The Elixir of Innovation

Chapter 1 of Thinking About Innovation (2020).

In his famous diaries, Samuel Pepys, the 17th-century London author, described his daily repast: Each morning he would break his fast with a pint of beer or ale. At mid-day, he would lunch on meat, bread, and a pint of either beer or wine. On the way home in the evening, he would stop for ale or hard liquor. Dinner included at least another pint of beer.

Pepys’s menu was not unusual. Entire countries were awash in an alcoholic stupor. In the majority of the population, this continuous sotting of the brain engendered a lethargy of body and mind that suppressed productivity and dulled creativity. Even a hundred years later, the effects were evident; Benjamin Franklin describes the situation as he found it in the London printing house to which he was apprenticed in 1725:

"I drank only water; the other workmen, near fifty in number, were great guzzlers of beer. On occasion, I carried up and down stairs a large form of types in each hand, when others carried but one in both hands. They wondered to see, from this and several instances, that the Water-American, as they called me, was stronger than themselves, who drank strong beer!

We had an alehouse boy who attended always in the house to supply the workmen. My companion at the press drank every day a pint before breakfast, a pint at breakfast with his bread and cheese, a pint between breakfast and dinner, a pint at dinner, a pint in the afternoon about six o'clock, and another when he had done his day's work."

Europe found its solution to this problem in 1652, with the introduction of a wondrous new elixir that came to London in the hands of an Armenian named Pasqua Rosee. Rosee opened a new kind of pub in St. Michael’s Alley, serving a Turkish brewed beverage known as kaweh, a word that translates as “strength and vigor.” Today, we are more familiar with the English adaptation of that word, coffee. From that single café, the new drink, previously little known in Europe, grew rapidly in popularity: there were more than 3,000 coffeehouses in England by 1675, just 23 years later. This was an expansion on the order of Starbucks’ growth in the 1990s.

Pasqua Rosee himself benefited from the new business, most likely opening multiple houses in London and other parts of England. In 1672, he became an international franchiser when he opened the first coffeehouse in Paris. Rosee enjoyed a citywide monopoly on the business across Paris for 14 years, until his first competitor opened in 1686.

When he opened his Paris coffeehouse, Rosee may not have been thinking of anything larger than expanding his own personal wealth, but his business had huge effects—it arguably became a pillar of the nascent French Enlightenment. Rosee’s house was one of the meeting places for French Enlightenment thinkers like Voltaire, Rousseau, and Diderot, who is credited with creating the first modern encyclopedia in that coffeehouse.

But certainly, caffeine cannot not singlehandedly transform a country into an innovation machine. If it were that simple, every country would just import stimulants to trigger the creation of new ideas and new businesses and buoy their economies. It was certainly important that France’s great thinkers weren’t wine-addled, but coffee, and the coffeehouses in which it was served, provided other important supports, nourishing individual creativity in less obvious ways by providing a community and a culture that sparked ideas and supported innovation

Community and Culture

Coffeehouses provided both the meeting places that brought great minds into contact—allowing their ideas to collide and grow with unprecedented productivity—and the fuel for their discussions. Suddenly, intellectuals across the continent, chemically stimulated by coffee, were engaging in vigorous political discussion, advancing philosophy, and creating new schools of art—and entire new industries: the insurance industry was born with the creation of Lloyd’s of London in a coffeehouse in 1688, the London Stock Exchange formed in one in 1698, and Sotheby’s and Christie’s were each formed in coffeehouses, in 1744 and 1759, respectively. Similarly, Wall Street (the New York Stock Exchange), which was famously started under a buttonwood tree in 1792, found its first home inside the Tontine Coffee House just a few months later.  

Lloyd’s of London is a particularly interesting case. Edward Lloyd was originally a coffeehouse owner. Located near the Tower of London, where shipping businesses converged, Lloyd's Coffeehouse became a meeting place for ship owners, merchant exporters, and sailors. Presiding over this convergence of people with a common need gave Lloyd insight into the need for a more comprehensive way to insure ships and their cargo. Thus, Lloyd transformed himself from a coffeehouse proprietor to a broker, connecting those with a need for insurance and those with the financial means to provide it. Over time, he built Lloyd's of London into an insurance market within which wealthy individuals and businesses could offer insurance to the shipping industry. This market approach to pooling resources and spreading risk proved more stable than any individual insurance company, whose limited resources put it at constant risk of being wiped out by a few large losses.

From a certain perspective, the meeting place may have been more important in sparking Lloyd’s innovation than the coffee itself. But the coffee provided both the reason for assembly and the fuel for long hours of discussion and problem solving. The wealthy virtuosi, who were expected to pursue learning for its own sake, might meet and exchange ideas at a salon or a scientific society meeting. But the merchants and craftsmen, shrewd innovators with a keen sense for a practical opportunity, had only the coffeehouses.

Other times and places also saw coffee-fueled bursts of innovation. In the 1960s, American folk music, and artists like Bob Dillon and Joni Mitchell, found a place to mature and build a following in coffeehouses. Those coffeehouses nurtured the social revolution that would come to define the period, and remake American society.

Similarly, the explosive wave of innovation that put Silicon Valley on the innovation map in the 1990s erupted almost symbiotically with the emergence of Starbucks and Pete’s Coffee & Tea, and their new dedication to coffeehouse culture.

Conclusion

Often, innovation is not driven by the brilliant insights of a single person or small group. Rather, it emerges from the clash of many ideas that occurs in a social space, like a coffeehouse. In cases like those cited here, that productive exchange is enhanced by the chemical stimulant of the coffee itself, the social stimulant of the coffeehouses, and the cultural stimulants engendered by people’s encounters in the coffeehouses.

With these historical cases in mind, we might ask ourselves, where is the coffeehouse in my company? What am I doing to create and nourish an innovation community where I work? Are the chemical, social, and cultural stimulants needed for innovation accessible to everyone in my company? 

Author: Dr. Roger Smith has studied, practiced, and taught business innovation, leadership, and management for over 25 years. He has held executive positions in healthcare, computer systems, and national defense companies and is the author of multiple books on technology and management. He is available for keynote speaking engagements with customized versions of many of the stories from this book as topic presentations.

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