Pepito’s Paletas Empowers Worker-Owners, One Popsicle at a Time

Savannah Kuang, CUESA Staff
September 20, 2019


Summer may be coming to an end soon, but you can still enjoy refreshing frozen treats at the Jack London Square Farmers Market, while supporting Bay Area women entrepreneurs.

On Sundays, Pepito’s Paletas, a worker-owned cooperative, sells delicious paletas (Mexican popsicles) made with fresh fruit, natural sweeteners such as agave and honey, and water or milk. Founder Nancy Rosales manages the cooperative with four other worker-owners, providing a successful model of a democratized work environment.


From Corporate TV to Cooperative Food

After working for KRON 4 in San Francisco for seven years, Nancy founded Pepito’s Paletas in 2007 with her sister and opened a brick-and-mortar called Pepito’s Ice Cream.

Unfortunately, the ice cream business weathered hard times in the Great Recession in 2008. Nancy had to close up shop in 2010, but customers still wanted paletas and continued to call her. “There was just no way I could afford to do it anymore, so I started looking for resources to help me continue the business.”

As part of her revamping journey, she applied for the Good Jobs Accelerator program through Inner City Advisors, a nonprofit group that provides technical assistance for small businesses. She also attended trainings at AnewAmerica, an organization that offers training and other support services to women entrepreneurs.

Starting a co-op wasn’t part of Nancy’s business model until she stumbled upon Prospera, which provides assistance and capital to Latinx women launching businesses through the cooperative model. Nancy joined as an entrepreneur fellow in Prospera’s three-year incubation program. “Being a cooperative means creating a business to share the same profits as everyone else,” says Nancy.

Fostering this model inspired Nancy to hire more women worker-owners to own a piece of the business. New workers have to commit to working for a year and a half before they can become owners.

“We’re all getting paid the same, and to me, the passion and quality in the people we hire are important because they have to be passionate about sharing in the profits,” she says.


What’s in a Paleta?

Roughly translated as “little sticks,” a paleta is a Mexican popsicle or ice pop. But unlike the cloyingly sweet mass-produced popsicles you might find in a grocery store, which may include corn syrups, food dyes, artificial flavors, and stabilizers, paletas are made with natural ingredients such as fresh fruit, nuts, herbs, and spices.

Paletas also come in endless varieties of based flavors, frequently fruit based, such as mango, strawberry, tamarind, and watermelon. Pepito’s Paletas experiments with special flavors such as horchata, sweet corn, and caramelized fried bananas. They source mostly from local farmers, including a few from Jack London Square Farmers Market.

“Most of the recipes are inspired by my childhood,” says Nancy. “We currently have over 32 recipes, and my mother gave me a layout of creating these recipes since they’re all made from scratch.”

With so much fresh fruit, the paleta-making process can be labor intensive. “Everything is made from scratch, so I’ll get fresh fruit such as kiwis and cut them all up by hand,” explains Nancy. “I remember spending two days on a watermelon paleta recipe just taking out the seeds!”

In addition to selling at Jack London Square Farmers Market, Pepito’s also sells their paletas in bulk to technology corporations such as Facebook and Google, and offers catering online. To keep up with the demand, Pepito’s now works with California Popsicle, Inc., a manufacturer in South San Francisco, to increase capacity and cut distribution costs. “Because of this process, everything is already pre-ordered or made to order,” says Nancy.

They’ve also eliminated the use of plastic packaging and freezer costs by creating their signature storage box, which can keep up to a few hundred paletas frozen for up to eight hours. “This is our way of eliminating plastic packaging and having to use freezers, while creating something sustainable and biodegradable.”


Paletas as a Path for Women’s Leadership

Through teamwork and democracy, Nancy sees the cooperative model as a driving force for her fellow worker-owners’ development as business leaders.

“The women that I work with, we all empower each other,” says Nancy. “We’re trying to build this together—to be on the same page. No one is smarter than the other, and we can work on this together, because more brains are better than one.”

Nancy is also hoping that Pepito’s Paletas will help worker-owners develop the skills and leadership to start their ventures one day, if they so desire. “If they want to be part of the business long-term, that’s great! But if they don’t, they’ll already know how to run a business and become that leader. I’m just a big dreamer, but my dream business is one that has women supporting each other, empowering each other, and paid the same as one another.”

Find Pepito’s Paletas at the Jack London Square Farmers Market on Sundays.

Photo of watermelon paletas courtesy of Pepito’s Paletas.