3 ms·

> Or, some businesses are just not worth it. > You can throw as much business intelligence and automation to, let's say, an Ice Cream truck. It will still be an

> Or, some businesses are just not worth it. > You can throw as much business intelligence and automation to, let's say, an Ice Cream truck. It will still be an Ice Cream truck. Nobody is becoming a millionaire with it. That's probably what people said about coffee and cafes prior to Starbucks.

guiriduro 6y ago
Starbucks is an essentially American phenomenon. e.g., nobody in Europe ever thought coffee shops needed to become branded chains that set a single product quality expectation, because almost nobody who'd ever visited an Italian/mediterranean-style cafe ever thought they lacked a quality or sociability option to begin with. Sure, some chains exist, but the quality delta between them and the average cafe isn't great enough to scale fast. Only in a place where coffee is generally awful, and VC money easy, could the concept that became Starbucks ever come into existence.
- nmfisher 6y ago
  There's a whole lot factually wrong about your comment (Starbucks started as a single cafe, it wasn't funded by VC, and it started in the 70s/80s when money was far from cheap, and 1/3 of its total outlets are in Asia). But that's all beside the point. I'm not saying an Italian would be able to replicate Starbucks in Italy. What I'm saying is that there are countless opportunities staring us right in the face, every day, and 99% of people see a cafe and think "it can't scale, it's local demand only, there's no point, why bother", the remaining 1% see Starbucks.
wenc 6y ago
Just to follow up on that: I'm sure we agree that Starbucks metagame is about selling more than just beverages. It's about selling a middle-class aspiration -- using concepts like a "third place", "Italy", etc. This is why Starbucks is a $24b revenue company and Dunkin is a $1.4b revenue company. Luigi Zingales, an economist at UChicago, once said, "the fact that Starbucks is not Italian is hurtful. The extreme agency problems of Italy make it difficult to scale firms.".

guiriduro 6y ago

Starbucks is an essentially American phenomenon. e.g., nobody in Europe ever thought coffee shops needed to become branded chains that set a single product quality expectation, because almost nobody who'd ever visited an Italian/mediterranean-style cafe ever thought they lacked a quality or sociability option to begin with. Sure, some chains exist, but the quality delta between them and the average cafe isn't great enough to scale fast. Only in a place where coffee is generally awful, and VC money easy, could the concept that became Starbucks ever come into existence.

nmfisher 6y ago
There's a whole lot factually wrong about your comment (Starbucks started as a single cafe, it wasn't funded by VC, and it started in the 70s/80s when money was far from cheap, and 1/3 of its total outlets are in Asia). But that's all beside the point. I'm not saying an Italian would be able to replicate Starbucks in Italy. What I'm saying is that there are countless opportunities staring us right in the face, every day, and 99% of people see a cafe and think "it can't scale, it's local demand only, there's no point, why bother", the remaining 1% see Starbucks.

wenc 6y ago

Just to follow up on that: I'm sure we agree that Starbucks metagame is about selling more than just beverages. It's about selling a middle-class aspiration -- using concepts like a "third place", "Italy", etc. This is why Starbucks is a $24b revenue company and Dunkin is a $1.4b revenue company. Luigi Zingales, an economist at UChicago, once said, "the fact that Starbucks is not Italian is hurtful. The extreme agency problems of Italy make it difficult to scale firms.".