Studying and caffeine just naturally go together, so it’s hardly a surprise that coffee shops flourish on college campuses. But the coffee shop that opened in April 2015 at Drexel University in Philadelphia, Pennsylvania, is a bit unusual: It’s a partnership between Drexel’s Close School of Entrepreneurship and Saxbys Coffee, and it’s run entirely by undergraduates. As students handle all phases of operations, from budgeting to marketing to hiring, they gain real-life experience about what it takes to run a franchise. They also earn course credit through the university’s co-op program.
The student-run cafe was the brainchild of Saxbys Coffee CEO Nick Bayer, who founded the company in 2005. Saxbys Coffee now has 29 locations, mostly in the eastern half of the United States. Although the Drexel coffee shop is only a few months old, the operation has been so successful that Saxbys Coffee hopes to expand the program soon to other universities.
Bayer has been closely involved in the Drexel program, serving as mentor to the student entrepreneurs, and he’ll expand that role this fall when he becomes an adjunct professor at the Close School within the LeBow College of Business. Here, he shares his thoughts about how business schools can nurture young entrepreneurs.
Most entrepreneurs target an underserved niche, but you chose coffee shops, which already exist on every corner. How did you differentiate your brand?
We focus on a space where we can compete: customer service, or as we call it, guest engagement. Taste is wholly subjective, but how you treat a guest is objective. Of course we want our coffee to be good, but if guests have a terrible time while they’re getting their coffee, they’re not coming back.
Additionally, we start from scratch to make every cafe design unique. We want every Saxbys to feel like a reflection of the community it serves.
How can business schools help students uncover their great ideas or discover the passion they’ll need as entrepreneurs?
The best way to holistically learn about business is to find hands-on, experiential learning opportunities. You really need to throw yourself into a business and figure it out as you go. Experiential learning gives aspiring entrepreneurs the room to make mistakes and learn from them within a structure that provides support and feedback.
Maybe someone joins our Drexel team thinking marketing is her thing, but one week in she discovers she’s an operational superstar. Experiential learning opportunities allow students to learn these important details.
You speak regularly to business schools on the topics of entrepreneurship and franchising. What’s your key message?
Learn from my mistakes! I maxed out my AmEx card to start Saxbys. I didn’t have a business plan, and I found out the hard way that having one is crucial to your success. I always speak about the challenges I have faced and the tools I found to avoid those road bumps in the future.
Saxbys has 12 other campus cafes, but the Drexel shop is the only one that’s run by students. Why were you so interested in opening a location on a university campus?
When I was in school, entrepreneurship wasn’t even a minor. Starting a business and being in school were looked upon as opposite endeavors. Today, many universities are embracing entrepreneurship. Drexel has an entire building and a standalone school dedicated to the topic.
I thought opening our first experiential learning cafe on a college campus was the perfect opportunity to foster entrepreneurship in students eager to learn about it. This generation of students wants to take ownership of what they do. They’re natural entrepreneurs.
In what ways has the cafe launch gone more smoothly than you expected? Where did you encounter bumps?
What’s gone smoothly is that we’ve found a great team of individuals to work for us. The only challenge we’ve run into is one we expected—finding a new cafe manager every six months, which is the length of the co-op. We’ve had two stellar co-op cafe managers so far. Meghan Regan helped us develop the cafe and team, and Kelsey Goslin opened the cafe and leads it now. They’ll be so difficult to replace.
What’s the process for finding the new managers? What traits do you look for?
We want people who are comfortable in their uniqueness. We look for O.D.D. individuals—people who are outgoing, detail-oriented, and disciplined. The hospitality business requires people with outgoing personalities, but they also have to get the job done at a high level, every time. For instance, since our managers have to perfect each drink recipe, they must pay close attention to detail; since they sometimes have to wake up before dawn to open a cafe, they must be disciplined.
Because our managers are part of Drexel’s co-op program, we go through the co-op to find candidates. The interview process is thorough. Candidates meet with members of each department—me included—as well as the existing cafe manager to ensure that the “O.D.D.-ness” is there and that our next co-op manager really locks in to our mission and core values.
Many business schools have programs that require students to become entrepreneurs for a semester, often by starting a business that lasts for the duration of the class. How is the Saxbys Coffee experience different?
The budding entrepreneurs who run our cafe receive endless support and resources. They’re able to lean on our expertise, but they still have the flexibility to make their own choices. They also have a hand in things that really make or break a business—like hiring and developing employees. I think it’s much truer to the actual experience of starting a business.
You meet with the student entrepreneurs to offer them one-on-one guidance. What does it take to be a good mentor?
You have to be candid. It’s important to be transparent about your own experiences, because whatever students don’t learn from you, they’ll learn in a much harder way later down the road.
This fall, you’ll become an adjunct professor at the Close School, focusing on entrepreneurial franchising. What are some of the most important lessons you hope to impart to students?
The purpose of the class is twofold: to provide functional knowledge about the franchising industry and to show students how franchising can be a great outlet for entrepreneurial desires.
As for takeaways, I want them to learn what they’re good at and passionate about, how to find a brand that they’re a great fit for, and how to meld their entrepreneurial skills with the systems created by great franchise brands.