I held the content of this newsletter back in order to (mostly) ensure it coincided with Independent Bookstore Day, which happened last Saturday. I have been watching the turnaround story at Barnes & Noble closely over the past couple of years. Admittedly, I thought that B&N was doomed and the so-called turnaround would be a slow motion train wreck, but I have been proven wrong so far. Barnes & Noble’s turnaround shows that a successful large multi-location business keeping a local feel (by giving curation power to its local leaders) is a recipe for success. Pairing the Barnes & Noble story with a three-part story on PE’s involvement in the specialty coffee world (including a potentially promising new model for specialty coffee) just felt right. Books and coffee. What a combo!
Enjoy this week’s newsletter and please don’t miss the links in the “Still Curious?” section. There are some great ones including an interview on what it is like to be a software engineer with my friend, Taylor Hughes. Taylor is a very talented engineer and he is also very funny. It is a great interview and Taylor tells it like it is.
P.S. I ride the Best Buddies Challenge Hyannis Port every year to support the work Best Buddies does for folks with intellectual and developmental disabilities (IDD). Please consider donating to my 2025 campaign if you feel so inclined. The ride is about a month away and I sincerely appreciate any support you can provide. Thank you for investing in Best Buddies and being a part of Team Xcitebike!
What’s Interesting
+ Barnes & Noble, a bookstore, is back in the business of selling books - “Central park bisects upper Manhattan, creating two neighborhoods and, apparently, two reading cultures. On the Upper West Side, the New York Times is “a standout for us” in terms of driving book purchases, says Victoria Harty, assistant manager of the local branch of Barnes & Noble, America’s biggest bookstore chain. On the east side, meanwhile, customers prefer recommendations from the Washington Post and the Atlantic. Tables showcasing tailored recommendations greet west- and east-siders. Such curation is standard at independent bookshops but, for about a decade, was missing from Barnes & Noble, which modeled itself on more generic retailers, almost going bust in the process.”
+ Three part series on PE & specialty coffee
'Capitalism on Steroids': Private Equity and the Future of Specialty Coffee - “When was the last time that something ended up at the tail end of an obscene growth process, and [was] better than it's ever been?” asks Professor Roberts. “I'm not sure that at the end of the day, any singular experience with Blue Bottle will be made better because of the arrival of Nestlé.”
Private Equity vs. the Coffee Workers - “The workers, meanwhile, also carry on, understaffed and overworked—if they’re lucky enough to still be employed. “I’ve met other people in tech now that I’ve brushed up against that world, and they’re like, ‘Oh, yeah, that happens in tech all the time, you expect to get laid off in 18 months’—and how do you live like that? It’s taken me a year to process through this”, Apple says.”
Could a Private-Equity-Backed 'Collective' Offer a Template for Specialty Coffee’s Future? - “What if there were a different way—a way for small specialty coffee businesses to unite under one umbrella, and utilize their various assets to benefit the collective? What if there were a kind of investment that didn’t come with ruthless cost-cutting in pursuit of bigger margins, or pumping a company full of money to make it more attractive to even bigger investors? What if growth didn’t have to mean sacrificing the quality- and community-focused ethos of specialty coffee?”
Meditations
“Your mind will take the shape of what you frequently hold in thought, for the human spirit is colored by such impressions.” - Marcus Aurelius, Meditations, 5.16
Pair with this old Cherokee proverb:
A grandfather was teaching his grandson about life.
He said, "A fight is going on inside me," he told the young boy, "a fight between two wolves.”
“The Dark one is evil - he is anger, envy, sorrow, regret, greed, arrogance, self-pity, guilt, resentment, inferiority, lies, false pride, superiority, and ego." He continued, "The Light Wolf is good - he is joy, peace, love, hope, serenity, humility, kindness, benevolence, empathy, generosity, truth, compassion, and faith. The same fight is going on inside you grandson…and inside of every other person on the face of this earth.”
The grandson ponders this for a moment and then asked, "Grandfather, which wolf will win?"
The old Cherokee smiled and simply said, "The one you feed".
Mental Model of the Week
Scale
When many of us think of scale we think of economies of scale or the proportionate saving in costs gained by an increased level of production. Economies of scale is just one of the changes that occur as companies, or systems, scale up or down. What works at a small scale may not work at a larger scale and vice versa.
Take the Barnes & Noble example from the “What’s Interesting” section above. The old B&N model of deciding centrally on what books to stock in all of their stores worked well until it didn’t. The original model always provided economies of scale from a cost perspective, but other new book buying options (Amazon, etc.) showed that a central book selection and purchasing model wasn’t going to work for B&N going forward. How could B&N compete in this new world?
B&N’s new CEO had a different idea of what scale looks like for a bookseller, one that had worked for him in the UK. Let the employees at each store curate the selection of books for that store since they know what their customers want. Sure, that made purchasing harder and it eliminated some of the cost benefits B&N had gained from their centralized model, but it made B&N relevant again. The change made B&N feel like a local independent book store, something Amazon couldn’t do, and the customers began to come back.
When you are building something, or rebuilding something, you need to constantly think about scale. How will this work when we are ten times larger than today? One hundred times larger? What has changed, or could change, in the marketplace that will make our current system(s) less relevant or even a burden? Think through these things and put plans together so, when the time comes, you can pull the right plan off the shelf and deploy it.
On The Night Stand
“The Devil’s Cup: A History of the World According to Coffee” by Stewart Lee Allen - Given that one of the main topics this week is coffee, I had to mention this excellent book on coffee I read about a year ago. Anthony Bourdain really said it all about this one:
"Absolutely riveting . . . Essential reading for foodies, java-junkies, anthropologists, and anyone else interested in funny, sardonically told adventure stories."
In Heavy Rotation
+ Freddie Hubbard: “On Fire: Live from the Blue Morocco” - One heck of a live performance from one of the all time greats. Check out this article from the IndyStar for more on Freddie and this performance. The performance is available on vinyl (3 LPs) and CD as of now. There is a single available on Spotify as well. Fun fact: The Blue Morocco’s owner at the time of this recording, Sylvia Robinson, was an influential figure in the early days of hip hop, founding Sugar Hill records and creating the Sugarhill Gang of “Rapper’s Delight” fame.
Still Curious?
+ What’s its like to be a software engineer (w/ Taylor Hughes) - “The people who are really the amazing software engineers in at least the kind of product-focused, uh, world that I live in are the people who can make massive changes that solve real business problems while also not breaking everything. The whole job really is sort of like you hold the structure of what the existing thing does in your head. It's like this big set of flowing gears and arrows and stuff, and then you wanna just tweak like this one, uh, and then you ship it and make sure that like everything's still working and that your new thing is also working, and then tomorrow you do the next thing until all of a sudden you have a- a different shape at the end.” (podcast)
+ Scientists filmed wild chimpanzees sharing alcohol-laced fermented fruit for the first time and it looks eerily familiar - “If these gatherings over mildly alcoholic fruit represent a kind of proto-feast, they may echo deep evolutionary roots. It could suggest that our own social rituals involving alcohol could trace back millions of years.” (Pair with Drunk as profiled in Commonplace Chronicle #2) h/t to CC reader Joe Kiefer for this one!
+ How Japan Remade American Culture - “Yet Japan, Yoshimi writes in “The Ambivalent Consumer” (2006), “did not merely import American culture; it remade it.” Reinvention often flowed from reverence: The country’s craftspeople studied each object with great attention and made it Japanese. Each borrowing is transformed almost past recognition, in a culture that competes through innovation (or kaizen, the word for such relentless improvement). The world then often copies Japan in turn, from anime to bullet trains.”
Thanks for reading and please refer a friend (or ten) if you find value here at The Commonplace Chronicle.
Until next week,
Eric