How a Minneapolis cafe ditched its prices — and started turning a profit
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Nearly half of all customers at a Minneapolis cafe now walk out without paying a cent. And that’s exactly how the owner wants it.
Post Modern Times, a small eatery in the city’s Whittier neighborhood, stopped charging set prices in January and shifted to a voluntary donation model. The change was less a business pivot and more a political statement — a direct response to what owner Dylan Alverson called a “government occupation” of Minneapolis following heightened federal enforcement actions.
The cafe sits just four blocks from where Renée Good was killed in January by ICE agents, and only six blocks from the site of George Floyd’s murder in 2020. Alverson posted on Instagram that he would no longer “make money for the fascists that occupy our city” and refused to generate taxes under what he described as a “functioning for-profit capitalist business aligned with government strategy.”
What happened next surprised even him. Post Modern Times began to thrive — not despite the fact that 40 to 50 percent of customers pay nothing, but perhaps because of the goodwill generated by the model. Because donations are voluntary, the cafe no longer collects sales tax, and its staff work as volunteers, sharing tips and community contributions.
Last year, the cafe brought in $1.3 million in sales but still lost $18,500, even after Alverson paid himself just $23,000 annually as “manager, chef and fix-it man.” After 15 years of fighting for profitability, he concluded it wasn’t possible “without taking advantage of people.” Since the switch, he says, “I’ve succeeded more than I ever did when I was running a conventional business employing 22 people.”
The success comes against a grim backdrop for the industry. The National Restaurant Association reports that 42 percent of restaurant owners said their businesses weren’t profitable last year. Alverson’s experiment — born out of a tax protest — may offer a template for addressing what some call a structurally broken business model.
The “pay what you wish” (PWYW) model isn’t new. As the Guardian notes, it’s a well-known if uncommon pricing strategy designed to build trust between a seller and a fair-minded buyer. In 2015, fashion retailer Everlane held a PWYW sale. Radiohead famously released their 2007 album “In Rainbows” as a PWYW download: 62 percent of fans paid nothing, yet the band’s average revenue per download exceeded what they would have earned through iTunes.
Post Modern Times suggests that in a world of rising inequality and anti-establishment sentiment, letting customers decide the price — even if half choose zero — might be the most profitable move of all.