In a region where companies like Uber and Airbnb have cashed in on unauthorized cabs and boarding houses, vendors trying to make a living selling food without a license face police crackdowns

From their spot on the sidewalk outside San Francisco’s Dolores Park, Miguel Muniz and Juan Anguiano could see children running around the playground and hundreds of hipsters lounging on a grassy hillside amid games of beer pong and men hawking loose joints in mason jars.

But the pair of palateros, or ice cream vendors, were hesitant to go to the place near the jungle gym where they would have the best shot at selling $2 ice cream bars. Park rangers would confiscate their carts and give them tickets, they said, if they ventured inside the park’s perimeter.

“You can do anything in this park,” Muniz said in Spanish. “You can smoke weed, you can drink liquor, but you can’t sell ice cream.”

Amid all the questionably legal behavior in the park, the palateros feel unfairly targeted, though a man selling rum in coconut shells said he too had been ticketed and harassed by park rangers. Muniz recalled the time his cart was confiscated. When he got it back, all the ice had melted and the ice cream had spoiled. Anguiano pulled out a ticket he had received just two weeks ago for $114 – a hefty figure considering the $60-$70 he said he usually earned per day.



For a region that champions entrepreneurship, the San Francisco Bay area can be tough on hardscrabble business people trying to make a go of it.



For street vendors, legal compliance – even for someone delighting children with cold treats on a hot day – is no mean feat. A document explaining San Francisco’s process for obtaining a mobile food facility permit looks like a parody of government bureaucracy, and requires as much as $1,500 in application and licensing fees.

Those challenges were on display in a viral video captured on 9 September of a University of California, Berkeley, police officer citing a man selling a local favorite (bacon-wrapped hot dogs) outside a college football game.

“This is law and order in action,” the officer said as he removed $60 in cash from the wallet of the vendor. The money was taken as “evidence of the suspected proceeds of the violation”, the university explained amid an outcry from many of the millions who watched the video.



“People saw I wasn’t doing anything wrong,” the vendor said in a subsequent interview with Telemundo, in which he asked to be identified as Beto. “I wasn’t stealing or drinking. I was just working to sustain my family.”

Beto is not alone in being targeted for doing on a small scale what other entrepreneurs have been hugely rewarded for doing on a large scale: skirting the rules. In May, a local sheriff’s department faced criticism after a deputy was photographed handcuffing a man who had been selling fruit without a permit on a street corner. In 2016, a Silicon Valley software CEO faced criticism (and subsequently apologized) after he threatened to “do whatever it took” to chase off unauthorized fruit sellers from a tony neighborhood – including “destroying some of their produce”.

Meanwhile, the region’s tech industry has fetishized certain entrepreneurs’ willingness to “disrupt” the petty regulations that hold less savvy businesspeople back. While the former Uber CEO Travis Kalanick’s wallet was stuffed with billions by venture capitalists eager to invest in his unlicensed taxi cabs, Beto’s wallet was emptied for no greater a violation of the law.

What’s ironic about the disconnect between these entrepreneurs and the ones who are able to cash in with VCs is that so many of the internet era’s most successful startups have succeeded by monopolizing a previously informal – and frequently illicit – sector of the economy. Think Uber for unlicensed cabs, eBay for garage sales, Airbnb for unauthorized boarding houses and subletters, and StubHub for ticket scalpers.

Small business owners still trying to make a go of it in sectors dominated by those tech monopolists find themselves facing what can feel like an uneven playing field.

Facebook Twitter Pinterest Omar Algahim works at a corner store in San Francisco’s Tenderloin. Photograph: Julia Carrie Wong/The Guardian

“As Uber effects the cabs, these other companies affect us,” said Omar Algahim, who works 12 hour days seven days a week at a corner store in San Francisco’s low-income Tenderloin neighborhood. “It’s much easier for people to order with the app than come to the store.”

Algahim’s store is packed floor to ceiling with your standard corner-store fare: beverages, non-perishable groceries and items such as homemade pickles, individual hard boiled eggs, incense sticks, single Tootsie Rolls and winter gloves. But most of the customers are looking for a couple of loose cigarettes, which Algahim hands over for $1.

Algahim is not worried about the glorified vending machines that a pair of ex-Googlers have branded as “Bodegas” so much as the plethora of VC-backed delivery services, which he says cut into his earnings by operating without the overhead of rent, a tobacco license, and the big-ticket item: a liquor license (he said he had paid $100,000 for his).

“These guys deliver beer and wine and liquor for free,” he said. “No license, no rent, that’s it: easy. I’m proud of these companies. I’m proud that this area is the technology center of the world, but it’s really hard.”

Not every startup is playing by a different rule book than the small-time immigrant business owners. Joseph Lai, a former Yelp product manager, was set up in a parking lot near the LinkedIn headquarters in San Francisco on a recent afternoon, with a stack of pre-ordered lunch boxes. Lai is the founder of Bento Club, a company he started to bring the authentic Asian cuisine of the city’s outlying neighborhoods to office workers downtown.

With a permit to make deliveries, Lai is allowed to distribute his boxes from the back of his car to people who have ordered them, but he’s not allowed to sell them to passersby – a restriction he was chafing at, but not defying.

“It’s not like I did this the Uber way,” Lai said. But that didn’t stop him from empathizing with Beto and other low-income food vendors. “I feel for them. They can’t follow the rules because they can’t afford it. The margins are too thin.”

As a former tech company employee – and someone with experience raising venture capital if needed – Lai was aware that he was working with certain advantages.

“I have an accountant,” he pointed out. “I don’t think cops will come and take away my money.

“Fingers crossed.”