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Embracing Company Culture, One Cup at a Time | A Cup of Common Wealth

by Pablo Fuentes | Last Updated October 11, 2017
Embracing Company Culture, One Cup at a Time | A Cup of Common Wealth

Embrace community. Serve others. Create culture.

These are the words you will find on the walls of a coffee shop in Lexington, Kentucky.

A Cup of Common Wealth is doing what the biggest and best companies in the world aspire to do, create an amazing culture.

A great culture not only inspires your workforce, but helps to promote your brand.

A company's culture goes beyond their benefits and is not something that employees bring with them. It must be set by the founders of the business and it is reflective in the vision, beliefs and values of the organization.

We were lucky to speak with Sal Sanchez, founder of A Cup of Common Wealth, about how they think about culture and how that has helped the growth and success of their business.

This week on Small Business War Stories, Sal Sanchez of A Cup of Common Wealth Coffee.

Listen to the podcast:

The Soul of America Tour

This episode is part of the Soul of America tour sponsored by Tecovas Boots, Badger Maps, and Impact Dog Crates. During April 2017, I drove with my six month-old puppy Muddy Waggers, my guitar, and my podcasting equipment with the goal of recording podcast episodes with small business owners throughout the heart of America.

Show Notes

A summary of our interview with Sal Sanchez from A Cup of Commonwealth is below.

You can use the links below to jump to your interests.


Can you tell me a little bit more maybe about A Cup of Commonwealth, and what do you guys do?

Sal Sanchez: Yeah, we are a coffee shop, and we opened up maybe three and a half years ago, four in July, and we've just really kind of gotten behind our mission, which is embrace community, serve others, create culture, so everything we do is based off of that mission, and it's really allowed us to get entrenched in the community. We've figured out ways to do like non-profit days or we have a pay it forward board where customers can buy drinks for other customers, and so there's just walls covered with these free drinks.

Tell me more about how that works… people buy for just anybody?

Sal Sanchez: Yeah, we started off and it was going to be something really small, where we figured it would be a little board and people will buy drinks for maybe somebody walking by or a friend, and Lexington just got really behind it, so it turned into this small piece of paper to a giant butcher paper, to now two walls in the coffee shop, just full of these sleeves, and they can be something as simple as the next person that walks in, or it can be as intricate as do 25 jumping jacks in the middle of the coffee shop, so there's just a lot of crazy things that happen in the shop all the time.

Wow, what is the craziest one you've ever seen?

Sal Sanchez: We had somebody act like a chicken for 10 minutes, and it doesn't sound that crazy but when you really think about how long 10 minutes goes…that is a long time to act like a chicken. It was strange, he was jumping up on tables and pecking people, yeah. It was very weird.

We had a dance teacher. She came in and she did the whole Beat It dance in the middle of the coffee shop, to Michael Jackson. That was pretty awesome, just realizing how talented people are, you're like, "Man, that's really impressive and I am not that talented."

I saw you guys have a cool typewriter too, and there's like a really good vibe, so what are the kind of things that people do in the shop?

Sal Sanchez: Yeah, we've come to the point where we just realize the community decides what happens to the coffee shop, so people will bring in typewriters. A lot of our furniture that's there, customers have just brought that in, so I'd say almost all the tables are from customers that came by. Almost all the chairs are from customers that came by. The walls are painted by customers. Both of our bars have been made by customers. We had an old condiment bar that was made by a customer, then another one that was made by a customer, and then another one, so we have three renditions of it now. It's really nice when you walk in there. You talk to any customer, just about any one, and they can point out the different things that they've contributed to the shop. It's made it feel very community-oriented. We've just realized we don't really control it. The people that walk in those doors control it.

What was the inspiration, I mean, if you decide to start a coffee shop, there are probably many different angles you can take, right? You can go, you know, something really kind of more corporate and clean-cut or something more community-oriented. How do you decide that this is the kind of thing that you want to do?

Sal Sanchez: Growing up, I just, I really liked coffee, and I started working in a coffee shop. I was actually chasing a girl and that didn't work out but I joined this coffee company. I loved coffee and I just kept sticking with coffee, so I worked for two other companies and I kept noticing that the coffee shops I really admired across the country are the ones that were entrenched in their communities, they're really good about customer service. They found a way to create their own culture, so that made the three pillars come together okay. Community, service and culture, that's what we're going to be about. That's what I think makes a successful coffee shop.

We realized that we don't have any real control over how people come together. We just want to embrace community and let community decide what they want. That’s when some really cool, fun things happen, and for the shop there, we're in this weird spot where universes are colliding. You have downtown. You have the Kenniwick and Bellcourt neighborhoods. You also have East End, and some others.

What are those neighborhoods like? How has the community come together?

Sal Sanchez: We have some really high-end neighborhoods and then some really low-end neighborhoods, and then you have downtown. We're like kind of in the middle so it's been fun to watch all the collision. We have kids coming down there. They've learned how to read by going down the pay-it-forward board, or they have learned how to tie their shoes. You also have people that are coming in there and they just want a break from their everyday life. It's been fun to just see what happens in those four walls.

It started out as a little spot and we've more than doubled in size. Now we blew out a wall and so we stretch all the way to Main Street. The shop used to be 800 square feet and now, I think it's maybe 1,800 or 2,000 square feet.

What were some of the coffee shops nationwide inspired you? Are there some that jump to mind that really have that powerful vibe that inspired you?

Sal Sanchez: Water Street Coffee Joint is one that I worked in Kalamazoo, Michigan. I love them. They're one of my favorite coffee companies. They're so good about just being community-oriented and treating people right.

Cuvee Coffee in Austin is one that I really, really admire and respect. They have a new one on the east end. I knew them when they were still a roaster out near Bee Cave, but they just opened up one in the East Side. It's kind of like Chipotle-style, which is really cool and I love that model. Instead of like ordering like you normally would at a coffee shop, you pick your milk, you pick shapes, you kind of go down the line, and Mike, the owner, is a big Chipotle fan so it's kind of worked out that way. It's pretty cool.

When I worked for Whole Foods, we had Allegro Coffee Company and really learning about Allegro and the people involved in it was really cool and seeing some of the coffee farms, and just kind of getting a better feel for that.

There's a shop called Midnight Oil in Searcy, Arkansas. It was like in an old house that was really, really cool. There's Houndstooth in some of the Texas areas, like Austin and then, I think they opened one up in Houston or Dallas. The one in Austin is where I actually was finalizing the business plan for our coffee shop, right before I moved to Lexington, so I always have a special place in my heart for that coffee shop. Yeah, those are the ones that come to mind.

Why did you want to start it here in Lexington?

Sal Sanchez: I was looking at different cities and Lexington won out. I'm from Michigan, so I originally thought I was going to open shop in like southwest Michigan or Chicago, and then I had a really good buddy that was stationed in Fort Knox, so we had come through Kentucky. We looked at Louisville. We looked at Lexington. We looked at Frankfort and at the time, that was back in 2006. Lexington wasn't what it is. It was a lot different and I ended up going to a different company, and worked there for five or six years. I was in Texas for a long time, and then as I was working at Hastings and Whole Foods, I started visiting a lot of different cities and sort of watching Lexington bubble and grow, and then I just finally, one day, sat down and wrote down all of the things that were important to me to start a business. Strangely enough, Lexington, Chattanooga and Detroit were the three cities that topped almost all of my lists.

The thing that stuck out with all of them, they were really friendly to small business. They were all kind of starting out. They really weren't into the coffee scene yet. They were still kind of slow behind that movement. They were all closer to my family. When I moved to Texas, I was really far from all of my brothers and sisters and parents in Michigan, so I was trying to get closer to them, and what's special about Lexington is that it was a college town, which is really helpful. There's a nice rural and urban combination. They're super friendly to small business, and that was the same thing for Chattanooga and Detroit.

Detroit, I think, was going through a renaissance, and it still is. It's a powerful place. I still haven't been to Chattanooga. It's strange it popped up on my list. It had all the things I was looking for when I was researching. It kept popping up and I haven't been there yet, so Lexington kind of made sense.

Without naming names, see any coffee shops where you thought to yourself, "Oh I don't want to be like that?”

Sal Sanchez: Yeah, absolutely. I think one thing I learned from an old mentor was to focus on the attributes that I do want in my shop. But I definitely paid attention to the things I did not like. Sometimes service was bad, and that’s something that has really started bothering me over the years as I get older, how important service is. I'd go into coffee shops that some were just beautiful, design was great, the coffee was amazing, and they would give you really bad service, so that really bothered me.

Sometimes weird designs would bother me if they didn't match. I'm not a huge fan of when somebody takes a new space and then they make it look old, just the lack of authenticity bothers me.

Do you guys roast your own coffee?

Sal Sanchez: Yeah, we just started. When I worked at Water Street, we just built a relationship with the owner and the management team, so when we started here, that was our major roaster. Then, we had two local roasters start supplying us coffee too, and we would rotate out. We became like a multi-roaster. We had a lot of different ones there. Then, I went to Denver for a bit and the owner of Magic Beans reached out to me and said, "Hey, you know we're looking to sell and get out of here and we want to make sure the brand's taken care of, so I want to see if you'd be interested in it." It was something we were planning on doing, but like five years down the road. It was just an opportunity. Yeah, let's buy it and see what happens, so we acquired Magic Beans Coffee Roasters a little bit over a year ago, and now we're roasting our own coffee. We still get from Water Street, just because it's a good relationship and we very much believe in keeping a relationship strong.

We have still other multi-roasters, but it's just been fun to roast your own coffee, practice, play around, learn.

Yeah, that sounds like an entire art in itself…

Sal Sanchez: Yeah, it's crazy, and Joe, who's our roast master, I mean he's amazing. He has a great palate, and he can pick up anything in coffee. He loves the idea behind roasting, and he loves the science of it. He is one of the smartest people you'll ever meet, and it's great because he has that skill set and I don't have to worry about that part of the business.

Do you distribute and sell your coffee to other people or is it mostly sold through your shop?

Sal Sanchez: We mostly sell through our shop right now. We do, we have a few shops that serve our beans hee in Lexington. 21C, the hotel, we supply their coffee and there are few other key spots as well. We haven't tried to get like too big. We're here regionally and I don't know if we're ever going to be national, if we're ever going to try to get really, really big.

Let's talk about creating culture. To enabling the community to come together and create, there has to be a certain environment that makes that easy, and a big part of that is the people in there. When you're looking to hire somebody, what's your process to hire and find that person, and make sure that they're a good fit with what you're trying to do?

Sal Sanchez: We have a really crazy interview and hiring process, I think. People definitely kind of make fun of us because it's so elaborate. We probably start off with 100 applicants at any given time. We don't have applications. We tell them to apply or send us a resume. Tell us why they're fun and why they want to work with us, just through an email. Then, we take all of those applicants and start taking them through the process.

There's a giant group interview that can be anywhere from 20 applicants to 100 applicants, kind of depending on how many people we have at the time. When we interview them, we're looking at their personality. Are they genuine? Do they really want to be here?

For the group interview, we get in a giant circle and if it's too many people, we might do two or three group interviews at once, and then we just start asking questions as we go along. There are usually two people that are doing the interview. One that's asking the questions and one's kind of an observer, and just paying attention to all the candidates that are there. Once we get to the group interview, there's usually maybe five that make it out of that, and they go into the panel interviews.

In the panel interviews, three or four staff members interview them. If they get through that, they do a shop interview, where we do an on-the-job assessment. They're standing next to the register and greeting customers and we're just seeing how they interact with people, and then we usually end up with one or two people, so from like 100 to one or two.

They have to get through all three interviews. The catch is that our process is unanimous…they can't have a single “no.” They have to be interviewed by at least five of us and any “no” ends the interview process, so I have no trump card. I can't say, "I really like this person. They're going to get hired." If one of, if a barista, the newest barista said no to that person, they don't move on.

It's really interesting because there's some accountability that's build up, where the baristas know that, "Hey, if this person's going to work with me, I okayed it." They're much tougher in a lot of ways and by the time we get through it, we figure if we have all said yes to this person, then that person is probably going to fit our culture.

Has the lengthy and strict process ever backfired?

Sal Sanchez: It hasn't yet, but I do think sometimes we maybe have missed out on some good people, where we're like, "Yeah, that person was great," but they just, they got four out of five yeses or six out of seven yeses.

Do you think there's a potential trap there where you could be hiring for lack of weakness instead of hiring for strength?

Sal Sanchez: You know, there's that potential, and what I'd like to believe is that we are searching for the person that fits the culture at the right time for us. I think there's always a right time and a right place. We've had plenty of people that have applied and we really liked them, and they applied again and they've come through the second or third time and end up getting hired, so hopefully we've built in enough checks and balances where we kind of prevent that problem, but I'm sure there are times where we've probably made a mistake, but I've been happy with the staff. I think our culture's really strong.

Once they come in, they go through a 75-90 hour training program. By the end of training, they usually feel good about the skills and responsibilities of the job. We don't have a lot of turnover. People stay. In the end, they've put in so much time…they're like, "Yeah, I've interviewed forever. I've trained forever. I'm going to be here for a while."

How many people do you currently have employed? How often do you hire?

Sal Sanchez: We have 25 people on staff and hire probably one or two per year. We recently had our first batch hire when we opened Chocolate Holler, which is our second shop now. We hired 10 people in the last month, and that's the first time we have done that in such a short period of time.

As a management team, we always know that when we're about to start interviewing, it's going to be a lot of work. But the process really matters to us. Our employees are the front line. They're the most important position in the company, so we want to spend a lot of time in hiring the right people.

Did you spend time in the front line yourself?

Sal Sanchez: Oh yeah. When the shop opened, there was me and my business partner at the time. We were there from open to close, so it was 16, 17 hour days for us. When Chocolate Holler opened, same thing, and it helps me just be in there and kind of get into it.

Can you think of a time when you had to make a tough choice because of culture, but you knew deep down it was the right thing to do?

Sal Sanchez: Yeah. Wow, let me think of a really good example here. It happens all the time; I just want to make sure I come up with something good. Well, recently we were thinking about expanding and we were looking at acquiring another business. I was really excited about it because it was going to inject a lot of revenue into the company right away. But we looked at our mission and we were like, "Okay, our mission is embrace community, serve others, create culture." All of our decisions have to be made off of that," and we came to the conclusion that the acquisition was not going to really fit into what we're trying to do.

Instead of buying another business, we came up with the concept of Chocolate Holler, and we decided that it actually fits our mission better. It's a new business that we're organically growing. It opened and it didn't inject the same amount of immediate revenue as the acquisition would have, but it was the right choice. It was a lot of work. We started working 16, 17 hour days again, and it became really exhausting and there was times where I thought to myself, "Maybe we made the wrong decision," but now looking back on it, it ended up being the right decision.

Let's talk about that a little bit because I think a lot of small business operators have sleepless nights when things are not going as planned. How do you manage your own psychology in those moments? How do you know when to stick the course?

Sal Sanchez: It's taken me forever to figure this out, and I think I'm just starting to. One, I always tried to balance professional and personal life, and now I realize there's no point. I'm just going to kind of blend them all together, so if I feel like I need to go for a run or I need to go read, I'm going to go do that and then I'll come back to work. That's helped a lot, where I don't feel like I have, I'm not thinking in terms of all these crazy hours that are going into it. Then, I've found time to carve out, that I just need to be by myself, so I know that I get up really early. I'm a really, really early riser, but I need two hours to myself without people around or anything. It's times with my dogs and it usually turns into four hours, so by the time I actually run into people, I'm pretty far into my day.

I have a few really close friends. I like to have a bourbon or a coffee with them and talk and bounce ideas. Some of those people are removed from the coffee shop, because they see it objectively and so that helps me to hear their input from an outsider’s perspective. I also prioritize touching base with my family. My parents are not really into specialty coffee, but they're still my parents and so they still can just be like, "Hey, this is stupid. This is how you should be thinking."

What's an example of something that you did or said where your parents said: "This is stupid?"

Sal Sanchez: You know there's times where I'm thinking of plans for the future of the coffee shop and say like, "You know we gotta do this, this and this," or "This is what I'm thinking of the staff right now, this is how we can develop them and my plan is to do this with this person, this with this person."

My parents are like, "They're kids. You have to give them some room, extend grace sometimes. Be nice. You don't have to push people hard all the time," and I have thing where I want to develop everybody I talk to, and work with everybody, and sometimes my mom is like, "You've got to realize there were times when I wanted to smack you so hard, but you can't always do that. You just have to," not that I smack my employees, but you have to give them that opportunity to fail and mess up.

It's cool to see that you don't have to be in industry to give people advice. I think that's what I love about my parents is that they're not afraid to tell me when they think I'm right or wrong, and they don't hold back. They're like, "This isn't smart," or "You're working too hard," or "Come home and visit your grandma," that kind of stuff.

Can you think of a time when things were not going well and how did you deal with that?

Sal Sanchez: Yeah, early on we were still trying to get going and build up revenue, and we were working all the time. Abut four months into it, we finally decided, "Hey, let's just take a step back. We've got employees. Let's take a break." We did that and the shop started declining. We're like, "Man, we've got to get back in there. Hopefully we can keep this going."

Then the weirdest thing happened, where we got broken into one night. They stole like $300.00. The window was more expensive than the money that they took, but the next day, customers and people from the city just started flooding. They came in. They brought food. They brought money. This one kid didn't have any money so he brought a piggy bank, just so people could put money in there to raise for the window. It was almost like a really happy funeral in a sense, where people just came in and they dropped off food at the tables. We were still a really small space, so it was crowded all day long, and people were there helping pick up the glass.

My business partner and I were there all night, just kind of waiting for the first customer to come in, and the baristas came in and they were so upset. They're like, "Oh, this is going to suck."

My partner and I ran home to take showers and come back. On my way back, I called and the barista at the time starts telling me "You will not believe what's happening." Before I left, I had told her "We don't have any money so if people buy stuff, you just don't take their money because we can't give them change," so she had told the first customer that she could not take their money, and he said, "All I have is a $20, keep it, this is a way to get you guys back."

Then the second customer did it and the third customer did it, and the next customer bought a pay-it-forward and he put a drink up, and it grew from there. I mean even to this day, I still get kind of emotional thinking about how it just started spiraling and that day turned into one of our biggest days, and all of a sudden we had news reporters in there all the time, asking questions about the pay-it-forward program, and for the first time we had this huge limelight on it. People were like, "This is really cool. We didn't know this existed."

That day marked the beginning of a turnaround for us. We started shooting up from there, and I think from that point we grew 30-50% every week for a while. The business has been on an upward trajectory since then.

It's funny what a break-in can do. It just changed everything. We took one our worst days and turned into one of our better days. We've turned it into a holiday, too. Every December 9th it's our Break-in Day and so we do free drinks for the community, just because they supported us that day.

What would you say is your number one lesson or piece of advice that you would give small business owners or people who are thinking about starting a small business?

Sal Sanchez: This is so simple, but I'd say just be good. I used to always want to come up with something really cool to say or something like, "This is the one thing that's going to make you successful," but for me, I realized if you're good to people and you're genuine and you're honest, and you want what's best for other people, everything kind of just works out. Everybody treats you well. I mean when we do free drink days too, like that Break-in Day, people were like, "I don't want to take a free drink." We're like, "No, no, no please do," and like people just take care of each other. There's something, and I might be biased, but there's something really special in those four walls, and it's something that, every time I walk in that shop, and even Chocolate Holler doesn't have that yet, where you walk in A Cup of Common Wealth and you're almost in a different universe. Everybody's kind to one another. Everybody's looking out for one another. It's something really, really special.

Where do you see this going in the next 10 years? How do you want to see this grow? How do you repeat that magical success you have had with the coffee shop?

Sal Sanchez: Yeah, I actually wonder that all the time. We've talked about this, this past week too… is this lightning in a bottle or just a flash in the pan? We talk about how we do want to grow it and one thing that we've mentioned is that we want to stick to our mission, so maybe that's two stores, maybe that's five stores, maybe that's 10, maybe it's 15. We're not sure, but what we do know is that once we feel like we can't fulfill that mission anymore, we will stop growing.

There are lots of opportunities to grow in Lexington, but there are other places, too. I love Michigan. I would love to get something up there at some point. I love Tennessee. Kentucky has some great spots that people still don't know about.

I think Chocolate Holler, from a business perspective is a little bit more replicable than Cup of Common Wealth, but there's something special about Cup that if you can duplicate it, it's really cool to be able to provide that.

Why did you decide to start a chocolate business as your second location instead of another Cup?

Sal Sanchez: We are really trying to avoid every being too cookie cutter, so we want things to be different. Chocolate's really similar to coffee in a lot of ways. I learned more about it about five years ago and it made me really interested, and I've seen French Broad and Asheville, and then like the Ghirardellis and Godivas that pop up in big cities, it's a cool little business that I don't think people have really tapped into. People love chocolate.

We want to take chocolate and tie in our culture of community, and it's a really, really cool idea, so that's where Chocolate Holler came from. It's been fun to see how it has impacted different customers. The two shops are literally across one major street from each other. You could throw a rock and hot the other location, but they're two totally different customer bases. One's very much coffee and community-driven. One's very much about chocolate, with a clientele heavy on college students.

Do people know that they're the same company?

Sal Sanchez: Slowly they're learning. We thought we made a big deal about it, but we find out all the time that people really don't realize it's the same company, so we'll tell them, and they're like, "Oh, so ..." The funny thing is we originally opened Holler that close because we wanted to cannibalize some of the sales from Cup in the morning. We were like, "Well, that will make our mornings a little bit easier. We'll have this second location. We'll build this up." What ended up happening was, the new customers we got from Chocolate Holler heard about Cup for the first time, and suddenly the sales at Cup shot up, and so now we are seeing the complete opposite of what we thought would happen. But those are good problems to have.

You talked about Lexington a little bit. I'd love to hear more about what it's like to do business here, what's your relationship with the government? What's your relationship with other small business owners?

Sal Sanchez: Yeah, it's really cool. There's something about Lexington where people want to celebrate everything and they want to work together. When we opened the shop, small business owner after small business owner started coming to the shop and supporting us. There's very much this sense of we'll extend our hand if you grab it, we're going to help you along the way.

Even in the building that we're in now, the Plantery, it's the bread box, so there's a brewery here. There are artist studios. There's a Roaster. There's this non-profit space. It's just a very community-centric place.

The city has done some really fun stuff, too. Right outside of the coffee shop, there are all these parking meters and so we pay for people's parking. We put a mug out there and people can take the change and fill up their meters. Well the city found out about that and they, for Christmas, brought down gift cards for customers so they could just use and throw it in the meter and everything, so there's a cool relationship there.

We see the mayor every day. A lot of the councilmen come in and out of the shop. We try to work with them as much as possible. There's a huge project right now called Tom Brach, where they're going to be taking creek, throughout the middle of the city, and connecting a lot with a bike path and we're going to do some tests with them, where we're going to do like pop up coffee carts and just kind of play around and see what we can do.

Where can people find you?

Sal Sanchez: For the shop, it's 105 Eastern Avenue and just outside of downtown, right across from Thoroughbred Park. We are also on Instagram, Facebook, Twitter, and our website, acupofcommonwealth.com, that covers a lot of the different aspects of the business. Yeah, if people want to reach out to me, email's really simple, it's [email protected].

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If you have any questions or comments about today's episode, please leave them below.

Topics: small business war stories, podcast

Pablo Fuentes

Written by Pablo Fuentes

Pablo Fuentes is the CEO of Proven. He is a graduate of the Stanford Graduate School of Business and UCLA. He is a Brazilian Jiu-Jitsu practitioner and a blues guitar player and builder.

 

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