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June 15, 2022

Sabir x Nicholas Stone

TL; DR

Bluestone Lane is an Australian coffee company based in the United States. It was founded by a former athlete, helped to popularize avocado toast, and is easily one of the best places to grab a cup of coffee in New York.

Nicholas Stone is the founder of Bluestone Lane, a hard-working innovator whose ambition has helped to make this chain what it is today.

The Bluestone Lane story is one that every entrepreneur should know, and in the following guide and video, you’ll get an in-depth, behind-the-scenes perspective from the man himself, Nick Stone.

He covers many key aspects of this startup’s journey, including:

  • How an Australian coffee business made it big in a US market saturated with chains and independent stores.
  • Why the Aussie coffee culture was key to Bluestone Lane’s growth and Nick’s ambition.
  • How the company used loyalty and word-of-mouth to grow into the successful brand that it is today.
  • What challenges Bluestone Lane faced along the way and how Nick Stone dealt with them.
  • How the support of Nick’s wife was integral to his continued success and helped to get him through the toughest challenges.
  • What advice you should listen to and what advice you should ignore when growing your own brand.

Behind every founder’s journey, there is a lesson for a budding entrepreneur. After all, they have been there, done that, and have a wardrobe full of t-shirts to prove it. They have made the mistakes, discovered the solutions, and now wear their scars with pride.

Be sure to read to the end of this guide or watch to the end of the video, where you will discover what Nick Stone has planned for the future of Bluestone Lane and where he thinks the business is going.

The Bluestone Lane Startup Story With Nicholas Stone

The Bluestone Lane story is one that needs to be told.

The company was founded by Nicholas Stone, an ex-Aussie Rules footballer. It was built on the Australian coffee experience and aimed to bring that experience to the United States.

Australia is one of the few countries where Starbucks failed. Australia has a rich coffee culture and history, and that culture is built on independent brands.

It’s a culture that uses coffee shops to facilitate interactions. It’s a place where the baristas know your name and your order, and you go to enjoy a drink and a pleasant experience.

It’s more of a personalized experience, and for Nick Stone, it’s one that was noticeably lacking in the US coffee market, where convenience and speed were prioritized ahead of personalization.

The Bluestone Lane journey is a founder story and a startup story that every entrepreneur should hear. If you’re currently on your own entrepreneur journey and are preparing to deal with the many bumps and obstacles that will inevitably come your way, this is a story you need to hear.

I invited Nicholas Stone into the This Week With Sabir hot seat to tell his story. You can watch the full podcast episode in the embedded video below or follow the story in this guide.

Why Australian Coffee Culture Is Unique

When you think of big coffee countries, Australia is probably not the first place that comes to mind.

But it has a huge coffee culture, one that’s akin to what you will find in Italy.

Traditionally, Australia was a tea-drinking society. It was part of the Commonwealth, and so it was heavily influenced by British culture and British tastes.

After the Second World War, it welcomed a wealth of tourists from other European countries, including Greece, Italy, and Turkish. As these immigrants made Australia their home, they began to influence its tastes and change them from traditionally British into broadly Europe.

Coffee was a key part of that change.

In Greece, if you ask for a cup of tea, you’re more likely to be offered mountain tea (known as “Tsai Tou Vounou” or “Tea of the Mountain”) than black tea. In Italy, it’s all about chamomile, and in both countries, these teas are consumed as remedies for colds, flu, and stomach ailments.

Coffee is the main drink in these southern European nations, and the way they consume that coffee is different from how we drink it here in the US.

It’s not about convenience, nor is it about buying the biggest cup that you can find and then loading it with syrup. It’s more of a communal experience.

In that sense, it’s more like the Central Perk coffee shop in Friends, as opposed to your local Starbucks.

When Rachel, Ross, Chandler, and Co. visited the coffee shop, they weren’t just looking for a quick takeout coffee, nor did they take their books/laptops along and spend the time with their heads down. They relaxed, chatted amongst themselves, and were greeted by the servers and locals.

That’s essentially what the European coffee experience is like and it’s one that took root in Australia many decades ago. It’s also the one that Nick Stone sought to bring to the United States via Bluestone Lane.

The Challenges Of Scaling A Coffee Business Like Bluestone Lane

Entrepreneurship is not for the faint of heart.

It’s tough. It’s stressful, and you spend your days finding ways to overcome challenges.

You almost need to be a little masochistic to be an entrepreneur, as it’s a career built on failure, difficulties, and pain. You can’t have success and riches without lots of blood, sweat, and tears.

For Nick Stone and Bluestone Lane, it was much the same story.

He admits that he didn’t have it as hard as some other entrepreneurs. The company didn’t follow a long line of failed startups and small businesses. But he certainly met with some challenges and most of these came when he tried to scale the business.

Initially, he had the idea to centralize the production of some key food items, including the avocado toast for which Bluestone Lane are best known. It’s something that many chain restaurants do and it helps to keep everything uniform and ordered.

In simple terms, a large manufacturing and distribution center will prepare and package the foods and these will then be shipped to the many locations.

However, it just didn’t work for Bluestone Lane and it didn’t work because it produced a low-quality food product.

By the time it was prepared and shipped, the quality of the food had dropped too low, and it just wasn’t what the company wanted to sell or be known for.

Many people insisted that Bluestone Lane needed the centralized commissary and simply couldn’t scale without it, but Nick knew that the business had made it to that point without a commissary and believed he could expand further without one.

In the end, he was right, and the business was able to grow.

That mistake cost hundreds of thousands of dollars, but it was a lesson that helped to steer the business in the right direction.

You can learn from all of the mistakes that you make in business. Some of them are avoidable and doing your research and listening to experts will help you to avoid them. Others, like Bluestone Lane’s commissary trial, have to be learned through experience.

In any case, a business’s success is ultimately determined by how it deals with these disasters and what it learns from them.

Promoting Bluestone Lane

In the early days, Bluestone Lane relied heavily on word of mouth, and all of that came from the quality of its product.

Its loyal customers became its biggest weapon.

Initially, it attracted Aussies living in the city by them an experience that they could only get back home in Australia. It was an easy sell in many ways, as everyone wants a taste of home.

A Greek restaurant is always going to attract the local Greek clientele. An Italian pizzeria will get local Italians through the door. Once you get them through the doors, the next step is to provide them with an authentic experience that they’ll want to have time and time again. If you can tick that box, not only will they come back, but they will tell their friends and colleagues, as well.

Before you know it, you’re the business that everyone is talking about.

That’s essentially what happened with Bluestone Lane.

By producing high-quality coffee in a cozy and welcoming environment, it was able to create a buzz. In addition, it sold a smashed avocado on toast that became popular throughout the city, helping to keep that buzz alive and provide something tangible that customers could remember it for.

Once it was getting customers through the door, it began to expand. But when you open more locations, you risk losing the charm that made the first one so popular. You become a chain, and when people think of cozy, personalized experiences providing great food and beverages, they don’t think about chains.

Nick was able to make it work by focusing on the details and never losing sight of the things that matter the most, which was maintaining brand identity and not simply trying to grow as quickly as possible.

Why You Should Never Lose Touch With Your Customers

Nick Stone approached everything with what he called a “continuously improving mindset”. He spoke to his staff and his customers. He kept an ear close to the ground. And as a result, he was able to keep the wheels turning and remain focused on the destination without losing sight of where he came from.

It’s something that countless entrepreneurs fail to do, and many founder stories are littered with tales of staggered growth and disastrous outcomes that occur because they lose touch with their customers.

Take video games as an example, as they serve as the perfect illustration of this problem.

When a developer has a successful series, they will try their best to keep it going and keep making money. Eventually, they’ll start implementing new features and ideas into the game as a way of introducing it to a new audience and attracting a wider player basis.

In the process, they invariably anger all the gamers who made the series what it was, and from there, there are only two outcomes:

  • They either attract new players, lose the old ones, and go down a different route, or
  • They fail to attract new players, lose everyone, and scramble to try and save face.

Neither outcome is good, but if those developers had stayed in touch with their core base of fans, whether through YouTube videos, reviews, or forums, they would understand what the issues were and would find a solution to fix them.

Sometimes, people lose interest in a small company as soon as it grows and there is no valid reason to do so.

I had a friend who would only listen to obscure underground bands, and when one of them made it big, he stopped listening to them and refused to support them. The music hadn’t changed. In fact, the album that he once claimed to be his favorite was the same album that made them superstars. He just wanted to support something small and wasn’t interested in what he called, “Feeding the corporate machine”.

You can’t legislate for those people. But the vast majority will remain loyal throughout your journey if you continue providing them with the experience they know and love.

That doesn’t just apply to startups, either. It’s something that Nick Aldis also spoke about in the context of personal branding.

By staying in touch with the fans that made him a superstar wrestler, Nick was able to transition into a business owner and all-round entrepreneur, taking every single one of those fans with him on his journey.

Don’t Overcomplicate Things And Always Listen To The Right People

If there is an important lesson that entrepreneurs can learn from the rise of Bluestone Lane, it’s that you should keep things simple and only listen to the right people.

In the past, I’ve referenced Gordan Ramsay’s Kitchen Nightmares when talking about businesses, and it’s a good example here, as well.

I have binged pretty much every episode of that show, even the ones filmed in the UK, and they usually go the same way.

In the beginning, Gordan shows up to a restaurant that hasn’t been updated in 30 years and finds a menu that looks like it was written by Dostoyevsky.

The food is bland and terrible, and when he ventures into the kitchens, he finds a disordered, bacteria-ridden bombsite.

Invariably, the owners will ignore his advice at first, referencing something that sounds preposterous to everyone but them, such as, “Our old customers love it, so they must know more than you” or “my mother-in-law thinks it’s great, and she used to own a food truck”.

One of the first things that Gordon does is change the menu. He focuses on quality over quantity, which means the food can be prepared fresh and there is much less waste.

That one simple change has a knock-on effect that improves the quality of the food, saves the restaurant money, and creates happier customers.

Whether you own a coffee business, restaurant, or retail business, you must keep things simple.

When you start adding more elements, there are more things that can go wrong and more things that will get in your way. Rather than focusing all of your time on the things that matter, you’ll be distracted by things that don’t.

As for the advice aspect, that should go without saying. If you have Gordon Ramsay in your restaurant offering advice, you should pull up a chair, shut up, and listen. And if you don’t have a chair, throw yourself at his feet because that man knows more about restaurants than you could ever hope to learn, and his advice is priceless.

Don’t assume that you know better, and don’t take the advice of someone else who doesn’t have any experience or credentials.

I have lost count of how many friends, colleagues, and clients have made ridiculous business decisions based on the advice on an ill-informed friend or someone who has completely irrelevant experience.

The $100,000 Question

At the end of every This Week With Sabir episode, I ask my guests for their best piece of advice—their $100,000 insight.

For Nicholas Stone, I wanted to do something different. This episode was all about his startup journey after all, so I asked him what the future looked like for Bluestone Lane.

He said that the business was planning, “A lot more stores in a lot more markets”.

It’s a brand on the rise, and I look forward to seeing what the future holds for Nick and his Australian coffee business.

In September 2020, I interviewed the co-founder of Magic Spoon, only for that company to sky-rocket over the following year. Today, it’s hard to watch a single YouTube video without seeing a sponsorship placement for Magic Spoon, and sales seem to be exploding.

Hopefully, the same will be true for Bluestone Lane and I expect we’ll be seeing a lot more of it in 2022 and beyond.

About Nicholas Stone

Meet Nicholas “Nick” Stone. Nick is the Chief Executive Officer and Founder of Bluestone Lane, the Australian-inspired specialty coffee and lifestyle brand with 55+ units across the U.S. and growing. A native of Melbourne, Australia, Nick envisioned Bluestone Lane to provide the premium coffee and cafe experience readily found in his hometown but lacking in the U.S. Nick started Bluestone Lane in 2013 in New York City, and, three years later in mid-2016, he left his career in corporate finance to serve as the full-time CEO.

Prior to commencing his career in corporate finance, Nick was a professional Australian Rules Football (AFL) player for 6 seasons. Nick has drawn upon his experience in elite sports and investment banking to build a lifestyle brand that is known for its premium in-store experiences, product and technological innovation, high-growth and strategic partnerships (including most recently announced with Hilton).

In 2019, Nick was selected as a Finalist in EY’s Entrepreneur of Year New York.

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