The coffeeshop fallacy
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The coffeeshop fallacy
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Re: The coffeeshop fallacy
#2This 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.
Re: The coffeeshop fallacy
#3Not 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.
Re: The coffeeshop fallacy
#4This 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.
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.
Re: The coffeeshop fallacy
#5This 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.
Whoa, whoa, whoa. I'd downvote you if I could, not because I disagree with you, but because this is a strawman.
The author used a low margin, low sucess business example to make a point about what mindset someone should be in to successfully run a business. You took from that the message that anything enjoyable is not sustainable.
"Focus on creating something inherently good --> it will not be sustainable"
You also less directly imply that focusing on profit will necessitate producing an inferior product, again using a specific example to provide a generality.
Re: The coffeeshop fallacy
#6This 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.
Re: The coffeeshop fallacy
#7This 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.
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.
I was going to reply with what you said but then I thought, since they're the in that "most calories per dollar" bucket, maybe poor people eat there out of necessity and not choice...
Re: The coffeeshop fallacy
#8Without 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.
Re: The coffeeshop fallacy
#9I'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.
Re: The coffeeshop fallacy
#10This 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.
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.
Most of the alternatives are equally awful.