
The coffeeshop fallacy - robfitz
http://thestartuptoolkit.com/blog/The_coffeeshop_fallacy/
======
jasonkester
Without taking anything away from the article, it's worth noting that running
a software business absolutely can provide one with a great lifestyle. More so
than pretty much any other profession I can think of.

The lifestyle I wanted: pretty much as close to zero required work as
possible, the ability to do said negligible work from anywhere I feel like
parking myself (preferably with good rock climbing), enough money to live
comfortably there.

Absolutely achievable, with a couple years of effort (and achieved, by the
way.) Try doing that in any other high-paid, high-prestige profession (Doctor,
Lawyer, Banker, whatever). Can't do it. Too much doctoring, lawyering, etc.
taking up all your time. Sure, you can set up your own practice, staff up, and
eventually get the thing running on autopilot. But certainly not in your spare
time after work, and definitely not for a few hundred dollars, all in.

So yeah, set your goals right and you'll find you've chosen the one industry
where you really can own that coffeeshop.

~~~
jimboyoungblood
yes, you will be able to own that coffee shop, but you won't want to. being
their landlord is a better way to go.

also, i don't think software is viewed as a "high-prestige" profession.

~~~
patio11
Writing letters isn't high-prestige either, which is why lawyers don't
describe their job as writing letters all day. Learn from their example.

~~~
pacemkr
I've been thinking about this. Saying "I'm a software developer" just doesn't
communicate what I do, even though programming is... well, what I do. Thanks
for reframing the problem succinctly.

You thought about this, so how do you describe your profession?

~~~
efsavage
patio11's answers are cute, but if you say things like that you'll probably
just end up defending yourself against people's misinterpretations. "So you're
a teacher?" or "You mean like a security guard?"

I think the best approach is a middle ground, rather than say what you are, or
what the ultimate result is, just say what you _do_. "I build websites" or "I
build iphone applications" or "I run servers and networks" is something
accessible that people can comfortably take wherever they want, e.g. "what
language?" or "oh, i just downloaded this cool app that ..."

~~~
tptacek
His cute answer is safer than mine, which is "I rob banks."

You need to internalize something about marketing. When Patrick says, "I
helped 2 million kids learn how to read", he has _framed the conversation_ in
terms of the value proposition he wants to talk about.

Statistically speaking, "nobody" cares about websites and iPhone applications.
Moreover, virtually nobody --- even practitioners --- can tell the difference
between someone who is good at building a website and someone who is working
from a copy of "learn PHP in 3 hours". Saying what you "do" is a remarkably
bad strategy.

If the thought of explaining the broad value you choose to provide to people
produces cold sweats, my recommendation is "practice more".

~~~
efsavage
Oh I'm not saying that those answers don't have their place. When you're at a
bar or some industry event or chatting with someone in a compatible
professional environment, sure.

I guess I was thinking more in line with the last person who asked me this a
few days ago: the 52 year old no-nonsense guy carrying a 10 year old nokia who
just painted my bedroom. "I helped 2 million kids learn how to read" would
have gotten me an eyeroll and a handful more drips left behind. "I build
websites" got us on a conversation on how he wants to start a youtube show
with his hunting exploits.

Framing the conversation is important, but knowing your audience is just as
much so :)

------
toast76
The coffeeshop fallacy is, in fact, a fallacy.

People don't open coffee shops to drink coffee all day any more than someone
would open a bar because they want to drink all day.

My brother is a wine maker. He is insanely passionate about wine (Pinot to be
precise). When he's not working he's talking about and sharing wine. But at
the end of the day, he's just a farmer. He tends his vines, picks the fruit,
puts in vats, waits a while and then pours it out into bottles. It's horrible,
torturous, back-breaking labour for him. But he does it because he wants to
put the best damned Pinot on your table.

That's why you open a coffee shop.

That's why game developers build games.

Anyone passionate about wine knows what it means to make wine, and anyone
passionate about coffee knows what it takes to make coffee. The coffeeshop
fallacy assumes our coffee drinker knows no shit-all about coffee.

~~~
thenomad
Quite.

I speak here as someone who owns a coffee shop's less profitable cousin, the
independent film company.

There are basically two types of people who will start a "cool" company -
those who like hanging out in coffee shops, and those who would be making
coffee for people whether they were getting paid or not. Those people, in
fact, whose happiness is in large part directly related to the percentage of
the day they've spent with their hand on the lever of a manual expresso
machine. Yes, they exist. No, they're not kidding themselves - that really is
what makes them happy.

Discouraging the former from starting a coffee shop is an excellent plan.
Speaking as one of the latter (film-making, not coffee), trying to discourage
them from starting a coffee shop (or indie film company) is a) probably
pointless and b) not a great idea if you actually care about them as a person.

Their passion may wane. They may decide to start other businesses to help
their passion business grow (as I've done).

But at the end of the day, people like toast76's brother, me, and a wide
variety of other people are GOING to open the damn coffee shop, and if it
works, it will make them happier than anything else they could do.

In those cases, you will be better STFUing about how awful an idea it is to
open a coffee shop, and instead starting to talk location, accounting, and
sales skills...

~~~
HeyLaughingBoy
I read this at least three times while thinking of how true it was.

My wife is someone who would happily spend all her waking hours on the back of
a horse. She's trying to make her horse training/riding lesson business work
while I wonder if it's ever going to be possible to make a living at something
that's essentially become a luxury but which people aren't willing to pay
luxurious prices for. Talking her out of it would be pointless, so the only
thing I can do is try to help her find ways to make it even slightly even more
profitable.

Even has an HN component: I just mentioned patio11's Appointment Reminder as
she was sitting around with four horses tacked up and ready to go, pissed off
at the people who made an appointment and didn't show (eventually got here
about an hour late).

At least hay's cheaper per ton than coffee :-)

------
nlh
Similar to the coffeeshop fallacy is something I described to a friend over
dinner the other night as the "ambulance fallacy" ...

He was telling me about his startup ambitions and about one particular
business that he said sounded like a ton of fun (it was an alcoholic beverage
business) - he loved the lifestyle potential of being "that guy".

I told him a story about how I wanted to be an EMS worker when I was 12 years
old. Why? For a single, simple reason -- I thought it was _extremely_ cool to
be able to drive around with lights and sirens blaring, blasting through
traffic. That was it.

Then a family friend who actually was an EMS worker told me one day what the
job was actually like - sure, for about 10 minutes you were driving like a
madman through traffic, but the rest of the time you had to, you know,
actually BE an EMS worker :)

And the same goes for startup life -- you have to actually BE a startup
founder for 99% of the time. Don't get caught up by the lights and sirens.

~~~
mikeash
This is similar to how I talked my brother out of his brief thoughts of
becoming a professional pilot. It sounds wonderful, but in reality the pay is
poor (unless you're one of the lucky few able to work their way up to a good
long-haul route), a lot of it is boring, a single relatively harmless medical
problem can end your career, etc. etc.

You have to look at the bad parts of any job when considering a career or
starting a business, and it seems to be something that people are bad at
doing.

~~~
hugh3
Very few jobs, I imagine, are anything like they seem from the outside. Every
glamorous-looking job has many hours of painstaking drudgery involved.

On the other hand, dull-looking jobs probably have great parts that outsiders
never know about.

------
larrys
This is similar to what was around in the 80's with corporate people and
owning a Bed and Breakfast. Many wanted to get away from the stress of
corporate america and traded it for owning a B&B in the country. What they
found was that running a B&B was obviously much different then staying there
as a guest.

"The 1980's was the ideal time when everybody wanted to own an inn, thanks to
Bob Newhart," she said. referring to the popular television show that featured
Mr. Newhart as a Vermont innkeeper. "

[http://www.nytimes.com/2005/08/19/realestate/19bandb.html?pa...](http://www.nytimes.com/2005/08/19/realestate/19bandb.html?pagewanted=all)

Something you like doing everyday and something you like doing occasionally
are two different things. As well as something you have to do as opposed to
something you can decide to do (like writing comments on HN - imagine if it
was your job to do it 8 hours a day 5 days a week or more..)

~~~
cosgroveb
I know a guy who was a broker on Wall Street throughout the 80's and 90's...
He retired to take over the family farm, the sort of thing a lot of his peers
wanted to do, and after 10 years of working non-stop to almost-not-quite
break-even he's almost ready to sell it.

He says that he had no idea how much harder than working on Wall Street it
would be. He's got to know everything about the domain, he's got to know
accounting, sales, marketing, and just about every other aspect of running a
business and it is exhausting for such small potential gains.

------
steve8918
Not to hijack the conversation, but the following line really struck home with
me but in a different way:

"Lots of people think they want to start a coffeeshop. They likely don't.
That's like buying a minimum wage job for two hundred grand."

This is very similar to what I said about buying a home in Silicon Valley. In
the nice areas like Palo Alto, the homes around > $1.5MM. If you don't buy a
house in a good school district, you need to spend $1000-2000/month on private
school, which is I suppose how the price of the homes in PA got inflated.

Anyway, I told my wife, "If we were to buy a $1.5MM home in PA, first off we
need a downpayment, which is roughly 500k. Then, after the triumph of saving
half a million, we are rewarded for all our hard work by exchanging this for a
1MM mortgage."

In the same way as the coffee shop example, the economics really need to make
sense, otherwise it's a terrible investment. As long as we are living in the
Bay Area, we will rent.

~~~
pagekalisedown
Being house-poor is extremely common in the bay area, to this day. It totally
baffles me as to why people keep doing it. My only guess is that people are
more economically irrational than I'd like to believe.

------
MicahWedemeyer
I have found that being personally interested in the product has a lot of
benefits. First, if you're a user/consumer, it's easier to determine which
features are most important as well as usability issues. It's surprising how
unusable some products are because the developers never actually use them.

Second, and most important, a personal connection helps to get you through the
dark days at the start. It's very emotionally draining to work on something
that has no traction, no supporters, and just a bunch of naysayers. If you
love the product, though, it can offset this emotional drain quite a bit.

In my case, I built a tabletop gaming (ie. DnD) CMS. In the beginning, nobody
used it except me, and it was tough to go upstairs and hack away every night
and weekend. However, _I_ used it and that was enough to keep me moving. Now,
we've got thousands of users and paying customers, and the motivation is much
easier to find. But, I never would have made it this far if I didn't care so
much about the domain.

Unfortunately for me, I think there's probably a lot more money to be made in
"boring" areas. If you can keep motivated to work on a CRM or medical billing
system, you'll probably end up making way more than my DnD website. But, it
will definitely be harder to keep the momentum in the beginning.

~~~
robfitz
I actually completely agree with you[1].

My [intended but perhaps poorly articulated] point was that playing DnD
doesn't feel the same as making tools for DnD.

However, if you accept that premise and are willing to endure potentially dull
work, then caring about DnD will allow you to make much better DnD tools.

[1] _(updated to remove irrelevant personal information)_

~~~
MicahWedemeyer
_playing DnD doesn't feel the same as making tools for DnD_

That's absolutely true, and I'd take it a step further. Playing DnD doesn't
feel the same as making tools for _and running a business around_ DnD.

~~~
hugh3
And doing that doesn't feel the same as slinking around dungeons and fighting
dragons, which is probably terrifying and deadly... but on the upside holds
far more social prestige than playing Dungeons and Dragons.

------
jtolle
This is an interesting article by someone who went through the actual
coffeeshop version of the coffeeshop fallacy:

[http://www.slate.com/articles/news_and_politics/recycled/200...](http://www.slate.com/articles/news_and_politics/recycled/2009/08/make_that_a_double_shot.single.html)

------
richcollins
_If he saw a big opening he could exploit, he'd be there regardless of whether
it was drilling for oil or starting a babysitting empire._

This is why most everything that we use is shit.

Also see: [http://thetudu.wordpress.com/2011/10/12/the-real-reason-
well...](http://thetudu.wordpress.com/2011/10/12/the-real-reason-well-miss-
steve-jobs/)

------
brador
This could also be called the game/app developer falacy. How many programmers
started out wanting to make that perfect game/app? only to realise doing so is
tedious and boring compared to dropping a $1 on a finished product.

~~~
bendotc
This immediately made me think of a quote about folks wanting to get into the
games business:

"Thinking that 'Hey, I like playing games, so maybe I'd like making them' is
sort of like saying, 'Hey, I really like taking baths, maybe I'd like to be a
plumber." -- Jesse Schell

To be a successful game developer, you not only have to love games, you really
have to love MAKING games, too.

------
brohee
And I thought I was dumb never having worked out a way to make a decent living
wage out of the places I patronize. It turns out most of the owners didn't
either.

------
phil
I don't think it worked this way for Levchin, either.

It's obvious that they were so excited about what they were making at PayPal.
The PalmPilot thing? All that encryption stuff they did early on? They were
just in love with what they were making, and it worked out very well for them.

On the other hand, Slide, a basically dispassionate attempt to build a company
he thought would be successful, while still a success, didn't work out quite
as well.

------
jroseattle
This is great advice for some people, but terrible advice for others. It
seriously depends on context -- who is to say someone's maximum pleasure
doesn't come from running their own coffeeshop? It's not incorrect, but it's
nearly impossible to make these statements without projecting one's own biases
into the conversation.

The most startling thing was the Levchin quote: "You you can't be in love with
a particular idea or business. You have to be in love with the idea of running
a business."

It's presented as an either/or dichotomy. I'm pretty sure Steve Jobs, Larry
Page, Mark Zuckerberg, etc. didn't succeed because they were focused solely on
resource management. Lack of passion in one's product is certainly just as
important (some would say more so.)

------
code_duck
Insightful article.

My own experience working in restaurants teaches that one should never go work
at a restaurant you love - it might ruin their food and ambiance for you
permanently.

------
pemullen
Actually I'd prefer a job drinking coffee in a coffee shop.

------
Shivetya
This is not really different that trying to convince students to study and not
bet it all on sports. Family friends did a good job a few years back bringing
their son back to reality; he was really good at basket ball; by having him
find all the people from his school, county, and state, who made it. Then
asking him how many didn't.

People seem to always underestimate the effort and over estimate themselves.

------
marshray
I've worked in restaurants and coffee shops where the owner spent about half
time hanging out and "curating the bookshop". The author's point is correct
though, there's a huge amount of unseen thankless work (and cashflow) needed
to make that happen.

------
6ren
> ... it's how people end up spending years building stuff nobody wants to
> buy.

Isn't that the opposite of the coffeeshop fallacy? i.e. that you enjoy
producing it, not consuming it; the coffeeshop fallacy is that you enjoy
consuming, not producing.

------
zach
One time when I was working at Luxoflux, the pizza guy remarked it must be
great to work as a game developer and "play games all day."

I had to hold my tongue or I would have replied that it must be great to work
at a pizza place and eat pizza all day.

~~~
minikomi
Funnily enough, I did this in college - and it was great! Especially since you
can choose the toppings.

------
iskander
I'm not convinced this fallacy really exists. It's not hard to observe that a
coffeeshop is a hectic place that makes its meager profits one latte at a
time.

------
brianlash
This is exactly the premise behind Michael Gerber's E-Myth series of books:
That loving something /= running a business that sells or does that thing.

~~~
wayneyeager
Indeed. Gerber went even further and says that it may be counterproductive to
own a business that matches your technical expertise. That's because of the
temptation to jump in and do the technical work... instead of focusing on the
strategic aspects of owning the biz.

------
quinndupont
Since when does a coffee shop have a 10% success rate? According to a large
study by the Speciality Coffee Association of America, independent coffee
shops in the US have a 90% success rate. Perhaps the author mistakenly assumed
coffee shops have the same market dynamics as a restaurant, but coffee is low-
staff, low-overhead, and high-profit. So long as people are walking in the
door, you'll do okay.

~~~
genieyclo
That statistic is absurd, and highly suspect coming from the "Specialty Coffee
Association of America". I have run a coffeeshop and restaurant both, and can
attest to the high attrition rate in coffeeshop turnover. I'd be surprised if
even more than 40% of coffeeshops are still open 3 years after establishment.

~~~
pseudonym
I'd be willing to be the "SCAA"'s numbers are something like "Still open 3
months after founding".

------
dusklight
Maslow [<http://en.wikipedia.org/wiki/Maslows_hierarchy_of_needs>] would
disagree with the fundamental premise of this post.

~~~
leehnetinka
dusklight - thanks for being the catalyst for making us provide an
instructional splash page... check out the new bubble.ly (may have to refresh)

------
bluedanieru
This all seems at odds with the Ira Glass quote that makes its rounds here:

 _Nobody tells this to people who are beginners, I wish someone told me. All
of us who do creative work, we get into it because we have good taste. But
there is this gap. For the first couple years you make stuff, it’s just not
that good. It’s trying to be good, it has potential, but it’s not. But your
taste, the thing that got you into the game, is still killer. And your taste
is why your work disappoints you. A lot of people never get past this phase,
they quit. Most people I know who do interesting, creative work went through
years of this. We know our work doesn’t have this special thing that we want
it to have. We all go through this. And if you are just starting out or you
are still in this phase, you gotta know its normal and the most important
thing you can do is do a lot of work. Put yourself on a deadline so that every
week you will finish one story. It is only by going through a volume of work
that you will close that gap, and your work will be as good as your ambitions.
And I took longer to figure out how to do this than anyone I’ve ever met. It’s
gonna take awhile. It’s normal to take awhile. You’ve just gotta fight your
way through._

You don't have taste in something you're not passionate about, and you likely
won't keep it for long after that passion wanes. You won't know that you've
made a good cafe unless you care about coffee. You might not like accounting
or mopping but you'll tolerate the grind only to the extent you care about
what you're doing.

------
noonespecial
_Caring about the product seems to be the most dangerous. It's how the
coffeeshop fallacy pops up and it's how people end up spending years building
stuff nobody wants to buy._

Steve Jobs might have disagreed with that particular point.

~~~
saraid216
Just because it's dangerous doesn't mean it shouldn't be done. It's risk, not
ABANDON ALL HOPE ALL YE WHO ENTER.

------
aloneinkyoto
This is the paradox of capitalism. Focus on creating something inherently good
and it will not be sustainable. Focus on creating something sustainable and
profitable and it will most likely not be as inherently good as it could be.

Example: McDonalds. Brilliant business model. Awful product.

~~~
rick888
I have to disagree with you there. If Mcdonalds had such an "awful" product,
nobody would eat there and it wouldn't be as popular. There are plenty of
alternatives.

~~~
JoeAltmaier
Some of their food is very tasty; all of it is pretty bad for you physically.
I particularly enjoy the large sweet tea for $1.06.

However I have to agree that others do it better. Hardees has the best fast-
food burger around. Also the best ads :)

