Bluestone Lane Founder: How Nicholas Stone Is Redefining the U.S. Coffee Culture With Zero Coffee Experience

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Speaker 2 If you can't pay your rent and you're trying to build an organization, I think it's tough.

Speaker 1 Today, I actually get to talk to Nick Stone, who is the founder and CEO of Bluestone Lane. Bluestone Lane is bringing Aussie coffee culture and better coffee right to the US.

Speaker 2 When I was starting Bluestone Lane, I had an extraordinary amount of people that said to me, it won't work. I actually never had ever made coffee at all.

Speaker 2 I just missed that feeling of being a local where I walked in and they knew my name face and order. So we had to make a difference to the coffee culture in the US.

Speaker 2 I'm not really in the game of products on shelves that don't talk back. I'm in the theater of humans working together congruently as a team.
And when COVID hit, we lost 87% of our revenue.

Speaker 2 So we went from 51 stores to 14. We had to keep stores open for three reasons.

Speaker 1 As a founder, it hurts. How do you cope?

Speaker 2 I'm very, very fortunate to have...

Speaker 1 For those who don't know me, I am such a coffee snob.

Speaker 1 And today, I actually get to talk to Nick Stone, who is the founder and CEO of Bluestone Lane, which is such an incredible place that I love coming again and again to.

Speaker 1 They have 55 cafes, if I'm not mistaken, coffee shops across the country. And Bluestone Lane is bringing Aussie coffee culture and better coffee, right, to the U.S.

Speaker 1 And I am just so excited to have Nick with me here to talk about his career because you were not always in coffee, Nick, were you?

Speaker 2 No, well, it's a pleasure to be here. I actually never had ever made, whether it was commercially, professionally, or even at home, I'd never made a coffee at all.
I was also a coffee snob.

Speaker 2 It was entirely dependent on these great independent coffee shops and cafes making beautiful flat whites, as we talk in Australia.

Speaker 2 And yeah, Bluestone Lane, we had to make a difference to the coffee culture in the U.S. We've made a little dent, but hopefully it keeps gathering more momentum.

Speaker 1 Oh, and I love that, Nick. And right before we start recording, we talked about when we came here to the U.S.

Speaker 1 about a decade or two ago, we felt like it was completely a desert of really good espresso drinks. So we welcome you with big arms.

Speaker 1 And you actually have an incredible Bluestone Lane coffee shop here in Los Altos, right next to my house. And I'm very excited and a lot in San Francisco.

Speaker 1 But take me back in time when you started, you started from sports.

Speaker 2 Sure. So I grew up in Melbourne, Australia.

Speaker 2 I grew up playing a variety of different sports, but probably the one that I love the most is a football code that's indigenous to and really only played in Australia.

Speaker 2 It's called Australian Rules Football, AFL of footy. My father played, my uncle played professionally, my grandfather played at a very high level.
So that was the one that I resonated with the most.

Speaker 2 And in my final year of high school, I got selected. in the Australian Football League draft and I was drafted.
So my childhood dream became a reality. And I played six years professionally.

Speaker 2 I played at three different teams. I got cut from three different teams.
So effectively, you have your childhood dream squashed three times in six years.

Speaker 2 And by the time I got delisted for the final time, I was only 23 years of age. I was very, very grateful that I went to university at the same time.

Speaker 2 The AFL League are very pro and supportive of players studying at the same time. They will pay for your university education.

Speaker 2 They will make sure that clubs give you at least one day off during the work week to attend university. So it took me a three-year full-time bachelor's degree.
I did it over six years part-time.

Speaker 2 So when I got finally delisted by the third team, and I was very fortunate to be in Melbourne the whole time, I then transferred to, I began an internship at an investment bank.

Speaker 2 And then that sort of kicked off my finance career and that led me to New York City where I arrived in late 2010.

Speaker 1 Incredible, Nick. But I want to take you back in time for a second because most professionals or most people, when they're kicked out once, they're done.

Speaker 1 What made you, and there's a reason why I'm asking, because I think it's a theme here, right? Was entrepreneurship too?

Speaker 2 What made you go back and try again and give your all, i assume so what was it it's a very good question and i certainly think it helped that i was very young of age i was in many respects naive and there was a level of innocence about me that oh just pick dust yourself up and go again because i'm only 19 and it was a couple of things certainly i had the internal fortitude to believe that I could make it and that I was prepared to do whatever it took to make it.

Speaker 2 I had the training commitment and I had an extraordinary amount of support behind me. I had people saying, I believe in you.
You can actually do it.

Speaker 2 And even though in my first two years at the club I got drafted to, I didn't play any games at the senior level. I wasn't really expected to in the first year.

Speaker 2 My second year, I was, but I sustained a quite challenging injury. And that just led to essentially me being delisted and re-picked up by another team.

Speaker 2 But, you know, it's a combination.

Speaker 2 I think that you need to, and I've applied this to my banking and to Bluestone Lane, is I just became a student, a student of not only the game or the industry, but myself.

Speaker 2 What could I really look at objectively and improve? And I would be prepared to reach out and ask for coaching, ask for advice, even if it's sometimes can be pretty critical and challenging.

Speaker 2 And then I was very lucky that I continue to invest so much in my relationships with my friends and family and old coaches. And they were the ones that said, you know, you can actually do this.

Speaker 2 I believe that you can do this. And I believe in that case, a team will recognize it.
So keep going, keep working on those lesser strengths. And that's really what happened.

Speaker 2 It was such a long time ago, but it was so.

Speaker 2 formative for my life. And even though I look back at it and I think, oh, I didn't achieve everything I wanted and I didn't enjoy the journey enough, especially given it was my childhood dream.

Speaker 2 But it was so

Speaker 2 important for my next evolution and my next careers. There was so much transferable skills through that experience.

Speaker 1 I mean, it feels like that's exactly the muscle you needed to build in order to create what you're creating in Bluestone Lane and beyond. It sounds like it's exactly what needed to be built.

Speaker 1 So you're going and you're leaving Australia and you're moving to New York, which is a whole different network, a whole different thing. What is that like, Nick?

Speaker 2 Well, New York was a dream as well for me. I think when we're footy finished, I set my sights on moving overseas.

Speaker 2 And a lot of Australians grow up thinking that they want to spend a year working in London because Australians are entitled to spend two years in the UK.

Speaker 2 But for me, I just had this burning desire to go to New York. And I think a lot of it was because I was obsessed with New York rock and roll and indie bands.

Speaker 2 And back in the late 2000s, the middle of 2000s, there was just this emergence of these New York rock and roll bands. And I used to play in a band when I was in high school.

Speaker 2 I played rhythm guitar terribly, but it was a cover band.

Speaker 2 I just was fascinated with the fact that New York City is this melting pot, the capital of commerce, fashion, the arts, all amalgamating in one small island.

Speaker 2 I love this idea about density and going from one side of town to the other. And it was just enthralling to me.

Speaker 2 So I'd set my goal when football had finished and I was so determined not to have a less successful career. I was just so hungry and desperate.

Speaker 2 And then eventually I found my way to New York, which was also through an unorthodox way.

Speaker 2 It was actually via studying because at that point in time, I couldn't get a transfer with the bank I was working at because at that stage, the global financial crisis.

Speaker 2 But my cards sort of fell the right way because I put myself in the right position. And it was just simply sensational.

Speaker 2 And I lived in New York City for 10 years before I moved to California and it was so much fun and something I highly encourage people if they ever can get the opportunity to chance their arm to live a couple of years in New York City.

Speaker 1 That's incredible. So what are some of the differences? Because again, you kind of push your own luck or make your own luck there, right? You get somehow into New York, but it is a new network.

Speaker 1 You kind of need to build yourself there.

Speaker 2 I decided to keep studying after football. I did a master's degree and then part of my plan to get to New York, because of the financial crisis and the inability to really get a job.
A lot of the U.S.

Speaker 2 banks, Lehman Brothers failed. A lot of the banks were cutting roles was actually to do an MBA.
And I had a mentor who had coached me in banking, who's from Princeton, New Jersey.

Speaker 2 And his advice to me was actually don't quit your job to go full-time in an MBA.

Speaker 2 Why don't you do an MBA in Melbourne at Melbourne University and continue working, continue learning and experiencing a practical job. Don't just go academic.
And the advice was invaluable.

Speaker 2 It was such salient, truthful and beneficial advice. So when I went to New York, I actually ended up facilitating an exchange and I went to a university that I wasn't really familiar with.

Speaker 2 It was called Fordham University and I went to the graduate school there. And I was able to study at the executive program.
So when I landed, I was a student full-time for the first time in my life.

Speaker 2 And I used that as an opportunity to meet as many people as humanly possible. So I formed friendships.
I didn't know a single person at university, but I just proactively engaged them.

Speaker 2 I asked their journey, why they're here. Do they ever want to go have a coffee or a beer or go for the gym and go for a run? What's their best restaurants? What are the things I have to see?

Speaker 2 And then when when I was in New York, I was really fortunate. I had my wife or girlfriend back there.
She knew some people, but I think she connected me with someone.

Speaker 2 And next thing, I joined a running group, then I joined a gym group, and then there was an Australian Girls football group.

Speaker 2 And it's probably a bit of a secret source, a special skill that a lot of Australians embody, particularly those that are more nomadic and are willing to go overseas and try their best.

Speaker 2 It's the ability to socialize. Aussies love social settings.
they love

Speaker 2 getting together with others to celebrate to catch up to have a coffee to watch a game to go to a concert go to a festival go skiing and that's why you find and i think it's probably very similar to israelis like that's why australia only has a population of 25 million and a lot of people are shocked when i say that because there's aussies everywhere and there's some of those common traits around socializing and hanging out and humility and also being generous with your time.

Speaker 2 So if someone does reach out to you and say, hey, hey, Nick, I heard that you're in town.

Speaker 2 Is there any chance I could grab a coffee to chat about my startup idea or I'm trying to get a job in finance or I've got a hospitality company? Can I pick your brain?

Speaker 2 I've always paid it back because so many people have provided me that opportunity. It's a very, very strong Australian trait and a value that my parents also instilled in me.

Speaker 1 I love that, Nick. So you're going into the finance world again, you know, investment, banking, et cetera.
Like it's a very lucrative place in New York.

Speaker 1 But what takes you from that to entrepreneurship? That's a really hard move. It pays well.
It's comfortable. It has its status.

Speaker 1 What makes you leave such opportunity?

Speaker 2 Alana, this is the million-dollar question because there's been many times over the Bluestone Lane journey of 11 years, especially during the depths of COVID, I was really scratching my head.

Speaker 2 Why did I have a retail business that wasn't able to operate, that was shut down by the city, that was trying to ensure that people didn't come together? It's a very, very good question.

Speaker 2 But ultimately, I think I became so frustrated and disillusioned with the coffee culture in New York and how different it was from what I was used to and what I craved in Australia.

Speaker 2 I had a very myopic view on Starbucks and on Duncan. They are brands that are not found in Australia.

Speaker 2 And Starbucks has emerged over the last couple of years, but it's very much focused on shopping centers where there's a critical mass of international students.

Speaker 2 Very, very rare to find, I think, Australians. that have been in the country for a long period of time or born here to be drinking coffee at Starbucks.
It's just atypical.

Speaker 2 It might change, but Starbucks effectively failed in Australia, like they failed in Israel. Starbucks wasn't as successful in Israel.

Speaker 2 And I just felt that there's got to be something different here because it wasn't just about the coffee taste and the product per se for me.

Speaker 2 What was much more important was getting a coffee or the act of going to coffee was a ritual. It was a process.
It was a way to facilitate human connection.

Speaker 2 And it was such a critical part of my day as a banker because we would start the morning with this team ritual of getting coffee.

Speaker 2 And then we would also often get a coffee in the afternoon because at times we wouldn't know what time we would go home.

Speaker 2 It would depend on the demands of the client that you might have calls internationally that could run into the evening.

Speaker 2 So I just missed that. feeling of being a local where I walked in and they knew my name, face and order.
It's pretty simple. That's what I was used to and that's what I expected.

Speaker 2 And after a a number of years of living in New York, I just thought, we've got to change this. And I had an opportunity to really think about a business model through completely objective lens.

Speaker 2 I had never worked a day in hospitality. I had this customer-centric view.
I had experience with numbers and advising businesses and financing businesses.

Speaker 2 And I had some insights around building brands and marketing through my time studying studying my MBA. And also my brother was in advertising.

Speaker 2 And my best friend, who I lived with for five years prior to moving to New York, was very, very strong, a bit of an expert in brand management.

Speaker 2 I just put the business plan together, thought about it for a couple of years, asked a million questions, most of them repetitive and naive and very much, you know, a novice.

Speaker 2 That's how it all came together. And I didn't have these ambitions of building it into 60 plus stores that we have right now, 65,

Speaker 2 but it was something I thought the community would love because we were going to focus on people and have much better product. And that's what we went about executing.

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Now back to the show.

Speaker 1 I love the idea of not just being driven almost like product led versus experience-led, right? Really giving a whole experience to coffee because that's how I grew up.

Speaker 1 But I mean, fear can be numbing, right?

Speaker 1 And most people, even if they have this great idea and they have whatever, all the background or all the things that you're mentioning, but they'll still not go ahead and open the first shop because there's a light years away between thinking about it and actually taking action.

Speaker 1 Take me to those days when you're contemplating, yes, no, the fear is numbing. Where is that taking you?

Speaker 2 It's such a great question.

Speaker 2 And when I think back to my mental state when I was considering Bluestone, I am naturally pretty risk averse. I like to do a lot of planning and become a student before I dive into anything.

Speaker 2 And with Bluestone, I think I just summed up that I understood what the downside was going to be. I wasn't going to leave my job as a banker full-time.

Speaker 2 The company couldn't afford to compensate me as CEO. The company also didn't need me as a full-time CEO.
It was one store and it was going to be two stores within six months.

Speaker 2 It didn't warrant a chief executive. In fact, I think I had...

Speaker 2 enough self-awareness to appreciate that me full-time is probably not going to benefit this business. I would probably push it too hard.
I might be too ambitious.

Speaker 2 And I didn't have the requisite operation skills i was going to be much better at overseeing a larger organization that had more complexity and different verticals so i think i summed up that well ultimately if i make this investment this financial investment if i lose it it's not that much money where i can't recover and it's also i'm doing it a period of time where

Speaker 2 time's on my side and I'm going to be in my early 30s in New York City and I'll bounce back and I'll take all these lessons and I'll recover.

Speaker 2 And my way of thinking has always been a little bit contrary to some advice from entrepreneurs, which is you've got to go all in early.

Speaker 2 I'm more of the view that you should go in when the signals are there and the business can afford you. I'm not saying to earn the same amount.

Speaker 2 if you're working in another career, but I think having significant personal stress when trying to build a company is a huge distraction.

Speaker 2 If you can't pay your rent and you're trying to build an organization and put in the requisite, I think it's tough. Now, some people can fall back to home and leverage those benefits.

Speaker 2 But for me, I just summed up that no matter what, this is going to be amazing learning experience. And I'm going to do something and operate a business.

Speaker 2 And I went from football to banking and I didn't have the tangibility. and understanding of running a business.

Speaker 2 And my father, who's in property development and in construction, when I first told him, he said, oh, that's great. That's great.
I assume you're buying the store.

Speaker 2 And I said, no, I'm going to be the tenant. And he goes, oh, no, no, no.
You can't be a tenant. You can't do retail.
You can't be the tenant. This is not going to work.

Speaker 2 And I said, no, no, it's all right, Dad. Like, no matter what, I'm going to learn from it.
But, you know, that was his mentality. You're going to be a lessee.
Are you serious in New York? Good luck.

Speaker 2 So. Not everyone was 100% convinced, but looking back on it, I probably proved a few people wrong there.
A few people.

Speaker 2 Yeah.

Speaker 1 So, first of all, I'm a big advocate for experimentation. So, I think what you just said is really, really important.
I think there's a little bit of a myth about burning the boats.

Speaker 1 You can burn the boats, but once you're pretty sure this thing is going well, and after you experimented and you have a good feel, right?

Speaker 1 If you burn the boats too early, the stress might make you freak out. But when you start a business or when you start growing a business, you hear a thousand opinions.

Speaker 1 I don't know about raising capital, outsourcing, expansion. I can go on and on trying to scale.
How do you decide what to listen to? And I would also love a story around things that didn't work out.

Speaker 1 I'm sure there's quite a few.

Speaker 2 This is a fantastic question. Certainly, when I was starting Bluestone Lane, I had an extraordinary amount of people that said to me, what do you know about hospitality?

Speaker 2 You've never worked a day in hospitality. It won't work.
I had to sort of block them out and just be really confident that I understood the market.

Speaker 2 I'd spent enough time in New York observing the consumers and I could see how other brands had been successful in different verticals. And I knew that we'd have a similar core customer.

Speaker 2 And ultimately, I broke it down that if a value proposition is so strong, if we know everyone's name, make them feel like they're part of our community, like they're a local, if we've got great quality coffee that stacks up to the coffee that you expect in Melbourne or Sydney, and if you've got food that you can't find in other coffee shops, the probability of success is, and the cost structure is understood, and you don't have to sell $2 million worth of coffees to break even.

Speaker 2 I just thought there's a very good chance that this will work if we can execute well. And most businesses, the idea is the easy part: execution is everything.
As it relates to taking advice,

Speaker 2 it is a really, really challenging thing when you're building a company because a lot of people feel obligated or encouraged or excited to give you advice.

Speaker 2 And it is hard looking out in because there's so many different machinations, your corporate culture, your understanding of people. Ultimately, we're just a people-centric business.

Speaker 2 Without people, there's no coffee being made. So I'm not really in the game of products on shelves that don't talk back.
I'm in the theater of humans working together congruently as a team.

Speaker 2 It's the same as playing professional sport. It's not about the balls and the boots and the uniform.
It's actually about the people.

Speaker 2 Can you get them all aligned to know their role, execute their role, and do it often in a very selfless manner? And that's the art of hospitality.

Speaker 2 And I probably didn't fully appreciate it until we opened the doors and got going. I was like, wow, it's nothing to do with the beans.

Speaker 2 It's all to do with the barista and how they're feeling and how aligned and engaged they are.

Speaker 2 So if I think about different lessons over the time, there's been some that are the advice I should have taken. Absolutely.

Speaker 2 There's some that I didn't probably think deeply enough about their counsel, but there's others where I didn't trust my intuition and I went with their counsel.

Speaker 2 Some of those decisions have had some really, really challenging outcomes that you look back in time and go, wow, I wish I didn't make that call.

Speaker 1 Can you share one?

Speaker 2 There's a few different examples. When we were looking to expand to outside of New York, we had gone to Philly, we'd gone to DC, we'd gone to California.

Speaker 2 There was the discussion about expanding to Florida. And there was also discussion about expanding to Canada.

Speaker 2 And we looked at Toronto and thought, wow, this is the fifth biggest city in North America. It's very similar to New York City.

Speaker 2 It has this critical mass, finance-orientated, a lot of young people, young professionals, affluent, high-spending. sophisticated culture.
There's some commonality with Melbourne and Australia.

Speaker 2 It's close to New York. why don't we open in canada and i did have a number of people say no maybe just stick to the us like go to florida or look at texas

Speaker 2 and we chose canada and

Speaker 2 we opened two stores in canada just prior to covert arriving in the early stages of 2020 and Canada effectively quarantined the country much like they did in Australia. We couldn't get anyone in.

Speaker 2 So Americans weren't able to go in. Australians weren't able to go in and effectively only Canadians.
And when COVID hit, we shut both stores down and we unfortunately laid off all that team.

Speaker 2 We were stuck. We couldn't get in.
We couldn't get our stuff out. We couldn't pack up the stores.
And I think about it now, that that was a decision that, in hindsight, it was the wrong call.

Speaker 2 It was too early in our life cycle to go internationally. And even though I thought, hey, it's closer to New York than Chicago.
I think Toronto is closer to New York than Chicago.

Speaker 2 It's about the same distance. It's closer than Miami, that's for sure.
It was the wrong call. That's one example where I didn't follow the advice.

Speaker 2 I've received a lot of advice regarding spending and deploying capital. When we did our benchmark round in the middle of 2018, the thought process was to pretty much scale at whatever cost.

Speaker 2 Of course, it was meant to be prudent. and judicious, but the comments were build up a team and scale and try and get as big as you can.

Speaker 2 And at that point in time, maybe, and the way the valuations were working, maybe that was the right idea. But ultimately, when we ran into an existential crisis like COVID, the cupboard was bare.

Speaker 2 We had no cash left. We had blown tens of millions of dollars on opening stores, a lot of them in office buildings.

Speaker 2 And we didn't have the buffer that we needed, not only to make sure we were stable and strong during a crisis, but also to get on the front foot and go and acquire different stores and maybe benefit from, well, not benefit, but just maybe use a crisis and turn it into an opportunity to scale faster.

Speaker 2 So there's two examples, but it's a very, very tough needle to thread to know what advice to take. But I think the most important thing is your gut.

Speaker 2 If you get different signals and you have an ability to process it, and I had that and I still do because I also had the business acumen of working and advising companies for so long, plus working in high performance teams.

Speaker 2 At times I should have said, I really appreciate the advice. Thank you, but I'm going to disagree and commit to this.
And other times you've just got to think a little bit more objectively.

Speaker 2 Like, is really going international this early in our life cycle the easiest way to be successful? Because one of our board members said an amazing comment to me. probably back in 2019.

Speaker 2 He said, Nick, you don't get paid extra for a degree of difficulty. So what he was saying is you don't get paid more for doing something in a more complicated way.
And that's so true.

Speaker 2 And it's probably the number piece of advice that I impart to other entrepreneurs. You don't get paid extra for degree of difficulty.

Speaker 1 That's incredible, Nick. Although I have to say, I would not guess that Toronto would not work because they are coffee snobs as well.
So I have to say.

Speaker 1 My instinct would have been the same. And I wonder also if you didn't have COVID, if the outcome would have been the same, right?

Speaker 1 But again, I think think sometimes when we hear opinions, that's the hardest thing: is when you're anyway wobbly about all these decisions you need to take.

Speaker 1 And as an entrepreneur, you're going to make a thousand decisions a day. It's just sometimes really hard to figure out.

Speaker 1 The grass sometimes looks greener on the other side, and you're trying to figure out, should I go taste that green grass? But I also want to understand a little bit just in terms of logistics. I mean,

Speaker 1 coffee shop,

Speaker 1 and not even talking about coffee shops, many, many, right? Just in terms of logistics, I mean, the avocado will get bad, the milk will run out. Like, how do you even plan for it?

Speaker 2 One of the things about hospitality that is, I think, so misunderstood is the level of complexity. And the reason being is when you look at a restaurant, it appears very linear.

Speaker 2 The building blocks are quite logical. You have an idea, you sign a lease, you hire staff, you buy the equipment, you buy the inputs, you make the product, you sell it.
It is linear.

Speaker 2 And a lot of people, and I think that's why they dive into it. They go, I can do this.
It just makes a lot of sense.

Speaker 2 And what's so misunderstood is the complexity because you are effectively just coaching people the whole time. You're dealing with a perishable product.
You're dealing with.

Speaker 2 thousands of consumers that will assess you based on that experience, not not the experience they had two weeks ago, two months ago, a year ago.

Speaker 2 They will assess you and determine whether they repeat and come back to your business based on that experience alone.

Speaker 2 And it's very, very different from when you manufacture clothes and they sit on the shelf and you have six months to sell those jeans and you can then discount them and people are more interested in the product than the experience.

Speaker 2 For hospitality, the experience is everything.

Speaker 2 Particularly what we're trying to do, we are not processed food out of a drive-through window, selling soft drink and chips and things that ultimately aren't very good for people or society.

Speaker 2 We're in healthy food. We're in clean eating.
We're in real food that goes off quickly.

Speaker 1 Exactly. That's why it's hard.

Speaker 2 It's extremely hard. You know, a lot of brands you go to, one including Starbucks, that when you order something, you'll see they'll take it out of a plastic bag.
And why is that?

Speaker 2 It's because the bag is modified atmospheric packaging. It's nitro flushed.
It's coming from probably a place in the middle of America, shipped in frozen.

Speaker 2 They put it in the Mary Chef, the microwave, heat it up, and it's good to go. And it's a very big difference from that versus someone using real bread, real ingredients, and making it to scratch.

Speaker 2 And I hope over time there's a greater appreciation for it because one of the big challenges with the US society, me even living and bringing up three young kids here is the life expectancy in the US is materially lower than Australia.

Speaker 2 It's materially lower than probably that I know that a lot of countries in Europe and I'm sure Israel. So

Speaker 2 for us, there is a lot of complexity. You have a lot of small moving parts.
And ultimately, the biggest challenge is you're dealing with such a high turnover industry.

Speaker 2 A lot of people work in hospitality because it is out of necessity or they have an interest in another career. There's very few that set themselves on a professional hospitality job.

Speaker 2 Those that do rise to the top very quickly and their earning potential is actually really great. And it's a bit of a misnomer that people think that everyone at hospitality is compensated poorly.

Speaker 2 That's actually incorrect. I think it's one of the fastest ways to earn a six-figure salary, in fact.

Speaker 2 So you're dealing with the industry turnover or the industry average in New York or in the US is about 120% a year. So if you have 10 staff, you've got to hire 12 every year.

Speaker 2 Now, what happens if you have 1,000 staff? And we have 800. We're hiring 960 just to keep the status quo to remain flat and stagnant, let alone if we're opening new stores.

Speaker 2 So there is a lot of complexity. It's not fully appreciated.
Often consumers are at times a little bit demanding. They're more accommodative of themselves and their mistakes they make at work.

Speaker 2 I certainly think about banking and there was a lot of errors. There were typos in pitch books.
There was errors in financial models.

Speaker 2 People were late for meetings, but there's very little limited quarter given to hospitality and particularly coffee.

Speaker 2 You know, if we get coffee that tastes slightly different or it's too hot or too cold or has the wrong milk or whatever, which is just a completely normal mistake, people can also go on a website and chastise you and feel that

Speaker 2 they've got the liberation to do it in a pretty asymmetric way.

Speaker 2 Like I don't get the ability to rate consumers or my locals and say that locals are rude or they didn't pay properly or they didn't come back enough. Who knows?

Speaker 2 But yeah, it's just, it's just part and parcel. But sometimes I think you need to appreciate that there's people out here really trying to do their best and just be kind, be nice.

Speaker 1 Yeah, be nice, like chill. I know I'm with you, Nick.
But and again, we're in the consumer space too, right? And from time to time, we're like, come on.

Speaker 1 So, especially when you have like a good heart, right?

Speaker 2 Like, you really are trying to do good but mistakes will happen but as a founder from time to time it will also take my sleep away it hurts how do you cope i'm very very fortunate to have an amazing family construct my wife alexandra and i we've been together a long long time we dated for a long period of time and then we we got married uh nine years ago She's been such a rock.

Speaker 2 Like she's just an extraordinary person. She's definitely challenging.
That's for sure. She's very strong, independent, and driven.
She's at times a little bit apathetic.

Speaker 2 She's sort of like, you chose this career. You know, you could be in banking.
You could be probably in something more stable, but you wanted to go this route.

Speaker 2 And I do have a responsibility to my family and to her and to, of course, my team, my investors, my locals, my friends. My friends, their care for me is unconditional.
My brother.

Speaker 2 who works in the business has been an extraordinary ally and someone who is so supportive. I can often vent and I give him more critical feedback.

Speaker 2 I'm so raw with him at times, probably shooting too straight, but he can sort of bounce with it and deal with it and process it and not let it sort of go too deep.

Speaker 2 And that's another thing that's been a bit misunderstood at times, even with, I think, some people that are very close to the business, they at times think that, oh,

Speaker 2 your brother's working your business, you know, you must give him special treatment. I actually think it's absolutely the opposite.

Speaker 2 The way you treat your siblings is, I think, a lot harder than how you treat your executive team, let alone in the staff, you know, teammates working in the store that I'm trying to be as pleasant as possible.

Speaker 2 And even though I see something terrible, I'm not going to make a scene. I'm going to walk out.
And so Andy's been extraordinary. And then just my school friends, it's really important.

Speaker 2 They don't really care about. what I do, how much I earn, whether I'm on this podcast, whether I know famous people, whether I go on great holidays or not.

Speaker 2 They just care about me as a person, the values. They're the ones that I've known since I, in some cases, were four years of age, others at 12.

Speaker 2 We spent those school years playing sport, playing every different sport under the sun, going out to parties, chasing girls, going on holidays, like just living in a really unencumbered, fun way.

Speaker 2 And they're the ones that...

Speaker 2 They're just amazing because when I call them, they're not interested in really Bluestone. They're just interested in me.

Speaker 2 They're not interested whether it's really profitable, whether it's going to be worth a lot, whether it's going to fail. They just want to make sure I'm okay.

Speaker 2 And no matter what, they and even when I call them and I'm really down, like I've had a really bad day, a bad month, bad year,

Speaker 2 they'll be like, mate, it's all good. You'll be fine.
You'll work it out. Hey, so when are we, when are you back? Like, when are you coming back to Australia so we can catch up?

Speaker 2 Like, when are we going to, when we get all the family together? Like, we've got to go out and have a big dinner or a big lunch. And I want to go get together with this restaurant.

Speaker 2 They just, they bring you back to earth.

Speaker 2 they level you, they talk about what's most important, which is your health, your happiness, your family, the most critical relationships you have in your life, the people that you know are going to be on your deathbed, they're going to be there or they're going to be at your funeral.

Speaker 2 And you often get a lot of advice as you grow from wise people that tell you that you're probably only going to have 10, 20, 30 people at your funeral that really matter. And I think that's right.

Speaker 2 Like you get caught up and absorbed with all these distractions and you think that I have to do this and it's so important.

Speaker 2 And sometimes you just, you got to keep a bit of perspective because life is to be enjoyed and you can do both. You can have a really successful business.

Speaker 2 Is it going to take a lot of commitment, a lot of hours? Absolutely. There's no shirking from that.
And I love hard work.

Speaker 2 But there are times where you've just got to realize that your life shouldn't be just work and achieving this because it goes really fast. And for me, I am not a great individual sportsman.

Speaker 2 I've always been a really good addition to a team. And that's Bluestone Lane and banking were team sports.
I wasn't a trader. I wasn't a sole operator.
I am great in teams.

Speaker 2 And part of that is celebrating success as a team.

Speaker 2 And I feel that whatever happens at Bluestone or any of my other endeavors or my career, that I want to celebrate with my family and friends and the people that matter the most.

Speaker 2 And of course, my parents who are just incredible. Yeah.

Speaker 1 And I think what you just said, and this is really important for everybody listening, because again, we are not trying to just create a paycheck, we're trying to create the life that you want with that.

Speaker 1 And whether it's in a corporate job or entrepreneurship, but it doesn't mean that you're not going to work hard, sometimes you're going to work your ass off, but create the life that you want with it.

Speaker 1 But Tiki, you did allude to COVID, and I assume that COVID is the hardest moment in entrepreneur in hospitality.

Speaker 1 It was a few years and it was like, especially the first year, and there was a lot of unknown. It was opening and closing and opening.
Like, I can't even imagine.

Speaker 1 But Nick, what was it like for an entrepreneur?

Speaker 2 It was extremely challenging, sad, scary.

Speaker 2 and very complicated. So we lost 87% of our revenue in a couple of days.
So we went from 51 stores to 14 and those 14 stores couldn't offer dining. They were simply serving out of a window.

Speaker 2 When we had to make those really hard decisions like eliminating 85% of the staff, that was heartbreaking because it wasn't just people losing their jobs.

Speaker 2 It was many people having a real disruption to their career, a real impact on their family.

Speaker 2 And also, I had a number of Australians or others that their visas were tied to working to Bluestone and without a job, they weren't able to stay and they had rent obligations.

Speaker 2 They had signed leases, but then they weren't entitled to work. So that was really, really, very hard.
We did it. We weren't allowed to be together.

Speaker 2 So many of my team had COVID that first week, you know, around March 13.

Speaker 2 Now, I had COVID. I was home.
We couldn't be together. So it was done, of course, over Zoom, which you never want to do, but it was done very quickly.

Speaker 2 It ended up, we used it as a way to turn a crisis into an opportunity. And even how we made people redundant, we were able to give pay severance and then move them on to,

Speaker 2 if they were eligible, to that enhanced unemployment benefit that the federal government provided, plus the state support.

Speaker 2 So a lot of our team got an upfront payment, then they went on to a decent payment from the government. So it ended up working out okay.
We didn't know.

Speaker 2 We thought the best thing was just to pay a severance. And that means we had to make the decisions on eliminating positions straight away because we wouldn't have no cash in two more weeks.

Speaker 2 Because in hospitality, you're always paying on terms, right? You're paying staff on arrears, you're paying your vendors on 30-day terms, 60-day. So you've always got a big account payable balance.

Speaker 2 So we did that. We were so fortunate that we were able to get a PPP loan that kept us in business.
And then we just had this. clarity that we had to keep stores open for three reasons.

Speaker 2 One, we had to preserve as many jobs as we could. Two, we had to give locals that were holed up in their apartments, that were coming out once a day, a reason to get out.

Speaker 2 Some of them were international and they had no way of going back to their own homeland. Like they were stuck in New York or in DC or in LA.

Speaker 2 And going to a Bluestone for a coffee once a day, even though there was a lot of, they couldn't go with other people and they couldn't sit down, they couldn't dine.

Speaker 2 California effectively banned furniture outside for over a year. Like, can you believe that? Let alone two years indoor dining.
But they were sitting on the curb. They were sitting.

Speaker 2 It was just, it was, it was a wild time.

Speaker 2 And then thirdly, we had to be open for the healthcare heroes that were working so hard, keeping society going, first responders doing their job the best they could in really, really challenging circumstances.

Speaker 2 So it gave us enormous inspiration and the fortitude to keep going.

Speaker 2 And we actually turned it in a way to throw caution against the wind, to do things that we talked about, that we knew now we could do it without any fear of consequence. So we went 100% digital.

Speaker 2 We didn't have order ahead. We didn't have an app to integrate all this technology.
We went pro-tech. We changed the menus.
We changed the way of serving people, the format.

Speaker 2 We used it to our advantage and it was so complicated from the people side because if people can cast their mind and memories back, if we had one of our teammates that was tested positive for COVID, that meant everybody that they had been exposed to then had to go two weeks quarantine.

Speaker 2 So one person comes in making coffee and they work with three others. And then the next day they work with a different person and two of the same.

Speaker 2 We're talking everyone being knocked out for two weeks. And then we've got to somehow scramble and open the store.
And then a lot of people didn't want to work.

Speaker 2 They didn't want to stand next to other people because they were feared or they had people that had compromised immune systems. It was completely logical and it was fair and normal.

Speaker 2 Very, very complicated. But getting through that was one hump.

Speaker 2 And I think that what's been even more challenging and at times like really dispiriting has been dealing with our legacy footprint, particularly with coffee shops in office buildings that were the core of the business, the core of the proposition, and that are no longer really financially viable.

Speaker 2 And that has been probably more frustrating. I fully appreciate the benefits of flexible working.
I'm a huge proponent of it. I saw it as a huge issue in banking, why we would get to director level.

Speaker 2 And I was on the executive leadership team of our bank in Europe and Americas.

Speaker 2 And we were constantly talking about why aren't we having enough young females coming through at the director level that are ready for executive positions.

Speaker 2 And a lot of it was because they had gaps of their career where they were having children and they took time out and the organization kept moving forward and sort of left them behind.

Speaker 2 There wasn't enough maternity leave. There wasn't enough consideration that, hey, maybe they just work for three days a week coming back, you know, after their child or what have you.

Speaker 2 And I'm a big proponent of it, but it's very, very hard for our business because a lot of the stores really only have what I call material revenue three days a week.

Speaker 2 And for everything you read in the press about the push to return to work and corporates demanding it, I have not seen a significant change in the last couple of years.

Speaker 2 And I do think that what we're dealing with, there's some permanency to it. And this is the way it's going to be.
And that's hard.

Speaker 2 You know, at times you think I built so many stores like this, and they don't really work how we anticipated or how the feasibility was meant to work. So.

Speaker 1 Oh, my goodness. I didn't even think of these.
I can't even wrap my head around it. This sounds so, so, so hard.

Speaker 2 But it's inspiring. It's inspiring at the same time.
You know, like you can focus on all the negatives and the challenges, but we're serving 80,000 people and making a difference.

Speaker 2 And like, for as many hard stories I have, I have stories where people come tell me and say, you know what, like, I am so grateful Bluestone Lane. I had the worst morning.
I didn't sleep a wink.

Speaker 2 My baby was up and I was just so looking forward to walking in here at five past seven in the morning and seeing a friendly face, seeing some people, new people, adults, and then listening to music and grabbing a great coffee.

Speaker 2 I just want to tell you, like, what you do is essential to my world and my community. And then you're like, okay, for all the challenges, wow, you know, like, it's pretty cool.

Speaker 1 I just love Bluestone Land. This is close to my home.
Thank God. From San Francisco, you got closer and now I can go visit all the time.
And you have the best avocado toast.

Speaker 1 So I know there's a ton of other things, but I somehow always order the same thing.

Speaker 2 But

Speaker 1 what are you the most proud of then, you know, for Bluestone now or Bluestone? that you see in the future for you.

Speaker 2 It sounds like a lot of it is the community, but talk to me more about like what are you most proud of i'm really really proud that i don't think we've compromised our company values or our product to chase potentially more lucrative outcomes i haven't compromised on the importance of service and human connection like we could use automated coffee machines which reduce the skill of the barista.

Speaker 2 There's a lot of brands out there.

Speaker 2 There's one that has raised hundreds of millions of dollars, they use an automated machine, they don't focus really on experience, they focus on convenience and getting product to people

Speaker 2 that exist, and that's very successful in the U.S. Like drive-thrus are very successful in the U.S.

Speaker 2 Having pre-made food, have commissary-made food that comes in and it doesn't have the integrity of ingredients or quality. I could definitely add more sugar and more syrups and

Speaker 2 take shortcuts on beverages and really reduce the health components. So for me, I'm really proud that I've stuck to my guns.
Yeah, we've had some LTOs. Are we like absolutely pure saints? No,

Speaker 2 we're not. We're practical.
We know what our consumers want, but I'm not prepared to be a candy store wrapped up with a coffee logo, which so many of them are.

Speaker 2 And I'm not prepared to just be a window which just shovels out product for convenience. I want to create community.

Speaker 2 I want places where we have locals, not customers, because ultimately that is what I'm looking for.

Speaker 2 And whether that scales, whether that reaches the economic potential that it should, or whether it makes as much money as it's necessary to be a public listed company and take on the world, I'm not sure.

Speaker 2 I don't know. It's really up to whether people value it or not.

Speaker 2 And I think there's enough people out there that do, but I do think there's a huge way to go to educate and just to remind people that this is just not like a junk coffee.

Speaker 2 This is not just a poor quality bean, poor quality milk, poor quality packaging, environment, service, music, cleanliness, food. There's a really lot of heart and thought in this.

Speaker 2 And yeah, it might be 50 cents more expensive, might be 25 cents more expensive, might be a dollar, but like, look at the whole value you get at Bluestone Lane versus some of the others.

Speaker 2 And that can be a contrarian thought. And people might say, like, Nick, you are a capitalist and a free market person.
Yes, I am.

Speaker 2 But there's a point in time where I think that you got to recognize that some people are providing more value and it's well beyond just the price you're paying. So that's the thing I'm most proud of.

Speaker 2 Yeah.

Speaker 1 As somebody that knows some of the rest of the things around, for me, they're not a comparable, right? Like, I don't really compare that, right?

Speaker 1 For me, this is an experience and it needs to come with the coffee, those

Speaker 1 really quick, let me just grab a drink. That's just not going to happen.
So it's not just comparable. It's just not going to happen.
So I do appreciate that a lot.

Speaker 2 I've got one other thing that came in my mind that I'm just thinking about a fraction longer because Alana, I did not read any of the pre-questions. I just want you to know this is completely wrong.

Speaker 1 And that's what I love about this, Nick. Yeah.

Speaker 2 You know, I'm so proud of our focus on promoting promoting from within and promoting people based on merit and alignment with our values and one thing that i didn't really understand at all i think i'm very fortunate i grew up in australia that has a very strong social security system um very high living standard very wealthy country for gdp per capita naturally endowed like it has a lot of benefits I don't think I fully appreciated being in banking, like how hard it is for small business and some people out there that didn't come from an Ivy League college or university that weren't, didn't grow up in a stable family construct or had parents there or didn't have, you know, parents that weren't incarcerated and things like that.

Speaker 2 And that's probably what I'm most proud of. That I've really learned about and appreciated people's struggles and challenge.

Speaker 2 And I've given them opportunity without considering their background or whether they went to school or university.

Speaker 2 I treat everyone as it relates to our values and our key success factors and our definition of hospitality, speed times, experience. And when they align with that, I want to promote them.

Speaker 2 I want to look internal for every single role.

Speaker 2 It's only the very technical roles where I look externally, but I'm enormously proud of like taking some kids that may have been from very low socioeconomic groups and getting them to

Speaker 2 their first salary in their family, their first paid annual leave. You know, like no one's in their family's ever had, they've had time off unpaid, so they never take it.

Speaker 2 Things like that are enormously, you know, points of pride for me.

Speaker 1 Oh, I love that, Nick. So based on everything that you know, what would be like an advice to your younger self?

Speaker 2 I think you got to enjoy the journey. I think you spend too much time worrying

Speaker 2 about

Speaker 2 how you're going to be perceived if it doesn't work or if it works. And you just get caught up in the minutiae of building a company or on the grind and suddenly you get to 11 years.

Speaker 2 Being at this for 11 years, I've been at it for over 12, but I've been CEO from the first store for 11 years. It's gone so quickly.
There's been so many highs.

Speaker 2 There's been a lot of lows, but like you got to embrace and enjoy the journey.

Speaker 2 And I wish at times like I just didn't, you know, waste unnecessary energy on things I can't control or opinions I can't create.

Speaker 2 As we talked about earlier, there's so many people that have opinions and they really don't have the requisite skill or intelligence or experience to really give them to you that they feel that they should.

Speaker 2 Maybe because they've read a few books and they were successful at one thing. It's not that hard to be successful at one thing, especially if you're part of a team.

Speaker 2 Like you can fluke it and you could be catch the tailcoats of someone who's just extraordinary. They can make you a perceived superficial star.
So I think join the journey. Celebrate success.

Speaker 2 I never celebrate success and you really should. And there's so much and like you focus too much on problems.

Speaker 2 problems some problems at times you got to go hey this was awesome and hey just pause for a moment we did a really good job here high five and let's have a beer let's have a coffee and then let's go chase after those problems

Speaker 1 i absolutely love this and i think you talked about how we're harder with family on family and i would say the hardest we're on ourselves right especially if you're driven you know you're going to talk to yourself in a way that you're never going to talk to a friend or to a coworker or to anybody, right?

Speaker 1 And I think celebrate the journey is just so important because we get to be so hard on ourselves. Nick, this was so inspiring.

Speaker 2 Thank you. Yeah, love the chance.
These are some of the best questions I've had on a podcast. And I'm really proud.
I'm very grateful for the support. But, you know, it's been a learning adventure.

Speaker 2 And I'm 42 now.

Speaker 2 And,

Speaker 2 you know, I still feel like young and inspired and energized to do more more things. And everything's about lessons.

Speaker 2 So I've had three careers, six years in one, 10 years in another, 11 years and another.

Speaker 2 It's really good. And there's so much transferability, but ultimately like staying true to your values, being a good person, being humble, being open-minded, learning, inquisitive.

Speaker 2 I just think that you can do so many things in this world. You don't have to be in tech or finance or hospitality.

Speaker 2 There's so much transferability, especially in this age of EQ probably being more more important for humans than IQ, especially with AI and the digital economy.

Speaker 2 I'm pretty excited about the future, and thank you for having me on and chatting.

Speaker 1 Oh, it was amazing! Thank you, Nick. Love Bluestone Lane, and let's go have some coffee there at some point.

Speaker 2 I'd love to, love to.

Speaker 1 I hope you enjoyed this as much as I did. If you did, please share it with friends.

Speaker 1 Now, also, if you're feeling stuck or simply want more from your own career, watch this 30-minute free training at leapacademy.com/slash training. That's leapacademy.com slash training.

Speaker 1 See you in the next episode of the Leap Academy Wuzzilana Golan Show.