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A Cooperatively Run Company

Three Stone Hearth was founded in June 2006 in Berkeley by a cooperative of five worker-owners: Larry Wisch, Jessica Prentice, Porsche Combash, Catherine Spanger, and Misa Koketsu (in photo above, L-R with our original articles of incorporation). Larry passed away on May 5, 2012. One of the testaments to Larry's indomitable spirit, besides the effervescence in our kombuchas which he originated, is when he coordinated the move to our current location in 2011 from a site near Berkeley's Aquatic Park. He managed to get everything moved over and we didn't miss a week of food production! Catherine has relocated to Point Reyes to explore new paths in her life.

In 2014, we inaugurated a five-month candidacy program to help employees learn the fundamentals of our business, develop the skills needed to assume an ownership role and to be openly and actively engaged in personal growth. After two rounds of candidacy, we have grown to 19 worker-owners, along with about 25 other full- and part-time employees.

There are many economic and social benefits to working cooperatively, and the cooperative model is gaining popularity across the country. Three Stone Hearth has been an active member of NoBAWC, the Network of Bay Area Worker Cooperatives.

As of January 1, 2017, however, we changed our legal entity from a Cooperative Corporation to a Limited Liability Company (LLC), due to a change in California workers compensation laws that would have added a huge financial burden (hopefully, this law will be amended within the year to take cooperatives into account). An LLC is a particularly flexible business entity, and we have been able to design our "new" company to continue operating in every meaningful way in a cooperative manner, with worker ownership and profit sharing, a democratized and self-directed day-to-day operating structure, and all the health, disability, sick and vacation benefits we had previously.

 

From Five "Mom and Pops" to Fifty!

Three Stone Hearth has never been an “off the rack” business model, and the creative challenge of organizing and running our business is a work-in-progress. The first five or so years here were characterized by a mom-and-pop, energy--though we had four moms and one pop--exciting, inspiring and chaotic. The founders nurtured a bustling and open feel of community, a joy and passion for our work, a beehive in the best sense. Our organizational culture was deeply felt, but, as with many startups, organizational structure did not figure prominently in that model.

As the business grew and a more long-term staff came together, the need for a greater structure also grew. We had to create "Beehive 2.0." This transition is a challenge for many small enterprises. How can we develop a structure that captures the alchemy, the entrepreneurial creativity, the heart of our unique Community Supported Kitchen? How can the open, non-hierarchical style modelled by five co-founders be replicated to include a very diverse staff of nearly fifty?

In the past four years we have been intentionally engaged in shepherding this transition. We have turned to Holacracy, a cutting-edge system for organizing work with very little centralized power and control, and to Self-Management, a broader framework for how members of an organization can all show up at the highest level.

These experiments have been sometimes exhilirating, and sometimes excruciating. There are days when it feels like we've "got it"--everyone is showing up with confidence, openness, able to focus on their work, collaborate, adapt to changing circumstances, try new solutions, resolve differences. Other times we can feel like an orchestra out of tune, out of rhythm, and without a conductor to guide us. Getting back in synch can be elusive and frustrating. We are a community of individuals, and any container that will hold such a community has to allow for quite a bit of creative chaos and trust in each person's ability to navigate it.

We will continue to report on this ongoing experiment to create Beehive 2.0!

For more on Holacracy and responsive/self-directed organizational development, see these links:

https://en.wikipedia.org/wiki/Holacracy

http://www.responsive.org/

http://www.reinventingorganizationswiki.com/Main_Page

http://www.holacracy.org/

http://www.theselc.org/worker_selfdirected_nonprofits