A seafood restaurant with a perpetual purpose
It’s a lot more common in recent years to hear how we need to reinvent the economy, change cities, rethink how we live within planetary boundaries. However, actual examples to follow seem to be very small-scale and dreams of change project large-scale visions. “Real life” examples beyond hobbies or purely volunteer models are a bit harder to find.
Patagonia’s founder giving away the company is a recent large-scale example, but relied on the owner being rich enough to give the company away. Laura Anderson of Local Ocean Seafoods in Newport, Oregon, managed to take a similar approach by selling her restaurant to her cause.
With the restaurant situated right on the marina, Anderson gives “Dock Walks” a few times a year, which includes a visit of the docks, some background on the history of local fishing boats, questions and answers with the walkers, and a meal at Local Ocean.
A majority of species in the display case, she explains, as well as seafood cooked and served at Local Ocean, comes off the boats like her father’s, all of which are docked right outside the restaurant, across the street at Newport’s main commercial marina.
Since the very beginning of the business, Anderson considered Employee Stock Ownership Plans, or ESOPs and various other forms. But in a high turnover industry where most employees are young and in their first job, what often amounts to a retirement fund isn’t much of a draw. It’s also a solution that doesn’t always include a mission or broader stakeholders, like the local fishing industry in this case. Hence, a trust with a mission.
[T]echnically the employees aren’t owners — nobody is the owner. The new special purpose trust that owns Local Ocean is not a person, it’s a legal entity meant to represent the broader social mission of the business, which includes providing dignified, well-paying jobs. […]
“The trust is not a person, the trust does not need income, the trust just holds the purpose.”
Beyond the already inspiring story of transforming a local institution into more than just a business, the whole project is also noteworthy for where Anderson got help to get it done. She worked with Oakland-based nonprofit Project Equity, which runs an initiative “to support more legacy business owners with conversions to various forms of employee-ownership.”
Then with Alternative Ownership Advisors, an affiliate of Organically Grown Company, which “had its own journey through various ownership structures including an ESOP, but eventually converted into a steward ownership model.”
And finally, since financing innovative community-centric projects usually proves near impossible with traditional banks, “Local Ocean Seafoods turned to Shared Capital Cooperative, a community development financial institution based in the Twin Cities.“ Created in 1978, it was conceived “to make loans to cooperatives, including housing co-ops, food co-ops and worker-owned co-ops.” Though the restaurant trust is not a co-op, the values aligned enough that the financing co-op decided to help the transition from sole ownership to the trust.
It often takes more work, but Laura Anderson shows that businesses can pivot, and be supported, even financed, in bringing significant changes to their community.
Image: By Emiliano Bar on Unsplash.