Hello to all you winter-bound northerners… We were in partly sunny Pensacola Florida on Tuesday (72 but windy). Big Navy presence down here, and lots of pelicans too. Local public art combines the two, with interesting effect:
We spoke to businesses from both ends of the age spectrum here. One was a fish market, a local institution started by the current proprietor’s father back in the 1930’s. Frank Patti, now in his eighties, runs Joe Patti’s, and still begins his days with 4 am phone calls to Spain to place orders for fresh fish to be flown in, and ends them by cleaning the floor in his coffee shop. Frank was a gregarious and gracious host, and even insisted on a photo:
A second was a startup in the internet matching space. I’m sure we’ll write more about them later, but for now just think about internet dating. This firm — started only about a year ago — is trying to use various web technologies to match up two sides of a market. They’ve got a functioning product and a revenue model, and are working hard to ramp up.
What was interesting to us was how both businesses — seemingly disparate — rely on attaining sufficient scale. Joe Patti’s flies in fish in bulk (thanks to Frank’s 4 am phone calls), and sells in smaller batches. The economies associated with buying in bulk contribute to his margin. The startup is trying to provide a platform for matching, and in cases like this buyers want to be where the sellers are, and vice versa. So they need to get scale on both sides of the market and fast, in order to become the dominant platform in the space.