At Crumbs & Whiskers, the extremely popular cat café in Washington, DC, customers can drink lattes, play with rescued cats, and even adopt felines for their own. But regulators almost put a stop to all this caffeinated kitty cuddling before Crumbs & Whiskers even opened its doors.
In an interview with ReasonTV, the café’s founder, Kanchan Singh, explains the bureaucratic hoops she had to jump through to open the District’s now-beloved cat café. First, she was told to allocate $25,000 just to get approval for zoning an establishment with animals.
This doesn’t even get into the litany of ordinary costs associated with operating a small business and complying with the near endless list of local and federal regulations.
Eventually, a DC area journalist would go on to submit a Freedom of Information Act request to the DC Department of Health to obtain any internal communications relating to Singh’s attempt to open a cat café. This request uncovered a byzantine labyrinth of bureaucratic inefficiency and paternalism.
Who’s the Boss?: Regulators vs Customers
The incentives at play within regulatory agencies predisposes them to being overly cautious in the face of uncertainty and risk. Never mind that consumers — cat and coffee lovers alike — would gladly bear that risk themselves in order to get their feline fix.
Singh eventually opened her cat café, following a hugely successful crowdfunding campaign on Kickstarter, which helped cover the costs of complying with the onerous regulations and legal fees. Not only would Crumbs & Whiskers grow to become a beloved national treasure, but Singh would go on to open a sister store in Los Angeles just about a year later.
This feat shouldn’t go unnoticed. California and DC are not known for their hospitable climate for entrepreneurs, which makes her success all the more remarkable. The petty tyrants that occupy county zoning offices and health departments are exactly why we can’t have nice things.
Most entrepreneurs don’t have the technological know-how or social media savvy to launch a viral crowdfunding campaign. Crumbs & Whiskers is the outlier in the increasingly anti-entrepreneurial climate creeping across the country. By and large, most start-ups will never see the light of day thanks to burdensome regulations that greatly increase the cost of going into business. Most of the few that do successfully establish themselves will succumb to the ruthless market process and shutter their doors in just a few years’ time.
It’s probably a good thing that startups that can’t turn a profit eventually go out of business. The problem is that for many startups, the biggest cost of doing business isn’t payroll or rent, but the price of complying with the complex tax code or of greasing the wheels of the regulatory state to obtain the necessary permits.
Lowering these costs would greatly serve society by decreasing the barriers to entry for startups to bring their goods to market. Let consumers determine if the risk is worth the cost by voting with their dollars. Humanity has yet to come up with a system that holds people to account better than the competitive market.