Today’s a big day for Josephine, the startup behind the ‘cottage food’ sharing platform and marketplace that enable home cooks to sell food to their neighbors.
That’s because today is the day a bill is being considered by the Health Committee of the California state legislature called the 2017 CA Homemade Food Operations Act (edit: the bills name was changed to “AB 626—The 2017 Homemade Food Act” in the form it went before the committee). The bill, which Josephine management helped craft and introduce, would expand California’s current cottage food law to allow aspiring home-based food entrepreneurs to sell home cooked meals to neighbors.
(Ed Update: The bill passed out of assembly on April 25th. You can read our story here).
That’s naturally of interest to Josephine, which has built a platform which can more or less be described as an “Uber for cottage food” (although it should be noted the company resists the negative connotations associated with platforms like Uber). The problem for Josephine, which is based in Oakland, is that the sale of home cooked meals to neighbors is not allowed under current California law. As a result, about a year ago home cooks using Josephine received cease and desist letters, which eventually led the company to shutting down operations in the east Bay area.
The company, which has investments of about $2 million from Kapor Capital and angel investors, believes home cooks with the proper licensing should be able to sell food to their neighbors. And why not? Just as how Uber, Airbnb and other sharing economy platforms gave entrepreneurial folks a marketplace to rent their underutilized assets – whether that be a car, apartment or a person’s own time and labor – it’s logical that there’d also be demand to do so with home cooked food. In fact, it would be hard to argue there isn’t a large potential market of people on both sides of the equation – those who can cook and need to make some extra money, and those who like to eat – to make a marketplace like Josephine successful in the long run.
I caught up with Josephine cofounder Matt Jorgensen to ask him about Josephine’s efforts to change California’s cottage food law and also get a little backstory about Josephine.
You can keep up with the status of Josephine’s efforts and the California Homemade Food Operations Act at their blog.
When was Josephine forced to halt operations?
Jorgensen: In April of 2016, several of our cooks were served Cease and Desist warnings from local health regulators, which lead us to halt operations in the East Bay. This ultimately led to our good faith collaborations with State health regulatory coalitions in CA
With the Homemade Food Operations Act (Editor Note: Bill name was changed to “The 2017 Homemade Food Act:), when is a vote expected on this bill?
First the Bill must pass through Health Committee next Tuesday April 25th, and we expect the legislature to vote at some point in the early summer.
How does California compare to other states in terms of legality around cottage food as a business?
Jorgensen: California is essentially on par with the 30+ states that have passed Cottage Food laws.
Like many states, certain California cooks with the access and means can apply for cottage food permits as hobbyists, but the law doesn’t allow for the sale of most financially viable/ culturally relevant products… instead it’s focused on certain shelf-stable foods (jams, granolas etc). So we haven’t seen CA yet push beyond others in terms of the available food types. Several states go further, with Wyoming’s “Food Freedom” law being the most open.
Do you see this bill as the first in a push towards national rolllout? (And will other states follow suit)?
Jorgensen: We’re taking a different advocacy approach in each state– while we’re supporting Garcia’s legislation in CA, we’re actually looking at various administrative paths in other states. In Portland for example, we have strong support letter from the Mayor for a proposed pilot program. In other states like Wyoming the low-risk behaviors we are proposing are already legal.
How does Josephine business work? Is it similar to other sharing economy services that take a % of the overall bill? Charge a flat service fee?
Jorgensen: There’s no cost to set up a cook account or post meals. For each meal cooks serve, they keep 90% of your total sales and 10% of your sales will go toward covering credit card fees and the cost of our services. We also partner with values aligned non-profits for no cost.
How does Josephine find new cooks?
Jorgensen: Mostly through word of mouth and through offline communities. Many cooks are already partaking in the types of activities we support before choosing to partner with Josephine.
How does Josephine ensure people are going to be quality cooks? I assume getting a “cottage cook” license (as permitted by the bill) would be one step. But are there other things you do?
All cooks go through a vetting process from the masters of public health on our team and have access to our knowledge base before posting their first meal. We work with them to ensure a quality first experience, but all meals are also reviewed by customers (built-in accountability).
Is Josephine the only cottage cooking platform app, and if so why hasn’t this market taken off (is it legal restrictions, or something more as well).
Jorgensen: Some other companies have tried to make this business work, but we believe we are still in the early days of building the cook confidence and public trust necessary for this business to succeed.
How big is Josephine and what is your funding?
Jorgensen: We have a few hundred cooks across the country, a staff of 10 in Oakland, CA, and funding from a handful of different impact, angel, and venture capital investors. We’ve raised a little over $2m so far from angel and impact investors including Kapor Capital.