(The author of this article is Xiaofeng, and Titanium Media is authorized to publish)
Xiaofeng said
Seesaw is about to collapse, and many people are shouting that specialty coffee is no longer good. What is truly worth asking is another question: why do some brands die as soon as they get paid, and why do some brands refuse to expand and instead live well?
This is not a matter of scale, it is a matter of 'boundary perception'.
1、 How big can a business be without deformation?
As an early top tier boutique coffee brand, Seesaw had 135 stores at its peak, but now there are less than 30 left and it is currently filing for bankruptcy.
Why does it have to open to 135 stores?
The answer is simple – if you take money from capital, you have to go to the capital table.
Seesaw's financing path is very typical: in 2017, Baifu Holdings invested 45 million yuan, in 2021, Heytea led the investment of over 100 million yuan, and in 2022, Black Ant Capital and Cornerstone Capital invested hundreds of millions of yuan. Behind every round of financing, there are gambling terms, growth commitments, and exit expectations.
The founder's plan is to take money, expand, grow, go public, and cash out; The calculation of capital is: invest money, promote growth, exit, and double.
No one can calculate: how big can this business be without deformation?
Seesaw's "boutique" persona is essentially built on a fragile set of assumptions: large stores over 100 square meters, expensive decoration with one store, one design, barista's humanistic style, and a customer price of over 30 yuan. This model was established at 10 stores, became tight at 50 stores, and collapsed at 135 stores.
It's not fine coffee, it's Seesaw style fine coffee, with a maximum scale of about 50-60. If it exceeds this number, it may face management cost control, quality control decline, brand dilution, and single store model failure. It was pushed over its' ability ceiling 'by capital and then smashed to pieces.
The core contradiction of this type of model lies in the logical conflict between the single store profit model and large-scale expansion. We can calculate a rough account: a large Seesaw store, assuming a monthly rent of 80000 to 100000 yuan (located in the core area of Class A commercial district), decoration amortization of 20000 to 30000 yuan per month over 5 years, labor costs of 30000 to 50000 yuan, plus material, operation, and headquarters amortization, the monthly fixed costs are conservatively 150000 to 200000 yuan, which requires an average daily sales volume of 200 cups to balance.
What is the average daily cup volume during Seesaw's peak period? The data circulating in the industry is 100-150 cups, far below the breakeven line. This is not a problem for the Seesaw family, but a common dilemma for all boutique chains that prioritize space and labor.
So the question is: why can it survive in 10 stores but collapse in 100 stores?
The answer is that when you have 10 stores, you can only choose one or two of the most core commercial districts in each city, open the stores in the most prime locations, and maintain high customer flow and orders through "scarcity". But by the time you reach 100 stores, the good locations have already been taken up, and you can only settle for the second best. If you open in the secondary core business district or even the community's ground floor, the customer flow will decrease, but the rent will not decrease much, and the single store model will immediately become ineffective.
From this logic, it can be inferred that models like Seesaw have a limited total number of high-quality locations in selected commercial districts. There are only 10-15 first tier and new first tier cities in China that can support 30 yuan premium coffee. Each city can open 3-5 "core stores", and 50-60 stores are already the ceiling.
If you are a boutique coffee brand that values space, experience, and high customer demand, after exploring the core business districts of first tier cities, your expansion path will enter a "no man's land" – there is no ready-made experience to refer to, and every step is testing the limits of your own model.
The problem with Seesaw is not "expansion" itself, but not knowing where the limits of their model lie. It is driven by capital, from Shanghai to the whole country, from large stores to small shops, from boutique to creative coffee, every transformation is a departure from the original model. In the end, it is neither a premium coffee (due to diluted quality control and service) nor an efficiency coffee (due to a heavy cost structure), with no reliance on either end.
This is what I call 'boundary sense' – knowing where one's ceiling is is more important than knowing where one's ambition is.
Someone may say, what about M Stand? It also does space and design, why hasn't it died yet? So what? Compared to Seesaw, M Stand has a higher average order value, a more "check-in attribute" design, and has received strategic investments from companies such as Xiaohongshu, providing stronger brand momentum and traffic support. However, even so, M Stand still faces expansion pressure – the news of Xiaohongshu's withdrawal from M Stand in early 2025 indirectly reflects that capital's patience with premium coffee is running out.
No model is always safe.
However, no one studies the 'way of death'. The industry report studies the "winners" – how Luckin Coffee opened 30000 stores and Manner achieved 2000 stores. No one will calculate the optimal size of a failed model.
2、 Why don't people like 'small and beautiful'?
Seesaw was not the first to fall, nor will she be the last. The question is, why do so many founders know that expansion will die, or do they rush in without hesitation?
Sadly, 'small and beautiful' is not a choice of scale, but a choice of desire.
When you stand at the position of 10 stores, capital hands over a check followed by a complete narrative: "You are the benchmark of this track," "We believe you will become the next Starbucks," "Achieve 100 stores within three years and increase valuation tenfold.
This narrative is poisonous. It makes you feel invincible, makes you feel that 'not taking money is not ambitious', and makes you feel that' guarding one and a half acres of land is small '.
But the problem is that Starbucks' model and yours are fundamentally different. Starbucks has always had an industrial logic from the beginning – standardized products, standardized stores, and standardized supply chains. Its core competitiveness is' consistency ', not' uniqueness'.
The essence of the so-called 'boutique' is precisely 'uniqueness'. It's the mood of the hand brewed barista today, the scarcity of that seasonal single bean, and the different designs of this store and that store.
Uniqueness and scalability are logically contradictory. You can scale up the production of 'decent' products, but you cannot scale up the production of 'surprises'. Specialty coffee sells that 'surprise', once scaled up, the surprise becomes' standardized '- what else is it called a specialty?
So the tragedy of Seesaw is that it attempts to replicate a handicraft using the logic of industrialization. This is not 'expansion', this is' self destruction '.
Of course, there are also many companies that adhere to the principle of 'small but beautiful', but they are not in the spotlight. For example, a boutique coffee brand in Beijing has been open for 15 years and currently only has 6 stores. Every store is profitable, with healthy cash flow, and the founder has never raised a penny for financing.
No one has searched for it. At the craziest time, during the hottest wave of new consumption in 2018, three venture capitalists chased after and invested, with valuations reaching 200 million yuan. The founder refused for a simple reason: "I don't know how to spend the money after receiving it
In his business model, there is no element of 'money for scale'. His core competitiveness lies in the team of baristas he has been working with for ten years, the procurement system that personally selects beans from the production area, and the reputation chain of old customers bringing new customers – these things cannot be bought with money.
Later, with the decline of new consumption, the brands that had been expanding wildly were all over the place, but their six stores were still there, their loyal customers were still there, and their cash flow was still there. This is not luck. He knows the essence of his business and the boundaries of his abilities. Not everyone wants to become Jack Ma.
For example, a ceramic studio in Jingdezhen does not sell coffee but rather cups. The founder is a ceramic artist, and his works have gained some popularity in the industry. In 2019, someone came knocking on her door and said they wanted to invest in her to "create a Chinese version of Wedgwood", open a chain store, do standardized production, and take the e-commerce hit route.
She refused. She said, 'My cup is expensive because I made it myself.' If you let me mass produce it, is it still my cup?
The key to this case is that she knows what she is selling – not cups, but "the time and craftsmanship of a ceramic artist". This core asset cannot be capitalized. Once capital intervenes, she will have to spend her time on management, expansion, and marketing instead of pinching the cup, and then her 'product' will be finished.
Of course, many business models do require capital, and there is no need to demonize them. This is not a topic for further discussion. If you want to hold the border, I think there are at least three points that can be discussed.
Firstly, before financing, think carefully about 'what will this money be used for'.
The reason why most founders take money is because "others have taken it" or "the valuation is tempting", rather than "I really need this money to do something that I can't currently do".
If the purpose of this money is to 'accelerate' – to do things you already know how to do, just to do them faster – then be careful. Acceleration means that your quality control system, management capabilities, and supply chain must be synchronized and accelerated, and these things cannot be solved by spending money.
If the purpose of this money is for "cross-border" – doing things you have never done before – then be even more careful. You haven't even mastered your main job, why do you think you can succeed in a side job?
There is only one situation worth taking money for: this money can enable you to do something that you can never do with your own cash flow, but can establish long-term barriers.
Secondly, include the "right not to expand" in the financing agreement.
After all, financing agreements can be negotiated, not all money requires you to open 100 stores within 3 years. You can set "protection clauses" – such as "the maximum number of stores is determined by the founder" and "the founder has veto power over major strategic decisions".
True good capital will accept these terms because they are here to invest in 'people', not 'stories'. Only those hot money who want to treat you like a puppet will refuse.
When you refuse, you should be grateful – because the money didn't come in, it may be the most correct decision you have ever made.
Thirdly, learn to be a 'respectable little'.
This is the most difficult one. 'Decent small' means accepting yourself as a 'small and beautiful' brand, rather than the next Starbucks. You accept that your annual profit is only a few hundred thousand or a few million, not a few hundred million. You accept that you only have a small group of loyal customers, rather than a well-known national brand.
This is not embarrassing. In fact, this is the norm for most businesses. The stories of the trillion dollar track and billion dollar market value are meant for investors, not entrepreneurs.
A true entrepreneur is someone who strives to do something to the extreme within their own capabilities. Even if this matter is small, to the point where only one street, one community, and one specific group of people know about it.
This' small 'is a strategic choice, not a helpless compromise. This is not teaching you to be "conservative", but to make you "sober".
In the torrent of capital, clarity may be one of the rarest qualities.
For more exciting content, follow the Titanium Media WeChat account (ID: taimeiti), or download the Titanium Media App