The story of Ample Hills Creamery is highly instructive. It goes something like this: couple starts modest, bootstrapped ice cream shop in Brooklyn. They make great ice cream, with innovative flavours. Couple gets Bob Iger, the CEO of Disney, addicted to their ice cream. Iger sends ice cream to influential friends — including J.J. Abrams, Steven Spielberg, and Oprah Winfrey. All of them love it; Oprah features the ice cream in her magazine. The couple raises money from investors. The business expands really, really quickly. They open many stores nationwide, including a massive factory in Brooklyn that costs a lot of money. The expansion then proceeds to kill the company.
This is a companion discussion topic for the original entry at https://commoncog.com/c/cases/ample-hills-creamery/
The main takeaway from this is that the founders were catastrophically bad businesspeople. I don’t like the financial aspects of running a business because I’m much more of a dreamer than a realist. That doesn’t mean you just pretend finances don’t exist though.
They had so many opportunities that people kill for, and they straight up squandered them.
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My main takeaway is that sometimes hyper growth, especially when it’s fueled by debt, is not desirable. We have a local ice cream shop near my house that only opens in the summer. There’s always a line outside and I bet they sell out. It’s a small but handy profit for sure.
When you enjoy working in the business instead of on the business, you’re much better off optimizing for that. Plenty of small sandwich shops around my office—that have been around for decades—are only open from 11:00am to 2:00 or 3:00pm during weekdays.
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