Andrew Stoloff's Rubicon Bakery gives a second chance to ex-cons

When restaurateur Andrew Stoloff agreed to consult on the finances of an inner-city bakery, he found a failing business, a part-time staff of 14 former prison inmates, and decrepit equipment 20 to 30 years old.

Today, Rubicon Bakery is a moneymaking business owned by Mr. Stoloff, employing 105 full-time staff, some with only a sixth-grade education and many having served time in prison.

Back in 2008, Stoloff had agreed to the request of a cycling buddy to evaluate the financial situation of the bakery. As the owner of several restaurants in the Bay Area, Stoloff had the expertise to make recommendations.

But Rubicon's problems had no easy fixes. For 20 years, the bakery had operated as a nonprofit jobs-training program, but over time it had grown into a real business. Its parent organization, Rubicon Programs, headquartered in Richmond, Calif., assists people who are homeless, economically disadvantaged, or have mental-health disabilities. It didn't have the finances or expertise to operate such a complex business.

After Stoloff's assessment, Rubicon Programs decided to sell the bakery and asked Stoloff to oversee the sale. It had only one requirement: The buyer must commit to the mission of Rubicon Programs. The new owners would have to hire marginalized, hard-to-place workers.

Stoloff tried to sell the business, but the aging equipment and the ex-con workforce didn't make for a very attractive package. Over several months, as he spent time with the employees, Stoloff learned how the bakery had changed their lives. He fell in love with the mission.

Against the advice of family and friends, he bought the bakery himself. He felt confident he could make it profitable. "I was an entrepreneur. I knew restaurants. I thought, 'How different can a bakery be?' " he says. "As it turns out – pretty different!"

At his other restaurants, Stoloff felt fortunate to have a 10 to 15 percent annual turnover in employees. Across the industry, turnover runs as high as 100 percent a year. Even at his restaurants, most of the waitstaff take second jobs to make ends meet.

"That situation didn't do much for my soul," Stoloff concedes.

At Rubicon he found that although the employees had tremendous difficulties in their lives, he could count on their loyalty.

"They put a lot of thought and energy into their work and are determined not to screw up," he says.

Today, Stoloff owns only one other restaurant, the Red Tractor Cafe, in Dublin, Calif., just a few towns away from Richmond but in a different world: a well-manicured suburb, as opposed to Rubicon Bakery's inner-city location.

Contrasts, though, have marked Stoloff's life since his teens. After he and his family moved from a diverse, urban neighborhood in Philadelphia, he started high school in the suburbs. After two years, his parents saw he needed more substance and depth, so in his junior year he transferred to a Quaker school. "It changed my life," he says, "because they taught us how to care for others."

Upon graduation, he found a college where, he says, "people want to change the world": Oberlin College in Oberlin, Ohio.

At Oberlin he met his future wife, Leslie Crary. After a 25-year career as an attorney, Ms. Crary recently quit her job to become the much-needed director (and founder) of the bakery's human resources department.

Stoloff also met a friend-for-life in his freshman year at Oberlin, Steve Herrine. Stoloff's love of cooking began when he and Mr. Herrine cooked for 110 fellow students. Today, Herrine, a physician and vice dean at Jefferson Medical College in Philadelphia, says Stoloff is "very passionate about what's important. He's uncompromising but nonaggressive. He's a bridge builder."

After Oberlin, Stoloff earned an MBA from The Wharton School of Business in Philadelphia and then spent 13 years on Wall Street. Bored and tired of staring at spreadsheets, he knew he needed a career change.

"His stint in the financial world didn't appeal to him," Herrine says of Stoloff. "The goals and intent there didn't sync with his."

Stoloff and his wife began visiting San Francisco and fell in love with the city. Leaving Wall Street behind, they moved to the West Coast where Stoloff started working in the restaurant world, including managing a sandwich shop in San Francisco's Financial District.

Another alum from Wharton – the chief financial officer of Il Fornaio Restaurants in San Francisco – introduced Stoloff to his future restaurant partner. "Even though I made every possible mistake," Stoloff says, he was able to open his first Red Tractor restaurant.

Stoloff eventually opened three more in the Bay Area. But years later, about the time his cycling buddy called asking for help with Rubicon Bakery, Stoloff knew that owning restaurants wasn't going to be "it" for him. He already had sold two of the restaurants by the time he arrived at Rubicon Bakery's door.

After buying Rubicon on Nov. 1, 2009, Stoloff gathered the crew of 14 workers, all of whom were battered by months of anxiety over the possibility of losing their jobs. He told them that they all would be staying. They cheered.

Next, Stoloff had to immediately hire 20 more workers to meet the demands of the holidays. He had a stack of applications, all stating "no experience."

In all his years of hiring, he'd never had an applicant check "yes" to the question, "Have you ever been convicted of a crime?" Every one of Rubicon's applicants had answered "yes." He took a leap of faith because he had no choice.

"Some worked out, and some didn't," Stoloff says. But the ones who did? "What amazing people."

Over the past four years Rubicon Bakery has not only made a huge financial leap, but the people working there have also made positive changes in their lives. In order to support them, Stoloff began offering short-term loans to individual employees.

"It broke my heart to see them work so hard at the bakery but then go down the street where they could borrow money to get through the month or over the holidays." Because of high interest rates, an employee could quickly see a $250 loan turn into $500 of debt.

Today, the bakery runs a program that provides no-interest loans between $50 and $3,000. Rubicon has loaned out $150,000 over four years, with only three loans not paid back.

Stoloff continues to share what he's learned from his Quaker teachers and his years at Oberlin, and his financial expertise gained from his time at Wharton and Wall Street and as a restaurateur. Working with hard-to-employ people gives him the experience to help people like Craig Barnard, an instructor at Tri-Valley Regional Occupational Center/Program at the Santa Rita Jail in Dublin.

Mr. Barnard says that having Stoloff on the program's advisory committee and serving as a community partner ensures that ex-cons and others on the margins of society are given the skills they need to turn their lives around.

"Andrew helps us see how best to support our population," Mr. Barnard says. "He not only successfully operates a fine bakery, he changes lives with grace and ease. His relationship with us offers great hope for the currently and formerly incarcerated community."

Stoloff concedes that hiring ex-cons might not appeal to every business owner. But he encourages businesses to consider how trusting people and letting them prove themselves can reap huge rewards.

"Tapping into a whole vein of employees others haven't found will bring you people who work hard, give you loyalty, and fill the need for manual labor," Stoloff says. "These people want to develop their skills and contribute to the success of your business."

Rubicon Bakery has proved this to be true and seen lives turned around a hundred times over: to date, 105, to be exact.

• To learn more, visit www.rubiconbakery.com.

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