Cover Stories

What’s In Store

GT1542 CoverWEBNew Leaf Community Markets celebrates its 30th anniversary with a block party this weekend. Co-founder and president Scott Roseman talks about how he set out to change the world, and the changes in his own life after New Leaf’s sale

Scott Roseman, the founder and president of New Leaf Community Markets, has a beatific manner about him, laid-back and almost rabbinical. But he and his partners startled the local business community in 2013, when they announced the sale of their New Leaf corporation—which has grown to include eight stores in total, five in northern Santa Cruz County, and nearly 600 employees—to investment firm Endeavour Capital, which also runs the New Seasons grocery chain in and around Portland, Oregon, with more than a dozen markets and a workforce of 2,700.

It was a multi-million-dollar sale estimated to be well in the eight-figure range—Roseman says the details of the cash-and-equity deal are “private”—that would eventually lead to a complete takeover by New Seasons of the natural-foods brand he began to forge 30 years ago.

And while New Leaf will celebrate that 30th anniversary with a massive block party at the Westside market on Saturday, Oct. 24, for Roseman, it marks a time for reflection. He can be modest about his accomplishments—from promoting locally grown organic produce to developing a cutting-edge approach for marketing sustainable seafood (named FishWise)—but on the national level, the industry has recognized his many innovations. Just last year he received the first-ever “Service to the Industry Award” presented by the Independent Natural Food Retailers Association. The award was given “in recognition of leadership and values that have a widespread impact on people’s lives in the independent natural products industry.”

Certain things that are now taken for granted in the natural foods grocery business—a predominantly organic produce selection or rewarding customers with “Envirotokens” for using reusable bags—were originally developed at New Leaf by Roseman, his partners and his staff.

Roseman also set a very high standard for community involvement during his tenure at New Leaf. Citing the influence of his Jewish heritage, he has donated 10 percent of the organization’s profits to a variety of nonprofit community organizations, including the Santa Cruz AIDS Project, Second Harvest Food Bank, Volunteer Center, and the Santa Cruz Cancer Benefit Group. He has also been engaged politically. In 1987, he co-founded the Progressive Business Network of Santa Cruz County, which served as a counterbalance to the then rigidly conservative Santa Cruz Chamber of Commerce. Up until the sale to New Seasons, Roseman was an active promoter of Think Local First. “Buy Fresh—Buy Local” was a mantra of the New Leaf stores—and Roseman says it will continue to be so.

“I’m very proud of what we’ve accomplished in terms of setting a high bar for quality and for being on the cutting edge in respect to organic and natural food stores across the country,” Roseman says. “But there came a point where we felt the timing was right to sell. And we said yes.”

cov 2Roseman and I enjoy a friendship that stretches back to the mid-1970s, back to when Santa Cruz was a much different place, before a global economy altered our dreams, our vision of the world, even our sense of the political—though, Roseman would argue, not our core values.

Our lives have crisscrossed in numerous ways since then: we were both members of the radical Phoenix newspaper collective, a seminal alternative weekly in the region; we belonged to Our Neighborhood Food Co-Op, where we occasionally bagged cheese and tofu together or swept the floors; we worked on numerous political campaigns and forged a political alliance that has remained pretty much in place to this day; our kids briefly attended the same school; oh, and we both survived near-deadly bouts with cancer, though his battle happened earlier, so when my turn came, I leaned on him to help shine a lighted path toward survival.

After nearly 40 years of friendship, however, we have never taken the time for a slow, unencumbered walk together. It’s a hot October afternoon and the two of us decide to stroll along East Cliff Drive and Pleasure Point, away from our work and the various pressures and challenges that often demand our attention.

We talk first about our families and our health. Roseman has always been thoughtful and articulate, choosing his words carefully, usually with a smile on his face. If the world has changed considerably since we first met, his manner has remained remarkably constant. I know of a hidden nook off the Eastside cliffs, a special spot I have visited for decades when I’ve needed to be alone and clear my thoughts, to get a different perspective on life. He tells me that he’s never been there before, so we head down a path to a ledge very close to the water where no one can spot us.

At least not anyone on land. There’s a huge southern swell, so surfers are everywhere, carving up waves, and struggling their way out to distant sets on the horizon. There’s also an incredible potpourri of marine life—dolphins and whales, sea otters and sea lions, cormorants and pelicans. Roseman is a devout environmentalist—he has been ever since the day I first met him—and I explain to him that the scene before us didn’t exist here when I was a kid. The dolphin, sea otter and humpback populations had nearly been wiped out; ditto for the California brown pelican, nearly rendered extinct by DDT. “I guess in some ways we are doing a little better,” he says philosophically. “That’s hopeful.”

He tells me that he recently participated in a Rosh Hashanah ritual at New Brighton State Beach with fellow members of the Temple Beth El. The gathering threw bread out into the ocean, and the nearby seagulls and then sooty shearwaters flocked in to feast. He is smiling that beatific smile of his as I imagine the scene. “It was amazing,” he says reverently.

We shift topics and discuss the sale of New Leaf—a sale that has made him, if not quite rich, then more than likely “comfortable” for the rest of his life.

There’s something I’ve been wanting to ask him about this afternoon, having watched the arc of his business career in its entirety and at relatively close range. “Back in the day,” I inquire, “when we were co-op members together, did you secretly have visions of being a supermarket mogul?”

“Not at all,” he says in a measured tone. “I was thinking about a life in public policy, social action. Business was the furthest thing from my mind …”

“But you always seemed to have a certain amount of ambition,” I note. “A lot of drive.”

“I guess so,” he responds, still smiling. “I wanted to change the world.”

Roseman has lived in California for two-thirds of his life, but there’s still a hint of an East Coast edge to his speech patterns and cultural sensibilities. Born in the winter of 1956 at Mount Sinai Hospital overlooking Central Park in Manhattan, he was raised in the shadows of New York City on Long Island, first in Bellmore, then in Rockville Centre, about 30 miles from the heart of the city. He grew up a sports fan, and he loved the New York teams—the Mets, the Jets and the Nets—at a time when sports teams in the Big Apple shaped the identities of a generation.

I have a way of testing real Mets fans from that era by asking them who played third base on the 1969 World Championship team. Roseman didn’t hesitate for a second: “Ed Charles!” he says with a smile.

Roseman and his father had season tickets to Jets games, too, in the chilling reaches of the upper deck at Shea Stadium, and he is quick to rattle off the starting backfield of the Jets’ Super Bowl championship team. But his big love is basketball (he was a Julius Erving fan), which he still plays competitively at the age of 59 and with a profound reverence for the game.

Roseman’s mother, Marilyn, was a junior high-school teacher; his father, Norman, who died in 1990, was in the “creative side” of advertising, mainly “direct response advertising,” Roseman explains, starting with magazines and “then shifting to those obnoxious late-night TV ads” that populated television in the 1960s and ’70s. He later developed a publication called Soap Opera Digest.

After high school, Roseman headed off to the State University of New York, Binghamton, then a hotbed of radical politics. He majored in political science, but was put off by the “strident, angry” tenor of the political activity on campus. “I had liberal leanings, even as a teenager, though not necessarily radical,” he recalls. “I was actually pretty turned off to radical left politics at Binghamton.” Following his junior year he left college for New York City, where he worked at a variety of odd jobs, including a stint as a taxi driver.

The lure of California caught hold of him. He switched majors to sociology, then a cauldron of radical social theory, but with a practical component as well. Unlike at Binghamton, where he felt alienated from the faculty, his fires were lit at Santa Cruz by professors like Alan Wolfe, Pam Roby, Jim Mulherin, Bill Domhoff, Jim O’Connor, and Mike Rotkin, the latter of whom first ran successfully (as a socialist-feminist, with Bruce Van Allen) for Santa Cruz City Council in 1979.

After a short stint working as a probation aide (“a real eye opener”), Roseman took a job with the Alternative Energy Co-op, where he eventually produced a small, alternative publication called the Alternative Energy News, which he published in conjunction with the Phoenix collective. “This idealistic leftist radical was now running a publication that needed financial support from the business community,” he notes with a bit of irony, “and I began to learn to run—and grow—a business, which I got pretty darn good at.”

All the while, Roseman kept doing his time at the Food Co-Op. Eventually, he was hired there in mid-1981 as a “floor coordinator,” which meant that he did everything—stocking, cleaning, cashiering, and coordinating volunteers, which, from my vantage point at least, seemed a bit like herding cats.

Soon he took over the produce section—which he admits to “knowing nothing about at the time”—and soon it was transformed. After that, he moved into different areas (dairy, the deli, frozen foods) gathering information and experience that would serve him in the years ahead.

cover1In the summer of 1984, Roseman was experiencing more than his share of frustrations at the Co-Op. There were tensions between those committed to upgrading the service and quality of food and those who took a more laissez-faire attitude toward their employment. He had scheduled a road trip with his dad to Canada—the first time just the two of them had planned a trip together—when his health took a spiral. He was feeling run down and couldn’t seem to shake a nasty cold. Finally, he went to Stanford for some tests. A few days later, he was diagnosed with acute lymphoblastic leukemia. He was 28 years old.

Roseman immediately began an intense regimen of chemotherapy. Roseman’s body was so riddled with cancer cells that following his first chemo treatment he nearly died from the overload of dead cells that his body was struggling to discharge. But the good news was that his leukemia was responsive to treatment. A month later, his bone marrow was cancer-free. And while his chemo regimen lasted for more than a year, he soon turned his mind to other matters.

I had been living in Italy for much of this period, and didn’t learn about Roseman’s diagnosis until coming back to the U.S. I have a very vivid memory of running into him on the street upon my return in 1985, when he told me about his leukemia battle, and, in what seemed like the same sentence, that he was buying out the Co-Op of its assets and getting ready to open the Westside Community Market. He seemed incredibly healthy and vital for someone who had just gone through a near-fatal battle with cancer.

Roseman borrowed some money from his folks, negotiated an assets-only deal with the Co-Op’s board of directors for some equipment and remaining inventory, and on Oct. 19 of 1985, the Co-Op shut down. On the following day—30 years ago this Saturday—Roseman’s Westside Community Market opened.

Roseman hit the ground running and hasn’t looked back since. He was committed to organic produce and to the healthier food choices that the natural foods movement offered. He was also committed to working with local farmers and local producers years before that became the trendy thing to do. And he implemented one of the first sustainable seafood programs in the country.

He was changing the world—one display case at a time.

[Drop Cap] Roseman realizes now that his father’s entrepreneurial spirit provided some guidance for him (and “some big shoes to fill”), but his only business training had come on-the-job, gleaning what he could from his stints at the Energy and Neighborhood Food co-ops. In essence, he got his MBA from the streets.

Roseman established himself as a creative, sensitive and community-oriented business person from the get-go. He had read Michael Phillips’ book Honest Business, which had a profound influence on him. Phillips advocated for things like sharing financial information with staff, giving back to the community, and paying bills on time, as well as having fun and enjoying one’s business—all of which New Leaf has done throughout the years.

In the late 1980s, Roseman met Rex Stewart and Chris Quinn, then serving as consultants to natural food stores across the country, and invited them to become partners as he contemplated his first significant expansion—from the original warehouse on Ingalls Street to a new, 7,000-square-foot market in a small shopping center on Mission Street. The partnership—along with the move and a commitment to growing the business—facilitated a change in the name of the business as well, to New Leaf Community Markets (Roseman credits Stewart with coming up with the new name), which they adopted at their opening on Mission Street in May of 1990.

Then came a relatively rapid succession of new stores: first, Felton, in early 1993 (which is actually owned by Bob Locatelli and licensed by New Leaf); Capitola (on 41st Avenue) in October of 1993; then, in 1996, they made a signature move to the old Bank of Italy building on Pacific Avenue that had been vacant since the October 1989 earthquake. “While New Leaf was known in the community of folks who shopped organic and natural foods, it was not until we opened the store on Pacific that New Leaf really made its mark,” Roseman observed. “This location put us on the map.” In 1998, Locatelli opened the fifth New Leaf location in Boulder Creek.

Location has always factored significantly in New Leaf’s varied decisions to expand. Roseman & Co. continued to have an eye on regional growth, but the stars didn’t realign for another decade. In the mid-2000s, they opened a new store at an abandoned Albertson’s in Half Moon Bay, embarked on a significant remodel of their downtown location, and moved to a 20,800 square-foot store (their present Westside location) at the corner of Fair and Ingalls streets—less than half a block from the original Co-Op warehouse.

But the latter expansion did not come easily. In the middle of New Leaf’s plans, the global financial crisis hit, and New Leaf’s financing for the projects fell through (as did a deal to sell to Planet Organic for $9.75 million). Roseman and Stewart, along with chief financial officer Kimberly Hallinan (“she was the real hero in all of this,” says Roseman) negotiated a creative string of financing involving four banks—the Santa Cruz Community Credit Union, Santa Cruz County Bank, Global Trust, and, with a final nudge from then vice-president and loan officer Jill Hitchman, Liberty Bank in Boulder Creek. The new Westside store eventually opened in March of 2009.

While Roseman and his partners navigated successfully through the crisis—many of those in local financial circles considered it nothing short of “a miracle”—they were still in hot pursuit of additional expansion capital. In 2012, they opened another store in the Evergreen section of San Jose, and then in Pleasanton the following year. They seemed to be on another roll.

Throughout our walk, I wondered if Roseman might have some mixed feelings about the sale to New Seasons. A few years ago, he told me that he had been looking for investment capital to continue New Leaf’s expansion into various Bay Area markets, and he seemed enthusiastic, if not excited, about pursuing his economic vision and expanding the New Leaf brand.

I asked him what had changed his mind? In fact, they hadn’t been looking to sell, but were seeking an influx of “investment capital to help grow the business.” New Seasons made them an offer they couldn’t refuse, Roseman says, merging New Leaf with a “very similar community-oriented natural foods retailer that would ensure the legacy of New Leaf.” It provided an exit strategy for leaving their business in good hands.

That legacy clearly matters to Roseman. New Leaf has been on the cutting edge of natural food grocers since its inception, and Roseman has become a national figure in the movement. One of the roles he has accepted as part of the deal is serving on New Season’s board of directors. It’s a place where he can continue to exert his influence and to foster his political and social vision. Part of the deal with New Seasons allowed Roseman to hold on to his management position within New Leaf for two years. He’s now done with that particular tour of duty. “I’ve pretty much finished with my everyday work,” he says, “though I am still working on a couple of projects, and I’ll continue to serve on the New Seasons board ongoing, though I don’t go to the office anymore.” Instead, he’s working on his golf game. “I wish it were better,” he says with a chuckle.

All the same, he admits that it’s been a little tough to let go. “I don’t miss all the headaches of running the business on a day-to-day basis,” he concedes. “But, I do miss hanging out with the wonderful people who make up New Leaf. At the same time, I am staying connected. I am staying on the company’s board, and I’ll continue to do the fun stuff, like being a part of our 30th Anniversary Party next Saturday.”

Roseman is mostly looking forward to spending more time with his family—he has been married to Jasmine Berke since 2000, and they have an extended family of children, stepchildren and grandchildren with whom they share their lives. “I look forward to watching them grow and experiencing how they shape their futures,” he says.

He’s also assuming a position on Jacob’s Heart board of directors, and has agreed to serve as the next president of the board at Temple Beth El, beginning next July. He hints at fostering new start-ups and mentoring young business people. “I like to think I’m going to try and slow down a little bit,” he declares, though not quite convincingly. “But that’s probably not really me.”

Probably not. I get the strong sense that he still wants to change the world.

New Leaf’s 30th Birthday Block Party is 4-8 p.m. on Saturday, Oct. 24 at 1101 Fair Ave., Santa Cruz. Live music, local food vendors, beer and wine, kid’s crafts and more. Bring a can of food for a free raffle ticket. Free.

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