concept of worker co-ops more than to earnestly investigate the question posed in the title - which is fine, but this doesn't seem like a very good example to choose to make that point. They say they have ten employees, and the buy-in for ownership is a thousand dollars. But there's no way the start up capital for a quality restaurant in Seattle was only $10k, so either the original founders absorbed those costs or some later employees paid in extra to cover them - either way with no expectation of increased control or return. That's more charity than alternative economic organization. They also mention that the business has been around for ten years, but isn't profitable - and it's implied probably never has been on any consistent basis, or they would certainly have called that out. Somebody is covering that shortfall, and they're not getting anything in exchange for doing so - very noble, but again that's a reliance on charity for the business to continue existing. Can a worker-owned restaurant work? Sure, I think there are plenty of examples that prove it. Does this one work? Not as a business, by any reasonable standard.
• banannaise 3y ago
  Shorter answer: "As long as the rent isn't too high... welp"
• nymanjon 3y ago
  This still seems like capitalism. Not all the workers own the company. Just the ones deemed worthy and will to put up capital. It's a fine business model for at least this use case, it appears. That's the great thing about capitalism. You get to try out all sorts of models for running your business and whatever works for you is what you can run with.