When craft meets wall street
June 17, 2011
Stumptown, Portland’s beloved coffee maker recently sold a stake in the business to a private equity company- TSG and this move, as predicted attracted a lot of negative press.
It’s kind of like an early 90s indy band selling out to the major label.
One of the most vocal was Todd Carmichael who wrote a pretty scathing piece in this Esquire column.
” Chances are, it will be another in a long history of promising roasters sold and promptly suffocated by corporate America, like Torrefazione Italia, Seattle’s Best, and Green Mountain, to name just a few. Instead we must brace for a watering-down of what was, by way of explosive expansion, in which Lady Gaga coffee ends up on Spaghetti Factory menus and ultimately, tragically, the whole thing terminates in some clever bundling transaction triggering a much-needed corporate tax write-off.
What advice can I give to anyone who’s mourning this loss? Vote with your dollar and avoid Wall Street-owned roasters. It is through sales, or lack of them, that these people might learn that trying to buy coolness is a finger-burning strategy. Hopefully then they will leave our roasters alone. In the process, they may even realize that some consumers do care that there is a real, hardworking craftsman behind the things they eat and drink. Those consumers are not statistics and marketing strategy targets. They are lovers of true craft.”
Todd’s perspective seems to suggest that these Wall Street firms are only too happy to buy up cool and then use their financial and marketing wizardry to grind them into the ground, destroy the very essence of their being- leaving them a shattered shell of their former selves.
Of course, this is possible, but isn’t it possible that TSG understands the value of brands- the founder went to Wharton twice after all and is going to be very careful to mess with it.
For owners of these loved craft brands the really have two options- continue doing what they are doing and potentially leave opportunity behind or get hold of some capital and make what you love doing accessible to more people- there seems nothing at all wrong with that.
As Stumptown’s founder Duane Sorenson explained.
” At a time when it’s difficult to find the financing to grow, run and operate a quality driven and sustainable business, I am pleased to announce that Stumptown has found an investor to help us offer opportunities and take care of our employees, farmers and customers like we’ve never been able to do before. I have been lucky enough to find an investor that will enable me to continue to run Stumptown and focus on the coffee.
While Oregon’s economy struggles and the unemployment rate is staying high, we’re looking forward to employing more talented and creative people to help us grow and stay focused on the highest quality coffee and the service we are known for. After all, the success of Stumptown comes from the awesome individuals we have and the strength of our team.
Stumptown will continue to be about the coffee and the relationships we have – with our employees, our farmers, our customers and all the folks looking for the finest coffees available. Aleco, our head coffee buyer, now has more resources to find and work with the absolute best coffee farms and farmers in the world. We’re excited to continue to roast and prepare the finest coffees, support the neighborhoods where we do business and the countries where we purchase our coffees from.”
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