James Daunt’s favorite book is Leo Tolstoy’s Anna Karenina, though the Barnes & Noble CEO has never finished it. He says he’s returned to the novel several times, but always stops short of its conclusion so he can preserve the feeling of coming back to it.
That may be an unusual habit for the executive leading America’s largest bookstore chain. But Daunt has never had a conventional career. Before he ran Barnes & Noble, Waterstones, and his own Daunt Books chain, he worked as a purser for Carnival Cruise Lines and later as an investment banker at JPMorgan.
Now, Daunt is applying his skills as an independent bookseller to execute a comeback for one of retail’s most recognizable big-box brands. Since becoming CEO of Barnes & Noble in 2019, Daunt has focused on shifting power away from headquarters and into the hands of frontline employees.
“I had been a bookseller for 30 years at this point,” Daunt told Fortune’s Phil Wahba for Behind the Business. “I simply wanted to make these stores really good again. One sets on a series of very slow and incremental processes to do that.”
Daunt wore many hats
Daunt’s route to bookselling was anything but direct. After studying history at Pembroke College, Cambridge, he worked as a pursuer for Carnival Cruise Lines, a job that put him in charge of administrative, financial, and guest-relations duties on the ships.
In 1985, he moved to New York to become an investment banker at JPMorgan. While he enjoyed the business trips, Daunt quickly determined that banking was not his calling.
“I decided to give up a good office job for something more vocationally interesting,” he told The Guardian in 2018.
That vocation would ultimately be bookselling, with a specialization in travel books. In 1990, Daunt returned to the UK and opened the first Daunt Books location in London’s Marylebone neighborhood.
“My parents were appalled,” he recalled in a conversation with The Times last year.
To fund his new enterprise, Daunt raised £250,000 through the UK government’s tax incentive program for small businesses, now known as the Enterprise Investment Scheme.
The small bookstore eventually grew into a distinctive London chain known for browsing-friendly stores, knowledgeable booksellers, and shelves intentionally tilted upwards to best catch the light. Today, it’s valued at over $10 million.
The bookstore’s famous Edwardian interior, lined with classic oak shelving, several skylights, and a large arched window is just part of the charm that draws tourists and customers to its storefronts. In 2010, Daunt Books Publishing was founded to produce lost classics and titles inspired by the bookshop specifically.
In 2011, Daunt was tapped to lead the floundering British retailer Waterstones, which returned to profitability under his leadership.
Prior to Daunt’s arrival, Waterstones was struggling to compete with online booksellers including Amazon. Previous CEOs led the book and stationary retailer to the brink of bankruptcy while the store’s physical book sales dwindled.
Daunt led the company to its first year of profits since the 2008 recession by applying a small bookstore mentality. He closed under-performing locations and gave store managers more power to pick which books to sell. The experiences gave Daunt his most enduring management principle: bookselling is local.
“Choose your books well, show them off very nicely and, above all, have nice people working in the shop who are friendly and run the place in an intelligent, dynamic way that reflects where they are,” he told The Times.
From indie bookstore to mega-store CEO
His latest challenge has been engineering a turnaround for Barnes & Noble. When Elliot Advisors acquired the company for $683 million in 2019, the retailer was struggling with years of declining sales, store closures, and stiff competition from Amazon and other online sellers.
Barnes & Noble brought in Daunt to revive the chain, but instead of imposing a one-size-fits-all playbook, he gave local booksellers control over the displays so each store could reflect its community’s tastes.
“We’ve abandoned that [prior approach] 100%,” Daunt told Fortune. “Now each store curates its own assortment, reorders its own books, does each to their own and we encourage, develop, promote, and train against how you do that well.”
The result is a more decentralized operation. A Barnes & Noble in Union Square can highlight literary fiction and books by New York authors, while another store can lean into romance, young adult novels, fantasy, or regional history. Stores are encouraged to create their own displays, offer handwritten staff recommendations, and stock titles that reflect local demand.
Daunt said people can come into a bookstore for one title then be inspired to walk out with three. He also noticed a key difference between American and UK customers.
“American consumers are wonderful because they buy enormous amounts of books,” Daunt told Wahba. “Individually, they buy more than the UK customer does.”
The rebound has been dramatic. Today, there are a total of 717 brick-and-mortar stores, almost 100 more than in 2019, and Daunt plans to open more by the end of the year.
There have also been rumors of a possible IPO, however it is unclear when and if the company will go public. Daunt is apprehensive about what this could mean for the individual bookstores’ management, which has been perfected since his arrival as CEO.
“We are trying to run really good bookstores, most of that effort is being done at the local level,” he told Fortune. “We’re really just bringing these principles first: small bookstores to large chains to even larger chains, and it’s all based on the core principle of what makes a great bookstore.”
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