The Barnes & Noble comeback, from the CEO who did it (James Daunt)

Jeff Berman 0:00 BookTok does feel like a new thing.

James Daunt 0:02 The core of our market, and this has been since I started bookselling thirty-six years ago, has been these three young adults, so teenagers up into people through their early twenties. That's where a lot of the bestsellers come, and we, we then read constantly that now it's all about BookTok, or it's all about romantasy, or it's all... As though these are new things, and they're not. It's just a constant cycle of this demographic reading books like stink. As long as we leave it to the kids with the blue hair, we'll be fine.

Jeff Berman 0:32 This is Masters of Scale. I'm Jeff Berman, your host. [upbeat music] On Masters of Scale today, we have the leader who has taken on the daunting task of turning around Barnes & Noble and doing it with flying colors. I have been looking forward to this conversation for some time. Welcome to Masters of Scale, James Daunt.

James Daunt 0:58 Thank you very much.

Jeff Berman 0:59 Uh, I'm thrilled to have you for so many reasons, um, not least of which being

Jeff Berman 1:03 I happened to be in London this spring. Um, we, we made a point of going to one bookstore and one bookstore only. It bears your name. Uh, we probably spent ninety minutes there, walked out with far too many books to schlep back across the pond. Um, uh, but I'm, I'm an avid reader. I've got an Instagram just for my books. I'd love to start with w- where this comes from. You had a, a burgeoning career in finance. You could obviously have gone and done any number of things, and you, you sort of tossed it all aside to go open a bookstore. What happened?

James Daunt 1:37 I, I, I think burgeoning career is, is, uh, quite flattering. I don't suppose any of my then colleagues will remember it quite as that. I was y- I was extremely young, and then I wanted to do something, uh, that, that married with my interests, and I read a lot. Um, so I settled on a bookstore, and, and there, I- I- I, I got stuck, actually, quite early on. Um-

Jeff Berman 1:57 What do you mean you got stuck?

James Daunt 1:59 Well, you set up a business, and I think when you're young, and I was extremely young, you think, "Well, you know, I'll try this, and if it doesn't work, I'll go back and do something else." But actually, as soon as you're embedded in something, uh, y- you get all sorts of obligations. I had, um, I had investors, so I then [laughs] had the obligation of, uh, of paying them back their investments or the embarrassment of losing their money. Um, and you're employing people quite quickly, and then you... though you have those obligations. Uh, and that, that in some ways is a trap. And, and certainly early on, I think I probably felt it to be a trap, um, because at the beginning, we weren't successful.

Jeff Berman 2:36 What, what do you mean you weren't successful in the beginning?

James Daunt 2:38 I opened the store in nineteen-ninety. The first Gulf War happened. There was a recession. Our neighboring stores all closed down.

Jeff Berman 2:45 Mm.

James Daunt 2:45 We simply didn't have enough, uh, business to pay the rent. And, and then you have to work all hours that God gives and scrimp and decide whose bill you're gonna pay and whose you're not and, and all of that becan- can become quite, uh, difficult.

Jeff Berman 2:58 What got you through it, and then what turned the corner for you?

James Daunt 3:02 Probably stubbornness-

Jeff Berman 3:03 Mm

James Daunt 3:03 ... um, and, uh, and, and application. I think, you know, there are many people who've set up businesses who probably have had the same experience. Uh, and then slowly it began to work. And, and in fact, our sales grew every single month that I was open from the moment I was open, so that just got over the tipping point-

Jeff Berman 3:21 Mm

James Daunt 3:22 ... probably after about three or four years. We were underwater by ten percent, and then we were underwater by six percent, and then we were flat, and then we were above, and then we could breathe.

Jeff Berman 3:31 Was there an insight that, that led you to believe you could maintain that or accelerate and get past that, that tipping point?

James Daunt 3:37 I think bookselling is like most things in retail. It's attention to detail. It's presentation. It's service. It's, uh, the assortment that you have. It's the inventory backing. It's the judgments you make. Uh, and, and we just were able to steadily improve all of those things. And, and frankly, it's now thirty-five years later, I still believe that every year we make it a bit better.

Jeff Berman 3:58 What allows you to make it a bit better every year?

James Daunt 4:00 You try to really analyze every part of the store, and then you're responding to what's going on in the world.

Jeff Berman 4:05 Mm.

James Daunt 4:05 And reading tastes change. The makeup of your customer base slightly changes. And then how do you adapt the store to, to best optimize a- and really give the best experience to that customer base?

Jeff Berman 4:16 How much of

Jeff Berman 4:17 that is gut instinct feel, and how much of that is data?

James Daunt 4:22 Uh, I think a lot of it is gut instinct and feel in as much as it's a qualitative rather than a quantitative judgment. But you can teach it. In fact, most of the time, in- including now that we run a very large business, it's about put the data aside. The data can occasionally be an interesting reference point, but it's the judgments you make almost in defiance of the data that will, will give you an inspiring store.

Jeff Berman 4:46 How do you know when to defy the data?

James Daunt 4:49 As booksellers, uh, we are engaged in the process of curation. Uh, and quite often it's about having the right allocation of, of space. A- as a simple example, um, board books, little kids, early reading, two-year-olds, sell fantastically well. But two-year-olds wanna read the same boar book again and again and again, and you really don't need a big range of that. You can get enormous sales out of very small space.

Jeff Berman 5:17 Mm.

James Daunt 5:17 Once you get up to young readers, you know, ten-plus-year-olds, they read everything, and you just wanna give that as much space as possible. But if you're analyzing the data, and a lot of my predecessors did do that, they allocated space completely inappropriately. They had too many board books, too few young readers. Both groups became very unhappy because now the people after the board books don't just have Goodnight Moon. They've just got this enormous choice. So they're now finding it quite stressful and difficult. And then the young readers don't have enough.

Jeff Berman 5:45 I can appreciate that blindly following data, being data-driven is, is deeply problematic for all the reasons you just laid out. But if there's a meaningful variance in the data, are you looking at that and saying, "Mm, that really contradicts the gut that we have"?

James Daunt 6:00 Yes. I mean, it, it's worth also observing that we are dealing here with booksellers, and booksellers and data do not mix easily. [laughs] Um, booksellers and numbers, uh, tend to be sitting in opposite corners of the room. Um, we are the nerds who read all our books, and when we got to the Maths and science just gave up. And-

Jeff Berman 6:18 I mean, you're, you're talking to one right here, so yes

James Daunt 6:20 So, so w- And, and then my other problem a- always with data is 'cause it can be very, if, particularly if you apply intelligence to it and it's temptation, clearly it's hugely valuable, but it also unlocks this Pandora's box, which is our danger, which is you then centrally control-

Jeff Berman 6:37 Hmm

James Daunt 6:37 ... because you've got the data, and the data tends to be held centrally, and then we use the data to inf- to impose uniformity on the stores, and that really is the death knell for us. It works in almost every other branch of retail. It doesn't work in books. Uh, so if you can drive out the data, that then empowers the local stores to really start interrogating how they're engaging with their customer base, how they're presenting their stores. If you do that long enough and you in-incalculate that as a principle and that as a culture, then you can reintroduce the data and it's used, gets used, uh, properly, uh, and without this sort of a- I'm afraid, just sort of pernicious instinct to impose control, which a large corporate will always want to do.

Jeff Berman 7:21 In the late aughts and the early 2010s, um, the large iconic British bookstore chain Waterstones hit some financial skids, um, uh, and, and as I understand it, you went looking for someone to finance you taking over that chain. Why?

James Daunt 7:41 One, an arrogance that I felt that I could sort it out, that, that this was totally unnecessary. The sales in my own store were going up. The sales in theirs were cratering. Every one of their stores I went into was really awful and getting worse. Um, so I knew that I could r- really turn it around and make it so much better. I also knew if they disappeared, then I could open up more stores, but I was never gonna open up 300 stores-

Jeff Berman 8:04 Hmm

James Daunt 8:05 ... and I was never gonna open up the size and scale of the stores that Waterstones had. So if you could keep it all together, you got your 300 stores, and you would keep all these communities with bookstores, um, and that seemed worth doing.

Jeff Berman 8:17 And so you had, um, courage of conviction based on your experience with your chain of independent stores that you could apply the same logic to a much bigger set of stores and, and, and turn, turn around, get growth back.

James Daunt 8:30 The loss of confidence that was going on, largely in the face of Amazon, uh, was, it was misplaced. Bookstores are different to Amazon. Amazon will sell you a book extremely efficiently and great and all wonderful, and we all know how to do that. But at the end of the day, a book's f- bought in a bookstore, discovered in a bookstore is a better book. Same book, but is a better book, and also it's just nice and enjoyable. These are places in which people will want to continue to come, and the, the loss of confidence just needed to be reversed. We needed to get our booksellers to believe that they could run good bookstores, and then our customers would come back, and we'd be okay.

Jeff Berman 9:04 How did you go about finding an investor to put the money behind you to, to go make this happen?

James Daunt 9:12 I did it fairly conventionally. I went round private equity firms and the like, and I said, "Look, here's this great idea, and invest your money, and, and it will come back in multiples, and you will all be happy, and I'll be happy, and you don't have to put very much in, and don't you think that's a good idea?" And everybody said no. [laughs] So, and then a... But one of them, um, uh, rang me up and said, "You know, I've just met a, a, a Russian. In fact, he's having a cup of tea with me. Get on your cycle, put your helmet on, pedal over here, and meet him-

Jeff Berman 9:44 Hmm

James Daunt 9:44 ... because that'll be fun anyway. But you can pitch to him." Um, and very sensibly and very agreeably, after about 40 minutes, maybe 35 minutes, um, this Russian entrepreneur, um, said, "Yeah, okay. Go ahead."

Jeff Berman 9:59 Uh, that, that was it.

James Daunt 10:00 That was pretty-

Jeff Berman 10:00 A handshake over 40 minutes of tea-

James Daunt 10:02 Pretty much

Jeff Berman 10:02 ... and there you are.

James Daunt 10:04 Yeah. It's just-

Jeff Berman 10:05 Wow. Um, were you at all concerned that he might not be the right partner for you? Was there any...

James Daunt 10:11 He wasn't an oligarch as such, so we didn't have those kind of problems.

Jeff Berman 10:14 Hmm.

James Daunt 10:14 He was an entrepreneur. Um, he loved books.

Jeff Berman 10:17 Mm-hmm.

James Daunt 10:18 Um, he very much identified with the purpose of bookstores and really got that, so that was all sort of big ticks. And, and he observed Waterstones, uh, cost roughly half what a, a Premier League player had just been bought by a, a, a London club then by a, another Russian. Uh, so it was a bargain as well.

Jeff Berman 10:37 Um, the turnarounds are hard. They are not easy, uh, even if you have deep experience in the sector and if you have real vision and if you have, um, uh, the experience to, to give you the, the confidence you've got the right playbook. Um, when did you have a sense beyond your, your faith and optimism that this was really working at Waterstones?

James Daunt 11:01 I, I think I was reassured that in arriving at Waterstones that the, the core of the people in the business were the same tribe as me.

Jeff Berman 11:09 Hmm.

James Daunt 11:09 They were booksellers. Um, so that was a plus, so I had people I could work with. Um, it was also really upside down in terms of the principles by which it was being done, so sorting out that side of, of it seemed sort of fairly straightforward. It's hard work. It's a grind. You have to... You're, you're changing a culture at the end of the day, and changing cultures is, is, is like stretching on a rubber band. You know, the, the minute you relax, it just pops back. But again, as, you know, I'd been through it once before at Daunt Books, you know, you just knuckle down, you concentrate, uh, you do the basics, you just drive forward improvements across the piece and, and be confident that it will come back.

Jeff Berman 11:47 Hmm. There was a frenzy

Jeff Berman 11:49 around e-books at the time. Um, and obviously e-books are a meaningful category now, not suggesting otherwise. Um, uh, Barnes & Noble, which you now lead but didn't at the time, launched a competitor. Um, uh, there, uh, I, I have to imagine were arguments to lean into that and try to ride that wave and to run entirely counter to it. How did you handle that in that moment at Waterstones?

James Daunt 12:13 I did, did it perhaps a little bit counterintuitively. Yes, we sold the Kindle. Uh, and the reason I did that was I think as a- Uh, uh, you, you should always do whatever your cust- is in the best interests of your customer. But my main motivation is I wanted my booksellers to stop fearing Kindle.

Jeff Berman 12:29 Mm.

James Daunt 12:29 To stop... There was this sort of obsession that people were coming into our stores and photographing books and then ordering them Amazon and, or, uh, coming in and choosing books and then downloading them on their Kindles, and it was... Which, which just simply doesn't happen, uh, except in the most vanishingly small percentage it, that takes. So I wanted them not to fear the Kindle and to realize that their store was where people should come to discover books. So if we could put the Kindle in the middle of it, then you could demystify this thing. So we put the Kindles in the middle of it, sold an improbable number of them as it happened, so that, that was sort of helpful from, from a financial perspective. But it also demystified it.

Jeff Berman 13:10 The turnaround at Waterstones is underway. You are, um, succeeding. Um, uh, what happens that all of a sudden you are in discussions to also turn around Barnes & Noble?

James Daunt 13:24 I think that was simply Barnes & Noble un- unfortunately was a sort of mirror of Waterstones pre-2011. It was having a really tough time, and as a public company, then de- they determined to sell. And again, we had an answer. I mean, we clearly had a model. By then, we had changed our owner, and we had a new backer with some, with the resources, um, and, you know, they bought the company.

Jeff Berman 13:46 Sometimes when you have, um, directly applicable experience, it is of massive value, and that same playbook is just going to work. You can have a, a coach go from one team to another, rebuild that culture, uh, keep stretching that rubber band, not letting it snap back. Um, uh, but sometimes the game has changed, and the same playbook won't work. Um, w- h- has it, has it worked the same way? Have you been able to run the slame- same playbook, or has the universe changed and you've had to really adjust?

James Daunt 14:17 The US is obviously different to the UK. [laughs] It's rather larger. Uh, the stores are rather larger. There's, there's some nuances within there, but essentially, no, it's very much the same. The customer buys books in the same way, almost literally the same books. Uh, the booksellers are the same. I call them a tribe. We are a tribe. Um, so that sort of vocational drive that you have amongst the people, you, that, that, that run the stores was the same. I have to say, I, I thought it would be rather easier and faster second time around, but it, in fact, the timelines are almost identical.

Jeff Berman 14:49 Why hasn't it been easier and faster given the experience you had?

James Daunt 14:52 I think culture changes slowly.

Jeff Berman 14:55 Yeah.

James Daunt 14:55 And you may want it to go faster, but it's enduring. It's... And, and you can say, "Well, you know, to get from A to B, we really have to go this route," 'cause when we were at Waterstones, we went via that route, and it was really tough.

Jeff Berman 15:10 Mm-hmm.

James Daunt 15:10 And everyone scratches their heads and goes the tough route because they're booksellers. Slowly, you get yourself into the right place.

Jeff Berman 15:17 In the early part of my career, I was very lucky to work with leaders and in organizations that had a mindset of, we agree on goals, we agree on resources, and then we get the hell out of your way until you raise your hand and say you need help with something. It's how I prefer to work. It's how I prefer to lead. Um, in the middle to latter part of my career, I have come into organizations that are very much command and control, that there, there is as little autonomy as possible, here's how we do things, et cetera. Um, and I have found it very difficult. It takes, in a small organization, at least a year, in a larger organization, much longer, to get people to really embrace this idea that they do have autonomy, they do have decision-making power, that their opinion matters, and that we want to trust them. Um, what, what have, what has worked for you in helping people make that, that same transition?

James Daunt 16:14 Uh, whether rightly or wrongly, I'm always trying to flatten hierarchies, and that, um, you, you in- you tend to inherit, particularly in this business, quite established hierarchies. You know, not least of which is you have a store manager and then an assistant store manager and so on. It's a hierarchy. And I always, I, I, almost everything I do is about flattening those hierarchies and then trying to introduce collective responsibility amongst the team once you've done that. Uh, and w- w- it's a much nicer way to work, and it's n- much more engaging and much more empowering and all of those good things. But it's so much more difficult that often people resist it, particularly when it's difficult. Yeah, we'd rather have the hierarchy. "Just tell me what to do, please." But I think ultimately, if you can get to a point of reasonable collective responsibility amongst a team, it's a very much healthier environment and much more responsive, um, and much more durable. Um, we're a retailer. People come and go. But it's also a tough business. It's seven days a week. You gotta open it at 9:00. You gotta close it at 9:00. It's really hard, hard work. Um, and the, for that, you, you do need other compensations. Um, the money is poor as well. So you really, really need other compensations.

Jeff Berman 17:30 The hours are long-

James Daunt 17:31 [laughs]

Jeff Berman 17:31 ... but you won't make much money. So right.

James Daunt 17:32 It's, it's not a great sell-

Jeff Berman 17:33 Yeah, yeah

James Daunt 17:33 ... is it? So you better have a nice team, uh, and a vocational, uh, fulfillment from what we do, and it's for us and beholden upon us to make that really true for them.

Jeff Berman 17:46 I have to imagine that that switch from that command and con- control to more, um, uh, distributed decision-making culture, there's also fear.

James Daunt 17:54 Mm-hmm.

Jeff Berman 17:55 Because in a command and control structure, if you make a wrong move, you'll probably get your head taken off. You're being fired, whatever it is. Have you found ways to, um, to model for team members that, that those decisions that look good at the outset turn out to be bad are actually to be celebrated and embraced to encourage this kind of, of, um, autonomy?

James Daunt 18:17 Yeah, I'm, I'm not very cuddly, so, uh, the, all the celebration side of things-

Jeff Berman 18:21 All evidence to the contrary, sir

James Daunt 18:22 ... I'm not, I'm not, I'm not, um, I'm not- Very good at that. But what I am good at is let's not look in the rear view mirror-

Jeff Berman 18:28 Mm

James Daunt 18:28 ... and let's quickly recognize anything that we're doing wrong quickly, quickly, and there to be no consequence to that and no reflection upon it. So I'm not one for saying, "Why did we make that idiotic decision, and who d- who made it, and why did we make it?" Mine is just, "Okay, it was idiotic. Move on. What are we doing now?" And I think if you continuously do that, then people, but it becomes easier and easier to acknowledge mistakes for people newer, younger, less exalted in the hierarchy to say, "Are you sure, guys?" And for the people above to say, "Uh-oh, let's switch."

Jeff Berman 19:02 Particularly

Jeff Berman 19:03 in a moment, not just in the US but, but globally where, um, it's not just anti-intellectualism, it's anti-fact, it's anti-truth, um, seems to be in vogue. Is that a trend that you don't worry about? Is that actually something where you can be countertrend and that helps accelerate you?

James Daunt 19:26 I think the latter, um, I mean, we obviously live in the societies in which we live with all of the concerns and, and tribulations that, that are there. Um, but remember, we're a, as a bookseller, we serve every age-

Jeff Berman 19:39 Mm-hmm

James Daunt 19:39 ... and, and most demographics. I think there's a sort of feeling that, you know, bookstores are educated, more affluent folk, um, but it isn't. I mean, we, we appeal to everybody within our communities. We've also, at the core of our market, and this has been since I started book selling 36 years ago, has been w- these three young adults, so teenagers up into people through their early 20s. That's when people really engage with bookstores and with reading, and it's, that's where a lot of the bestsellers come. And we, we then read constantly that now it's all about BookTok, or it's all about romantasy, or it's all... As though these are new things, and they're not. It's just a constant cycle of this demographic reading books like stink, and that's why Harry Potter is a great thing, and now it's Sarah J. Maas or whatever it might be. We sell books, and then everyone's going, "Oh, well, nobody's reading anymore." [laughs]

Jeff Berman 20:32 [laughs]

James Daunt 20:32 It's, it's, but these, of course, they're reading. You can see it even in, in the cycle of our day in a bookstore. We start off the day with lots and lots of buggies in our store, and the people pushing them, and that can be the carer, it can be the young mom, it can be the this or that. But, but it's noisy, and it's full of kids running around because they've dropped off their sibling at school. That's who comes in. They then leave and go back 'cause they're getting tired and hungry. And then the old people are in our stores 'cause they're not working, they're retired, and they're thing, and they like it 'cause it's quiet, and they can come and natter and things. And, and then the lunchtime crowd comes in, and they wanna get out of the way before, voompf, all the kids who've left school during turnaround. And then it's full of teenagers. And then, uh, the teenagers go back 'cause they gotta do their work and get their school things out of the way. And then all the young people who are introverts courting come in because you don't wanna be in a bar-

Jeff Berman 21:22 [laughs]

James Daunt 21:22 ... and you can do it. And, and so it goes on. You know, we, everybody's coming into our store, and they're all engaging with the store in different ways, buying different things.

Jeff Berman 21:30 BookTok

Jeff Berman 21:31 does feel like a new thing. When a trend like BookTok begins to emerge, how do you determine when you should start investing marketing time in that?

James Daunt 21:41 Well, we have the great benefit of not having a marketing department, so we have zero marketing dollars to spend, so that makes it an easy thing. So that's never happening. [laughs]

Jeff Berman 21:50 None whatsoever.

James Daunt 21:50 None whatsoever. I mean, literally zero. Um, and, uh, but what we do have is young booksellers.

Jeff Berman 21:58 Mm-hmm.

James Daunt 21:58 And again, this model of leaving stores to do what they want, uh, ha- turns out to be fantastically adapted for the social media age.

Jeff Berman 22:07 Mm-hmm.

James Daunt 22:08 And w- the media, sort of general media sees things on a national scale, but most of it isn't going on on a national scale. It's going on on a very local scale. It's the BookTok in the local schools, in the local area, and what's going on there. And if you're employing them at the weekend, and you, you're gonna be really locked into that. And we are, and if you give them time and let them do whatever you want. And as long as also when they make mistakes, you go, "Okay, well, you know, stop being so silly. Please use common sense. [laughs] Be nice. Use common sense. Otherwise, get on with it," you're very attuned to, to these social media waves. And, and BookTok has been absolutely fantastic for us. A lot of it is taking place in our stores and quite a lot of it by our booksellers as well. I mean, I, I make this rather facetious joke of it, "As long as we leave it to the kids with the blue hair, we'll be fine." Uh, and it is true.

Jeff Berman 23:00 I, I, I have to imagine if I were on your board or, or working at Barnes & Noble, um, I, I would be asking, well, as a former boss of mine was fond of saying, it's easier to catch a wave than create a wave. You're, you're catching this wave using the, the younger people in your stores who are native to TikTok and are creators of BookTok. But James, what an opportunity to take the best of these BookToks from Barnes & Noble local booksellers and put a little bit of money behind them, turn them into ads, et cetera. Why, why not have a, a, a really thin marketing department to amplify the incredible marketing being done organically by your teams?

James Daunt 23:42 I, I'm sure we would be much better and, and richer of business were we to do that. But if you're, um, almost literally allergic to central control, and you know that if you ever impose central control, you could break this rather fabulous thing that we have going, you don't need to.

Jeff Berman 24:00 Mm.

James Daunt 24:01 Keep it small. We have a small home office which sits above our, um, each of our flagship stores. We have a New York office which sits on the floor above the Union Square store. Our Waterstones office is above the Piccadilly store. So you gotta walk through the store, see the books all the time to get to work, and it's a small number of people. And yes, you could do all of those things. But then the kid with the blue hair is gonna be told what to do, and the kid with the blue hair doesn't wanna be told what to do. They just wanna get on with it.

Jeff Berman 24:28 But the kid with the blue hair doesn't have to be told what to do. It's just a question of, oh, kid with blue hair in Omaha, Nebraska, or Santa Monica, California, hit the TikTok algorithm with this great post. We can just push some weight behind it to amplify it further.

James Daunt 24:45 They do it themselves.

Jeff Berman 24:46 Mm-hmm.

James Daunt 24:46 They, the booksellers are fantastically good at communicating within store to store. Books that start taking off in one store just sort of spread like a rash through the business.

Jeff Berman 24:56 Mm.

James Daunt 24:56 So y-y-you don't need to, and it keeps it authentic. And I think one of the things about BookTok, or at least I'm told because I have absolutely no idea about BookTok at all, I'm told that it, the authenticity is what resonates. And if you really do literally keep your hands off the whole thing, it does remain authentic.

Jeff Berman 25:15 Yeah.

James Daunt 25:15 It is authentic. And, you know, I also think if it's not broken, don't try and fix it. Other than if I can make my booksellers' lives easier in the center, then I should invest in that. So I, I need to invest in IT, I need to invest in distribution centers, I need to invest in kits that'll makes our lives easier, and that's where I spend the dollars.

Jeff Berman 25:36 Not only are you not on BookTok, you are, um, uh, somewhat famously o-one of the more, um, open about being an introvert, uh, CEOs of large companies out there. W-what is a lesson about leading a large organization, um, a-and a public-facing organization as an introvert that other introverts who are building and leading companies could take from your experience?

James Daunt 26:00 I, I, I'm sure I would be much better at if I wasn't sort of, and, and was able to be less, um... But, uh, it, at least it keeps me humble. Um, and I think, uh, also I am of my tribe. I, you know, I am genuinely a bookseller. I put in 21 years on the shop floor. And, and therefore, I recognize booksellers. I know who they are. I know-- I, I've literally done every single piece of work that they do for a very much longer than most of them have been alive. Um, and I feel very connected to them. Now, I m- don't express that perhaps, but I, I do definitely feel it. Um, and I, I think many introverts are quite confident in themselves. And i-if you can create a, a team that is assured in its direction, assured of its culture, assured of its strategy, things will be okay. And I think you can lead from a backseat. You know? Um, you, you don't have to always be in the front. I know there are wonderful, you know, flag-waving, rallying, uh, leaders, but I'm not one of those.

Jeff Berman 27:01 Um, y- when,

Jeff Berman 27:03 when we ask business leaders for books that have informed leadership for themselves or that they recommend to others, um, there's a, a set of authors and books that you get pretty regularly. Jim Collins' Good to Great, um, more recently, uh, or Shoe Dog, Phil Knight. There's a long list of nonfiction authors who show up regularly. We hear about fiction less when it comes to leadership lessons. What is a piece of fiction that you recommend emerging leaders or leaders who are looking to grow as leaders should read?

James Daunt 27:33 Really good fiction that delves into the nature of humans and how humans are, um, relationships, rivalries, jealousy, all of those things. Most of the great novels are doing that one way or another, and I think if you're reading them, you're probably going to be better able to interpret and understand that and be responsive to. You start with Middlemarch, and you sort of move on from there. You're going to, you're going to understand people perhaps a lot better if you're doing that. If you're reading widely and properly, books w- are a civilizing force. They, they invite you to, uh, question, invite you to reflect, in-invite you to be more understanding, and, uh, all of those things are very necessary for readit- for leaders. Um, arrogance is a, a natural, uh, bedfellow of, of leadership and one that needs to be resisted. But also you're constantly or should be constantly trying to think of how you, you are best equipped to help the people that, that you have working for you, how you make the team stitch together, how you recognize when egos are being either overinflated or challenged. How do you work all of those internal jealousies or fears or insecurities? Novels are almost always about some element of humanity. Um, I mean, you can sit down and just actually get a few plays out and read your Shakespeare. It's, it's all gonna be in there.

Jeff Berman 29:06 One final question for you before we wrap, James. I have to believe that you are increasingly seeing books that are, um, at least in part written by AI. Um, how is, is bookselling and reading going to change, and what role will you all play in it with this AI revolution in, in writing and publishing coming?

James Daunt 29:26 It's gonna be very interesting. Um, we are fortunate in not being the first line of defense, if that's what it is. Uh, publishers publish the books, they edit the books, they choose what to publish or not to publish, um, and we then curate from amongst those. Um, we have a deep natural antipathy to anything that isn't by a real author, um, and definitely at the moment exclude and go to great effort to exclude both from our online catalog. Probably happens, uh, we think with, with what's in our stores naturally because we're selecting and curating. But online, we really need to put in lots of, uh, filters to try and keep the AI rubbish out. Um, will there be a world, and I've, you know, I have said, you know, there is gonna come a time perhaps when these books come through, we would ask publishers to the extent that they know that they indicate whether books are AI, assisted AI, written completely, um, and then we can indicate that to customers. Um, and I think transparency is important. Um, but we are booksellers. If customers wanna read particular books, we will sell them, and then everybody start shouting at me to say that, "I'll only sell AI books, and that's all I want." But that isn't true. We feel a deep, um, a- natural suspicion of it. And, you know, one, one of the things that we believe that we do as booksellers is support authors, create the careers of authors. And of course, that-- some of that is self-serving, but, um, because you, you need these great books to come. But I think there's a deep natural respect and bond between booksellers and authors. Um, and we really do believe that the author sh- is important and necessary. Uh, and, and many of us, in, in, particularly those in our metropolitan stores, you know, I've always felt as a bookseller that one of my things is to bring authors to readers, to be a place in which they can meet and they can discuss and, uh, and, and the like. And the idea that that isn't real is really sort of counter to everything in which we believe. Um, is AI gonna wr-write the next great books? I very, very much doubt it, but it will take categories of books out, quite clearly. Um-

Jeff Berman 31:35 Such as?

James Daunt 31:37 Home study guides. You know, you-- that will... That's an easy thing. You can just see whether you just sort of press a button and voomph, it's out, it's gonna come. And it used to say, you know, Dr. Somebody or another at the bottom, and it won't. It'll say AI. Um, so, uh, we're, we're not gonna be able to be completely pure around this, I suspect. But for, you know, editors and publishers, how much do they use AI is gonna be a, a, a massive challenge for them.

Jeff Berman 32:03 Is it your theory of the case that there will be a meaningful market of buyers who want artisanal books?

James Daunt 32:10 Well, that is the case now. People, and then sort of going back to why is it that we sell so many new novels, so many things published now, it's because people are responding to authors.

Jeff Berman 32:23 Mm.

James Daunt 32:24 You know, otherwise, you just read Jane Austen. You can... Leo Tolstoy, he wrote quite good books. You know, [laughs] you can go and read all of those all you like. Um, but they, they want the author. They listen to them. They, uh, they hear about them. They read about them. They want the connection, too. And w-we get these great swathes, you know, when, you know, whether it's Sarah J. Maas or whatever it might be. Again, that's all very, very focused on the author. Uh, so I think people really connect, and, and I don't see that changing.

Jeff Berman 32:55 James, such a delight being in conversation with you. Thank you for being on Masters of Scale.

James Daunt 33:00 Great pleasure. Thank you.

Jeff Berman 33:03 Thanks again to James Daunt for joining us. His quiet, steady leadership style is a model we can all learn from. And as an avid reader myself, I love bookstores so much. I love the feeling of walking into a space and not knowing what's gonna catch my eye, what I'm gonna find, what the local team at that bookstore has picked out to feature. Some of the best books I've ever read, some of the most eye-opening, mind-bending stories that I've ever encountered have come because of a random encounter in a bookstore that was created by a human being curating something special. James Daunt gets that, and I'm so grateful that he's saved not just one, but two iconic bookstore chains. I'm Jeff Berman. Thank you for listening. [outro music]