Captain + Stoker Closes as Sale Falls Apart, Cat & Cloud To Open Two New Santa Cruz Cafés

July 10, 2018 – Wendy and Peterson Conway had a seemingly simple dream: a community coffee shop with single-origin beans, world-class equipment and farm-fresh food they’d pull from their chicken ranch and orchard in Carmel Valley.

It would be called Captain + Stoker, named for and decorated with tandem bikes—like the one they rode into their wedding ceremony.

“Captain + Stoker was started with the intention that connecting with one another can both make our lives more meaningful as well as more empowered,” the original plans read. “Being in tandem is seeing we still need one another, perhaps more than ever.”

They pulled it off in style, debuting Captain + Stoker to enthusiastic reviews in late March. When the legendary cyclists who helped found the place (Tom Ritchey and Thomas Frischknecht) showed up at the opening, the shop’s Instagram account leapt from 60 followers to 1,600 in a day.

“We hit some nerve in the community,” Peterson says. “Monterey is blowing up—it’s a young person’s town again.”

But, yes, it got complicated. Initial costs soared five times higher than planned, putting more pressure on short-term profitability. Days in the red accrued. The Conways found themselves more occupied with the shop than they’d hoped.

“We didn’t have our normal summer garden, I was not baking bread,” he says.

Fortunately a solution beckoned.

Captain + Stoker owner Peterson Conway

Cat & Cloud—the cult coffee hit that started in Santa Cruz’s Pleasure Point neighborhood—originally came to Captain + Stoker to consult on operations and latte art around a month ago. Knowing they also had interest in expanding to this side of Monterey Bay, Peterson floated the idea of partnership or an outright acquisition.

Local media announced the sale late last week. But instead of what was reported as a transition of ownership and the start of a new era at Captain + Stoker, the shop closed suddenly on Monday, July 9 and its nine employees are out of a job.

As a longtime tech pioneer in Silicon Valley, Peterson Conway has closed hundreds, if not thousands, of deals. He was so confident this one was completed that he headed for a week in the Ventana Wilderness, an annual tradition he’s kept since he was a pre-teen.

He was lacing up his boots at the start of the trail when he got a call from Wendy, who was physically ill with the news that Cat & Cloud had pulled out.

Cat & Cloud founders Chris Baca and Jared Truby

Cat & Cloud partner Jared Truby is an alum of Verve Coffee Roasters and the director of operations for Castle Coffee Roasters and The French Press in Santa Barbara. He says talk of the sale was premature and reports he has known Conway for years are inaccurate.

He adds that what would surprise people about Cat & Cloud is that “it’s not a coffee business.”

“Coffee is merely a catalyst for change,” he says. “Our mission is to leave people feeling happier than when we met them.”

That’s relevant to the Captain + Stoker deal, he implies, because for his team it was about more than the bottom line.

“It’s off and it never was finalized,” he says. “We couldn’t come to an agreement that worked for both sides.”

“The stress of making the transaction final was not worth the money we could have made in the long term. It would have compromised our current projects and timeline,” adds Truby.

Conway fears he emphasized growth too early.

Cat & Cloud Coffee

“I was too Silicon Valley,” he says. “They told me, ‘I’ve never seen a big check make people’s lives better.’”

The good news is Cat & Cloud has two other projects in the works, albeit on the other side of Monterey Bay.

Truby describes their new 1,900-square-foot spot next to New Leaf Market in the forthcoming Aptos Village development as “an ode to Palm Springs-meets-Miami Vice, modern and timeless.” Ocean views will complement the native Cat & Cloud emphasis on service and positive culture in the café, which is expected to open before the end of the year.

Over on the Westside of Santa Cruz near the Cat & Cloud roastery on Swift Street, a different concept is coming into view, with breakfast to go and a full coffee bar. Another new Cat & Cloud café, to open in spring of 2019, will have a menu that includes ricotta pancakes with an overload of toppings, a take on ham-and-apples (handmade sausage patty with red-eye gravy and pickled apple with a poached egg on top) and a stack of options from a toast program.

The bad news is Conway says his team had moved too far along the sale process to turn back. That means employees like co-managers Tyler Ellis and Kelsea Richmond (who happen to be engaged) are left wondering what’s next.

“Monterey will lose the sense of friendship and connectedness they knew was at Captain + Stoker,” Ellis says. “It didn’t matter who you were, what lifestyle you lived, or how much money you made, we were there to listen and be the positive part of your day.”

Richmond echoes that in her own way.“We created so many relationships,” she says. “I didn’t know our work was going to bring me that much joy.”

Both describe feeling a little disoriented with the sudden shifts.“It’s a little bit lost here,” Ellis says. “I wasn’t expecting this. We were excited about working with Cat & Cloud. As far as the crew goes, they’re in shock, but we gotta move on.”

He adds that he’s heading up to Tahoe to “decompress things.”

Conway has a similar plan. After returning to town from the trail to deliver the bad news to his team, issue final paychecks and take everyone to burgers and beers at Alvarado Street Brewery, he is heading back to the wilderness himself.

“I got my ass kicked,” he says, “but we built something beautiful.”

Read more about Captain + Stoker in the summer issue of EMB here. 

Read more about Cat & Cloud in EMB here.

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