7 ms·

I opened a charming neighborhood coffee shop. Then it destroyed my life.

186 points by peter123 18y ago

dmix 18y ago
A new reference article for those who want to know the difference between a startup and a small business?
- JacobAldridge 18y ago
  I'm wondering what you see the difference as? For me, every start-up is a small business (with various size visions), and every small business is a start-up. Is it the size of the vision? (ie, a boutique cafe will only ever be small, while a start-up might be valued at $15B) Or is it the difference between leveraging effort rather than leveraging scalable code?
  - cperciva 18y ago
    I think PG describes the distinction quite well: To be a startup, a company has to be a product business, not a service business. By which I mean not that it has to make something physical, but that it has to have one thing it sells to many people, rather than doing custom work for individual clients. Custom work doesn't scale. To be a startup you need to be the band that sells a million copies of a song, not the band that makes money by playing at individual weddings and bar mitzvahs. -- http://www.paulgraham.com/startupfunding.html http://www.paulgraham.com/startupfunding.html
    - ojbyrne 18y ago
      I understand the distinction, but bands haven't turned out to be the best analogy. Thanks to P2P, etc, most bands now make little from CD sales, and have to pin their hopes on touring and merchandising - things that look a lot like "playing individual weddings and bar mitzvahs." And there was always the Grateful Dead, and Phish, The Black Crowes, etc, etc, which build a loyal following through their concerts, and encourage taping, thus in essence giving away millions of copies of their songs in order to promote their concerts and merchandise. Likewise, for startups, the distinction isn't always that cut and dry. If you're an Oracle or a Salesforce.com (both of which were once startups) you probably had to do customization for every one of your first n clients in order to make the sale. I think there are obviously businesses that let you scale easily, and ones that don't, and the quote above is a good starting point, but it's not a 100% clear line. And often what looks like a scalable business turns out not to be so, and vice-versa.
      - captainobvious 18y ago
        I think you may have missed the point. Playing a wedding or bar mitzvah is custom work on contract with a single client who to some extent directly dictates your set list, etc. Playing a giant stadium concert is you putting out your product and thousands of individuals autonomously buying in.
        ojbyrne 18y ago
        I'm just trying to muddy the point. Most of those bands playing giant stadium concerts started out playing maybe not bar mitzvahs, but small clubs, and doing cover songs. The distinction between products and services is not as clearcut as pg describes.
        alexbosworth 18y ago
        yeah, look at starbucks - they offer a service, but they've standardized the experience and packaged it into a product. I think the key is replication, not service.
  - emmett 18y ago
    I was talking to Justin recently, and he gave the most succinct definition I've heard: A startup is a business aiming for a liquidity event. Edit: Reading the responses to this, people clearly got the wrong idea. A liquidity event != early acquisition. But every successful startup nonetheless hits liquidity: acquisition, IPO, or substantial dividend payment to its shareholders. And that's a distinction between a successful startup and a successful small business, which are not intended to achieve liquidity.
    - sho 18y ago
      Succinct but definitely not universal. Like seemingly everyone else here, I'm a startup founder, and I did it because I thought what I created needed to exist. A "liquidity event" (god I hate that term) might be possible but it's not the driving force. If someone offered me a huge sum of money, I might be tempted, but I'd just take that money and work on the next thing I considered needs to exist! I don't think people obsessed with the goal of money beyond anything else create startups, although they might find great riches as a result of their efforts. If money was the only thing in my life I'd probably have tried to found an investment fund or a real estate company or something. Sorry to talk about myself here but in such things one can only really refer to one's own experience.
      - sachinag 18y ago
        If you'd take the money (and if you have clients it's really hard to take the money because they hired you) and you'd start the next thing, you're the perfect startup founder.
    - Agathos 18y ago
      That's a popular one, but I find it so depressing. Here you've quit your job and thrown yourself into something you believe in, and from the first day you're thinking about how you'll unload it?
      - gravitycop 18y ago
        I think the idea of startupism, or startup mentality, is that one believes most of all in starting things - kicking off great ideas - rather than being a shopkeeper. There are other people who like being shopkeepers. Let them run it after you've created and tamed it for them, so you can be free to kick off other great ideas - or to help new entrepreneurs do it.
ojbyrne 18y ago
Kind of old. I enjoyed the article (and realized that coffee shop == lifestyle business) when I first read it back in 2005.
TooMuchNick 18y ago
This also answers my longest-standing question about cafes: Why are there so few fun ones? San Francisco's Valencia Street (with its immediate offshoots) supports hundreds of interesting businesses. Many of them are cafes. Only two of those cafes are any good: Ritual Roasters, and Four Barrel. Four Barrel was founded last year by a disgruntled co-founder of Ritual. While the rest of Valencia's cafes are grimy, poorly lit, deathly quiet, or all of the above, RR and FB are sunny, friendly, and loud. That noise is all the foot traffic (and some David Bowie). The people sitting in Ritual for five hours on a laptop aren't paying the (staggeringly high) rent. It's the constant in-and-out of to-go cups. Mercifully, Four Barrel has no wifi and thus a more talkative, flowing crowd. Ironically, because RR and FB have coffee that makes people come and go quickly, they can afford to make a pleasant space for people who stick around. Their solution to cafe economics was to make their own high-markup product. Of course there are other solutions. Cafe du Soleil in the Lower Haight offers an extensive sandwich menu and gets its baked goods as part of a chain of boutique cafes and restaurants called the Bay Bread Group, which also sells bread to bigger clients like the Ritz Carlton. For all I know, Soleil is riding on the profits of the Bay Bread Group as an indulgent loss leader. But I suppose there's a lesson there for any startup with a boutique aspect: Make your own supplies, and you might have a business plan to support your dream. In a way, wasn't that the model for Reddit and Justin.tv?
- silencio 18y ago
  Honestly I think it's a location thing. Valencia Street is a place where interesting businesses would exist..I've always been intrigued at the kind of businesses I see when I visit friends in the area. From personal experience (I've been in the market for coffee shop businesses of all types in Los Angeles for a couple years - from family owned tiny mom and pop stores to franchises), it's all about the location unless you have a lot of hype and if you have both even better. Anyone can start a coffee shop and stock their display cases with local/well known bakeries and coffee providers, but you need all kinds of customers (both the people who occupy a table with only a $1 cup of coffee all day long and the people who rush in and out, both something you can't get if you are badly-situated) and not just a little something extra. The latter is typically a way to get people to come to your store rather than another close by, or a little perk for your customers so they'll return later. Plus, there's always Starbucks and Coffee Bean and Peet's to deal with...sigh.
pj 18y ago
Funny how the last line of the article says, Looking back, we (incredibly) should have heeded the advice of bad-boy chef Anthony Bourdain, who wrote our epitaph in Kitchen Confidential: "The most dangerous species of owner ... is the one who gets into the business for love." This in spite of recent conversations here discussing "doing what you love": http://news.ycombinator.com/item?id=449295 http://news.ycombinator.com/item?id=449295, http://news.ycombinator.com/item?id=449457 http://news.ycombinator.com/item?id=449457 Why didn't doing it for love work for the author? I suppose if I were to answer the question myself, I'd say either a) they didn't love it enough. or b) They did some bad math. Why not just sell the crossiants for $3? Why not sell the cold house coffee for $3 instead of $1? Raise the price, let your customers keep you alive. If they like what you have to offer, they will. If their dream was to open a coffee shop, why /not/ work there full time? Why not make it work? Other coffee shops have figured out the formula and do survive. Maybe their owners loved it more? Every business struggles in the beginning. Do /not/ give up. Keep going. If your formula isn't working, tweak it. Don't close up shop. That's what you don't do if you love what you do. You don't give up on something you love. You can't.
- patio11 18y ago
  Raise the price, let your customers keep you alive. I nominate this advice for being tattooed onto the forehead of web startups. I heard something about a spot of trouble in the market, CPMs in freefall, waily waily waily? What if we stopped trying to be all things to all people for nothing and instead tried being pain relief to people who are familiar with the notion of paying money for that? (I, for one, am raising prices in February, because I've been undercharging for years now. Silly me.)
  - mhartl 18y ago
    One problem: coffee shops are a competitive business. This makes their owners what economists call "price takers". It makes them what the rest of us call "bankrupt".
    - nostrademons 18y ago
lallysingh 18y ago
Maybe I'll do this later, but I always wanted to open up a hacker's place. I'd call it the Bit Bucket. Part bookstore (~50 titles, classics only - W. Richard Stevens, etc.), part coffee shop, part decent hardware shop (FPGAs, GPGPU, blade servers, and half & full-height rackmounts you can convince your S.O. to let you put in the basement), and bar. Also, a good selection of little parts that you'd normally have to ebay, a little selection of RAM, heat sinks, PCI cover plates, etc. I'd put it in a display where you'd normally see the baked goods. I'd have no illusions of being profitable at this, but it'll give me something to do when I retire :-)
- russell 18y ago
  Sounds like a smaller version of the first Fry's Electronics: http://en.wikipedia.org/wiki/Fry%27s_Electronics http://en.wikipedia.org/wiki/Fry%27s_Electronics They did OK.
  - brk 18y ago
    Just be wary of employees that have a suite named after them at a Vegas hotel.
    - sadiq 18y ago
      Is that a general reference or something specific to frys? Could you elaborate more?
      - bmelton 18y ago
        From the linked wiki: "In 2008, Fry's vice president of merchandising and operations, Ausuf Umar Siddiqui, was charged by federal prosecutors in an illegal kick back scheme involving Fry's vendors. The alleged scheme was designed to defraud the company in order to cover Siddiqui's gambling expenses"
      - russell 18y ago
        IIRC He embezzled something like $65 million in kickbacks from suppliers.
derefr 18y ago
I'm a writer. I go to coffee shops, sit there, and drink as little coffee as possible, staring into my little book while taking up a table and spraying a Cone of Introverted Quiet everywhere I turn. I am the bane of the regular coffee shop. But what if there were a shop that tailored their business model to me? Instead of charging for food or drink, and then letting you have the space for free, how about switching the two? Charge for the table by the hour (or with a monthly subscription), and then have free little snacks and drinks to go along with the seat. Limit customers to those with a creative/insightful streak (yes, get resumes), and disallow anyone from sitting alone or ignoring the people next to them for more than ten minutes. Perhaps even invite famously loquacious people to hang out there (in the exact same way as the regular patrons do.) Thus is born a sort of "idea club"--like TED, but every day, and peer-to-peer instead of multicast. On the same vein, don't buy newspapers (or anything else topical) for reading material; buy hardcover books, fiction and non-. Require that people read them out loud if they're reading (thus, basically, giving a reading of the book to whoever's nearby.) Don't have a wi-fi connection; do have a "room librarian" that will look up the answers to questions on a hard line, and is ready to explain the answers in detail. And so on.
- dkokelley 18y ago
  I like the idea of charging per table and letting the drinks and snacks be free, but I think encouraging and/or forcing a particular 'cozy' environment would be a bad idea. As a college student I like to go to coffee shops to study. It's a great way to get out of the house, maybe meet people, and get stuff done. I always buy something there but I feel bad because I believe I stay (with my laptop on the shop's free wifi) for a long time - probably costing more than I've contributed with my purchase. I would gladly pay a monthly membership fee and pop in and out knowing that I'll get whatever I'm in the mood for without any more expense. In fact, I would probably end up paying more for the 'free' drinks because I wouldn't show up enough to take advantage of the free food. I wouldn't like it if there was no wifi or if the rules about talking to people and reading out loud were enforced. Of course customers could still be screened somehow. A membership card could be swiped or scanned for the drinks (maybe even tracked) and an ID and password for the wifi would keep the freeloaders away, and if any customer becomes too unprofitable (too many drinks or slipping drinks to friends) their membership could be easily canceled.
mschwar99 18y ago
As someone who opened a similar business I thought that the ratios that were listed as rules of thumb were failry on target with my experience, but the statement "If you haven't hit the latter mark in a month, close" was crazy. 1.) Your potential customers are creatures of habit and it takes time to change their traffic patterns. Your grand opening is your biggest splash and a key time to get attention, but getting return customers is a struggle to reshape their patterns. 2.) A new business should ideally be properly capitalized to slug out way more than a month. Not only does it take time to get people in the door but it takes you and your staff more than a month to adjust to the unexpected, get your act together, and polish your product. If your new business is going to be your only stream of income you need capital available before going in to stretch more than a month. This piece of planning is every bit as important as the name on your shingle. Opening a new and not yet profitable business does suck up your whole life, but if you succeed that doesn't have to last forever. Its after this initial "slugging it out" time period that you can reclaim your life.
wallflower 18y ago
My friend and I would probably open an independent bookstore if we had no cares about making money.
callmeed 18y ago
I'm glad he quotes Bourdain. Kitchen Confidential is a great book and convinced me never to open a restaurant-even though cooking is my 3rd passion (behind hacking and photography)
stuntgoat 18y ago
Coffee shops fail because of poor management and/or poor quality. 4Barrel and Ritual succeed because they are quality focused. If you are a coffee shop- roast and brew the best coffee possible; this takes love, work, and an interest in coffee. Owners of successful coffee shops like the ones mentioned try to roast and brew the best coffee that they can. The author must not have set themselves apart from other coffee businesses in terms of quality; either that, or poor management. If you have quality and capable management it would be hard to fail. Defining coffee quality is beyond the scope of this site- methinks. ( basically, it is buying great green coffees, roasting them very well( don't burn them!), brewing them as best as you can( French Press or something without paper( and often (every 30-45 minutes))), having staff that care about keeping the quality standards ( good luck with that one!!), and thinking: about how to have better quality and be more efficient). Actually, it is fairly easy.
rms 18y ago
First time a story is #1 on HN and reddit at the same time?
deleted 18y ago
[deleted]
TweedHeads 18y ago
Forget romance, go for the money. Love what you do, but love money much more.
gcv 18y ago
"There are wealthy gentlemen in England who drive four-horse passenger-coaches twenty or thirty miles on a daily line, in the summer, because the privilege costs them considerable money; but if they were offered wages for the service, that would turn it into work and then they would resign." --- Mark Twain
socialtistics 18y ago
It is always easier to armchair quarterback people's stories like this, but I do see two problems that immediately stuck out at me. Success in business centers around execution and if you do not execute effectively you are bound to fail. In the first paragraph the guy says "The one that, as you calmly and correctly observed, was doomed from its inception because it was too precious and too offbeat?" As a business owner if my customers were telling me I was "doomed" I would be working to change that perception. If a potential long-term customer sees your business as doomed from the start, he or she is probably going to resist going to your business by instinct. This can be especially true in the restaurant business and even more so with coffee shops. People are creatures of habit and tend to go places they like and enjoy. If you want people to come to your coffee shop it is going to take time (more than a month). If they do stop in and feel as if your business is doomed then what incentive do they have to come back again? The second problem I see here is this guy had a dream and in that dream there was a part where he would open the shop and there would be immediate success. Not success earned by time and through customer loyalty. He expected the success of opening the doors and having people rushing in. Starting a new business takes time and, as others have said, a savings available to handle the rough times and starting period. This is especially so with restaurants and probably more so with coffee houses. Expenses are going to be high between rent, payroll, and food expenses. If you can't afford to handle these without a single customer walking in the door for a month or two your chances of success are instantly diminished. The final problem I see is this guy was not open to changing his pricing. His solution was to go with the cheaper product rather than raise his prices. It is a known fact that people will pay more for a better product, but they aren't going to pay the same for a cheaper product. I surely wouldn't buy a Kia at a BMW price. While I feel sorry for this guy and at the same time give him credit for trying, I do not feel as if he put enough thought into the business, gave it enough time, and surely was not familiar with the management side of running a restaurant. Sadly he learned the hard way and now his life is destroyed.
chadmalik 18y ago
One thing that annoys me about coffee shops is how unfriendly people are. Mostly peering into laptops. I'd like to go to a coffee shop where people go explicitly to engage in interesting/random conversation with strangers.
- blhack 18y ago
  Some of the best conversations I've ever had with people at coffee shops have started because of laptops. "Whoa, is that one of those XO laptops? Do you like it? Can I try?"
acangiano 18y ago
I think these people lacked business sense. You are not selling coffee, you are selling an experience. Most people go to Starbucks for the experience they have there, the illusion of being refined members of society who can afford it. To feel cool among their peers. The coffee is an admission price. People with a laptop bothering you? How about providing a wi-fi service and charging for it instead? To distinguish yourself you want to have outrageous quality and markups. You want to target upper middle class people who don't mind spending $10 for a large cup of coffee and a couple of baked goods. Make your environment as nice as possible. Make the quality of your coffee as good as it can be. Be remarkable. Be well known for having the best coffee in your city, state, or even America. Make people want to drive 20 miles just to get there. Just opening another unremarkable little coffee shop doesn't make much sense. Opening the "Fat Duck" of coffee shops does.
- gaius 18y ago
  People go to Starbucks because once you've learnt Starbuckish you can order your coffee exactly how you like it anywhere. They're selling ubiquity. It's the same business as Subway, you can get your "unique" thing wherever you are. Brands that (successfully) go for "cool" you see people wearing their logo on their clothing and accessories and I don't recall seeing anyone who wasn't staff ever sporting a Starbucks logo. My regular Starbucks, where they know me and start making my drink as soon as I walk in, I go to because it's on my way home from work and it's open 24 hours. And Starbucks knew that there was this kind of consumer and that's why they're there. That's what they're selling.
sgman 18y ago
"The marriage has been saved by a well-timed bankruptcy." Probably the best quote I've heard in a while.
ssharp 18y ago
The author notes that he did not do this out of wanting to own a business. While I believe that, I also believe that many folks who start businesses do so out of the romantic idea of owning your own business. They may not love the business but they love the idea of owning the business. I think this generally happens with people who are nearing retirement and are looking for something to do when they are done with their 9-5. It's almost ALWAYS a bad idea. One of the common reasons for their efforts is that they want to leave something behind...either in their name or a business that can be passed on to their children. Why burden YOURSELF with the hassles of a business in your retirement years let alone make your children feel like they have to take over when you can no longer work? If there's one thing I'd like my parents to do in their retirement, it's nothing. Enjoy life. Relax. Travel. Play golf. Show me see how enjoyable my retirement years can be.
awt 18y ago
I tried to open a neigborhood grociery store. It didn't destroy my life, but I did lose a lot of respect for the local city officials. Imagine if you wanted to start a website, but you couldn't work from your home on it because your home didn't have an ADA compliant restroom.

186 points by peter123 18y ago

dmix 18y ago

A new reference article for those who want to know the difference between a startup and a small business?

JacobAldridge 18y ago
I'm wondering what you see the difference as? For me, every start-up is a small business (with various size visions), and every small business is a start-up. Is it the size of the vision? (ie, a boutique cafe will only ever be small, while a start-up might be valued at $15B) Or is it the difference between leveraging effort rather than leveraging scalable code?
- cperciva 18y ago
  I think PG describes the distinction quite well: To be a startup, a company has to be a product business, not a service business. By which I mean not that it has to make something physical, but that it has to have one thing it sells to many people, rather than doing custom work for individual clients. Custom work doesn't scale. To be a startup you need to be the band that sells a million copies of a song, not the band that makes money by playing at individual weddings and bar mitzvahs. -- http://www.paulgraham.com/startupfunding.html http://www.paulgraham.com/startupfunding.html
  - ojbyrne 18y ago
    I understand the distinction, but bands haven't turned out to be the best analogy. Thanks to P2P, etc, most bands now make little from CD sales, and have to pin their hopes on touring and merchandising - things that look a lot like "playing individual weddings and bar mitzvahs." And there was always the Grateful Dead, and Phish, The Black Crowes, etc, etc, which build a loyal following through their concerts, and encourage taping, thus in essence giving away millions of copies of their songs in order to promote their concerts and merchandise. Likewise, for startups, the distinction isn't always that cut and dry. If you're an Oracle or a Salesforce.com (both of which were once startups) you probably had to do customization for every one of your first n clients in order to make the sale. I think there are obviously businesses that let you scale easily, and ones that don't, and the quote above is a good starting point, but it's not a 100% clear line. And often what looks like a scalable business turns out not to be so, and vice-versa.
    - captainobvious 18y ago
      I think you may have missed the point. Playing a wedding or bar mitzvah is custom work on contract with a single client who to some extent directly dictates your set list, etc. Playing a giant stadium concert is you putting out your product and thousands of individuals autonomously buying in.
      - ojbyrne 18y ago
        I'm just trying to muddy the point. Most of those bands playing giant stadium concerts started out playing maybe not bar mitzvahs, but small clubs, and doing cover songs. The distinction between products and services is not as clearcut as pg describes.
        alexbosworth 18y ago
        yeah, look at starbucks - they offer a service, but they've standardized the experience and packaged it into a product. I think the key is replication, not service.
- emmett 18y ago
  I was talking to Justin recently, and he gave the most succinct definition I've heard: A startup is a business aiming for a liquidity event. Edit: Reading the responses to this, people clearly got the wrong idea. A liquidity event != early acquisition. But every successful startup nonetheless hits liquidity: acquisition, IPO, or substantial dividend payment to its shareholders. And that's a distinction between a successful startup and a successful small business, which are not intended to achieve liquidity.
  - sho 18y ago
    Succinct but definitely not universal. Like seemingly everyone else here, I'm a startup founder, and I did it because I thought what I created needed to exist. A "liquidity event" (god I hate that term) might be possible but it's not the driving force. If someone offered me a huge sum of money, I might be tempted, but I'd just take that money and work on the next thing I considered needs to exist! I don't think people obsessed with the goal of money beyond anything else create startups, although they might find great riches as a result of their efforts. If money was the only thing in my life I'd probably have tried to found an investment fund or a real estate company or something. Sorry to talk about myself here but in such things one can only really refer to one's own experience.
    - sachinag 18y ago
      If you'd take the money (and if you have clients it's really hard to take the money because they hired you) and you'd start the next thing, you're the perfect startup founder.
  - Agathos 18y ago
    That's a popular one, but I find it so depressing. Here you've quit your job and thrown yourself into something you believe in, and from the first day you're thinking about how you'll unload it?
    - gravitycop 18y ago
      I think the idea of startupism, or startup mentality, is that one believes most of all in starting things - kicking off great ideas - rather than being a shopkeeper. There are other people who like being shopkeepers. Let them run it after you've created and tamed it for them, so you can be free to kick off other great ideas - or to help new entrepreneurs do it.

ojbyrne 18y ago

Kind of old. I enjoyed the article (and realized that coffee shop == lifestyle business) when I first read it back in 2005.

TooMuchNick 18y ago

This also answers my longest-standing question about cafes: Why are there so few fun ones? San Francisco's Valencia Street (with its immediate offshoots) supports hundreds of interesting businesses. Many of them are cafes. Only two of those cafes are any good: Ritual Roasters, and Four Barrel. Four Barrel was founded last year by a disgruntled co-founder of Ritual. While the rest of Valencia's cafes are grimy, poorly lit, deathly quiet, or all of the above, RR and FB are sunny, friendly, and loud. That noise is all the foot traffic (and some David Bowie). The people sitting in Ritual for five hours on a laptop aren't paying the (staggeringly high) rent. It's the constant in-and-out of to-go cups. Mercifully, Four Barrel has no wifi and thus a more talkative, flowing crowd. Ironically, because RR and FB have coffee that makes people come and go quickly, they can afford to make a pleasant space for people who stick around. Their solution to cafe economics was to make their own high-markup product. Of course there are other solutions. Cafe du Soleil in the Lower Haight offers an extensive sandwich menu and gets its baked goods as part of a chain of boutique cafes and restaurants called the Bay Bread Group, which also sells bread to bigger clients like the Ritz Carlton. For all I know, Soleil is riding on the profits of the Bay Bread Group as an indulgent loss leader. But I suppose there's a lesson there for any startup with a boutique aspect: Make your own supplies, and you might have a business plan to support your dream. In a way, wasn't that the model for Reddit and Justin.tv?

silencio 18y ago
Honestly I think it's a location thing. Valencia Street is a place where interesting businesses would exist..I've always been intrigued at the kind of businesses I see when I visit friends in the area. From personal experience (I've been in the market for coffee shop businesses of all types in Los Angeles for a couple years - from family owned tiny mom and pop stores to franchises), it's all about the location unless you have a lot of hype and if you have both even better. Anyone can start a coffee shop and stock their display cases with local/well known bakeries and coffee providers, but you need all kinds of customers (both the people who occupy a table with only a $1 cup of coffee all day long and the people who rush in and out, both something you can't get if you are badly-situated) and not just a little something extra. The latter is typically a way to get people to come to your store rather than another close by, or a little perk for your customers so they'll return later. Plus, there's always Starbucks and Coffee Bean and Peet's to deal with...sigh.

pj 18y ago

Funny how the last line of the article says, Looking back, we (incredibly) should have heeded the advice of bad-boy chef Anthony Bourdain, who wrote our epitaph in Kitchen Confidential: "The most dangerous species of owner ... is the one who gets into the business for love." This in spite of recent conversations here discussing "doing what you love": http://news.ycombinator.com/item?id=449295 http://news.ycombinator.com/item?id=449295, http://news.ycombinator.com/item?id=449457 http://news.ycombinator.com/item?id=449457 Why didn't doing it for love work for the author? I suppose if I were to answer the question myself, I'd say either a) they didn't love it enough. or b) They did some bad math. Why not just sell the crossiants for $3? Why not sell the cold house coffee for $3 instead of $1? Raise the price, let your customers keep you alive. If they like what you have to offer, they will. If their dream was to open a coffee shop, why /not/ work there full time? Why not make it work? Other coffee shops have figured out the formula and do survive. Maybe their owners loved it more? Every business struggles in the beginning. Do /not/ give up. Keep going. If your formula isn't working, tweak it. Don't close up shop. That's what you don't do if you love what you do. You don't give up on something you love. You can't.

patio11 18y ago
Raise the price, let your customers keep you alive. I nominate this advice for being tattooed onto the forehead of web startups. I heard something about a spot of trouble in the market, CPMs in freefall, waily waily waily? What if we stopped trying to be all things to all people for nothing and instead tried being pain relief to people who are familiar with the notion of paying money for that? (I, for one, am raising prices in February, because I've been undercharging for years now. Silly me.)
- mhartl 18y ago
  One problem: coffee shops are a competitive business. This makes their owners what economists call "price takers". It makes them what the rest of us call "bankrupt".
  - nostrademons 18y ago

lallysingh 18y ago

Maybe I'll do this later, but I always wanted to open up a hacker's place. I'd call it the Bit Bucket. Part bookstore (~50 titles, classics only - W. Richard Stevens, etc.), part coffee shop, part decent hardware shop (FPGAs, GPGPU, blade servers, and half & full-height rackmounts you can convince your S.O. to let you put in the basement), and bar. Also, a good selection of little parts that you'd normally have to ebay, a little selection of RAM, heat sinks, PCI cover plates, etc. I'd put it in a display where you'd normally see the baked goods. I'd have no illusions of being profitable at this, but it'll give me something to do when I retire :-)

russell 18y ago
Sounds like a smaller version of the first Fry's Electronics: http://en.wikipedia.org/wiki/Fry%27s_Electronics http://en.wikipedia.org/wiki/Fry%27s_Electronics They did OK.
- brk 18y ago
  Just be wary of employees that have a suite named after them at a Vegas hotel.
  - sadiq 18y ago
    Is that a general reference or something specific to frys? Could you elaborate more?
    - bmelton 18y ago
      From the linked wiki: "In 2008, Fry's vice president of merchandising and operations, Ausuf Umar Siddiqui, was charged by federal prosecutors in an illegal kick back scheme involving Fry's vendors. The alleged scheme was designed to defraud the company in order to cover Siddiqui's gambling expenses"
    - russell 18y ago
      IIRC He embezzled something like $65 million in kickbacks from suppliers.

derefr 18y ago

I'm a writer. I go to coffee shops, sit there, and drink as little coffee as possible, staring into my little book while taking up a table and spraying a Cone of Introverted Quiet everywhere I turn. I am the bane of the regular coffee shop. But what if there were a shop that tailored their business model to me? Instead of charging for food or drink, and then letting you have the space for free, how about switching the two? Charge for the table by the hour (or with a monthly subscription), and then have free little snacks and drinks to go along with the seat. Limit customers to those with a creative/insightful streak (yes, get resumes), and disallow anyone from sitting alone or ignoring the people next to them for more than ten minutes. Perhaps even invite famously loquacious people to hang out there (in the exact same way as the regular patrons do.) Thus is born a sort of "idea club"--like TED, but every day, and peer-to-peer instead of multicast. On the same vein, don't buy newspapers (or anything else topical) for reading material; buy hardcover books, fiction and non-. Require that people read them out loud if they're reading (thus, basically, giving a reading of the book to whoever's nearby.) Don't have a wi-fi connection; do have a "room librarian" that will look up the answers to questions on a hard line, and is ready to explain the answers in detail. And so on.

dkokelley 18y ago
I like the idea of charging per table and letting the drinks and snacks be free, but I think encouraging and/or forcing a particular 'cozy' environment would be a bad idea. As a college student I like to go to coffee shops to study. It's a great way to get out of the house, maybe meet people, and get stuff done. I always buy something there but I feel bad because I believe I stay (with my laptop on the shop's free wifi) for a long time - probably costing more than I've contributed with my purchase. I would gladly pay a monthly membership fee and pop in and out knowing that I'll get whatever I'm in the mood for without any more expense. In fact, I would probably end up paying more for the 'free' drinks because I wouldn't show up enough to take advantage of the free food. I wouldn't like it if there was no wifi or if the rules about talking to people and reading out loud were enforced. Of course customers could still be screened somehow. A membership card could be swiped or scanned for the drinks (maybe even tracked) and an ID and password for the wifi would keep the freeloaders away, and if any customer becomes too unprofitable (too many drinks or slipping drinks to friends) their membership could be easily canceled.

mschwar99 18y ago

As someone who opened a similar business I thought that the ratios that were listed as rules of thumb were failry on target with my experience, but the statement "If you haven't hit the latter mark in a month, close" was crazy. 1.) Your potential customers are creatures of habit and it takes time to change their traffic patterns. Your grand opening is your biggest splash and a key time to get attention, but getting return customers is a struggle to reshape their patterns. 2.) A new business should ideally be properly capitalized to slug out way more than a month. Not only does it take time to get people in the door but it takes you and your staff more than a month to adjust to the unexpected, get your act together, and polish your product. If your new business is going to be your only stream of income you need capital available before going in to stretch more than a month. This piece of planning is every bit as important as the name on your shingle. Opening a new and not yet profitable business does suck up your whole life, but if you succeed that doesn't have to last forever. Its after this initial "slugging it out" time period that you can reclaim your life.

wallflower 18y ago

My friend and I would probably open an independent bookstore if we had no cares about making money.

callmeed 18y ago

I'm glad he quotes Bourdain. Kitchen Confidential is a great book and convinced me never to open a restaurant-even though cooking is my 3rd passion (behind hacking and photography)

stuntgoat 18y ago

Coffee shops fail because of poor management and/or poor quality. 4Barrel and Ritual succeed because they are quality focused. If you are a coffee shop- roast and brew the best coffee possible; this takes love, work, and an interest in coffee. Owners of successful coffee shops like the ones mentioned try to roast and brew the best coffee that they can. The author must not have set themselves apart from other coffee businesses in terms of quality; either that, or poor management. If you have quality and capable management it would be hard to fail. Defining coffee quality is beyond the scope of this site- methinks. ( basically, it is buying great green coffees, roasting them very well( don't burn them!), brewing them as best as you can( French Press or something without paper( and often (every 30-45 minutes))), having staff that care about keeping the quality standards ( good luck with that one!!), and thinking: about how to have better quality and be more efficient). Actually, it is fairly easy.

rms 18y ago

First time a story is #1 on HN and reddit at the same time?

deleted 18y ago

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TweedHeads 18y ago

Forget romance, go for the money. Love what you do, but love money much more.

gcv 18y ago

"There are wealthy gentlemen in England who drive four-horse passenger-coaches twenty or thirty miles on a daily line, in the summer, because the privilege costs them considerable money; but if they were offered wages for the service, that would turn it into work and then they would resign." --- Mark Twain

socialtistics 18y ago

It is always easier to armchair quarterback people's stories like this, but I do see two problems that immediately stuck out at me. Success in business centers around execution and if you do not execute effectively you are bound to fail. In the first paragraph the guy says "The one that, as you calmly and correctly observed, was doomed from its inception because it was too precious and too offbeat?" As a business owner if my customers were telling me I was "doomed" I would be working to change that perception. If a potential long-term customer sees your business as doomed from the start, he or she is probably going to resist going to your business by instinct. This can be especially true in the restaurant business and even more so with coffee shops. People are creatures of habit and tend to go places they like and enjoy. If you want people to come to your coffee shop it is going to take time (more than a month). If they do stop in and feel as if your business is doomed then what incentive do they have to come back again? The second problem I see here is this guy had a dream and in that dream there was a part where he would open the shop and there would be immediate success. Not success earned by time and through customer loyalty. He expected the success of opening the doors and having people rushing in. Starting a new business takes time and, as others have said, a savings available to handle the rough times and starting period. This is especially so with restaurants and probably more so with coffee houses. Expenses are going to be high between rent, payroll, and food expenses. If you can't afford to handle these without a single customer walking in the door for a month or two your chances of success are instantly diminished. The final problem I see is this guy was not open to changing his pricing. His solution was to go with the cheaper product rather than raise his prices. It is a known fact that people will pay more for a better product, but they aren't going to pay the same for a cheaper product. I surely wouldn't buy a Kia at a BMW price. While I feel sorry for this guy and at the same time give him credit for trying, I do not feel as if he put enough thought into the business, gave it enough time, and surely was not familiar with the management side of running a restaurant. Sadly he learned the hard way and now his life is destroyed.

chadmalik 18y ago

One thing that annoys me about coffee shops is how unfriendly people are. Mostly peering into laptops. I'd like to go to a coffee shop where people go explicitly to engage in interesting/random conversation with strangers.

blhack 18y ago
Some of the best conversations I've ever had with people at coffee shops have started because of laptops. "Whoa, is that one of those XO laptops? Do you like it? Can I try?"

acangiano 18y ago

I think these people lacked business sense. You are not selling coffee, you are selling an experience. Most people go to Starbucks for the experience they have there, the illusion of being refined members of society who can afford it. To feel cool among their peers. The coffee is an admission price. People with a laptop bothering you? How about providing a wi-fi service and charging for it instead? To distinguish yourself you want to have outrageous quality and markups. You want to target upper middle class people who don't mind spending $10 for a large cup of coffee and a couple of baked goods. Make your environment as nice as possible. Make the quality of your coffee as good as it can be. Be remarkable. Be well known for having the best coffee in your city, state, or even America. Make people want to drive 20 miles just to get there. Just opening another unremarkable little coffee shop doesn't make much sense. Opening the "Fat Duck" of coffee shops does.

gaius 18y ago
People go to Starbucks because once you've learnt Starbuckish you can order your coffee exactly how you like it anywhere. They're selling ubiquity. It's the same business as Subway, you can get your "unique" thing wherever you are. Brands that (successfully) go for "cool" you see people wearing their logo on their clothing and accessories and I don't recall seeing anyone who wasn't staff ever sporting a Starbucks logo. My regular Starbucks, where they know me and start making my drink as soon as I walk in, I go to because it's on my way home from work and it's open 24 hours. And Starbucks knew that there was this kind of consumer and that's why they're there. That's what they're selling.

sgman 18y ago

"The marriage has been saved by a well-timed bankruptcy." Probably the best quote I've heard in a while.

ssharp 18y ago

The author notes that he did not do this out of wanting to own a business. While I believe that, I also believe that many folks who start businesses do so out of the romantic idea of owning your own business. They may not love the business but they love the idea of owning the business. I think this generally happens with people who are nearing retirement and are looking for something to do when they are done with their 9-5. It's almost ALWAYS a bad idea. One of the common reasons for their efforts is that they want to leave something behind...either in their name or a business that can be passed on to their children. Why burden YOURSELF with the hassles of a business in your retirement years let alone make your children feel like they have to take over when you can no longer work? If there's one thing I'd like my parents to do in their retirement, it's nothing. Enjoy life. Relax. Travel. Play golf. Show me see how enjoyable my retirement years can be.

awt 18y ago

I tried to open a neigborhood grociery store. It didn't destroy my life, but I did lose a lot of respect for the local city officials. Imagine if you wanted to start a website, but you couldn't work from your home on it because your home didn't have an ADA compliant restroom.