Third places and neighborhood entrepreneurship (2024)

https://www.nber.org/papers/w32604

by WasimBhai • 1 year ago

122 159 1 year ago

1. This is actually a really cool idea for a website. Is this powered by NotebookLM or some such?

2. Coffee shops are probably my favorite Third Place in general. Here in northern Europe, I've heard of some attempts at Costco-like coffee shops where you pay a yearly membership fee, somewhere between $50-100, for the ability to purchase coffee from there, but the coffee itself is quite cheap. You can usually bring some number of friends or colleagues as well. I'd really like to see this model take off, if they can solve some of the adversarial concerns with it (e.g. it probably shouldn't become a replacement for a full time office, but regular 2-3 hour work sessions seem ideal).

WasimBhai7• 1 year ago

Thank you. Previously it was NotebookLM but now I am doing the entire thing, music choice, dialogues editing.

hiAndrewQuinn5• 1 year ago

Oh, that's interesting. Did you find NotebookLM's dialogue wasn't getting you the tone you were after?

postexitus3• 1 year ago

What do you use to sound the back and forth dialogue?

moritonal2• 1 year ago

Politely, on point 1 I disagree entirely. At a glance I thought it was a parking domain and closed it because I figured their site had crashed. Likely because the "Listen Now" looks exactly like a Google Advert and the jump in gradient for the other element.

WasimBhai7• 1 year ago

I definitely agree but as a poor graduate student, this was the cheapest domain I could find.

thucydides• 1 year ago

Yes, I had the same experience. OP should refresh the design

hiAndrewQuinn5• 1 year ago

That sounds more like a design issue than an issue with the fundamental idea behind the website. 3 to 4 minute audio clips breezing over interesting new papers still seems near.

Noumenon72• 1 year ago

The link points to the original paper now (https://www.nber.org/papers/w32604) so this discussion isn't applicable going forward.

dmbche• 1 year ago

You can look for 'anti-cafes", where crackers and coffee is free but you pay for the time you're there, it was somewhat popular a few years back

frollogaston• 1 year ago

I love coffee shops but don't like coffee very much, and they usually don't prioritize tea. Wish tea were more popular.

collingreen2• 1 year ago

I love #2 and would like to see it become popular near me.

femiagbabiaka2• 1 year ago

Cafe hangout supremacy. The Yemeni coffee shops show the ideal model imo. Open late, lots of seating.

yupitsme123• 1 year ago

Unfortunately I think these kinds of places are almost impossible in modern american cities due to rent, labor costs, and red tape.

femiagbabiaka2• 1 year ago

Have faith! There are like 5 in downtown SF alone. Example: https://www.yelp.com/biz/sanaa-cafe-san-francisco

prmph• 1 year ago

Or, the kind of people who are likely to create startups are drawn to cities that are big on coffee shop culture.

As usual the direction of causation is a bit difficult to tease out

nemomarx2• 1 year ago

I think you have to assume the ability to meet other people like that helps in founding start ups though?

potato37328423• 1 year ago

What throws a big wrench into determining causation is that Starbucks tries to avoid opening where there isn't already a sufficient customer base.

Even if you do manage to tease out causation tech and other "sophisticated" industry startups are also just the tip of the entrepreneurship iceberg.

The bulk of the area under the curve of a city's wealth is the long tail of blue collar people who wouldn't voluntarily associate with the kind of people who go to Starbucks starting and making moves to grow businesses that HN snobs don't even notice.

dghlsakjg6• 1 year ago

Blue collar people drink starbucks, HN isn't a monolith of elite snobs. Please don't use unfounded or un-provable negative stereotypes to try to make a point.

If you read the article, you see that the effect was pronounced in lower income areas where a natural experiment was effectively run with Magic Johnson's intervention. Which kind of goes directly against what you are saying.

j_w• 1 year ago

The brief summary on the actual paper (https://www.nber.org/papers/w32604):

"...tracts that received a Starbucks saw an increase in the number of startups of 9.1% to 18% (or 2.9 to 5.7 firms) per year, over the subsequent 7 years. A partnership between Starbucks and Magic Johnson focused on underprivileged neighborhoods produced larger effects."

Seems like third places have strong effects here.

thinkingtoilet• 1 year ago

I wonder if it's more free wifi and an air conditioned/heated room than anything else.

wanderingbit• 1 year ago

This isn’t enough information about the study to tease out cause and effect. There may be a third confounding variable that positively impacts both entrepreneurship growth and Starbucks growth.

For instance, what if Starbucks only decides to move into neighborhoods that have reached a certain level of economic growth (ie number of households, number of business, etc…)? Neighborhood economic growth would likely attract entrepreneurs as well, and we wouldn’t be able to conclude that Starbucks had anything to do with entrepreneurship growth.

Said a different way, would adding Starbucks in the middle of the Atacama desert grow Peruvian entrepreneurs? I mean come on it’d be the only third space around!

I can’t read the full paper because I don’t have a subscription, but the fact that they don’t call this out in the abstract makes me doubt it’s a meaningful conclusion.

csomar2• 1 year ago

Or cities that were growing had a Starbucks join up? I highly doubt people get enthusiastic and start working because a “Starbucks” (specifically) opened up in the neighborhood.

bluehatbrit• 1 year ago

On the website / app this is using - it looks like a nice approach to consuming these papers, but I really wish they'd also provide the link to the original source paper. In an age where you can't trust anything anymore, being able to jump to the source material is really important.

Edit: This comment was made when the post pointed to an audio form of the main article. I'll leave it here none the less as feedback to the audio sites maker.

WasimBhai7• 1 year ago

Thank you. I will definitely add that over the weekend.

lazystar2• 1 year ago

No, this needs to be added before you post to sites like hacker news. how can anyone trust that this audio isn't a 100% fabrication from an AI? Flagging this post, hoping the mods remove this.

edit: thank you, mods, for changing the link.

sneak7• 1 year ago

I’m pretty sure I would move to a city anywhere in the world based primarily on the availability of high quality 24 hour third places.

the_real_cher2• 1 year ago

Hell yeah same.

Where though?

West coast and Gulf Coast where Ive lived have very few.

dghlsakjg6• 1 year ago

Look near universities and in the weird/artsy neighborhoods.

Axsuul• 1 year ago

Ktown in LA has a few

ghaff4• 1 year ago

I question how many people would want to hang in 24-hour third spaces beyond spaces that are open to some reasonably late evening hour.

dghlsakjg6• 1 year ago

Not many. But the existence of them in a place points towards a certain culture.

You see them not necessarily in places like wall street, but more in places with strong intellectual culture like universities and artsy neighborhoods.

I can use the existence of a country club as a useful signal about a place without being a member, or having any interest in it.

sneak7• 1 year ago

Go to some clubs in Berlin sometime :)

y-curious2• 1 year ago

With an American-centric view, how do you deal with homeless people using them as shelter? Like, Korea/Japan have those cheap gaming booths, but that would never work in America because of the aforementioned issue. The want would be an exclusive third place that has the people you'd want to meet with.

sneak7• 1 year ago

Third place doesn’t mean free. Churches and bars (the existing American third places) seem to have mechanisms for addressing this presently.

ericmay4• 1 year ago

With an American-centric view, how do you deal with homeless people using them as shelter?

I don't think it's a concern, first of all. Second, store owners will kick out non-paying customers as they have since time immemorial. You might as well ask how someone deals with pan handlers at the intersection on the way to their drive-through Starbucks. If the person is just sitting in a corner not bothering anyone, maybe someone will buy them a coffee, or maybe they'll be annoyed that it's too loud and leave, or perhaps they just look homeless but they're just mistaken for your run of the mill startup founder?

There are also lots of homeless people in other parts of the world. How do people in Paris or London deal with them? I don't understand why this exists an American-centric view here for such a general concern. Homelessness isn't unique to the United States, yet virtually every country on the planet has coffee shops you can walk into.

anovikov2• 1 year ago

I really can't imagine how it could probably ever work. So one goes into Starbucks and start bugging other random people sitting there (with whatever topic, not just pushing their "elevator pitch" onto them)? If that happened people will start avoiding them just like they avoid places frequented by bums or beggars. No one wants that. People won't go where it is possible.

hiAndrewQuinn5• 1 year ago

Typical mind fallacy. When I go visit places like this I do so with the explicit intention of meeting other people, otherwise I'd just stay at home.

Plus, isn't the claim literally that there is correlational evidence here? That lightly suggests your model of how the world works in this area is off.

TimorousBestie• 1 year ago

Cultural observations are not instances of typical mind fallacy, you’re reading OP too literally.

worldsayshi• 1 year ago

I think a more likely scenario is that you schedule meetups with people that have similar interests.

ghaff4• 1 year ago

Yeah. If I'm going to meetup with someone outside of a conference room or whatever (probably associated with some other event), it will probably be a coffeeshop. But I'm not going to be inclined to strike up a bunch of random conversations at one.

ekholm_e• 1 year ago

I used to work as a barista, and we had several entrepreneurs/small business owners who worked at the shop regularly. Most were friendly with one another. I'm not sure if any actually did business together, but they definitely chatted here and there.

dghlsakjg6• 1 year ago

The entrepreneurial people I know are incredibly social. They don't mind having, or striking up a conversation they weren't anticipating, or learning about strangers. It frequently isn't about business, but leads to networking regardless.

It isn't like they are bugging people, its more like they overhear a conversation or see something of interest and find a way to jump in, in a way that isn't intrusive. "I can't help having overheard, but are you planning to open a Taco truck on 5th?" That kind of thing.

hinkley3• 1 year ago

I have manned a booth at a trade show twice in my younger days. When you’re a little fish at a trade show, you get people chatting with you not because they’re interested in your product, but to gather more data about where the industry is and where it is going. We actually tried not to engage them too much because it distracts from other people who might actually be interested.

postexitus3• 1 year ago

Turkish Starbucks and its local equivalents are usually open until 2am. Don't have an idea on the impact on entrepreneurship though.

PartiallyTyped• 1 year ago

Dublin has a big problem with 3rd spaces; no cafe is open for anywhere close to that, and we are all basically shoved to pubs..

I used to sit at cafes pretty late with a laptop — buying multiple ( >= 2 ) cups of coffee, often salads and sandwiches — in the countries I lived in, but there’s none of that in Ireland. Most non-chain cafes are not open past 17; and chains go on until 20.

sillyfluke2• 1 year ago

British culture in general is pretty bad in this regard. Even in Central London, I find Leicester Square to be the only place that's a little alive at later hours. The pub culture, which I also like, might be to blame. If you start drinking at five on a work day it's pretty easy to call an early night. (there a lot of great third places if you stick to regular early hours, like the cafes of many of the museums.)

Germany I find even worse though. It's kind of ironic since they seem to have a more robust nightclubbing culture compared to the Brits.

picardo6• 1 year ago

Is it normal for people to be drinking coffee so late in the day?

sillyfluke2• 1 year ago

I for one haven't been to a Starbucks anywhere in the world that even tracks whether sitting customers have ordered anything. Is this a thing? Has anyone been to such a Starbucks?

zappb• 1 year ago

It's certainly normal in the Middle East where coffee is a big part of the culture. In some countries, coffee kind of fills the gap where alcohol might normally where it's banned.

csomar2• 1 year ago

Yes.

postexitus3• 1 year ago

They may or may not be drinking coffee - but those places don't track if people are constantly buying something. They are generally young generation, doing maybe university work, chatting up etc. I guess it works well for the coffee shop as well, as more crowded they look, more people come in.

Majromax• 1 year ago

Original paper link: https://www.nber.org/papers/w32604

huem0n2• 1 year ago

Thank you. (Wouldn't have read otherwise)

bdbenton5255• 1 year ago

Like a church? A synagogue? A mosque? That fits the definition exactly. It seems like a substitute for a house of worship for people who do not believe in God.

huem0n2• 1 year ago

Starbucks is my favorite place to worship

nemomarx2• 1 year ago

You do things at a place of worship other than socializing and meeting people, so while a church is a third space not all third spaces are very church like. A bar doesn't really have worship analogues right

williamdclt• 1 year ago

I don't think that's true. All third spaces I can think of are based on some activity, around which some community (or individual social relationships) form which might or might not be so closely related to the activity.

- Church/temple/mosque/etc: worship - Bar: drinking alcoholic drinks - Gym/sport: physical exercise - Volunteering: whatever you're volunteering for - Coffee shop: coffee? Reading, working?

All these have "a thing you do other than socializing and meeting people". You could (and do) go there specifically for the activity without socializing and meeting people (just like church).

Spaces that are "social-only" are pretty rare. Coffee shops are maybe closer to that as you're probably not going to consume many coffees, but people stay to read, work... it's a bit less structured than other third spaces (and personally I find that it makes it more difficult to socialise there)

fipar3• 1 year ago

But in a non-religious third place you may find people from any religion besides us atheists, which is not going to happen on places of worship. Your examples all seem more homogeneous to me.

That may be good or bad depending on what you’re looking for, but my point is I don’t think they’re as comparable as you do.

graemep5• 1 year ago

They are homogenous in terms of one shared belief. Places of religion can be just as varied in terms of most other things (industries, skills, politics apart from a few unacceptable things) and can be even more varied in some things (affluence of people there, and width of area they draw from).

dghlsakjg6• 1 year ago

Do religious people go to church daily and hold business meetings in church? Do religious people go to a church to do a casual date or catch up with friends and associates on weekdays?

I might be very misinformed about how church works, but I think that coffee shops fill a very different niche. History kinda supports this: coffee shops became valuable places of business and occupied the 'third place' role even in extremely religious places and times (I'm thinking of Lloyd's specifically, and 17th and 18th century coffee shop culture as a locus for business ventures in the Netherlands and England).

graemep5• 1 year ago

Do religious people go to church daily

Some do. Do people people go to sufficiently sociable cafés daily? Most people go with and talk to people they already know.

and hold business meetings in church? Do religious people go to a church to do a casual date

Not in church, but with people they meet in church.

or catch up with friends and associates

A lot of churches do have some socialising after services. Just serving coffee or something afterwards

Even without that people chat on the way out.

on weekdays?

If you go to church on weekdays

nsxwolf2• 1 year ago

My church is also my kids' school. We also don't have bus service. During the school year a large portion of the parish is in constant contact and communication because of this.

rexpop• 1 year ago

I am devoutly religious, but you are making chauvinistic assertions.

"House of worship" does not deserve the primacy you assign it. First came "third places" and human relations, and then came organized religion.

You're putting the cart of Churches before the horse of human interaction.

picardo6• 1 year ago

I'd be interested to see an update to this study in the coming years. Starbucks has been pivoting towards take out and mobile orders and removing tables and chairs entirely from some of its stores lately.

ghaff4• 1 year ago

I don't dispute that there may be a trend but a lot of Starbucks have long had pretty scanty seating--and certainly tables where you can reasonably meet and talk. And it can be fairly difficult to find a table at more traditional cafes/coffeeshops. So there's reasonable debate over whether a lot of coffeeshops are really third places.

walterbell4• 1 year ago

debate over whether a lot of coffeeshops are really third places

What are some examples of real third places in major US cities?

walterbell4• 1 year ago

If neighborhood entrepreneurs would benefit from seating, cities can require a minimum number of chairs per square foot, starting with a non-zero number to address US Starbucks locations that have removed all chairs.

sorcerer-mar3• 1 year ago

Or they can just get rid of Euclidean zoning and allow people to create small commercial enterprises in their actual neighborhoods so actual neighbors can easily spend time there.

yesfitz3• 1 year ago

They had been!

But in 2024, Brian Niccols pitched the "Back to Starbucks" plan, with point 3 of his 4 point focus being, "Reestablishing Starbucks as the community coffeehouse."[1] He said, "Our stores will be inviting places to linger, with comfortable seating, thoughtful design and a clear distinction between “to-go” and “for-here” service."

Whether or not that's working is another story[2]. Long story short is that Scooters, Dutch Bros. and other brands are doing drive-thru better, and cafe attendance is down 22% since before the pandemic.

Consumer tastes have shifted. And given Gen Z's preference for online interaction over in-person, I'm not sure if Starbucks will be able to steer the ship.

If I were Starbucks, I'd strongly consider splitting the branding on the cafes and drive-thrus. Keep the Starbucks brand with the drive-thrus, then try opening a few new cafes as a new brand. Worst case scenario, you rebrand those cafes as Starbucks. I bet they've talked about it.

1: https://www.cnbc.com/2024/09/10/new-starbucks-ceo-brian-nicc... 2: https://intelligence.coffee/2025/05/back-to-starbucks-long-o...

barbazoo3• 1 year ago

"Reestablishing Starbucks as the community coffeehouse."

What a load of corporate bullshit. Unlike any other community coffee house, this one made almost $10b in profit last year. I wonder how much the "community" really benefits from this.

https://finance.yahoo.com/quote/SBUX/financials/

ghaff4• 1 year ago

There is definitely a split in coffeehouses. You see all the coffeehouses that have all the laptops open. (If maybe less active socializing.) And then you have the drive-through lines for lattes around the block. Not sure how you reconcile. Could block WiFi but then I imagine a lot of people would just use their phones. (Or skip.)

There maybe is an old European style of coffeehouses but nut sure that's been hit on beyond a very local level.

ethan_smith• 1 year ago

This pivot to takeout-focused stores could completely invert the study's findings, as the core mechanism of serendipitous encounters that drive entrepreneurship disappears when physical gathering spaces are eliminated.

WasimBhai7• 1 year ago

I am sorry, I did not follow the guidelines so link was rightly removed. Here is the audioform link: https://thetreeoflife.cc/demo

bravesoul22• 1 year ago

In SF? Not anywhere I've been though. Cafes I see are full of friends catching up, families or caffeine addicts.

ak2172• 1 year ago

Check Four Barrel or The Mill. I'm sure there are others. For many years, Coffeebar played this role in SF - I was sad when they closed.

b0a04gl• 1 year ago

i remember koramangala, 5th block specifically, mid 2023. that blue tokai outlet next to roastery was ground zero. half of early stage bangalore was working from there. two pm to six pm you'd overhear: investor calls, pitch deck review, even product teardown with some YC alum. no seats inside so i parked at the outside bench near the window. wifi barely reached there. next to me this guy's debugging something on a steamdeck looking devkit. i half glance over and ask if it's AWS creds, he goes 'nah, it's some edge TPU , google keeps timing out cold starts'. we start chatting.

turns out he's building vision for offline-first retail. he's got no frontend, just a python backend. i scribble something on a napkin about fast-booting wasm modules from disk cache. 3 weeks later he pings me on telegram saying they got boot time down from 14s to 2.8s using a variant of that.

never met him again. never even learned his startup's name. but that entire bottleneck cleared because two people overheard a swear word near a bad socket.

we maynot recreate that on a discord channel. there's no incentive to overshare when you're not spatially co-located. bangalore 2023 worked because entropy was high and friction was low

aadhavans• 1 year ago

I grew up ~20 minutes from the place you're describing, and you just made me very nostalgic :D

kylehotchkiss• 1 year ago

I miss blue tokai! So many fun memories and delicious cold coffees there

gopalv2• 1 year ago

bangalore 2023 worked because entropy was high and friction was low

Go a whole decade+ back, it was the Leela coffee shop which opened till 1 AM.

we maynot recreate that on a discord channel.

IRC + freenode did the same decades ago, back in the day when the computers wouldn't fit in a backpack - people would just lurk socially and not really join a channel for a purpose.

Most of #linux-india was a third place after midnight, though not a physical one.

neilv2• 1 year ago

because two people overheard a swear word near a bad socket.

There's also an undesirable side to coworking cafe low-OPSEC.

Funny anecdote about that...

I was meeting up with a startups friend, at one of the cafes that's popular for techbros.

Before we met up, friend mentioned this guy from the startups scene, who sometimes lurks at that cafe, to steal ideas.

So friend and I are talking at the cafe about an application domain we both know. And how we're surprised no one is doing X for it, because then you could do A, B, C, etc.

I look over, and some guy has moved from his table, to sit on the floor, close to us, and just has a cat-that-got-the-canary beaming look on his face. Yes, it was the noted lurker-stealer guy.

Shortly after, an organization he's affiliated with announced a big initiative/group to do X for that application domain. Maybe just a funny coincidence.

drekipus• 1 year ago

Is the problem solved then? Is he making bank?

Ideas are useless without execution

Nasrudith2• 1 year ago

Sounds like a missed opportunity for trolling. Discuss deliberately bad ideas openly while not admitting that is what you were doing. Imagine or watch the karmic suffering as they do something utterly idiotic like "kitty porn" of marketting footage of cats mating to cat owners who feel guilt about having their pets fixed.

wagwang• 1 year ago

First, we compare census tracts that received a Starbucks to census tracts that expected a Starbucks but did not ultimately get one due to administrative issues such as city planning, zoning board rejection, architectural board rejection, or community mobilization. These ‘rejected’ Starbucks are a natural control group because Starbucks Corporation also sought to invest in those neighborhoods.

This is a terrible control group cuz it probably means that the cities that rejected starbucks have idiotic zoning and permit policies that impact entrepreneurship. Like SF, any restaurant that has over 7 locations requires special permitting and can be easily blocked.

hinkley3• 1 year ago

They’re usually called “third spaces” not third places. Otherwise you’d confuse them with bronze medal winners.

Nicell• 1 year ago

https://en.m.wikipedia.org/wiki/Third_place

hinkley3• 1 year ago

Wikipedia, the arbiter of all truth.

Third space" redirects here. For the postcolonial term, see Third Space Theory. For the concept of informal shared public space in community planning, see Third place.

There’s a bookstore in Seattle called Third Place Books. Rarely did I encounter someone who knew why it was called that.

nsxwolf2• 1 year ago

You people already turned every coffee shop into a wework and now you want a "third space".

collingreen2• 1 year ago

Who are "you people" in this accusation?

worik3• 1 year ago

Twenty five years ago, when I did Econ 101 I had it explained to me the theoretical underpinning for the fact that coffee shop chains are impossible

Does Starbucks even exist?

ak2172• 1 year ago

In terms of the ratio of profitability to social good and positive economic externalities, coffee shops are in a category of their own. All the cities trying to attract businesses and stuff should just subsidize some coffee shops first.

mystraline2• 1 year ago

At least in the US, SBUX was the primary 3rd place until they decided to remove themselves in lieu of drivethru and mobile orders... And removing chairs and tables.

To be fair, a proper 3rd place really can't be a company proper, since there's always the pressure of 'buy or leave'.

Even malls aren't sufficient, since many of them are incredibly hostile to under-18. I instead look at public libraries as the gold standard here.

It makes much more sense for cities to run the actual 3rd place, and businesses rent around the 3rd place. That way, coffee shops, restaurants, and the like can comingle as can the people.

Outside the USA, we see more of that in various areas. But folks here would likely howl socialism with a 3rd place run by the city. One can wish for better community, but alas.

gopalv2• 1 year ago

folks here would likely howl socialism with a 3rd place run by the city.

It is not socialism, the problem is the lack of that.

My city does a good job of running a 3rd place as part of their library, it is right outside the library in a big seating area meant for phone calls & talking in general.

But they have 3 full-time security staff, the police station is across the street and the social case workers have an office in the same building.

Outside of a decent coffee, the place has everything for me to walk in with my kids in the summer and work while they roam the hallways as if it was their own, meeting other kids from the same school district. There's even a no-cars allowed trail connecting the place for kids to cycle safely to.

However, take away the constant enforcement by security + social case worker hovering, this falls apart because it'll have the etiquette of a subway car.

The homeless are there btw, but they tend to be non-disruptive and mostly there to get help with something (like a cancelled EBT card).

chasd00• 1 year ago

But folks here would likely howl socialism with a 3rd place run by the city.

I think you're talking about a public library, there's typically plenty of rooms and tables to sit down at and talk with others.

mystraline2• 1 year ago

I explicitly call out public libraries.

But I didn't get into that discussion, but even that system was borne out of Carnegie, an earlier hypercapitalist. That's probably the only reason why libraries are publicly accepted. And in reality, many Republican jurisdictions, they aren't accepted and are being actively defunded.

Well, what I was getting to was more of a European piazza style open area with businesses surrounding it so that people can attend somewhere ever to whatever.

phendrenad2• 1 year ago

Third places still exist, and if you go find them, you'll notice something: Most of the best ones aren't places of commerce. Not coffee shops, but clubs, churches, nonprofits, public parks, universities, apartment courtyards, volunteer fire departments, etc. I think that our modern society, based around cutthroat capitalist optimization where any "third space" is a lost opportunity to extract money from "consumers", is so far from the possibility of true "third spaces" that we can't even reason about them properly, no, not even the people who ostensibly study them academically.

dSebastien• 1 year ago

Most people also miss a fourth place: https://www.dsebastien.net/you-need-a-fourth-place-a-place-t...

Third places and neighborhood entrepreneurship (2024)

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