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Can a worker-owned restaurant work?

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Re: Can a worker-owned restaurant work?

#321

Post by Turskarama »

hot_gril wrote: post #289
MrJohz wrote: post #281

Earlier quoted context omitted.

Except worker cooperatives are noted for being particularly resilient against closures - Wikipedia links to a number of studies and analyses here: https://en.wikipedia.org/wiki/Worker_cooperative#Research_on... For example there's a British study that shows that 76% of worker cooperatives tend to survive the first five years, compared to 42% of all companies overall, making them particularly stable businesses. You've…

Because of the big leap involved in "worker owned cooperatives that have been created by workers buying a business." Either the workers are unusually wealthy and dedicated or a rich owner is doing a bit of charity, in both cases their odds are way better with a corp too. If you're starting with nothing, it'll be difficult to find investment for a co-op.

Why would the workers be unusually wealthy? They can always get a business loan, a bank is going to be relatively confident if you're buying the same business you have worked in for years and know all the ins and outs.

Re: Can a worker-owned restaurant work?

#322

Post by Scarblac »

soligern wrote: post #145
exabrial wrote: post #88

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…

How do you fire people? Do you just get voted off the island? There would need to be managers.

They just get voted off the island, yes.

Re: Can a worker-owned restaurant work?

#323

Post by Gaessaki »

greenie_beans wrote: post #228
Gaessaki wrote: post #167

Earlier quoted context omitted.

Our coop took part in start.coop. Open to answering questions from anyone interested in starting a cooperative startup!

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?

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.

Re: Can a worker-owned restaurant work?

#324

Post by amrocha »

marcellus23 wrote: post #276
amrocha wrote: post #259

Earlier quoted context omitted.

I love that when it comes to tech companies, managers are all bumbling idiots and should all be fired to allow the workers to get the job done. But as soon as a working class business tries that, it apparently doesn't work in the long term.

HN is composed of individuals, it's not a hive mind. Different people have different opinions. Besides, comments here tend to complain about middle management being useless, not leadership.

I know, but I feel like the community sentiment is fairly consistent on these topics. I could be wrong though.

Also, restaurant owners are not much different from middle managers in terms of scale of responsibility.

Re: Can a worker-owned restaurant work?

#325

Post by Scarblac »

declan_roberts wrote: post #284

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”

As long as you also don't make losses, it's fine. Profit is a goal for investors, not of employees.

Re: Can a worker-owned restaurant work?

#326

Post by fouc »

andsoitis wrote: post #240
the_af wrote: post #217

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…

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/

> someone else had to get it off the ground

implying what? that "workers" can't start something? Even if we imagine there's a category of people that are suited to be "starters" or "entrepreneurs" that category is still plenty numerous, easily 10-35% of the population, if not more.

Re: Can a worker-owned restaurant work?

#327

Post by wjnc »

fouc wrote: post #326
andsoitis wrote: post #240

Earlier quoted context omitted.

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/

> someone else had to get it off the ground implying what? that "workers" can't start something? Even if we imagine there's a category of people that are suited to be "starters" or "entrepreneurs" that category is still plenty numerous, easily 10-35% of the population, if not more.

Please be kind in your interpretation. Build and run are two very different phases. You need lots of capital for the former, mostly hands for the latter. Capital formation is probably harder for a group of workers because it leads to messy questions about residual earnings.

Re: Can a worker-owned restaurant work?

#328

Post by rcme »

fouc wrote: post #326
andsoitis wrote: post #240

Earlier quoted context omitted.

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/

> someone else had to get it off the ground implying what? that "workers" can't start something? Even if we imagine there's a category of people that are suited to be "starters" or "entrepreneurs" that category is still plenty numerous, easily 10-35% of the population, if not more.

Yes that is the implication. Starting something requires raising money and organizing things. Generally, at the start, only a small number of people care to do this work. And once they do it, why would they give their ownership stake away to their employees when they could just keep it for themselves?

Re: Can a worker-owned restaurant work?

#329

Post by dpig_ »

afavour wrote: post #246
Aunche wrote: post #195

Earlier quoted context omitted.

> At most places I've been involved in the workers are more careful with money because they are standing together and want the business to succeed. This doesn't contradict anything GP said. Worker owners are careful with company money because they have to be, due to being invested into it. That's a responsibility that not everyone wants, especially when an organization approaches the scale of tragedy of the commons.…

> This is only true when you're defining success as a binary "does this company still exist." Worker-owned companies are significantly less likely to expand Why would that be a criteria of “success”, though? A worker owned business capable of supporting all its employees and maintaining itself long term is definitionally a success.

Absolutely agree. Why does everything need to scale up forever? Resources are finite.

Re: Can a worker-owned restaurant work?

#330

Post by salawat »

rcme wrote: post #328
fouc wrote: post #326

Earlier quoted context omitted.

> someone else had to get it off the ground implying what? that "workers" can't start something? Even if we imagine there's a category of people that are suited to be "starters" or "entrepreneurs" that category is still plenty numerous, easily 10-35% of the population, if not more.

Yes that is the implication. Starting something requires raising money and organizing things. Generally, at the start, only a small number of people care to do this work. And once they do it, why would they give their ownership stake away to their employees when they could just keep it for themselves?

Boredom.

(You have to be insane to whip something up and get it moving. Some thrive doing just that, but suffer under steady state stagnation.)

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