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(That Video Site)   Man sells his Wall Street brokerage for $1 billion to run a donut shop in New York City and drives two Dunkin Donuts stores out of business. David vs Goliath. David wins   (thatvideosite.com) divider line 30
    More: Followup, New York, Wall Street, Wall Street brokerage, donuts  
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2723 clicks; posted to Business » on 05 Feb 2014 at 9:32 AM (23 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



30 Comments   (+0 »)
   
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2014-02-05 08:03:05 AM
If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.
 
2014-02-05 08:16:16 AM
Normally, you don't expect to see business articles from a webpage known as "THAT VIDEO SITE"...
 
2014-02-05 08:29:40 AM
I didn't watch it because f*ck video articles.
Is it Donut Plant?  Because that place is awesome.
 
2014-02-05 08:36:59 AM

EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.


This.  Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

I'm not saying that's what he's doing, but the guy is a financial whiz.  He knows how the game is played.  And since this is basically just a hobby for him, he can screw with the big boys and win without having to worry about growth or long-term sustainability.
 
2014-02-05 08:43:08 AM

dittybopper: This. Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.


Or he race for the bottom with a cheap but inferior product, drive them out of business, and jack up the prices on his inferior product, exploiting the market while competitors are faced with significant costs to re-enter the market place.
 
2014-02-05 09:17:33 AM

kronicfeld: dittybopper: This. Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

Or he race for the bottom with a cheap but inferior product, drive them out of business, and jack up the prices on his inferior product, exploiting the market while competitors are faced with significant costs to re-enter the market place.


Nah, like I said, it's a hobby for him.  He eats his own product, so I don't see him going that route.  That's the route someone who wants to grow the business, but doesn't care about the product itself, would take.

I actually have a bit of experience in this, my parents owned a motel and donut shop up in the Adirondacks when I was a teen.  We did an excellent business, people used to drive miles to come get coffee and donuts at our shop, but we weren't the cheapest around, nor was our location all that convenient, being several miles outside of town.

What we did have was a superior product.  My parents bought the best coffee they could get, and because we had fresh well water, the coffee was the best around, and the donuts were good, even though we had a limited selection:  Plain, powdered, cinnamon, vanilla frosted, and chocolate frosted.  Occasionally we do maple frosted or something like that, but we didn't have filled donuts or crullers or anything like that.

Problem was, you basically had to make all your money during the tourist season from June to September.  They'd keep the donut shop open longer than the motel, but even that was just a mid-spring to mid-fall venture.  Not enough customers during the winter to justify the cost of keeping the shop open.
 
2014-02-05 10:00:07 AM

kronicfeld: dittybopper: This. Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

Or he race for the bottom with a cheap but inferior product, drive them out of business, and jack up the prices on his inferior product, exploiting the market while competitors are faced with significant costs to re-enter the market place.


Is it actually possible to make a donut that is inferior to a dunkin' donut?
 
2014-02-05 10:00:43 AM
Suck it Bain Capital!
 
2014-02-05 10:09:44 AM

dittybopper: EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.

This.  Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

I'm not saying that's what he's doing, but the guy is a financial whiz.  He knows how the game is played.  And since this is basically just a hobby for him, he can screw with the big boys and win without having to worry about growth or long-term sustainability.


except he's not really screwing with the big boys, he's screwing with Hilario and Rene and their excessive time to make the donuts 11.50/hour wage.
 
2014-02-05 11:36:50 AM

EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.


Reminds me of Louie CK's bit on the subject.  Something along the lines of if he ever became a billionaire, he'd open stores called shiatcoontfark and they'd sell dog food for a million dollars per bag.  And he'd put 5 of them around every Starbucks just to piss people off.
 
2014-02-05 11:55:06 AM

InfrasonicTom: dittybopper: EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.

This.  Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

I'm not saying that's what he's doing, but the guy is a financial whiz.  He knows how the game is played.  And since this is basically just a hobby for him, he can screw with the big boys and win without having to worry about growth or long-term sustainability.

except he's not really screwing with the big boys, he's screwing with Hilario and Rene and their excessive time to make the donuts 11.50/hour wage.


Dunkin Donuts stores are franchises as well, so likely he also just managed to screw with somebody who is just a little bit rich to be able for afford a couple franchises. Odds are he is the Goliath in this scenario to the franchisee's David.
 
2014-02-05 11:56:16 AM

EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath. With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.


Not exactly the focus of the article but It doesn't say if the DD were franchise. The DD franchise owners may well have been the David.
 
2014-02-05 12:11:45 PM
Dunkin Donuts Corporate didn't even notice when those two locations closed.
 
2014-02-05 12:13:25 PM

nocturnal001: InfrasonicTom: dittybopper: EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.

This.  Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

I'm not saying that's what he's doing, but the guy is a financial whiz.  He knows how the game is played.  And since this is basically just a hobby for him, he can screw with the big boys and win without having to worry about growth or long-term sustainability.

except he's not really screwing with the big boys, he's screwing with Hilario and Rene and their excessive time to make the donuts 11.50/hour wage.

Dunkin Donuts stores are franchises as well, so likely he also just managed to screw with somebody who is just a little bit rich to be able for afford a couple franchises. Odds are he is the Goliath in this scenario to the franchisee's David.


DrewCurtisJr: EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath. With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.

Not exactly the focus of the article but It doesn't say if the DD were franchise. The DD franchise owners may well have been the David.


Came for these, leaving satisfied.

/'Dis guy is a 1% job-taker-awayer!
 
2014-02-05 12:40:31 PM
I remember the story of R-Donuts, a topless donut shop somewhere in Florida. Came through Penn Jillette, and he asked the owner about how he'd learned to make such a wide variety of donuts for what was essentially a novelty idea. The owner takes Penn in the back and points to the boxes from Dunkin' Donuts.

If you built a shop on the old DD model where donuts are constantly made to be freshest vs the new DD where everything is centrally produced and the shop just vends, the old school will win.
 
DGS [TotalFark]
2014-02-05 01:30:36 PM
So big shot wall street guy opens a new business with shiatloads of cash and runs others out of business killing jobs in the process.

WHY NO JOBS 0BAMA?
 
2014-02-05 01:49:09 PM

DGS: So big shot wall street guy opens a new business with shiatloads of cash and runs others out of business killing jobs in the process.

WHY NO JOBS 0BAMA?


To be fair it sounds like the donut shop was there before DD shops and it didn't say he drove them out of business, it just says they didn't last. Could have been for a number of reasons like they left because then rent went up.
 
2014-02-05 02:38:08 PM
There are a zillion Dunkin Doughnuts and only one of him.  DD will win in the long term.
 
2014-02-05 02:57:44 PM

bromah: Suck it Bain Capital!


It's the range and persistence of venom that's so amusing.
 
2014-02-05 04:36:15 PM
David was a bored billionaire?  Great comparison, subs.
 
2014-02-05 07:47:49 PM

kronicfeld: dittybopper: This. Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

Or he race for the bottom with a cheap but inferior product, drive them out of business, and jack up the prices on his inferior product, exploiting the market while competitors are faced with significant costs to re-enter the market place.


That might work if you're Walmart in Fayetteville, Kansas* but it's gonna be hard to wipe out the donut competition in New York City.

*presuming there's a Fayetteville in Kansas
 
2014-02-05 09:48:21 PM

Rev. Skarekroe: I didn't watch it because f*ck video articles.
Is it Donut Plant?  Because that place is awesome.


It is Donut pub, both are great but pub might be the best standard doughnuts ever
 
2014-02-05 10:16:01 PM
OK you flyover country hill-billies, this place is a densely populated area, more people walk by that intersection in a day than you see in a year.  Those three shops could have coexisted quite easily together, the DD's failed for some other reason.
 
2014-02-05 11:19:43 PM
NoBagelNoBagelNoBagelNoBagelNoBagelNoBagelNoBagelNoBagelNoBagel...
 
2014-02-06 01:00:50 AM

dittybopper: EvilEgg: If you have $1,000,000,000 it's more Goliath vs Goliath.  With that in the bank you don't really have to worry about whether your shop makes or loses money, for a long time.

This.  Because he can take a loss basically forever, he can produce a quality product and sell it at basically his cost, or even at a loss, undercutting DD and any other business that actually has to make a profit.

I'm not saying that's what he's doing, but the guy is a financial whiz.  He knows how the game is played.  And since this is basically just a hobby for him, he can screw with the big boys and win without having to worry about growth or long-term sustainability.


And if push comes to shove, he can just buy out both stores and shut them down. Problem solved!
 
2014-02-06 04:31:20 AM
So Dunkin Donuts won?

Cause this guy's a billionaire, and I doubt that the owners of the Dunkin Donuts franchises are even multi-millionaires.
 
2014-02-06 04:48:09 AM
So a guy who already had more than enough drove two struggling actual small businesses out of business taking several people's livelihoods along with it.

And he is proud of this?
 
2014-02-06 07:58:50 AM
fark this guy
 
2014-02-06 12:16:31 PM
Boy I hate it when ONE MAN makes a billion dollars. Donuts look awesome though.
 
2014-02-06 08:10:36 PM

Prophet of Loss: So a guy who already had more than enough drove two struggling actual small businesses out of business taking several people's livelihoods along with it.

And he is proud of this?


I used to live a block from this place and go there all the time. It's a real local joint with great doughnuts and coffee and always busy. NYCers, at least the long time ones like the local joints over the chains.
 
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