Like every bar in the country, Donna was figuring out how to make things work when the COVID pandemic hit. It was selling bottled palomas out of a window, and making food for other food industry professionals, hoping to just pay operating expenses until things opened up again. But in November 2020, it had become too much to sustain, and the bar closed its location in Williamsburg, Brooklyn. According to worker Lauren Ruiz, “we thought that was that.”
It was a particular bummer because then-owner Leif Huckman had always run a nice place to work. Ruiz, at that point a 20-year industry veteran, describes a workplace where everyone had a say. Before it closed, Huckman, inspired by Danny Meyer, had been looking into eliminating tipping (though Meyer later abandoned that policy).
So it was maybe less of a surprise when Huckman began reaching out about reopening Donna under a new mode of operation: worker-ownership. In his research about tipping, Huckman came across The Working World, an organization that, along with its partner funding arm, Seed Commons, helps establish worker-owned businesses across multiple industries (including factories) in low-income communities by offering training, resources, and non-extractive loans that don’t require personal guarantees. “I thought to myself, worker ownership could be an alternative way to incentivize a whole team to run a business better, and provide good service,” says Huckman of first watching a webinar from The Working World. Instead of chasing after tips and the (often false) promise that everyone’s good work would be rewarded, workers could run things democratically, and be equally invested in success.
In 2021, Huckman began transferring ownership to his former employees and converting Donna to a worker-owned business. They allied with The Working World for guidance over developing just what a bar run on democratic decision making by the workers would look like, both in theory and in practice. In May 2023, Donna finally opened its doors again in a new Manhattan neighborhood. Ruiz and Huckman say in the three years since the transition they’ve seen increased profitability, improved employee retention, and a boost in general worker satisfaction.
There’s also increased excitement surrounding this business model. A 2025 report by the Democracy at Work Institute’s State of the Sector shows “Worker Cooperatives and Democratic Workplaces have shown 34% growth since 2020 while more than doubling the workforce in these businesses,” compared to traditional small businesses which have seen 13% growth during the same timeframe.
At its core, a worker-owned business means the people producing the products, whether that’s a fancy cocktail or a pizza, are the same people making the business decisions. There is no phantom owner reaping profits without ever setting foot in the kitchen, or manager unilaterally dictating how money is spent.
At its core, a worker-owned business means the people producing the products, whether that’s a fancy cocktail or a pizza, are the same people making the business decisions. There is no phantom owner reaping profits without ever setting foot in the kitchen, or manager unilaterally dictating how money is spent. Every worker-owner, whether they’re a head chef or a dishwasher, has a say, and a stake, in the business. Which has the potential for incredible outcomes. No restaurant or bar operates the same and there’s no one-size-fits-all worker-ownership model. It’s not a silver bullet, but imagine if all the workers at restaurants with abusive chef-owners had equal power. It could radically remake the industry.
There aren’t many, but as every day capitalism seems to drive something else into the ground, it’s no surprise some workers are looking for an alternative. Worker-owned restaurants and food service businesses like Proof Bakery in LA; The Cheeseboard Collective in Berkeley, California; Red Emma’s in Baltimore; Prospect Butcher Co. in Brooklyn; and Skylark in Chicago are showing people what’s possible.
Maybe we’re biased. After all, Ravenous only exists because our five worker-owners were looking for an alternative, too. But as restaurants struggle to survive increasing rents, tariffs, foodborne illnesses, and everything else that contributes to thin margins, worker-ownership has the chance to solve some problems. We spoke to hospitality industry worker-owners, and the folks helping build these businesses, about how to convert a food service business to that model. And more importantly, why you should.
It’s easier if the owner is on board
Most restaurants and bars don’t have an owner like Huckman, one who’s willing to cede power. The idea of a single owner calling the shots is omnipresent in all business ownership, but especially in the brigade-infected world of hospitality built on knowing your place and paying your dues. Huckman has since moved on as a hospitality consultant for The Working World.
“I had an idea of what worker-ownership looked like, but I never imagined that it could be a hospitality-focused business model,” says Ruiz.
In many ways, building a worker-owned restaurant is similar to unionizing a workspace, in that you need a group of people willing to do the work of research and communication among staff. Committed and well-positioned staff members, like Ruiz, are essential for success, says Scott Trumbull, co-executive director of The Working World. The first step in any conversion is facilitating the purchase and approving any financing, before moving on to a transition plan and making sure the new worker-owners understand the financials and operations of running a business. He says when a business introduces itself, he looks at the history of the business, its profitability, and speaks to current ownership about what would be required of them to facilitate a worker purchase. That’s just easier when both workers and owners are aligned.
That’s not to say it’s impossible if ownership isn’t immediately on board. Trumbull and the organization’s co-executive director, Ghislain Guiebo, say The Working World and Seed Commons have found success when explaining the benefits of worker-ownership to bosses who are agnostic or even antagonistic to the idea of changing business models. Still, even when an owner is aligned with the concept, they may require a lot of explaining about the future and their subsequent roles.
Huckman also emphasizes that many successful worker-owned businesses are already being cooperatively managed in spirit. He says his organization will look at communication between workers and if there are people already on the leadership team who care about the business and want to stay through the conversion. But success only comes when everyone understands what the model has the potential to create. “When you give employees the agency to affect change and to have a vote, I think it's a tremendous uplift to the work environment and morale,” says Huckman. “I deeply believe that it can make for a more profitable and a better run business when all of these things are in place.”
It still takes work even if you’re all radicals
“Back in 2003, 2004, we weren't yet using the language of worker cooperative,” says Kate Khatib, a labor organizer and co-director of Red Emma’s, a worker-owned bookstore and cafe, in Baltimore. She officially co-founded Seed Commons in 2015, while Red Emma’s was founded 22 years ago as an infoshop, a free community space focused on political activism and run by volunteers. Khatib says from the beginning they were focused on providing food and drinks with ethical sourcing, and that to do that reliably for customers, they couldn’t be volunteers. In 2013, after an expansion, Khatib says they started thinking of the business as an actual business, closely examining what “worker-ownership” meant. “Can you really say that you have a sustainable business or are experimenting with workplace democracy if you're not taking sustainability seriously for the workers?” Because “once you shift your business from being an activist side project to something that is paying people's bills, it really changes the way that your business has to operate,” Khatib says.
For Red Emma’s, that meant breaking down traditional roles and rebuilding the hospitality business from the bottom up. For example, in most restaurant kitchens, the dishwasher is on the lowest rung, and often thrown into other difficult grunt work. But workers at Red Emma’s didn’t necessarily want the dishwashers to also be in charge of mopping and cleaning the bathrooms, says Khatib. Workers began talking about how to spread that work around in a way that felt fair, but that still allowed people to specialize in barista or baking work if that’s what they wanted. “No matter how awesome the owners are, it’s a shift. You have to start thinking about your work differently. You think about your workplace differently. You think about yourself differently.”
That’s true even if a business is using the language of worker-ownership from its inception. “There is a real difference between theory and practice,” says Noah Wolf, one of three worker-owners at Sea & Soil, a sandwich shop in Brooklyn, New York. They’ve used the model from day one. It’s easy to both dream of or dismiss worker-ownership as a utopian fantasy where giving everyone equity in the business automatically translates to easy working conditions. But it’s still a business, meaning sometimes tough decisions have to be made around money and labor. “The only way that can be fair is for everyone to be part of making those tough decisions,” says Wolf.
Operations and governance aren't the same
Bustling kitchens do not run well on consensus. Even in the most egalitarian spaces, you can’t decide with every order who feels like making the espresso and who assembles the sandwich. “Operationally, we run exactly like any other bar,” says Ruiz, who serves as a general manager with bartenders, servers, cooks, and porters working as in any other traditionally run kitchen. What’s different is governance: “We have our board meeting once a month and we have our weekly worker owner meetings once a week. And that's when we make our [business] decisions.”
Worker-ownership doesn’t automatically mean everyone has the same job, or even makes the same amount of money. What it means is every worker-owner gets an equal say in making those decisions. The opinion of the cashier and the opinion of the manager get equal weight when it comes to where and how to spend money, what new processes should be implemented, and what business priorities are, even if after those decisions are made, the manager can still tell the cashier what to do on the floor.
“When you give employees the agency to affect change and to have a vote, I think it's a tremendous uplift to the work environment and morale. I deeply believe that it can make for a more profitable and a better run business when all of these things are in place.”
This is one of the trickier things for many businesses that want to be worker-owned to figure out, says The Working World’s Trumbull. “People aren't clear on what kinds of decisions are operational versus governance or democratic decisions, and that can lead to a lot of conflict,” he says. “People are like, wait, you just made that decision without me. Shouldn't we have all made that decision together?” Establishing what decisions people in each role are empowered to make, and what decisions must be made together, ensures everyone can do their jobs without second guessing themselves.
Know which problems it solves…
Lest you think this is all just a matter of how a business files its taxes, there are incredible benefits to worker-ownership. The first being that it’s an incentive to make people want to work for you.
“There was a huge brain drain that happened in the hospitality industry,” says Ruiz of the onset of the COVID-19 pandemic. Restaurant work became nothing short of deadly, and for many the low pay, lack of benefits, and general stress of the work became too much, and workers left the industry. “Offering equity shares, offering a voice in the governance body of the co-op, all of these things attract high level and high skill hospitality workers,” says Ruiz.
Worker-ownership has the opportunity to create a more engaged workforce with less turnover, both because it is easier to reap any personal benefits of success as a worker-owner, and because the model itself creates stability, and draws people who want to be engaged in building a business. “When you really create an opportunity for every worker in the business to have a clear, defined pathway to ownership and to leadership, regardless of what their job is, regardless of what position they occupy in the restaurant, you start to level the playing field and you start to take away some of that competitiveness,” says Khatib.
Ravenous Staff
Democratic decision making can also lead to a stronger business. Many of us have likely had the experience of knowing our jobs well enough to know what would create success and what wouldn’t, and offering that knowledge to a boss, only to watch the company we work for ignore our expertise and instead make some seriously baffling business decisions (what, just us?). Not only does that model generally result in a poorly-run business, it makes it easier for workers to mentally check out. Who cares how the business is doing if no one is going to take your observations seriously, and if you’re not even going to make more money if there are profits?
Instead, the worker-owned model encourages collective decision making, which makes it easier to share different points of view and for the whole team to see the business from different angles. “I’m seeing things one way, and then [the other worker-owners] will completely shift how I'm seeing something,” says Gaby Gignoux-Wolfsohn, a worker-owner at Sea & Soil. “That’s a relief, not to feel stuck in your zone.”
…And which ones it doesn’t
The idea of remaking an established business model is certainly intimidating, and some workers may feel it’s not worth the trouble. Because there are also new challenges to consider.
When conversion was first happening at Donna, Ruiz says not all her former co-workers were interested in becoming worker-owners. Some needed to learn what becoming worker-owners meant. “Some thought I'm going to be a worker-owner, so I get to make all the decisions,” she says, instead of seeing it as a way for everyone to work together. It is also all too easy for workers to recreate the combative dynamics of upper management and employees with worker-owners and workers who had not yet become, or were not interested in becoming, owners. For most people used to an us-versus-them workplace environment, it’s hard to understand what collective management means.
At Sea & Soil, all workers can achieve worker-ownership after a certain number of shifts (full-time workers reach eligibility faster than part-time workers), and the goal is for everyone to take that opportunity. “The whole point is that throughout the year you're having these conversations, you're having reviews, you're letting people know what you are looking for in a worker-owner,” says Gignoux-Wolfsohn. And if finances make hiring impossible, you need to be clear about that, too.
“It’s about giving people the means of their own production, in that Karl Marx sense, but it's also very American, right? Start your own business, do it for yourself, be your own boss.”
But the biggest challenge is that the business world is just not built for cooperatives. Typically, restaurants require thousands of dollars of up front capital that average workers don’t have access to, a barrier all too familiar to many in Black and Latinx communities. “Traditional lenders, basically the whole financial system, is just not designed to give working-class people the opportunity to own these kinds of assets,” says Trumbull. Banks tend to look for people who have good credit and personal assets, who can take on a loan on behalf of the whole business. Not a group of people who all want to own a business equally.
When these businesses do secure financing, banks, and governmental entities often do not understand the structure. Ruiz mentions the difficulties of adding every Donna owner to a New York liquor license, and how it couldn’t name multiple people to the business’s checking account or as the guarantor on the lease. Often, one person has to assume that risk, even if there are multiple owners.
Help is all around you
Running a restaurant is challenging, and shifting toward a worker-owned model won’t save a restaurant from mismanagement, environmental factors, consumer purchasing patterns, changing consumer-purchasing patterns, says Red Emma’s Khatib. Cooperative ownership won’t automatically make customers come in the door.
“You want the workers to be compensated well, the food to be as accessible as possible, and the ingredients to be sourced as ethically as possible,” Wolf says. “Squaring all of those things is really difficult, and being worker-owned doesn't solve that problem. It just allows you to face it collectively.”
Despite many structures not being built for worker-ownership, there are organizations that exist to help facilitate the business model. The Working World, Seed Commons, Project Equity and the Shared Capital Cooperative lend to and provide advisory services to co-ops, connecting workers with attorneys, accountants, and other experts to aid in the transition. States like New York, California, and Washington have business development initiatives for worker co-ops, while other states have proposed legislation. And organizations like the U.S. Federation of Worker Coops, Aorta, Start.coop and A Bookkeeping Cooperative provide business resources, trainings, and community for anyone interested in worker-ownership.
Huckman sees the promise of worker-ownership as bigger than any one restaurant. He notes how businesses have turned away from fostering loyalty with benefits like pensions, and that younger generations have few paths available for building any sort of savings or capital. Worker-ownership provides entrepreneurial incentive that can drive the economy by offering everyone equity in what they build. “It’s about giving people the means of their own production, in that Karl Marx sense, but it's also very American, right?” he says. “Start your own business, do it for yourself, be your own boss.”
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