California City Caters to Culinary Startups

It’s hard to start a business, even when you have a brilliant idea, a marketable product, and a great work ethic. The daunting prospects of developing a business plan and securing a suitable facility to operate it have quashed many would-be entrepreneurs.

The city of Arcata, California, looked at one specific impediment: the challenges of getting a kitchen certified for food preparation, and decided it could help its citizens. The result is the Foodworks Culinary Center, a massive food preparation facility available to local businesses at affordable rates. Services range from renting a pallet in a walk-in freezer to kitchens by the hour to operating a full commercial kitchen.

Arcata is a university town of 19,000 in Humboldt County. Mayor Sarah Schaefer says Foodworks was started with a community development block grant in the 1990s, with a goal to “jumpstart the economy and also just help young businesses and entrepreneurs get their start.” She says the region was already known for food manufacturing, so there was professional talent to tap, and with the barriers to starting a food business so high, this kind of incubator was a good economic bet.

Jennifer Dart, who manages Foodworks for Arcata’s Community Development Department, says there are many local residents who “just want to make a jam, or just want to make a hot sauce,” but discover that the “health department licensing that's required is actually really, really complicated. It's very expensive.”

Prospective tenants at Foodworks must prepare detailed business plans and secure reliable financing, but the city offers help, partnered with a regional Small Business Development Center. They oversee a micro enterprise grant and loan program, as well as a business assistance program, so that by the time an entrepreneur secures a space in Foodworks, they have a good handle on their prospective business.

Arcata now touts a roster of national or regionally known brands that got their start in Foodworks. Humboldt Hot Sauce is popular along the West Coast. HumYum caramels can be found at select retail outlets across the U.S. And Desserts On Us is the creator of Laceys Cookies, which are now sold at Costco stores nationwide. “It's really cool to see a local business be able to kind of step from a small incubator into such a large scale,” says Schaefer, who adds that she once worked in a Foodworks kitchen making cold-pressed juices.

In addition to the business success stories, Dart says she’s proud of the human stories. In one case, a student who came to Arcata to study at Cal Poly Humboldt partnered with his Salvadorean mother, who spoke no English, to turn her homemade pupusas into a food business. Today they operate Pupuseria San Miguel out of a Foodworks kitchen and offer delivery via DoorDash.

Arise Bakery was started by a local resident who was told she could no longer eat gluten and didn’t like her available options. So she started baking gluten-free bread out of a small Foodworks kitchen, and it was so well received she had to keep getting larger and larger kitchen units to keep up with the demand. Arise’s baked goods are now distributed throughout California and shipped nationwide.

Arcata residents reap the benefits of Foodworks in other ways. Several tenants operate stalls at Arcata’s renowned farmers market. And Dart says the area has become a “food truck hub,” with as many as eight local vendors benefiting from the access to commercial kitchens, which is often a barrier for start-up mobile food businesses.

After the initial block grant to convert the building and a few renovations over the years, the Foodworks operation breaks even or earns a modest profit most years. Dart says the challenge now is maintaining a large, old commercial facility while keeping rates affordable for the types of vendors they hope to draw. A for-profit operator would almost certainly make costs “significantly higher” for the local businesses that use the kitchens.

The greatest challenge Foodworks is facing now is popularity. There are currently 46 tenants and a waiting list for startups and existing businesses that want to scale up. Dart says it’s “a bummer” to not have enough space for current demand, but that level of interest should encourage other cities considering something similar in a sector that fits their economy. Providing those opportunities, “encourages somebody's dream, or smallish idea, to be able to come to fruition [when] they probably wouldn't be able to do it otherwise.” For Arcata, some of those dreams have become big economic drivers.

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Ben Abramson

Ben Abramson is a Staff Writer at Strong Towns. In his career as a travel journalist with The Washington Post and USA TODAY, Ben has visited many destinations that show how Americans were once world-class at building appealing, prosperous places at a human scale. He has also seen the worst of the suburban development pattern, and joined Strong Towns because of its unique way of framing the problems we can all see and intuit, and focusing on local, achievable solutions. A native of Washington, DC, Ben lives in Venice, Florida; summers in Atlantic Canada; and loves hiking, biking, kayaking, and beachcombing.