“The more I give away, the better the bar does”: Why Danu Social House wants to become the city’s first community-owned watering hole

What if your neighbourhood bar could really be your neighbourhood’s bar? That’s the question Parkdale watering hole Danu Social House is taking to its staff and patrons as it transitions from private business to community-owned co-operative. Founder and for-now-owner Joshua Zachariah opened the joint in July of 2022 with a lot of help from his friends and the goal of forming a place where people could truly get to know each other over a drink. Now, Zachariah and his comrades are making the next big step, drawing up the plans to formally incorporate the bar as a community-owned, worker-run co-operative complete with a dedicated board member to represent its beer-buying patrons. We spoke with Zachariah about Danu’s bold new path and why he hopes it could start a movement.

For the uninitiated, what is Danu Social House? It’s a bar at Queen and Dufferin—though it’s become a lot more than that. We opened in July of 2022, and since then it’s become a community. We’ve always had that idea at our core: we wanted Danu to be a kind of living room, a third space where people can gather and have good conversations. It’s the kind of bar where people can come by themselves but then meet people and socialize. We host volunteer-run events to help make that happen. And it’s also a political space: the other week, we hosted a drag show fundraiser for Palestine. So it’s a community space that’s clear about its values.

Related: This sort-of-secret Parkdale sandwich shop hosts an affordable family-style supper club once a month

What inspired the project? I’ve had the idea of running a modern-day salon since I was 16. I read a memoir of a guy living in Venice in the mid-1800s, which talked about how all real intellectual thought happened in bars. That fascinated me. For a while, I thought it would be my retirement project after whatever career I pursued, but as I went through my 20s, it became more and more of an obsession, to the point where my friends were urging me to just do it already. Eventually one of them put up some money, so I got serious. As soon as I did, my community came out in droves to help me—my sister had even kept a secret bank account saving up for this very project. All told, Danu received around $300,000 in gifts, loans and investments from my friends and family, including $60,000 from my own savings. After we got the keys to our space in Parkdale, a whole crew of my friends and family helped us renovate it from top to bottom.

Normally, that would mean running it for a profit and repaying your backers. Was that not the idea here? Bars are a pretty bad way to make money. If that’s what I wanted to do, there were other, better avenues. In my fantasy world, I’d get back the money I put in originally, but that’s not happening. My intention from the beginning was to make it a co-op, but at the time, no one was clamouring to take it on with me. The past three and a half years of this place have seen the highest highs and the lowest lows. We lost a lot of money in the first two years and almost closed down nine times—whether from money issues, our furnace breaking, failed business plans or just my own morale running low. But now we’re breaking even, and it feels like the place has legs. It’s come to the point where it feels weird to be the owner: the bar thrives because of the community that has developed around it. The more I give away, the better it does. The community and workers behind it now believe in it as our project. It’s not my thing anymore; it’s their thing.

Related: “We met, fell in love and merged our families in a housing co-op. Now, we’re starting a co-op of our own”

When you say “community,” what do you mean? The bar-goers? The broader neighbourhood? We’re referring to everyone who comes to the bar. But, when it comes to doing good and supporting “community work,” we’re not quite sure yet. That may mean Parkdale or the city of Toronto as a whole. Or even the world, like supporting Palestine. That’s a bit up in the air right now.

For the uninformed, what exactly is a co-op, and how is it different from a normal business? Co-ops can mean various things. Worker-owned ones are the most classic: the workers of a business own the thing and split the profits. There are also patron co-ops, like what MEC used to be, or like Costco sort of is, which are owned in part by their customers. Our goal was to become something that incorporated both workers and patrons in the co-op structure. So we’re becoming a community-owned, worker-led co-op: anyone can become a member, and patrons collectively get one representative on our board. Volunteers and contributors, like event hosts, also get a rep, as do our financial backers. But the workers run the show: anyone who has worked here for at least three months will get a seat on the board. They’ll have by far the most power. Right now, it looks like there will be 10 people total on the board, but that may change depending on who’s working this summer.

If the workers are on the board, does that mean they get dividends from the bar’s profits? No. One of our core values is to be anti-capitalist. I’m obsessed with the adage “From each according to their ability, to each according to their need.” The idea is that, first, our profits go toward keeping the bar itself afloat: service our debt, pay our costs, build a rainy-day fund, that sort of thing. Then we make sure each of the workers is paid equitably. Any cash left over gets given back to the community—and we’re still exploring what that looks like. But the dividends aren’t for us individually. As far as we know, we’re the first bar in Toronto to adopt this model.

If the bar is breaking even and could even turn a profit, why not sit back, collect the proceeds, and get rich and comfy? First, this road was really hard, and carrying the place was a huge weight on my shoulders. Danu wasn’t the community place I wanted it to be when we first opened: not enough people were coming, we weren’t putting on the right kinds of events and business was rough. But I made my intentions clear, and over time the bar found its people. So the first reason is practical: Danu will do better as a co-op. Bars don’t tend to do super well financially or make their owners rich. They need something to set them apart, and I think, for us, this is it.

The other reason is my own values. I deeply believe in distributed, democratic decision making. In our society, we almost gamify being bad to one another. I want to gamify being good to one another. My life’s mission is to help other people make villages and to make my own. That’s the game I’m playing: make strong villages, then network them so they become strong together. But I’ve let go of any hope of being paid. I’ve got a nine to five with the Ontario Public Service, and that’s enough to support myself.

Are you worried that democratic decision-making could make it harder to run the bar? Yes, I am nervous about that. But I’ve been impressed already with our ability to hash out disagreements. In the beginning, I could make decisions on my own, and quickly. I’m good at that. But, now that we’re making this thing together, I can’t do that anymore. I’ve had to take a step back. Even this interview was a point of tension since it’s focusing on me personally rather than on the co-op as a group. At the end of the day, though, we all have one another’s backs. We’re working toward the same goal.

Danu isn’t officially a co-op yet. When would all this kick into action? Our goal is to have our first annual general meeting on July 9. This has been in the works for a while, though. Last September, I finally came to a point where I had the energy to sit down and make a proper presentation to our workers and backers pitching the idea. I was shocked at how aligned everyone was: the same night I pitched it, we started planning. We’ve met every two weeks since then, often for longer than three hours at a time, and got down to it. In late January, we ratified the core of our plans. Now we just need to lock down the details.

What advice would you give other businesses looking to transform into co-ops? Start the conversation internally first. Sit down, have a beer and ask, Who should be in the co-op? How will they make decisions? What work would be done by whom? And where does the money go? Every co-op will look a little different, but I’m hoping the framework we’re building here at Danu will be usable elsewhere.

And if more businesses do take up the call, what would that look like? Once this is all settled—which will take a while—my mission will be going to see if other places want to work with us. One of the reasons chain restaurants and bars make better margins than independent ones is economies of scale: they can order in bulk, share accountants, do group liquor purchases and so on. If we can form a group of co-op businesses, we could share resources in the same way.

How will any of this change the patron’s experience of going to Danu?  A lot of people will just walk down the street, see the bar and get a drink as usual. But, for those who discover us through the co-op, I hope they’ll want to come and be a part of the thing we’re doing. Price-wise, not much will change: if this were a private business, the owner would charge as much as they could get away with. As a co-op, we’ll charge what we need to sustain ourselves. This world asks us all to play the “make number go up” game, and a lot of people are sick of it. We want to change that game, and my hope is that people will want to join us. Danu has a solid set of about 30 regulars who come four to five nights a week. Then there are event-goers, who tend to leave after the show is over. Once people know that this is a community they’re being invited into, with a mission they can join, I hope they’ll stick around. If that sounds interesting, just come by for a drink.

This interview has been edited for length and clarity.