I appreciate the honesty of this article but I just don’t quite understand why you’d need to burn $300K to learn these lessons: Small receipts, keeping drinks warm, staffing issues and daily order seasonality.
At the risk of being naive, couldn’t you work out the margins of this business on a napkin, or by asking a few local coffee shops? Or by running a subscription pilot with an existing shop? It just feels like this endeavor was tech first and business second. Shiny apps don’t solve any of the above problems.
There are some parallels between your critique of this startup and what educators critique about ed tech startups. Mainly that the tech comes first and the context that tech is supposed to be nested in is unacknowledged, leading to failure or other issues. I’ve been starting to wonder if incubators and CS programs need to teach units on founder humility, domain context, and social context so we stop wasting so much cash on reinventing wheels.
It's a human problem, not a technologist problem. I've often been asked by a business manager to create a website or other software in support of a new business process that is still in what I'd call the hypothesis testing phase. I encourage them to create content for it, first, and if they take my advice, half the time they realize the process won't have enough throughput to justify it.
Funnily enough, having humility is one of the best ways to remain teachable and perhaps one of the fastest ways to grow and continue to have a growth mindset
I consider 'reinventing wheels' to be a valuable educational experience, I often wonder about how could educational 'enterprises' (universities, and education companies?) leverage this to improve what they do, but then I remember that it doesn't matter what I think, just what I do, and I sure do not work for any such companies.
But it's kind of silly that "we" (as a society) are spending 300k USD to teach some of this "obvious" things to some random group of well connected americans.
then again, the dollar is made up so long as 'the future' pays back these money-creation loans we may as well spend the money this way. the alternative is going back to corporate backed research, instead of this strange contemporary VC-backed research
Reinventing wheels is good, ignoring any kind of domain knowledge/expertise is not.
If you’re running into problems that someone with a year or less experience in the area can point out and you don’t have good reason to do different then that’s incompetence not ingenuity.
Humility is the key trait that many CS grads are lacking. Personally, I attribute it to the explosion of CS popularity since ~2010. Most bio majors are still nerds (and I assume the same is true for education), whereas I think a minority of CS grads these days are motivated by passion and curiosity.
I think broadly their team was just too big for the stage of the company they were at. It probably would have made more sense to have perhaps one engineer, one operations / business person, and a few part time delivery drivers / baristas. Ideally the first two would be founders who don't need a salary in this early stage. With those economics they wouldn't be printing money with ~150 orders a day, but they would be solvent.
This seems to be the classic case of building much more than the stage of the company demands, and then not having the business-side be ready to bring in the revenue that level of commitment demands.
Ideally the last 2 would be the founders and they could invent orders or delivery coffee for free to even avoid the trouble of getting customers. We all know if we build it they will come, so the problem is always going to be operational.
The story of the Crave cookie company is the exact opposite of this one. They had a perfect product in cookies, super high margins, easy to transport and make, not perishable and easy to market through social media. Their tech was abysmal, I recall the founder saying customer orders through the website would get written to a text file that people would open and read. There wasn't a database.
I like the contrast between great tech with no market fit and comically bad tech with great product market fit. I think Crave cookies is worth quite a bit now.
Just asking any mildly serious barista would have got this answer: «I do not want the coffe I prepare be delivered more than a minute after i prepare it, and i do not want it to be bashed around inside a bag!»
You assumed the risk of naivety. $300k is a drop in the bucket for tech investment. That shiny app is representative of a business model that isn't based on retail coffee shop margins napkin math.
At the risk of being naive, couldn’t you work out the margins of this business on a napkin, or by asking a few local coffee shops? Or by running a subscription pilot with an existing shop? It just feels like this endeavor was tech first and business second. Shiny apps don’t solve any of the above problems.