Here’s how this New York City restaurant makes the cooperative business model work

Joanna Fantozzi

Before the pandemic, Donna was a popular restaurant in Williamsburg, New York that had its best month of sales right before COVID-19 hit the city. Like so many restaurants across the country, Donna eventually shuttered in Nov. 2020, but shortly after, former owner Leif Huckman approached his employees to ask if they were interested in reopening Donna as a worker collective. Huckman handed over the keys to four employees, and now, two years later, Donna has been reborn in the West Village as one of the first worker collective restaurant/bars in New York City.

 “Now that I've been through the ownership portion of hospitality, I just don't understand how one person can do it by themselves-- It really kind of takes a village to operate any bar or restaurant,” Lauren Ruiz, general manager and one of the four owners at Donna said. “The pandemic really showed how volatile industry can be …This worker-owned cooperative offers a revitalization for the hospitality industry in which we can attract good talent and keep people in hospitality by offering them equity.”

Currently, Donna has four owners that own a little less than 20% of the company each. The restaurant also employs a regular staff of bartenders, servers, and dishwashers with a traditional full-service foodservice hierarchy. But then, if an employee works for Donna for a year, they will be up for review and offered an ownership position, with an initial $500 buy-in. although for now, everyone has the same percentage, at the end of the fourth quarter, the profits are divvyed up by how many hours an employee puts into the business.

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Donna was converted to a worker-owned collective in partnership with The Working World: a nonprofit that helps build cooperative businesses in low-income communities. The restaurant operates much like a regular business except that larger decisions are made by the governance board, and three out of four votes are needed to move forward with any issue.  

“If we need to order more toilet paper, we don't have to vote for that -- We just go ahead and do it,” Ruiz clarified.

One of the decisions the board has made so far is whether to fast-track a new employee to ownership status. Donna’s new bar director has been devoting a lot of time and energy to spearheading the restaurant’s new cocktail program and the board held a meeting to decide if she can become a worker-owner early since she was instrumental to the grand reopening of Donna in May.

These are the types of decisions that Ruiz said makes the team feel like they are part of something bigger.

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“Other than the obvious financial benefits, it makes you have integrity for your job,” she said. “You know what everything costs, you know what the bottom line is, and everyone is working toward a common goal…it’s not just a hamster in a wheel situation where you’re just working for a conglomerate or investor without seeing any perks other than your tips. You get a piece of the pie and that is pretty empowering.”

As more workers start to come on board and think about the long-term benefits of equity, the staffing turnover rates will likely be lower than a standard restaurant, she added. Although they’re just getting started, Ruiz said the team has not had trouble hiring people so far. As the company grows, and Donna possibly opens more locations, there will be more profits to go around, which is especially important if more equity owners are added to the pie. In the future, Ruiz and her team would love to turn Donna into a hospitality group with multiple concepts, including restaurants in hotels and in other cities, and even other businesses like a liquor store.

“We’re the first experiment in New York,” she said. “I know grocery stores and distilleries that have adopted this business model, but not other restaurants…. If an owner is retiring or wants to pull back a bit, instead of closing down, they can just hand over the keys to the workers.”

Contact Joanna at [email protected]