I've started a new show where I have conversations with some of the greatest living founders.
That show is called David Senra.
It will be on a separate podcast feed from Founders.
So it's very important that you follow David Senra on Spotify, Apple Podcasts, YouTube or really wherever you're listening to this right now, so you don't miss future episodes.
This conversation is with one of my favorite living founders, Todd Graves.
Todd owns over 90 of Raising Cane's a business that is worth over 20 billion, and he's been working on this business.
Thank you so much for having me.
I was not expecting to start here, Todd.
We were just talking before recording.
I didn't expect to start on sleep, but what you just said is exactly how most of History's Greatest Entrepreneurs are.
They just can't stop thinking about their business.
Because I was asking you, like, how much caffeine do you take?
How much sleep do you need?
And then your answer was what?
I just have a really erratic sleep.
So I'll go, you know, some nights I'll go maybe three hours of sleep.
The next night might be three to four hours.
The next night might be five hours.
And usually about that point is the next night I have to crash.
So I'll sleep 10 or 11 hours to catch up.
And then I'll actually wake up feeling great, feeling like I don't have to muscle through a day keeping myself awake.
And then I'll be caught up.
I'll go another three hours that night, four hours and five hours.
But what really dictates it is what I have going on in business and what I have to be thinking about, what might give me a little bit of anxiety about things I got to decide on the teams, what I have to work through.
So my brain will be working as I'm sleeping.
I think it's trying to figure out solutions.
So then I'll just wake up.
And I'll actually wake up pretty refreshed thinking about that problem I had and then go jump on the computer in my underwear in the middle.
I wake up and go first that and then start sending out emails just to actually solve that problem.
But if I get caught up at work and there's nothing really pressing, then I can sleep like a baby.
I don't have a problem sleeping.
I just have a problem sleeping when I've got real business on my mind.
This keeps reoccurring in all these biographies of history's greatest entrepreneurs that I read.
And so I just did this episode on Jiro, the best sushi chef in Japan.
The documentary on him is Gerald Dreams of Sushi.
Why?
Because in his sleep, he is thinking about his work, right?
Then I did this episode on this guy named Michael Ferrero.
It's another family-held business.
It's the Ferrero Chocolate Company, right?
He would say that he dreamed up what he called comforts, which was new products, new chocolates to make in his sleep.
The Michelin Brothers, same thing.
They would dream up marketing ideas on how to market tires in their sleep.
Leonardo DiVecchio, Luxottico, one of the biggest businesses in the world.
He just passed away recently.
He said he would literally wake up.
He would dream about ideas for his business and he'd have to either keep a tape recorder next to his bed or, in your case, in your underwear in a computer, or he'd have like a notebook.
Notepad just to write it down.
It's very fascinating how you see the same personality type appear over and over again throughout history.
So we are in the very first Raising Cane's.
You were very kind enough to let us record in here.
The mothership.
You're almost at your 30-year anniversary for Raising Cane's, running Raising Cane's and starting this.
I want to ask you a question.
I love, I've heard you say this before.
What is the advice that these so-called the bad advice, these so-called experts gave you when you were trying to start the very first Raising Cane's?
Thank you.
So having a dream to start a chicken finger only concept was just back then was in Louisiana was kind of unheard of.
It was just a totally new idea.
You know, we're known for our Cajun and Creole food here.
Like at lunch, people would get a plate lunch, some Cajun dish.
And that's what people are used to.
Also in the industry at that time, you know, McDonald's and these other big quick service restaurant chains, they were adding menu items because they didn't want the veto votes, what they called it.
One person in the car that might not have the choice at that restaurant that they could get.
They said they would veto the whole car and go somewhere else that had that menu item for their deal.
They were also adding healthy items back then.
So starting a restaurant and having an idea to focus just on one thing, one singular product focused menu, was just really unheard of at that time.
We didn't have In-N-Out Burger, In Louisiana, right?
But you knew about Harry Snyder.
Not until I went to LA to work in the refineries.
That's when I went out there and to work in the refineries, when I went to In-N-Out Burger.
That's reaffirmed my belief that hey, you can do one thing and do it better than anybody else.
And then I did a research and I started studying the In-N-Out model since 1948.
So 1948, they have the exact same menu, right?
And people know what to go in.
It took me one time to go there and someone to recommend get a double-double and get it animal-style.
Get the fries, get whatever beverage you like and then get a chocolate shake.
And it's my same order every time.
So when I first went, I kind of held up the order line for a second and went inside and done.
Next time I went there I went through the drive-through double-double animal-style fries and a Coke, and then I also wanted to get that chocolate shake.
And so seeing that really reaffirmed that belief for me, because since 1948 you think about how many different burger chains opened up and then went all around In-N-Out Burger and they added all different menu items.
They added unbelievable marketing.
In-N-Out Burger's marketing is not much.
Generally they put big billboards on the interstate and say here's where it is, here's where we're at, and they continue to do well, raise their sales because they stuck to what they're good at.
And for that, that really reaffirmed my belief.
And when I was able to come back from going to LA to work in refineries, then going to Alaska when I came back, I think that was a big selling point being able to add In-N-Out Burger as a successful chain since 1948 with the banks at that time.
That's when I got that SBA loan, after I raised that capital.
So when I did the episode on you, this is where, because I read Harry Snyder's biography.
He's one of my favorite founders.
I mean, the guy was completely obsessed.
There's a great line in one of his biographies where he would live across the street from the first in and out.
And he'd work all day, right?
And then he'd sit in his living room and watch TV, but he'd look out the window.
And as soon as the drive-through would back up, he'd get out of his chair and run across the street.
He was completely obsessed.
And he, just like you, he blocked the trend in his industry.
They went to like when everybody I think McDonald's was like no, we're going to like freeze our beef, or whatever the case is.
He's like, I'm going to, have my own butchers.
He's like, I'm going to get the fresh tomatoes.
Like, no, no, I'm not going.
I'm all about quality.
There's a line that just gave me a tour of the kitchen.
It says never, you guys have a mantra that says never sacrifice quality for speed.
And he was like completely quality, completely like quality obsessed.
And then if you just sit there and you think about your business over and over again like he's the one, a lot of people don't know this.
He invented the drive-through speaker.
Because it's like, how can we do this better?
Because remember, the prehistory to that was you had drive-up restaurants.
You didn't have drive-through restaurants.
So in that episode I was induced into a state of rage because all these people are telling you oh, you can't have a simple menu.
I was like, no, just go to the West Coast.
They're thriving.
They have a cult-like following.
I went to visit my brother and sister in Orlando.
You guys had just opened up.
You weren't in Orlando before.
And I was like, have you guys ever had Raising Cane's?
This is after I did your episode.
And they're like, no, what's that?
I go, first of all, you should have listened to the goddamn episode.
Second of all, I'm going to take you to Raising Cane's.
And so I saw exactly what you said, where you're like, I don't hide.
You know, we put Raising Cane's right next to McDonald's or Chipotle or whatever the case is.
It's like, I'm just going to do one thing and do better than anyone else.
So we pull up.
My brother and sister are like, what the hell is going on here?
It looked exactly like when I was just in California two days ago.
It looks exactly like when you pull into an In-N-Out.
They're like, why is there a line out to drive-thru?
Why can't we find anywhere to sit?
We have to wait for people to get up.
I was like, just taste it, and you will understand.
And then I thought of you that day because we're eating outside and I look across the street and I see poor old little Wendy's and there's a single car in the drive-thru.
I go, it's because Todd is obsessed.
He wants to do one thing and do it better than anybody else.
Yeah, you have to focus on doing one thing and do it better than anybody else.
And so...
Since I have that singular product focus, right?
And some people call it like a simple menu.
I say, well, it's not simple.
It's focused.
And here's why it's not simple.
Because our chicken has to be exactly right.
Look, it comes from the weight of the bird that we want to get the size tender we want.
It comes from the species of bird that gives the most tender and flavorful chicken.
It comes up with a lot of technical stuff.
Rigor mortis on the bone after the chicken slaughter.
Then it stays on the bone a certain amount of time.
Then you get it fresh. then you brine it for 24 hours.
Like all those things are that, like our fries, right?
So we have crinkle cut fry, but like a thinner crinkle cut fry.
You get fries from different times of the year, right?
They do the crop harvest and it sits in the warehouses.
At certain times of the year, you get more sugar tips in the fries.
Those sugar tips have to come out.
So we have to remind our crew, hey, when you see those black sugar tip ends, take those out.
It's not visually pleasing, our bread.
So we get bread made by bakeries all over the country, but that recipe has to be exactly right.
And it's little dough balls put together baked together so it's pull-apart bread.
It's not sliced loaves.
Sliced loaves end up being more stale.
This is dense, moist, flavorful bread.
Our coleslaw, we secure all over the country.
We have to make sure all those vendors have the right type of slaw that we want for the right type of growers, grown a certain amount of time.
In that slaw you have cabbage, but you also have purple cabbage, you have carrots, all those things.
And so you go down to your tea.
Our tea gets brought from three different countries.
The tea leaves but we have to get it at the right time of the year.
We might pay more for that, but it's that focus on that.
So my team can focus on those menu items and deliver it every time to where it tastes exactly the same around every canes across the country.
So since we're focused, it's not a simple thing.
We can focus on those things.
We have a large culinary department.
It's not R&D, it's culinary, right?
So it's culinary, and making sure that all those products, those raw products we get, are all perfect and make sense there.
Same thing we opened in the Middle East.
It took two years.
Two years to get the supply chain just right, to make sure it tastes just the same.
Two years to do that.
Took two years to procure the chicken, two years to get all the ingredients right, because a lot of stuff you can't import in.
Plus it's very expensive to do that, for them to import it in from the United States where we get it currently.
You have to spend the time to do that.
So two years, people would look at that and say, man, you know, you should be open in a year.
That extra year is going to cost you X amount of dollars.
And I'm like no, those X amount of dollars are going to make us more money, because our sales are going to be higher, because our food is and quality ingredients create and a proper cook system creates craveable product.
So, like in the food business, like and I say this to all entrepreneurs that are in the food business like whether they're wanting to open up or they have restaurants open, it's like your food has to be craveable.
Like meaning, like oh my God, I love that chicken parm from Craig's.
So when I go there, I'm like, I want to go back and get that chicken parm.
Other stuff on the menu is pretty good or whatever.
I'll sample this to try different things because I like food, but I want to go back to that chicken parm.
If they didn't have that craveable chicken parm at Craig's, I wouldn't make it a point to go there.
There's so many good restaurants.
There's so many great places you can choose from in LA.
There's so many great places that you could have good vibe and good atmosphere and good people, but that craveable product is what brings it back.
And if you cut that quality and I've had CFOs over time, not not currency, but over time that have been like hey, you know what?
We just cut this just a little bit.
You know how much money, because it's a penny's business, right?
We're doing well if we make 10 cents on a dollar.
But like, if you start cutting a little bit here to save a penny, and you start cutting a little bit here and a little bit here, it's death by a thousand cuts.
Then your food one day is not craveable.
That's what's happened to so many quick service chains over the years.
They mess with their quality so much.
Then they lost the craveability.
So then it comes down to is it cheap calorie option versus a craveable meal that I'm dying to go get?
Yeah, the way Steve Jobs would describe that is like you want to make products that people lust over.
Lust over, yes.
And so you nailed the craveable because I told you I brought my 13-year-old daughter with me today.
And she's obsessed with Raising Cane's and she door dashes it to our house constantly.
She's definitely craving the quality chicken finger meals.
Todd Graves is obsessed about staying in the details of his business.
He says the most successful people he knows stay in the details of their business.
He mentioned learning from a friend who runs a multi-billion dollar shipping company and how that friend would pay attention to even how much his company was spending on bottled water.
When I heard that, I thought it'd be a lot easier to do this if that shipping company was running on ramp something a lot of history's greatest founders have in common.
They know their business from A to Z and their costs down to the penny.
Ramp is the best.
The amount of money you will save So go back to...
These people are giving you this advice.
Like you don't know what you're doing.
I know the answer to this, but I want to get it on record.
It's just like your kind of personality type.
These, like history's greatest entrepreneurs, are all the same.
If you tell them that you can't do something, you get the opposite reaction that you think you're going to get, which is like it's just going to make you want to do it more.
Absolutely.
You know, the best thing for an aspiring entrepreneur to be told is I don't think that's a good idea.
I don't think you can do that.
People haven't done that before.
Why do you think you can do that?
Because entrepreneurs have something to prove.
They have a vision.
They have an idea.
They have a passion.
If you're an entrepreneur, you're passionate about what you want to start.
You're like, I know this is going to work.
And you're so passionate about it when someone tells you, you know, do that facial expression.
I just, I don't think that's a good idea.
Your first thought immediately is, you know what?
I'm going to prove it to you.
That is a great idea.
And all those no's that you get, you just use that as fuel.
It's like entrepreneurial fuel.
It's putting gasoline on a fire because you have something to prove.
Later in life now is I can take, now that we're established and good, I can take...
I can take those things and not, they'll let it fire me up.
We still get at times, you know, like going into, you know, going into different countries.
They're like you know.
You know, like this mayonnaise type sauce.
It's much more popular as a dipping sauce.
They're not going to be used for sauce.
You need to add that.
If I would have heard that in the early days, I would have said you wait until cane sauce all that day.
You know, now I can say, hey, you know, actually we've had the same thing over the United States.
You know, ranch was popular out West and different things like that.
You know, and we went into Texas.
They said, you had to have cream gravy.
You got to have barbecue sauce.
You know, things like that.
But through tried and true, over time, customers love the cane sauce.
And so we want people to have cane sauce with our meal, not with ranch, because it's not nearly as good with ranch.
And so they can understand that.
So you kind of calm later after you've proven yourself.
But when you're getting started out, man, it is fuel.
You don't seem calm to me.
Yeah, I just don't have to prove people wrong anymore.
But I can feel your intensity over the table.
So I'm very curious about this.
Like the hours that you're working now, 30 years in, compared to the beginning.
So I just flew to Austin.
I got to spend five hours with Michael Dell.
And Michael Dell is hilarious.
He's been running his business for 41 years.
He's one of the most impressive people I've ever met.
Very calm and measured.
But underneath, just a super relentless person, as you can imagine.
And I was talking to him.
I was like, hey, I heard you on a podcast one time.
You said one of the funniest things.
Because somebody asked him when you were starting Dell in the University of Texas dorm room with 1000 and you're going to take on the biggest company in the world at the time, which is IBM.
That's so crazy.
And they're like, how many hours did you work when you started your company?
And Dale's face was like, all of them.
Literally all of them.
I slept at the office.
And so we had a long conversation because he's also, you know, he's married, he's got kids.
And so he was just like, you know, at the beginning, it's intensity.
But you know, the value is the consistency and the compounding over a decade after decade after decade.
He's like, listen, I love my business.
Because I asked him, I was like, Austin in July is not...
A little bit hot.
If I had your place in Hawaii, I know where I'm going to be in July.
I was like, why are you here?
He's like, I just love my business.
So one of the things he gave me advice is like listen, the advice for young entrepreneurs.
He's like I've seen so much over 41 years.
He's like, you think you're going to be knocked out by a competitor.
You're not going to be knocked, you're going to sabotage yourself.
That is much more likely that you sabotage yourself than somebody else sabotage you.
Absolutely.
He's just like.
So what you want to do is just like you want to make sure that you're surviving to the next day.
He's like, I work all the time.
Do I work?
I'm not sleeping under my desk.
And then he's like, I have a team around me.
When they say, hey, we have an important customer in Japan.
He's like, do I actually have to be there?
Are you sure that I have to be the one to be there?
So this whole point is just like over time you're still working a lot, but it's not even fanatic, because you're definitely fanatical.
And I want to ask you about your great quote about that.
But you're just... you're more measured.
You're going to live to survive the next day.
So how do you compare the hours you're working now compared to when you started this thing?
So when I started up and I give young entrepreneurs this advice I'm like imagine how hard it is to start your business.
Then multiply that by infinity.
And if you're still committed to do it and you have the stamina to stick with that, then you'll be successful.
Obviously, you have to have a good product and concept and you have to have something that's going to work, to make something go, which is often hard for people to see.
The vision of chicken fingers down here in Baton Rouge was like just chicken fingers, you know, just chicken fingers.
We like our plate lunches.
We want variety, things like that.
I'm like, wait till you have this product.
And then when I was able to start cooking for them, oh man, that is good.
And when they start talking about the next day, hey man, you can cook some more of that.
Yeah, come on by and have it.
When you have to start up.
There's so many amazing ideas by just promising entrepreneurs that, But they stop and the world never sees that product or service because it's so hard to open a business and it's so hard to make that business successful.
Then it's so hard to scale that business and grow.
And if they just didn't stop and they knew how hard it's going to be, because they're like, how do you have quality of life and work-life balance when you're starting a business?
I'm like, you don't.
Flat out, you don't.
You're going to live the business every day.
You're going to think about the business every day.
You're going to be tired.
You're going to be fighting through a bad mood because you're not getting enough sleep and things like that.
It's like you don't have it.
You have to be committed that you're not going to have it.
Now, once you get your business open and you get it established and it's working, then if you want to grow, then you're not going to have it.
Quality of life then, because going from one to two is your hardest step you'll ever have.
Then two to six and six to 12 and all those growth phases are there.
And so.
But I just wish people wouldn't stop when they go because, like my hours in the beginning, you know, when we started this restaurant we were open every day of the week.
We were open until 3.30 a.m.
And except for Sundays, we closed at 3 a.m.
And look, when we were closing up, it took us two hours to close down.
When we opened up in the morning at 10.30, we had to be here at 8 in the morning.
And so you get about three hours of sleep a night.
I had my apartment right back here that would go up.
And then during the day, we'd be like, hey, go take a nap.
You know, go get a nap for like two hours and then wake up and come back to work.
The hours were just all the time.
It was just nonstop.
And I was young enough to have that stamina just to roll.
And plus this environment.
I love this environment.
Cooking in this restaurant was very important.
For me to be in this restaurant so you could feel the vibe here.
You could feel the soul of this place.
It's right there.
It's just here, man.
You're not separated from your customers.
You're not separated from your customers.
You're right here in the middle of this place that I constructed with my own hands.
And it's like you just work constantly.
You constructed what with your own hands?
This restaurant.
I literally reconstructed all this with my own hands.
Everything except the electrical, because I literally don't know electric.
But plumbing, I did plumbing.
I learned how to do plumbing.
I learned how to do minor construction.
All this place has resurfaced.
So when you came in this place, it was a lot of different concepts, college concepts that just didn't work, but they layered on paneling.
Even the arcade was here, paneling after paneling.
So rip off one layer of paneling.
And there's like there's a rainbow strike paneling going down this way, because it was an arcade at one time.
And they had ripped up through this old paneling here on the, which is actually an Italian restaurant where it started.
This was the outside of the building. and they built this onto here.
So when I pulled all these things off I noticed this stucco all down the wall.
But there was one little place.
I saw brick.
I was like, oh man, we can have a brick wall.
So I started ripping it out with a crowbar, left stucco down the side and I got here and I uncovered this old mural.
And I look, I took it as a sign, man.
This was an outside advertising for this bread mural, for this bread bakery downtown Baton Rouge where we actually started with our first bread at Cane's.
I came up with the recipe with the bread purveyors there.
And this was an outside advertising.
Highland Road going from downtown Baton Rouge through LSU was the main core thoroughfare here.
And we took this as a sign.
This is what we came up with our logo for Cane's.
We took this design.
I literally took it as a sign to say this is going to be the Raising Cane's logo.
And that's what we ended up with.
But I learned this stuff because I didn't have enough money.
I got a small SBA loan for $90,000.
I'd raised equity in a sense of like $60,000 with original shareholders.
And I carried them over there a little a little bit of the business today.
It's been fun being with them.
I pray that, one of the things.
I don't even want you to tell me if it's true or not.
I want to talk about how you finance the business, because it's one of the craziest stories I've ever heard.
But I just pray that today there is a boilermaker named Wild Bill that owns a couple hundred million dollars of equity.
And raise a case because he bet on your chicken finger dream when you were in your 20s.
He did.
He did.
Let me take you back a little bit on the start of it.
So I worked in restaurants in high school and college.
I love restaurants. the restaurant business, food symbolized love to me.
So what that means is like when I could spend time with my mother cooking in the kitchen.
She's the one that taught me how to cook.
We cook Cajun meals.
So we would make a gumbo, right?
You make a gumbo, you start with a roux and you add your onions and you really you take all day making a gumbo.
Now, does it take that long to do it?
I don't know if it does.
It's more about spending time with somebody that you love.
And we're cooking for the family and our friends that we love.
So that time together and then you make a good gumbo.
Then you sit out and all your friends and family are like oh man, that's a good gumbo, that's good.
And they start talking about, well, I do mine a little different.
I do this.
And those conversations went, my grandmother would make me a pie, you know, chocolate pie.
She'd come visit.
She'd say, I made your pie you love.
And I'm like that, you know, I love you.
And so for me, restaurant and food and delivering food.
It's an expression of love.
And then the camaraderie when you're working in the kitchen and it's rolling and drive-through is going and I can work any position.
But it's that teamwork and it's immediate gratification when you're like someone spent their hard work money or hard earned money and they give you their money and they look at that chicken finger box and they're like, oh yeah, like that's a good feeling.
It's immediate gratification.
So much stuff with corporate work and administration work and things like that.
It's not immediate gratification.
It comes over time.
My favorite job is if I can literally come in the restaurant and just crank out a shift.
Like that to me is fun, man.
That vibe, that energy.
And you still do that?
Yeah, when I go to restaurants I go visit like a market and I'll go to one restaurant and I'll get all the crew to come there and we have like a town meeting.
My main job when I do that is, saying, thank you.
Y'all are doing great.
Thank you so much.
And then what can we do better?
And I can get that out of crew and management.
You know, it'd be like, you know, first thing a little bit like, oh, no, the support's great.
I'm like, yeah, it's great, but we're never going to be perfect.
So what can we do better?
Well, you know, the uniform program, be better if we could do this, that great.
Let's get some input because you can get you can get system-wide really good like things from focus groups, you know, with crew or management.
And you get good stuff from surveys.
But like when you actually talk, you can pull it out of them a little bit more.
And do with me, they feel comfortable and then they'll tell me.
But then I'll work with them and they shift and it's fun because you can just, everything goes away.
You're like focused on delivering good product and good service to customers right there.
It's great.
So I was in the restaurant business.
And so, like when I went to college, you know, I actually studied writing for script writing for television and film.
I thought I might want to be in movies, but I always went back to business when I was working because I was that original kid in the neighborhood that had the lemonade stand.
That was a kid that was going to cut your grass for 10 bucks.
It was just always I'd do like I'd set up like Halloween haunted houses in my house and, like you know, go around, put flyers out and five bucks for kids to go through.
So I knew I wanted to be an entrepreneur.
And that's when I got serious about it my senior year.
And I actually graduated, went to University of Georgia, but I was from Baton Rouge originally.
I knew I wanted to come home.
And I had a partner when I started the business since we wrote the business plan for Raising Cane's.
It started off, they're calling it Folly's Chicken Fingers.
That was the original business plan.
Terrible name.
But we had a friend that was, nickname was Folly, called each other Folly.
But anyway, we wrote that business plan.
And literally, I wrote the Bible of chicken fingers, man.
It was like, I knew what our aprons would cost.
I knew what would the cost.
I knew what would, I was just a college student.
I knew what college students needed to make. environment they need to work in.
I knew what college students wanted to eat.
I knew what price points they would pay for that.
All these things, but that professor gave you the worst grade in the class, which is classic, but it was only a B minus.
The rumor went out that it was a failing grade and all this stuff is.
But he was actually a somewhat greater, but he said no, the plan was great.
Like literally, you get the most detailed plan in the whole class, but the concept won't work.
And I said, well, why would the concept work?
Well, because you didn't study the industry.
We'll tell you to study your industry.
You know McDonald's is adding.
You know they've been at it a long time and they're the best in the business.
They're adding these menu items.
There's this thing called veto vote and people won't come to your restaurant.
If mom didn't want this, you know, they're also adding healthy items.
You know, someone's going to want a salad and that and do it.
And it's like, you tell that entrepreneur, no, you're like, oh yeah, wait, I will prove it to you.
Literally, I took that.
And people thought that'd be discouraging.
Actually, it was that fuel.
I will show, show you that this will work right.
So took that business plan, bought a cheap suit, went to Office Depot, bought I thought the businessmen need to wear a suit and I thought business.
Bought the briefcase.
I had the same one, but didn't you feel like a businessman?
You're like I went to school for a bit.
You don't know anything.
No man, you're going into bank, which is pretty intimidating, right?
You're like these bankers and you think they know everything and and literally brought it in and be like unlock the little safe.
You know the little combo.
Was the combo all zero?
I don't even remember what it was.
Yeah, something like English.
Open it up and then be like, here's a business plan for you.
Here's mine.
Put the business plan down.
And proceed to talk about this chicken finger concept I want to start at LSU.
And everybody was nice enough, right?
They're nice enough.
But it was the banker's response was, you know, just chicken finger, South Louisiana.
You know, that's not how we eat lunch.
And never heard of that.
Hold on a second.
Like, you know, you order pizza.
Pizza's real popular, right?
Yeah, yeah, yeah.
You probably order the same pizza every time, don't you?
Yeah. what do you get?
I like pepperoni or like whatever.
I'm like, you get that every time.
I'm like, this meal is that flavorful and craveable.
You're going to want to get this meal over and over.
Yeah, but you don't have years of management experience.
You know, you probably should go work for, you know, great companies.
I mean, you go work for Brinker for like 10 years.
Then you'll really own the business and then you'll have some money and then dah, dah, dah.
And then you'll be bankable at that point, you know, because you have no money, right?
I'm like, no, I don't have any money.
And they're like, you know, you can't get a loan.
You can't just get 100% loan, which I thought you could do.
But with every no, I got, they were nice enough.
I will give them credit for that.
And they were nice enough to take the meeting.
Maybe there's some kind of law that you have to actually see somebody in their business plan.
But then that, like, I was like, man, I need to go make money myself.
And so through a friend of a friend, I got a job as a bowler maker working in refineries.
Louisiana has a lot of refinery work.
And so what it is is turnaround shift work.
But this is super intense work.
This is like 95-hour... It is 95-hour work weeks.
So what happens is they'll shut down a certain sector of an oil refinery.
And they're missing out on production, man, which is just...
Big, big money they're losing.
So they'll pay for you to work nonstop.
They'll pay whatever it needs to get that thing back up and running.
So you go in and you fix things.
You put new equipment in and things like that.
So you work 95-hour weeks, and you just work straight through.
There's no days off.
There's no nothing.
You just work straight through.
So there's overtime.
There's double time.
There's some kind of crazy thing that goes into another level.
So you make a lot of money in a short period of time.
And that was the first group that was encouraging to me on my chicken finger dream, because they could see me working hard on something.
I don't know what I'm doing, but I'm willing to do whatever earn my money when I'm out there, willing to take on any job out there.
And they're like, Todd, you're gonna, well, they call me Hollywood.
We all had nicknames.
Interesting story on the Hollywood deal, but we'll leave that out.
So they were encouraging.
And Wild Bill, Tolar, we all had nicknames.
So Wild Bill was like, hey, Graves, man, you know, Hollywood, I see you got what it takes.
If you really want to make some money and you're not afraid of hard work.
But this is a really dangerous trade.
I fish in the summers commercial fishing sockeye salmon in Naknek Alaska, and he goes.
You can go up there get a job.
You can make a lot more money doing that.
Then you can't bore making.
So I was like, well, what do I do?
He's like, basically, get up to Naknek, Alaska.
I'm like, where is that?
He says, above the Lucian Chain.
Look it up on a map.
Back then, you couldn't look on a computer.
You had to pull out a map, buy an Alaska map.
And so, look, I called a plane to Anchorage.
I called a float plane to King Sam in Alaska.
I hitchhiked. to Naknek, Alaska.
There was no Uber back then.
Literally hitchhiked in, set up in Tent City where people go before they have a job.
You get set up in Tent City put your tent out on the tundra, by the way, and you go around to the boats and you ask them for a job.
You're basically a greenhorn.
It means you're a rookie out there.
You have to convince them to, that you can get on the crew, right?
They're looking for some help.
There's a few boats.
Most people were all staffed out, but a few of them needed just a greenhorn that they could pay a lot less right.
You get less cut of the take for the boat.
But I ended up getting a job on a boat that summer and had the wildest experience commercial fishing for sockeye salmon in Alaska, man.
We were on...
32-foot boats is regulated.
You couldn't keep going out to get the salmon.
So the salmon are born in a stream.
They swim out the ocean.
Sockeye salmon live out in the ocean.
Beautiful silverfish are like five years.
And somehow in five years, they know it's time to swim back.
The original river go up and spawn, and then they die.
It's a crazy cycle.
So they come during the peak of the season.
They're just rushing into these same rivers.
You catch them, but you can't continue to go out.
There's a Loran line back then, and you couldn't cross that line.
So if you set your nets gill nets If you set it up in front of another boat's net, you're going to catch three times as much, because you're catching the first fish coming in.
So these captains make their entire income just during the summer.
So they're heavily motivated to catch that perfect set in front of that other boat.
So you play chicken.
And literally somebody veers off in the end, someone chickens out, and sometimes you don't.
And we rammed boats.
We got rammed.
Crazy.
We catch so much fish around like six foot seas in a 32 foot boat.
And the back of the boat gets weighed so much down with salmon before you get unloaded to a tender boat out there in the ocean that literally you'd be like getting waves over the side.
Some boats sunk when it was gone.
It was just unbelievable work.
We worked 20 hour days during the peak of the season.
It was about two to three weeks.
And when you work 20 hour days, you only get like a nap here and there.
Like you get, hey, go take a nap real quick.
You can get an hour, get this.
Or we get a break to eat real quick.
You're so exhausted. that then you stop being careful.
So people were thrown out with nets.
They would not hold on the boat when you're getting a bad wave and they crack their head open or skull open.
So imagine this, you're out there fishing, you're getting rammed by boats, you're picking fish.
You hear on the radio, somebody just got scalped.
I heard that.
Seemfully scalped.
I don't know how they got scalped from the boat.
Some medical helicopters are going in.
National Geographic's coming over, filming the boat action.
And I'm out there for this chicken finger dream.
Nothing was going to stop me from doing it.
And sure enough, made good money doing both bowler making and doing the Alaskan fishing trade.
Came back.
I lived off credit cards because I had no other income.
Before we get there.
So there's this reoccurring theme in all these biographies.
There's a story just like this.
Now, your story is pretty extreme, and you tell it in a wonderful way.
And the way I summarize this is like, how bad do you actually want it?
And you have to actually ask yourself if you're going to compete against Todd Graves.
Are you willing to work 95 hours a week for a Boilermaker after you buy your suit and your briefcase?
And they're like, get out of here, kid.
We're not getting your order.
It's like, that's fine.
I'll find another way.
95 hours doing shift work in a Boilermaker.
You're going to take a flight to Alaska.
You're going to hitchhike.
You're going to live. in a fucking tent.
Right.
For a month before I got the job.
For a month.
Trying to convince captains of boats that you could die on to hire you And then to do that, and then to work 20 hours and the entire time.
What I love about your story is it's like I'm not thinking about sockeye salmon.
I'm thinking about my chicken finger dream.
Exactly.
I would have worked construction in Nebraska if that's what paid.
I love the fact that I went to Alaska and did that and did something as cool as sounding like a bowler maker, right.
But I would have gone and knitted blankets if that's where the money was at.
Anything I could do to make the money because I was determined, man.
It was like was like a nerd in the entrepreneurial club in college, like we had.
Then people would start up hey, i got this.
You know like i steam clean floors, i do these different things, but i saw these, some of these entrepreneurs have these really cool ideas and that's when technology is really rolling.
But they would just stop, you know, over a couple of years in college and be like I just I don't think I can do that and do it.
And I'm like that's.
The key man is when you set a goal, you do it to success or failure, but you don't stop.
You don't stop.
Actually, with my original partner, we went out to a camping trip in North Carolina.
I'm like we need to make this, like we're going to go in and we're going to camp and we're going to literally commit to this because, like you set an oath that you're not going to ever, ever stop, then you don't stop.
Because during the time, man, just two years took me to raise money for this.
Two years.
Tell me, wait, I love this idea.
Run that back to me.
I just did this episode on Elon Musk and he has a great mantra.
He's like, retreat is not an option.
Retreat is not an option.
Burn the ships, man.
We are going to succeed or I'm going to.
He's like you will know when I give up because I will be dead.
That's the spirit.
That's what you have to do.
He went on this camping trip to do an oath.
Yeah, he was literally.
But he gave up.
Literally.
It was literally to say like Around the campfire.
I mean we did everything but just like become blood brothers, you know to do the deal.
It was like, we're going to do this, right?
We're committing this.
We're going to make this happen.
We're going to see it through.
And somehow it doesn't work.
We're going to die trying.
And literally put that on the line, going out and fishing Alaska.
People died in that fishery.
God bless them, you know.
But yeah, it's just that.
And I think another thing, too, is I think When you have that relentless focus.
So for me is during that time, I was like, I came up with a quote, man.
I was like, nothing ever happens unless someone pursues a vision fanatically.
Like you have to be so fanatical when you have a dream and others don't believe in.
And you see it, you have to be fanatical.
So fanaticism is what carries you through, you know?
And so I see this fanaticism and I study people, right?
And so like your podcast, I'll hear things and I'll get reaffirmed with things.
Then I'll learn new things, new ways I can look at things and do it.
Yeah, man.
But it's great, you know?
And I like it too, because it's like you can learn from it and you can get inspired by it being established, because you need that fuel to keep rolling.
And it's good to hear other people are doing what you do.
And then you learn from other people.
I'm constantly a student of business.
So it's like you learn other things from businessmen and businesswomen.
But for me too is I love to be around celebrities like celebrities, the people that are successful at whether they're an entertainer, whether they're um, they're uh uh actor actors athletes, whether they're athletes, they all have this common core.
And you know what I see?
The most common core of all the people that are successful, for me is they're never satisfied, never satisfied.
And so we carry that into our business about never being satisfied, but it's a bad way to say it.
So you say never satisfied.
It's like, well, y'all aren't happy with what we did, you know, with this opening.
No, no, no.
So we changed the work, never satisfied.
It's like, we're always going to raise the bar.
So we raised the bar.
So we did great at that opening.
That was awesome.
These were all the good things we did.
But you know what, too, is these are some of the things we can get better at.
We can actually get two seconds faster, you know, and this is how we're going to do this.
Look, we needed the staff more.
We messed up here.
We didn't give enough support because we wore out a crew.
We should have had more crew members on staff.
You can always learn.
So I see that with people.
I see it with the best athletes.
I see it with the best actors.
It's like that film was good. but man, I could have done this better.
I could have done that better.
And then like if you don't wrestle rules, then you're always going to keep striving to get better and better and better.
It's like competition.
I love competitors because they make you get up even earlier in the morning.
It's just like, we got other people that are gunning after us.
You said the funniest thing.
So one.
I think one of your most important messages is like we need more founders that refuse to sell their businesses.
Like this.
There's this huge entrepreneurial industry that didn't exist, especially when you were starting your company.
This is like, and the entrepreneur industry is influenced by Investors, not entrepreneurs.
And it's like start, scale, sell.
Then what?
Then what are we gonna do?
And you have a great line where you're like if you create, and do you never wanna stop creating and doing?
And now you just sold the vehicle that you created and create into.
And so then what?
Then you're working on your second best idea or your third best idea.
And I think like one of the most important ideas that you have is, just like everybody in your business.
The reason I said this on the episode I did about you Todd's smoking them because he's competing against corporations.
Who are the founders in your business anymore?
They're either dead or they sold out.
And then I love somebody asked you the question out of the competitors who gets you fired up or maybe will keep you up at night?
And you're like, and they may not even exist, but they will exist in the future because you know that same personality type as you, they're coming.
It's like the young Todd Graves that has that fire in his soul and he wants to do exactly what I'm doing.
And you're like, that's fine.
But you have to understand, this is what I do.
This is in my DNA.
This is like, this is how I feed my family.
So if you want to come, just understand I'm on this 24 seven all the time.
You better be ready.
You better be ready because I'm coming after you.
I just saw you at the UFC.
Are you a UFC fan?
Yeah, I like all sports, you know?
And so Dana invited me to come and get to see Poirier do his last fight, Louisiana legend, man.
But seeing those guys, like, it's the same personality type.
So the reason I bring that up is because you were earlier in the conversation, you were breaking down on, like, the species of bird and, like, when it's... And, like, the amount of detail you just explained to us.
The thought I had in my mind was not about chicken fingers.
This is an important point you're making.
It's, like, the same personality type, just... pointed at a different endeavor.
Jon Jones, you know, probably the greatest UFC fighter.
UFC's the only sport, like, I'm obsessed with and I watch all the time.
Because I don't have time to watch anything else.
But I can watch one pay-per-view a month and have an understanding of what's going on.
And I heard him, he said the same thing that you said in that interview.
It was like, oh, you want to come compete with me?
This is how I feed my family.
And he was fighting surreal gain.
And he's just like, you know, and he was studying him, just like you, and understanding the detail.
And he's like, I know what he does when he wants to go left.
And when he goes right and everything else, he goes...
I assume that this guy is trying to destroy my legacy and trying to take the food off my family's table.
And I will not allow that to happen.
The same level of intensity that you're applying to your business.
Absolutely, man.
If I got somebody who's coming to compete, like you're competing with me.
My livelihood and my managers and my crew members depend on this restaurant, right?
You're coming, you're going to open up across the street here.
These people feed their families off this.
We're going to go out and you better be strong because we're not going to give up, man.
And look, I've done this.
I've done this for 30 years. and I'm just as fired up as I was the first day.
It never leaves you.
It's a blessing that entrepreneurs have, because when it's so hard to start your business, you gain this great sense of appreciation, appreciation for your crew that are working so hard beside you, Great appreciation.
Customers coming in, paying their hard-earned money to do this.
Appreciation for communities that embrace you.
So that sense of appreciation, which is what our culture is all built off of, 100 off appreciation is it never leaves you.
You always feel appreciative.
So you always want to take care of people.
It's like comes in, people are like, oh, man, you just sell the business worth all these billions.
You can just not worry.
I'm like, yeah, well, then what happens?
What happens to my management? who support their families?
What happens with the crew members that come up?
Because if I sold the business, you think they might have the same values?
I mean really hard to find a buyer that would have the same values that I do and that I believe and have that deep sense of appreciation.
They bought it for this.
They want it to be worth this because they're probably going to sell it themselves.
They're looking at it as an investment, not a vehicle to help people.
So I think, when entrepreneurs go, and then you get successful, and then you grow the business, and then you're successful at growth and you create something, It goes to a level.
It goes from fanaticism and passion and a dream.
Then you get purpose.
And so my purpose of Raising Cane's is God made me good at chicken fingers to help people.
And what I mean by that is I have 75,000 crew members.
We have so many part-time people that work.
I love part-time quick service crew members that come in We have an opportunity.
Most people's first jobs are restaurant retail.
They had to come in, learn values, man.
What are those values?
Hey, look, we're going to work hard.
We're going to have fun.
We're going to deliver great customer service.
We're going to deliver that craveable chicken finger box.
Why? because people are spending their hard-earned money here.
That's why we're going to do that.
And what we're going to do with the money that we make, we're going to help out our communities.
We're going to give that to people.
And as we scale this business and it grows, this thing's getting into these values of billions of dollars.
And someday when I clear debt, I'm going to get $3 billion in debt now.
Eventually with our growth.
You know, as we go, God willing we'll go, and then we'll be able to pay down debt and we'll have, when I have this free cashflow coming out and doing, we're going to be able to help people in a big way.
I can't wait for that phase of our business, but that's purpose, man.
So you start realizing, It's not what you make, it's what you give.
That's a better way to keep score.
So we have that purpose.
And what I want people to do is to keep that purpose, because too many great restaurant entrepreneurs and founders of the business, especially in the restaurant business, they sell, they sell.
And look, they're so passionate about it.
And they talk about it like, man, I have the passion and I love what I do, dah, dah, dah, dah, dah.
And then, all of a sudden, they sell a majority stake of their business because private equity is so good at putting that package together.
Generally the numbers are five or 10 million because entrepreneurs put everything back to the business growing it.
They prove in a successful model, either regional, or they prove it out in different regions of the country, which may make it a national.
Multiples go up and they're like hey, we'll come in, we'll give you a, we'll give you 5 million or we'll give you 10 million.
But they take control of the business.
And these entrepreneurs are like, oh my God, we've struggled so long.
We're still living by means.
I got debt.
I got all this stuff.
They will sell and then they lose control of the business.
And if your private equity and private equity serves a lot of good purposes, they also serve some bad purposes.
They take founders out of the deal.
And so decisions get made differently.
So a founder is powerful because a founder is their baby.
It's personal to them.
It's personal.
So for me to today, I read customer comments and look, we don't deliver every time.
We will screw up.
We'll have somebody that was rude.
We'll have something that messed up their order or something like that.
I take it personal.
My family, I take it personal.
I'm like, you spent your money here and we didn't deliver on that promise.
I don't know private equity really cares because it doesn't affect our overall sales.
It's a small percentage of what we're doing is, but you're personal on that.
Your crew is personal because they're working their ass off to fulfill your dream.
And you're sitting there and you're in a good financial position, but they're busting their butt.
Management's busting their butt.
Crew members are busting their butt.
I know when I'm working at 3 a.m. and I'm like, oh man, I'm tired.
I'm going to bed.
I know there's crew members still closing up somewhere around the country, right?
Somewhere around the world.
Somebody's closing up that way and it's that appreciation.
So when you lose that founder personal, that this is their baby, you start making the wrong decisions right now.
You really do.
And so so private equity.
They have their shareholders and they have to make a certain amount of money.
They're not getting the returns on their dollar.
They'll make other decisions that will go.
Maybe they price, maybe they raise their prices and maybe it's not the right time to raise their prices.
Maybe they cut their quality.
Maybe they cut wages for crew.
Maybe they do.
Maybe they don't do the bonus plug.
Their programs aren't as good as the year before.
All those things start to make the business not, not special, you know?
And so I just, I just encourage people People don't let money be one of your major goals.
Because if it is, you end up living a shallow life.
You end up saying I need that 10 million, but you lost control of your baby and then it's not special anymore.
It's not worth the dollars.
Stay with it grow learn, bring in other people to help you business the things you need help with.
Learn it and do it.
The private equity can come in and say hey, look at the staffs we have in finance accounting, IT and all these things that you think are too hard for you to figure out.
It's not too hard for you to figure out.
They had to figure it out too. one point.
I mean, you can figure that out.
Bring in some great people.
Stretch yourself.
Hire those people.
Bring them in.
Learn the details yourself.
I'm not good at IT, but I know enough to work with the great people to still add value, if that makes sense.
I just wish founders would hold on.
Hold on.
Don't get rid of it, man.
And why would you?
If it's something you're so passionate about, find that purpose.
Find that purpose.
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I think that's one of the most important messages that we could possibly get out there.
There's two things.
I have this idea, this maxim of anti-business billionaire, which I'll get to in one second.
But what I'm trying to do is exactly try to like bring attention to exactly what you're talking about.
It's like we celebrate the sale, but we don't.
It's like what happened to the guy for the rest of his life?
Is he still happy about this?
And so, you know, Trader Joe's, right?
The founder of Trader Joe's, his name's like Joe Colombo or something.
I can't even pronounce his last name.
He did such a wonderful service to future generations of entrepreneurs because he writes this autobiography.
That's excellent.
And he tells the story of Trader Joe's.
90% of the book, okay, he wound up selling Trader Joe's in like the 70s, okay?
And he lives for like another like 40 years.
90% of the book is this guy is so fired up.
He loves Trader Joe's.
He came up with a new concept.
90% of the book is just talking about how amazing Trader Joe's was, all the different ideas.
He's the same personality type that you had, right?
But he made the mistake that you didn't.
He got scared.
There was a bad economic climate.
He wound up selling, I think it was, to Aldi, which still owns the business today, if I'm not mistaken.
What's fascinating is just look at the time and effort he dedicated to Trader Joe's in the book.
And then the last 10% is, yeah, I invested in some real estate.
I did some consulting.
And it's like, it goes from like, this guy's fired up every day.
I'm in love to...
I sold my baby.
And then it ends the last page.
He's like, I have to tell you something.
I was not true to my own self.
I regret selling.
Thank you for listening.
Joe Colombo.
Okay.
That's the last page.
The book is published.
He dies the same week.
Gives me chills.
Think about that.
Yeah.
He's like, don't do this.
I wish I had the courage.
I wish I wasn't so scared.
I wish like... What a good man to just be honest, right?
To everybody.
And I wish I didn't do it because he wants to inspire people not to make the same mistake.
Paul Orfalea, the founder of Kinko's.
I did an episode on him too.
He thought, oh, I sell for billions of dollars.
I'm a success.
He's like, I can't even go in the store.
I can't look at it.
Like I got the money, but like I don't have exactly the purpose.
I love the word that used purpose.
So this is something I'm trying to draw attention to on Founders Podcasts.
It's like these anti-business billionaires, right?
They're not in it for the money.
Somebody like James Dyson, like the Steve Jobs, like an Yvonne Chouinard from Patagonia.
It's like these people are, just like you, so obsessed with the quality of the product that they are making right.
That is the main goal.
I'm going to make the best in the world. then they retain control.
And the point I make on this is one of my favorite maxims in the history of entrepreneurship comes from Henry Ford, who also owned 100 of his business.
1919, he bought out all his old investors, owned 100% of Ford Motor Company.
It's very equivalent.
It'd be like owning a $20 billion company today.
He says money comes naturally as a result of service.
Exactly what you said.
Stop fucking worrying about the money.
Can you make somebody else's life better by doing active service?
Then keep doing that and then figure out a way to scale up To serve more people.
And guess what?
The money will come automatically to you.
It will come.
So the anti-business billionaires this is.
They put the quality – they're obsessed with the quality of the product they're making.
They retain control.
And guess what?
If you're obsessed with the quality of the product you're making and you retain control, you wind up with the money anyways.
Absolutely.
Do you think for the right reasons in business, money will come?
Yes.
100% money will come.
So it's like sales-driven.
Do you want to be – profit driven or do you want to be sales driven?
Sales cures all woes.
You can raise your sales.
We're number two on average unit volumes. in quick service restaurants, Chick-fil-A than us.
And I think McDonald's might be a million behind us per unit per restaurant all the way down to a lot of our competitors, are like a third of what we do sales-wise.
But if you're sales-driven, you're going to do exceptional customer service.
You're going to have more people on shift, right?
And then cutting it shorter to try to save labor.
You're going to use highest quality products to do craveable.
All those things that you do, that do that then you end up making more profit because you have more sales, you have more happy customers, you have more repeat business volumes and you get the volumes and you get flow through dollars and you make more money.
This is where the finance industry gets it wrong.
And I think Bezos said this perfectly.
He's just like no over the long term, if you put the interest of customers first, it is the interest of the shareholders.
It just takes longer, but that's where you actually create the value.
It's like serve the customers, and then your shareholders will make plenty of money.
The dollars will come.
It's proven time and time again, and I'm an example of that.
When you talk about entrepreneurs going to a certain point, they get scared at certain times.
A great example is Tony Tenshi Kong, who had Jollibee, right?
So Jollibee is a Filipino concept, and he was an engineering student.
He explained to me.
He said look, if you were a smart Filipino kid, your parents were like you're going to be an engineer.
He's like, I hate an engineer.
He goes.
We went and looked at a dairy to see the engineering behind doing a dairy or whatnot, but they had a little ice cream shop up front.
He goes, that's what I was interested in.
I was watching them do the ice cream and run the register.
He started an ice cream shop.
Then he added a burger.
Then he added spaghetti.
Crazy, crazy menu.
It became this success.
He opened that one little ice cream shop, turns it into a restaurant, and then he starts growing it.
He's like, my goal, I want to be The largest restaurateur in the Philippines.
So he set on his goal.
He has his fanaticism.
All of a sudden McDonald's announces, we're going to, we're going to the Philippines.
It's all success that he was selling all these burgers and his accountant and his like financial people were like you got to sell, you got to sell this.
This concept's amazing.
McDonald's started in the U S they're just going to go and blow us away.
Sell now. you're gonna make all kind of money, you can live the rest of your life and be happy.
He's like, no, I won't be happy.
I like what I do.
And he said, what do I do?
He said, made me nervous as hell, right?
And bean counters will do that.
And they were showing him what could happen if McDonald's put him out of business.
Could be a millionaire or he could be worth nothing.
They put him out of business completely.
He said, you know what?
I'm gonna put the goal.
I'm gonna beat McDonald's and I will still be the largest restaurateur in all the Philippines.
Well, he did that.
McDonald's came in, he blew them away.
He grew all out through the Philippines, became the largest restaurateur in all the Philippines.
Set his next goal, right?
Fanaticism, right?
Am I stopping there?
I want to be the largest restaurateur in all of Asia.
Think of all of Asia.
He did that.
He did acquisitions of other restaurants and did his largest restaurateur in Asia.
Tell me what's the next goal.
I want to be top five largest restaurateur in the world.
This is what I want to do.
And this is the big boys.
This is McDonald's.
This is all the big ones.
That's his next goal.
But that fanaticism keeps him going versus getting scared.
It's okay to be scared.
It's actually a good thing.
But then say, well, I'm fanatical.
I'm going to beat it.
I'm going to see it.
And so I wish just more entrepreneurs would do that, because so many things can be out there that can scare you.
So many people are going to tell you, believe in yourself like you always did and don't give up.
Don't give up.
If you didn't give up when you started, that's the hardest part.
You didn't give up when you're growing in that deal.
That's the hardest part.
Don't give up now.
Go, go.
And you don't need those other things, because if you lose your baby, you lose purpose.
Then you lose purpose in life.
There's other things to do, but it's not your passion.
Let's go back to how you're financing this one.
And then I want to go to how you finance them.
The next 28.
And that insane story.
So you got the wild bill.
You got the refinery money.
You got the sockeye salmon money.
Now you're playing credit card roulette.
Yeah.
I had to do it the whole time when I graduated.
I bartended at night when we were working on the business plan.
And then trying to start the business.
Literally, I don't have any income.
So I'm living off bartender money from tips at night and then literally back then too, you could get credit cards.
There were 18 to 22% interest rates, and you can get as many as you wanted with $5,000 limits.
So that's just what I did.
I just would send in.
Yeah, I have a job bartending and okay well sure, here's 5000 credit line on this deal, but you're going to pay 20 to 22 on that.
And so I just lived off of that.
And so what I did was I had enough money of my own to come back and to live off of and put into the project.
At that point, I was able to raise some preferred shareholders, and I raised maybe $60,000.
These were people like-
Yeah.
Yeah.
I mean, you know, these are like my bookie guys.
Well, guys, I worked Buller making cash.
Yeah.
Yeah.
It was.
Can you take this ten thousand dollar investment in cash?
I'm like, sure.
If I get the bank, I'm like came from my investor.
But I was able to raise that and I was able to get I was able to get it. a $90,000 SBA loan.
And it was enough money for me to come in at this place, North Gates and LSU.
I had a wonderful real estate broker, one of my mentors, Mr. Red Reynolds.
This place had flipped over so many different times.
And he was like I want for the landlord laying in Tulu Arbor she was 94 at that time to have something solid.
I believe in you.
I believe in your fanaticism.
You will make this work.
So I'm telling her to hold, basically held the location for a year for me.
How impactful were those words of encouragement?
Because you're... you're young, like somebody you respect.
That was just a good man and a really good, good real estate broker.
Uh, I really respected that because he saw that it was affirmation, that why I was being so fanatical and trying to talk everybody into it.
You know what I mean?
Except for the he believed in me.
I'm like, okay, okay.
That's it.
That's just a little wind in my sails to do this.
And basically told her Hey, it's going to take them a year to put all this together, but I believe you'll do it.
And then I believe you have a long-term tenant.
Look, Sure enough, we've been here for almost 30 years and we got like a 100-year lease going forward and the family she passed away, but the family's like no, you know, I'm trying to buy it.
They're like we just have pride in this, you know.
So we'll just keep doing a lease, I said, but we'll give you 100 years, you know, and options to stay in this original location.
Do you buy the real estate now for the new store?
Wherever I can.
Absolutely wherever I can, I do.
Just good real estate, A-quality real estate, it's just there's so many people that own it.
It's part of larger shopping centers, larger developments.
A lot of it's in trucks.
You know, family trust and things like that.
But every one I can buy, I buy.
Absolutely.
They won't sell you this one, though.
No, no, no.
They like being a part of it, right?
You know, but they give me good, I got a good lease term on here.
And plus, you know, what I put into this place.
Look, I had to learn things.
You know, like I said, I had to learn plumbing.
I had to learn construction.
I had to learn this stuff.
I really didn't have a lot of money, too, to come in and spend much money on this.
But this place is sacred, man.
I can tell you every square inch.
And later on after we get into our discussion, I'll show you all these little points in this.
This is original furniture that I went.
I got a U-Haul, went around to all these equipment supply stores in Texas.
I hope you have bed sheets that look like the summer.
That's a damn good idea.
There's some pajamas too, right?
But it means something, right?
And keeping this like this, I can bring in management to here and show them this place.
We have big, pretty buildings, all functional, everything.
And they come here and go, this is our soul.
Just remember, this is where we started.
We got to keep that spirit going here.
Dude, the one in Miami Beach by my house looks like a nightclub.
Yeah, yeah, yeah.
Just like literally the deal.
I love that location.
It's huge.
So credit cards, SBA loan.
You said it took a year for the development of?
So you had the lease before you opened it?
No, so he didn't sign the lease.
He said, I'm going to hold it for you, right?
But this location was available, and I knew it was going to be awesome.
It took two years, two years from the business plan to where I actually opened up the restaurant.
It took me two years.
And so literally from writing the business plan from class, going to the banks, getting turned down, working in refineries, then working in Alaska for the summer, then coming back that fall.
And we opened in 96, so it would be the fall of 95 when I got back.
Then...
So I had, had some money on deal.
I went and got that S SBA loan and got, got the investors.
And from there, then we started the construction process.
We started getting the used equipment and look like the equipment I went I got from from.
I went into Houston and Dallas restaurant supply houses.
Cause you know, restaurant business go out nine out of 10, go out of business.
I could go buy stuff.
And I'm like, I need a fryer.
That'll work 60 days.
Like, give me your cheapest fryers.
They had to be 85-pound fryers.
And they're like, well, this one's good.
I'm like, yeah, that's 10 times as much.
I need something that lasts, because I know, as soon as I prove this will work, I know I can get another loan.
Thank goodness we made money.
And so when we opened up, I was so excited.
We reconstructed.
We're ready to open up. registers back to Office Depot.
They're these little registers.
And once they figured out how to program them, I went and started waving people in the restaurant and people came and people liked it.
And then we made $30 the first month.
That's what we made.
People were like, that's all you made?
I'm like, no, dude, that means I could pay my crew.
I could pay rent.
I could pay, you know, literally payroll's taken care of.
I can pay the vendors.
We're working.
And steadily off of that, we started making more and more money.
I could replace equipment as we went.
Just basically dumped everything back into the restaurant.
And sure enough, man, I was like, like, This is working great.
We can go to the other side of campus and we can go in and do that.
I brought the business plan to the SBA lenders that did us.
And I got to that one.
Literally 18 months later, I was able to buy the piece of property, construct a new building and open up 18 months after the first one.
It took two years to start this first one on a shoestring budget.
The second one, I have a piece of property and I got a brand new building that we opened up and it showed efficiencies there.
And what was really amazing with that location is that it was another shot of campus.
It also had traffic flow from neighborhoods, office buildings, things like that.
So we had not just students coming in.
All of a sudden we had businessmen and women coming in for lunch.
We had moms and dads picking up food on the way home.
We had T-ball teams on Saturday.
We had church groups on Sunday.
And that's when I got the vision.
I was like, this isn't just a college concept.
It's what I thought it was.
If I just work for college kids, I'm like, this works for everybody.
And that's when I got that fire, man, to grow at that point.
That's when I got the vision, man.
And the vision at that point was and it wasn't.
It wasn't articulate this way, but what I wanted was locations all over the world.
And I'm like I want to be known as the brand for craveable chicken finger meals.
Great crew, cool culture and active community involvement.
Like those are the things that turned me on with that deal, right?
What do you mean it wasn't articulated that way?
Well, so I just, I thought the vision was there.
I just didn't put it down.
And so I'm like I asked myself you know, it's like I was, like you know, why do you want locations all over the world?
I'm like cause.
I want to go into every community because I love hiring people to come in and build teams, creating opportunities, job growth, teaching them values.
And I'm like man, he's like like I get.
I get turned on by customers coming in and loving the food.
I'm like, and I'm like, keep giving them quality chicken finger meals, that craveable product.
And I was like, now I'm able to give money back to the community.
I'm like, and I want to be able to give money back to the community that actively involved.
And I'm like, but we have this cool culture, man.
I want to, I want to emulate that other places.
I want to be the place that, look, I worked in the restaurant business, high school, college, man.
It was like, it was not positive motivational management, man.
It was like, do this, do that.
You know, like you screwed up.
Yeah.
It was, there's no music in the kitchen.
Can you imagine working back there?
It was just negative environment because the manager was was negative because the owner didn't appreciate everybody.
You know what I mean?
So it was just this negative feeling.
I can get people from other, other, other restaurants where they're not treated right.
And they're not like giving good customer service.
They come here, they're treated right.
They have a good environment.
We've got music cranking in the kitchen.
We're having fun.
We're a team and it's positive motivational management.
It is like, good job.
Hey, thanks.
Thanks for, uh, for taking the stuff out to the trash out to the dumpster.
Wow.
That's good toast.
Hey, good job on the shift, man.
That That's how you motivate people.
Praise costs nothing and means everything.
It means everything.
Absolutely, man.
And it's teamwork, and it's good.
And also, too, is why I love operators is it's like when I was on the football team.
It's constant coaching.
Oh, yeah, that's a good pass.
Oh, man, you screwed that up, man.
Like, make sure your arm goes back.
And, you know, hey, block harder, do this.
You know, like, you're getting constantly coached, and nobody takes it bad.
No one takes criticism bad because it's all about doing better, winning the game.
It's the same thing in the kitchen.
You're like, hey, man, Toast needs to hurry up, da-da-da.
Hey, great, that's great toast.
Like you can mix those things in the corporate environment.
And this is how you get weeded out of Keynes.
Corporate is the people that can't take constant coaching, And it's coaching right.
You know it's like well no, we should meet every six months on an eval and how we're doing, and blah blah, blah and all that stuff.
It's like, no, every day is an eval.
Like every day we're going to get better.
And a lot of corporate people, one, if you make mistakes, like I encourage, make mistakes.
We're not making mistakes.
We're not pushing ourselves.
We're not trying new things.
We're not doing things.
But let's learn from them.
But let's admit our mistakes.
I see corporate people come in and it's like, like you don't address an issue.
You just say, oh, we're doing da, da, da, da.
It's just like, hey, man, we screwed up on this.
We learned this.
We're going to do this differently.
Let's move on.
Like, it takes all of 30 seconds.
When you create that kind of environment, like in a coaching situation or in operations.
That's a challenge for me on growing the business, because we're bringing in some really experienced people from other organizations.
Right now.
Yeah, right now.
As we do that, a lot of the culture is you don't admit mistakes.
One, you don't want to admit mistakes.
And two, you don't want to be coached.
It's this academia thing. type of things like that.
I was like, look, man, I'm learning every day.
And I'm the first one to always say, man, I screwed up on that.
And that was a bad decision.
Then the team knows, Hey, well, once it's validation too, he doesn't think he knows everything.
And two, it's okay for me to make mistakes, you know, we, we, but we do need to learn from them.
Like Todd's not going to make that same mistake over and over.
Like we know that.
And I won't either.
Right.
And so that's some of the the challenge and growth in in in in restaurant growth, we get the operators
And if you're an operator, man, you just have that culture.
And we have to get as people that are intrinsically motivated, right?
And so we can pay people really well because we do good.
But pay doesn't matter, man.
It's like to the people, they want to make a good living, of course.
Title doesn't matter, right?
You know, it's like this VP, executive, all these like titles and stuff like that.
People are like title crunching up.
I can literally interview somebody and I can see the things.
That's like.
It's like They're going after Tidal.
They're going after pay.
They're going after these things versus intrinsic motivation.
Like, I like to lead people.
I like to be part of good teams.
I like to be part of high-performing teams.
This gets the most out of me.
I like to be excited about what I'm doing at work.
Those are the things that when you hear that, you're like, you're intrinsically motivated.
I like what y'all do back in the community.
Hey, have you ever thought about supporting this?
I think this is a great organization.
When you hear that kind of stuff, because there's plenty of brilliant people.
There's so many brilliant people who do the same job or that have the experience, but they will learn that right.
They have the intelligence to do it, but it's hard.
It's 100% hard, man, if you're intrinsically motivated to do really well.
I love the idea that you said that they have this almost like theoretical, like academic understanding of business, and that usually only survives in an environment where you're separated from the customer.
It's like if you're working here, there is no theory.
It's like we made it.
We can see the customer eating it.
Look at their face.
What is actually happening?
Separated from the customer and separated from the crew.
Corporate environments.
Like when I started off, I was the first guy to wear a Canes T-shirt to like conferences, right.
Everybody else is in a suit and tie.
But there are crew members in the restaurant wearing like, you know, jeans and t-shirts.
It's like, you know, it was this business mentality from here.
You're separated from the customer because you're not in your restaurant seeing who's being served.
And you're also not with your crew to see what gets it.
You're in the suit.
So immediately when you go in with your suit into a restaurant, they're immediately like there's a separation.
There's a divide.
When I walk in a restaurant, I'm dressed exactly like them.
And I speak their language.
And I talk to customers.
They're like, There's no separation.
Like, oh, that's the boss.
They're like, oh, that's the founder, right?
That's a different title.
You know Les Schwab Tire Company on the West Coast?
Okay, I'm going to send you his book.
It's very hard to find.
I found this because Charlie Munger is like one of my heroes.
And he had like the complete history of American business in his head.
And he's like, you need to read about this guy.
I just read the book.
You would love Les, because he sounds exactly what you're saying, where he competed in very difficult business.
You come into...
Fast food, QSRs, that was an established thing.
You're coming in.
There's competition everywhere.
And he goes into selling tires, and he just smokes every single other person.
And the book starts because he's in his 60s.
The business is named after him.
So he goes, I need to put this in a book just so you know I didn't have a ghostwriter.
I wrote this all myself on a 50-year-old typewriter.
He goes, this is how I want the business to run.
If the business is not going to be run this way, take my name off the business.
Take my name off the business.
And he's like old school guy.
He's person all the other place like god damn it.
And he's just like i'd always tell the god damn people in the office like the only reason they have a job is because the people in the store selling tires.
And then he would talk about.
This is like if you're, if you're out, you're gonna love this guy.
I already know this for a fact.
I'll send it to you.
Uh, he's like if you spend 30 days outside of a store, you forgot half of what you know.
He's like you have to be.
He's like every single thing.
He's like we exist to serve the people that are serving our customers 100.
It's why we call the restaurant support office.
We're not corporate office.
We are a restaurant support office.
We're here to support the people that are serving our customers, 100%.
We have these monitors set up in our offices and it has restaurants and you can pull up any restaurant.
Our whole system.
I want people, when they're leaving our office, our restaurant support office, to see there's people still working right.
When they get there in the morning, there's people opening up, doing the restaurant, doing it.
There's constantly working.
So you see it every day.
You're walking by that every day.
You're like, Ladies and gentlemen, that's where we do our business.
And our job is to support them.
Because when you go to bed at night, they're going to be working.
When you get up in the morning, they're going to be opening the restaurants.
We've got 75,000 crew members across the system.
We're here to support them.
We're here to make their job better, easier, more efficient, more fulfilling, the whole bit.
And keep that going.
You have to, like...
You also have to do is entrepreneurs are very erratic, unscheduled that, you know what I mean?
Like so you know most of us, you know as a general deal.
It's like the people are like what's your schedule like?
I'm like, my schedule's all the time. everywhere, however, whatever.
It could be three o'clock in the morning.
Are my eyes open?
Yeah, literally it is.
If it means no sleep that week, it is what it is.
It means I can take off a day and go climb a mountain.
I'm going to do that.
Whatever called for the business, then you answer that.
So there is no schedule.
There is no that.
And so the discipline comes from the focus and the fanaticism.
You're always going to be there.
You're going to do it.
But there are the things you have to structure and do it.
And so like for me is to scale.
I created the Cain's Loaf department in our business.
Respect, recognition and rewards.
Man like so you know, when you have crew members that are working hard right, one things of respect are things that you should just do.
You shouldn't get credit for them so like we're closed on every major holiday.
That's not a reward, that's not recognition, it's just, it's just respect man.
It's like do i want to work on july 4th?
No, I don't.
I want to be with my family and friends.
I want to enjoy the holiday.
I want to take off Christmas Eve.
I want to not work on Christmas Day.
I want to be, you know, holidays and things like that.
I want to be there.
So if I respect my crew members, if I'm not going to work, you're not going to work.
I work nights.
I work weekends.
I work all that.
But we don't want to work on those days.
I mean, the first July 4th, I was open at this restaurant.
I saw the crew was dragging.
I was here working with them, right?
But they're like, oh, because all their friends were doing something fun.
Their family was doing something fun.
I was like, you know what?
That's not worth it.
So that's respect.
Recognition.
It's something you should recognize achievement.
You should recognize tenure.
You should recognize all these things.
There's things to recognize all the time.
It starts from a list of simple things like, hey, that's great toast.
Thanks for being so friendly in the drive-thru.
Man, they loved you today.
It's things like that that like, You work a year at Raising Cane's, you get a hard hat.
It symbolized the first year I was there.
All the crew members signs it.
It's fun, right?
Five years, you're getting the salmon.
Those are the recognizing things, recognizing that deal, the rewarding.
So it's like whether it's a 5 gift card to go get a coffee at the local coffee shop, onto other bigger and better things that you get.
There's rewards that you get.
And I don't want to build that better and better, but like, if I just think of these ideas and they come and go, it's like no, create a department around that.
Like, like literally, department that thinks of nothing but respect recognizing, rewarding crew members every day and put a bunch of brilliant people most of them came from from operations in the restaurant and they know this stuff about build systems.
So our next thing with that is first is saying here's the gift card or here's, here's a new canes hat or things like that.
It's like build a point system.
Right, it's kind of fun right, you'd be like you know you come in, you get it for Every year you work, every month you work.
You build shifts, right?
Like, hey, so-and-so was sick.
Do you mind coming in and working?
They come in.
You get points.
I want to build it up a really exclusive type merch and stuff you could build up to and do.
But like constantly getting better at that, raising the bar.
But have people around that.
Not just the field.
You have to put programs and things around these great thoughts.
You have to get structure to do that.
Sometimes that's tough for an entrepreneur.
One of the best pieces of advice that I've ever read in a book came from Mary Kay, who built that massive.
Remember the Mary Kay Cosmetics.
They would award people with the pink catalogs and everything.
And I feel Mary Kay was a master at understanding sales and human psychology.
So she had one of the biggest and most successful sales departments.
And the piece of advice that she gave the organizing principle for her salespeople sounds a lot like what you're doing with Crew Love.
And she goes.
Remember that every single person goes through life with an invisible sign around their neck that says make me feel special.
And I am hard driving person like you.
I can be a bit of a dick.
Just being clear.
It's like, I'm, you know, kind of obsessed.
And that just knowing that is like actually helped me interact with other people better.
And to kind of like modulate my behavior.
It's just like, they just want, that person wants to feel special.
Just like you do.
Just like the person that helps you secure this.
Like, man, Grace, I believe in you.
Like, and it makes a difference even to hard driving.
You know psychotically obsessed, fanatical people like you.
It does work.
Words of encouragement matter.
And so I remember reading a biography of Henry Ford, who I already mentioned.
And at the time, he was not successful.
He had this idea.
He was like, hey, all the cars that were on the road at that time were either electric or steam.
That's what people don't understand.
It's like electric cars are not new.
They were the default at the very beginning.
He had this idea to make one with an internal combustion engine because he's like then, the fuel source, you carry the fuel source with you, right?
And so he winds up meeting Thomas Edison.
At the time, Henry Ford meets him.
Henry Ford, no one knows who he is.
He's not successful.
I think he's already failed.
He had two or three, two failed car companies before he finally succeeded with his third, too.
Again, just uncommon no matter what.
Thomas Edison is the most famous person, one of the most famous people in the country.
He has a hard time hearing.
They're at dinner, like a huge dinner and Henry.
But Henry Ford's an engineer and so he gets a minute with his hero, Thomas Edison, and he's having to yell in his good ear about this.
And I think it's like seven words or something like that.
But Edison, obviously brilliant, he just gets it right away.
And he hits the table, and he goes, that's it, young man.
You have it.
Keep at it.
And then Henry Ford says in his autobiography, which he's writing 40 years later he's like those seven or eight words of encouragement.
There was a hell of a lot of pain between him telling me that and me succeeding at this idea.
But I heard that in my mind and it kept me.
I was going to keep going, but a little boost was very freaking helpful.
And I heard Edison, my hero, saying, you're good at this.
You have a good idea.
Don't give up.
I think it's really important.
Fantastic.
Yeah, it absolutely is.
But it's our own encouragement.
Edison knew he had it, right?
And so sometimes tough love, I had to learn that on Shark Tank.
Tough love is also... when you get different entrepreneurs and things like that.
And sometimes the ideas aren't good.
And I wasn't good at it.
Like it was always encouraging and you'll find a way and do.
But like on Shark Tank, they're like, hey man, you're gonna have to learn tough love.
Like Cuban knew me, right?
And then in being around, Mr Wonderful, then they're like.
I know it's heartbreaking, but sometimes the ideas aren't good.
And are they're doing it the wrong way and you're not doing them a service doing it that way.
So the tough love is to say, say this, but then help them. to focus on what's really important.
No disrespect to Shark Tank, but fuck that.
Like, I cannot stand.
I said this in the episode I did about you.
It's just like, the future is unpredictable.
Like if you read history as much as any.
Like, I think I read history more than almost anybody else.
It's like, all it is is humans failing to predict the future accurately.
Why would you sit on a stage in a suit and a bunch of makeup on and say this kid's not going to succeed?
Fuck you.
How about that?
Like, let's see how it actually is going to go.
I hate people that do that.
And so my idea is like, obviously there's a huge...
Millions of founders listen to founders and I get emails and all this kind of stuff.
And we have conversations.
It's like, what do you think?
What I think doesn't matter.
I was like, I don't know.
I have no way to predict the future.
All I know is like when I started my podcast, people were like, there's too many podcasts out there.
It's like 2000, there's 10 years ago.
There's no podcasts out there.
They're like, no one's going to listen to a solo podcast.
No one's going to listen to a podcast where you can't make a living reading books for like.
That's ridiculous.
It's like, it doesn't matter.
I just, I actually hate that show.
No offense to them.
But it's just like the idea of I'm, I'm all-knowing.
I'm an expert.
There is no such thing as an expert in entrepreneurship.
You know what you're going to be an expert in?
Raising canes.
You're an expert in raising canes.
And I'm sure you have a ton of ideas, which are obviously transferable to other businesses.
But we don't have predictive ability.
I just did this episode on Elon Musk.
Let me give you an example.
There's a guy named Michael Moritz, who might be the most successful venture capitalist of all time.
He's at Sequoia.
He invested in PayPal, which is a successful exit.
They sold it to eBay for $1.8 billion, something like that. if you want exits.
So they sell that.
Then he already knew who Elon was.
He invested in PayPal, which was Elon's company.
Then Elon goes to start Tesla and he pitches Michael.
And Michael's like, he's like, invest in my new company.
You just made money with me.
Michael's like, you're trying to compete with Toyota.
That's impossible.
I'm passing, okay?
That's a multi-billion dollar mistake on Michael's part, okay?
The funny part is and I'm not doing this to shame Michael, because in the book later on he goes that was.
He's saying years later he goes.
That was a mistake, because I severely underestimated the level of Elon's determination.
That's why I don't like shows like that.
You don't know what's inside that person's heart, inside that soul.
It might take him five years.
It might take him 10 years.
There's a book next to me that I just showed you. before we start, okay?
The reason that I've read 400 biographies of history's greatest entrepreneurs.
Yeah, so I've read that book four times.
I'm about to do another episode on it.
But the reason I bring that up and the reason that, out of the 400 books that I've read, that this is my number one recommendation, is because this is not a celebration of success.
90% of this book is James Dyson failing.
He goes through 5,127 prototypes.
He gets screwed over by, he gets screwed over by partners, joint ventures.
He was just like you.
Please, I want to sell you a piece of my company.
I need to raise investment.
Please take it.
Everybody's like, no, your company's not worth anything.
So that's why he owns 100% of his companies to this day.
But the reason that's so fascinating about this, right, is because he has the idea.
I think he's 44 by the time.
He finally has a product up to his standards that he owns completely, that he is now selling.
And the book ends where he's just like, listen, It's easy for me to say to not give up, right?
But there was times where my kids grew up seeing their dad as a failure.
He would go in the back do prototypes be covered in dust?
Because he's doing vacuum cleaners, carry himself inside and cry himself to sleep covered in dust.
That's what his kids see.
But he's like, so it's easy for me to say not to give up, but because I'm on the other side of that.
And where the book ends, he goes, they have one product, which is the vacuum cleaner.
They're in one market. and they're doing 300 million a year in sales.
And then what happens?
Now his company's doing billions of dollars a year.
And he's got a bunch of different products.
He's in markets all across the world.
The compounding between 44 and 75 was so important.
And it wouldn't have happened if he couldn't endure the pain.
I have one of my favorite quotes.
Endure the pain.
Excellence is the capacity to take pain.
It is.
And you see that over and over again.
It is.
100% is.
It really is.
And founders lead and they work with their heart and soul.
Yeah, absolutely.
In my conversation with Daniel Ek on this podcast, he said one of the most important ideas I've ever heard.
He said, I'm not obsessed about time.
I'm obsessed about energy management.
If you have time but you have no energy, you're not going to accomplish anything anyways.
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For me, you know, when I was growing and seeking advice, and I got a lot of really good advice.
I also got a lot of bad advice that I was able to, like, see through it.
You know what I mean?
And learn from, you learn from good and bad, good examples, bad examples.
Like people started saying stuff like Hey look, you know, Todd you, just you're.
You're so much in the details that you just need to delegate, delegate.
I hated hearing that word delegate.
I'm like, explain to me, explain delegating to me.
What do you mean by that?
Like, well, delegate means you give up.
I'm like, no, I know what the word means, but how do I, how do I delegate this off?
Well, you just hire good people and you delegate, you delegate them to do the work.
I'm like, I hire good people.
And let's say out of a hundred point scale, if I can do it at 95, pretty good.
No, that's perfect.
But let's say operations, I'm at a 95.
But if I hire somebody good, but they end up being an 85, but we need to be at that 95 to have success.
I can't just delegate that.
I have to supplement to get us back up to 95, working with that person to do it.
And over time, they might get to the 95.
So at that point that they're at the 95, then I'm like, hey, you can run this good.
Then they get to 96, hey, you can run this better than me.
So now I'm gonna ease off on some of those things that I was supplementing.
All the deal is, but I'll still check and make the.
But I still know enough too to where I can still add value on improving and doing things like that.
And so like, did you say it can't be in the details?
What do you mean on the details?
Oh man, look, all this, you're down to the minutia and all this stuff.
You're wasting your time doing that stuff.
You should be big picture.
You should be there.
I'm like, well, yeah, you gotta be big picture too.
But the devil's in the details on this thing is.
And so I got reaffirmed by this.
And this is Edison's West, a large shipping company here in Louisiana.
And actually it was one of his partners in another shipyard business had told me when I was explaining this to my YPO forum business group and saying people are saying I'm just too much in the details.
They're like, hey, Gary Swiss knows exactly what the bottled water costs at his place.
And he's like, look, and there's formulas to give it to him.
He doesn't go and count water bottles, right?
He looks at the program because he's like If we're paying 25 too much on bottled water and people aren't going up to the thing and getting out of the big thing and they're using which is wasteful two little bottled waters, it means they're doing that in every phase of the business.
So knowing those details, but that reaffirmation of me going, yes, me into the details matters.
So I say you don't delegate.
You hire great people.
You help them and do it.
And if they do it better than you, then you can back off and you make sure all those components of the business.
Look, I'm not great at IT.
I have an exceptional IT team.
They do it better than me, but I'm still into the details to make sure we're doing what we need to do.
We're supporting our operators.
We're doing it.
We're being innovative and we're getting faster in drive-thrus and doing it.
Our co-CEO in the business is a much better operator than me.
I'm still in the details with him in the business and I know enough about it.
I'm good at it to add value in the deal.
So the word delegation is used way too much.
Like trust your instincts, learn and grow and let people grow themselves, but be into what they do and absolutely stay into the details of your business.
If that's what made you successful, don't lose those things.
Get better at it.
Get more efficient.
Get the reports and things like that.
You all have products and you also refer people to products that can help consolidate the information, to write quicker, efficient.
More decisions like that.
You get better at that, but stay into things.
Stick to what you know.
Second on the concept, man, I fully believe be good at one thing and do it better than anybody else.
Be relentless.
Do it better than anybody else.
Can you expand on.
But that I said on this episode.
It's like Sometimes you can just hear a person say a sentence like what you just said about delegation.
It's just like, if that's the first thing I ever heard, I was like, I know him.
I'm like, I feel that way too.
Walt Disney has a great line about this, right?
If we lose the details, we lose everything.
These are not after, this is not something you think about after.
It's like.
This is what makes the magic you called it craveable, like the magical experience, like why there's people have an emotional reaction to your company.
Right.
Like you've, you're, product evokes emotion just like his evoked emotion but the reason the very first i didn't i was unaware of raising canes there weren't any in florida where i live i um and i actually saw a clip when you were on theo von's podcast it was a tiktok and you said something i was like i know him like i have to find out who this is yeah and then my brother-in-law lives in um austin and that's when i had my first race in canes so i'll tell you what i heard about you and then the first time i had it I was like, of course his food is like this.
And then I had it for lunch and dinner, lunch and dinner, lunch and dinner, lunch and dinner.
The whole week I was there.
His kindred spirits.
Yeah, but this is what I'm obsessed with.
This is exactly what Harry Snyder thought, the way he thought as well.
It's not just the principle of doing one thing, doing better than everything else.
It's just like how it applies to every single thing.
And you talked about in that podcast, where it's just like well, a simple menu has all these other positive effects that you can really focus.
Get all the details good, you can make it better.
But also you even had the concept that it's going to allow you in the future, to serve more people.
Because it's a, it's a shorter order time.
Right.
When did you figure that out?
Did you know that at the beginning?
Yeah, no, no, no, I didn't know.
What I wanted was what I wanted was craveable product.
You know, and I knew from restaurants, you had that the one craveable product on their menu and then they have all these other menu items, all these other distractions.
You're like, but everybody goes to Gino's to get that delicious carbonaro, right?
Like it's like, Focus on that, that, and do it extremely well.
Don't try to be all things to all people or you're going to be nothing to anybody, right?
You have to be what people will be fanatical about.
The restaurant business is craveable.
So what I want to do is create that craveable product that everybody do.
Then I saw the value of how quick I could do the drive-thru, right?
And so it starts from when customer pulls up to the order line deal the first time at raising gains, they look they have to decide what they want.
They do it after that they know what they want box combo, sweet tea, extra sauce, you know whatever whatever, whatever their whatever, their order is.
So the order is quick coming to the drive-thru.
We have a singular product focus right for that one menu item.
We have one line.
I'll take you back in the kitchen later.
You can see down the line.
Toast is grilled on the end.
You got chicken fryers, you got fry fryers and you got the board.
You can watch that cook to order process happen.
Like you're cooking.
And so you can cook and you have that product and you you're making one, basically one meal, just with three four, six chicken fingers.
So you can make an assembly quicker.
You'll have your, your, your drinks that are popular comes up in and out.
It gets out there.
Thank you very much for your, for your order.
And you go through.
And so then I saw the speed on that deal.
So it's like our concepts, craveable food spur served with fast food, speed and convenience.
That's what it is.
Right.
Fast food speed and convenience, craveable products.
So the both of those together.
So if I added menu items, right, then it would slow me down, right?
And I'd say, well good speed up is, then I'll put heat lamps and keep all this other food assembled done.
So then quality goes down.
So your speed goes down, then your quality goes down.
Then your quality goes down worse if you've been adding heat lamps.
And we don't have heat lamps.
We don't hold times with them, any of that stuff, right?
And that cook to order process.
It's like you go up to In-N-Out Burger and you know what you want and you're cooking ahead.
So it's literally like you're cooking ahead.
Now, if you show up, you're the first customer at Raising Cane's.
It could take you four minutes to get your order.
Four to five minutes because We're dropping the chicken.
We're doing that.
But when the line picks up, then you're cooking a little bit ahead.
Then during your rushes, you're cooking way ahead.
Meaning it's coming out, it's getting served immediately, right?
We're two minutes, 35 seconds drive-through and counter service, right?
If we added different products and we lost two seconds every two seconds.
That I can get faster is a point on sales.
So let's just say just roughly 1%.
If we do...
$6 billion in sales this year.
What's one for $6 billion?
$60 million in sales you can do if you can tweak that order time.
Two seconds.
Now it flips on the other side, right?
If you add two seconds, you add two seconds, you add two seconds, then those sales go down and then you flow through dollars.
Once you get to the flow through point, then you lose.
That's money.
So not having all those different things, it keeps the concept.
So, knowing what your concept is and sticking to that concept, Then you know what here's the engine, here's what drives, here's what drives sales, what eventually drives profitability it does.
There's other benefits too.
In the restaurant business.
You look at a lot of the quick service competitors.
They're adding all these LTOs, limited time offerings.
Management and crew have to learn a new product that's going in and how that works in the service model and do it.
And as they learn that, they do that.
It's a distraction of what you do.
Then the next 60 days, there's another one, then there's another one, then there's another one.
There's all these things going on.
Management has to spend so much time on learning those new products, delivering those new products, hitting the sales expectations.
All that, where's the time to encourage the crew and do positive, motivational management?
Point out, that's good toast.
You're great in the drive-thru.
Where's the time to walk out and talk to the customers and actually see Their food.
How clean is our restaurant right now?
What's the general vibe here?
Oh, wait, the music's a little lower.
Someone knocked it down.
Where's those things?
So our management can focus on that crew, member and customer experience and make sure that goes, because they're not these LTOs, they have to learn.
Go through training modules and do that.
You focus on what you do good.
And so, like, you go back to that business plan.
They talked about not having all these different menu items.
No veto vote doesn't happen.
They're like you're not going to get the frequency because you need frequency, gets driven by different menu items because you get all that stuff.
Are frequencies just as high as any other quick service restaurant, meaning how many times somebody comes back in a month period of time?
I see the DoorDash bills.
I know how frequent it is.
But then you come back, right?
You come back.
So it's anti what they say is what drives this stuff.
It's like there's no veto vote.
There's no variety drives more sales.
It's actually frequency.
Our frequency is as high as anybody else's serving the exact same thing.
People have day in, day out, because it's good.
Because it's good.
Our competitors can run chicken, finger, chicken strip, whatever type sales.
It doesn't affect our sales.
It doesn't affect it because people say they might try it, but two days later they're.
They're coming back getting their chicken finger meal from us because it's the best you know.
It's actually actually I love it when they run all these specials.
They do all this stuff because it adds more.
It adds more advertising out there for chicken fingers.
And we're known for the chicken fingers, man.
It's like when I when I want people to talk about chicken fingers, chicken strips, whatever they're talking about boneless chicken being dipped, I want them to say raisin canes in their mind, like Xerox.
You know it's not a coffee anymore.
Go give me a Xerox of that.
That's what you want to be known for.
Do what you're good at.
Do what you're good at.
When you can execute on a consistent basis, consistently and you can teach other people how to do it and they can execute and operate the same way and you stay focused on that and delivering that high-quality, craveable product with fast food, speed and convenience and being friendly, and doing that.
When you focus on that, day in, day out, the whole organization is around that.
Then you can look at stuff like Cain's Love.
You have time to do those other things that enhance that crew member experience.
And when crew's happy, they're going to be friendly to your customers.
That's why people come back.
They don't just come back to teams because the food's so craveable.
They come back because they know it's going to be food safe.
They know people are going to be friendly.
They know people appreciate.
Customers want to be appreciated.
They want to say, thank you for your food.
And our people mean that.
It's like, we appreciate you spending your hard-earned dollars here.
In fact, they want to go to the restroom.
It's going to be clean.
Those things get you that repeat business.
Yeah, we went to.
We landed and went directly to one last night and just greeting every single person that went to the door.
Like, it was like obvious how obsessive.
I love this idea because, again, focusing on one thing and being the best in the world at it, right?
To me, that should be completely obvious.
I think humans crave simplicity, but our default state is we tend to overcomplicate things.
So your competitor is like, okay, Todd's just going to have chicken fingers.
I'm going to have chicken fingers and nine other things.
The problem with that is the distracted do not beat the focus.
That's exactly right.
The distracted don't beat the focus.
They're going to say we're going to do chicken fingers, but we're going to have 100 different sauces.
People go back and get their same sauce.
They might come try it one time, and then it's also slowing down their order process, it's slowing down turnover time and all that stuff, and then they go back to the same sauce.
So how much time did you spend on all those different sauces that, when it comes down to you, might have narrowed down to three sauces?
What are the most popular?
Narrow down your menu items.
You're seeing more and more by-nighting restaurants narrowing their menu.
It's happening.
I'm not saying I wasn't part of that, but maybe they looked at Cane's and said wait a minute, I bring my kids here.
We come here all the time.
Maybe I don't need 50 different menu items on this thing.
And people don't actually want to make choices.
They want you to make.
No, they want to know it.
What do you do best?
I went to Jiro in Tokyo.
And, you know, it's a three-star Michelin restaurant.
It's 10 seats.
Maybe you can get me in.
I can't, actually.
I have a friend that knows how to do it.
So Jiro's really old, so he only comes in frequently, but his son was the one that served us.
But, like, you don't even get to choose.
You sit down, and he's like, I'm the best in the world at what I do, and I'm going to serve it.
Brilliant.
It's actually nice.
I don't have to think.
As long as you can get in, then I don't have to think about anything else.
I don't flip through a menu.
No, like the—what's the restaurant that has, like, a book this size?
Something—
California, not California, kitchen.
Cheesecake Factory.
Yeah, Cheesecake Factory.
I don't go there.
It's like, I don't want homework.
Like, I got other shit in my head.
I don't want to think about this.
It causes anxiety.
This is what we love.
It's like, last night, we were like, okay, what do you want?
You want three chicken fingers, four chicken fingers, or six?
Like, that's all you have to, you already know.
Like, that's all you think.
So another way that you buck, so you have this limited menu, right?
And then most people in your industry will, they're the franchise model.
Why did you not choose to go down that path?
When I started out, when I had that vision grow canes.
So franchising was one of the obvious ways to do it.
And so everybody was franchising.
Why do they do that?
Well, I mean, there's a lot of advantages.
One is less capital costs.
If you can grow off franchisees' money.
So let's say you have a good concept, you have a few locations and then from that for you to grow company restaurants, then you have to keep putting in, injecting a lot of capital.
And on top of that, you have to take in a lot of debt to do that.
Restaurants are very expensive.
You can't, you know, you literally, and that's not a manufacturing plant.
If I could do all chicken fingers, one location, send it out, right?
The cost wouldn't be there, the capital costs.
But every one is a new restaurant, a lot of money.
So people are like, You can grow in different areas and use other people's money to grow.
There's also the thought of that other restaurateurs will bring other things to the table, other knowledge.
They're good in their regions.
They know the local knowledge better, and it's better to grow that way and do it.
But I think mainly it's the money play.
It's literally we want to keep growing with our capital.
We'll take a royalty off the deal.
So I had a model of, like, I'm going to grow—
I knew I wanted to go company, but I'm like I'm not going to grow fast enough and I'm not going to have the capital to be able to grow in all the areas.
So I got really great at people from the industry, people that were CEOs and other great big billion-dollar businesses and they were good people.
They were people that I trusted and good people.
And so I'm like that will fuel my company growth right, getting franchise royalties in, and I'll be able to grow and we'll grow quicker.
And so I did open up in different parts of the country.
I opened up in Ohio.
I opened up in Minnesota.
I opened up in Nevada.
I opened up in these different areas.
And they were good franchisees.
And because I had the real friendship with them, we could talk through any problems or anything like that.
The thing is, they operated, say we're at 95 out of 100.
They were about 85 out of 100, which I think other franchisees were like 65 out of 100.
Honestly, on what they're doing.
So other people have been thrilled with them as franchisees.
But that 85 to 95 gap drove me crazy.
And I was just like, I know we could operate these better.
I know I could do it better.
It was a significant change in operational procedure.
We had tested it in our company restaurants.
We knew it made us faster or it was better for management and crew.
It was a better system.
To talk them into changing that system took so much time.
That was just totally inefficient, because it's their business that you had to respect.
To show them like ah, this doesn't work for us because it's different.
Well, what's different?
The crew and customer, your customers are exact same in both these areas.
No, we just like it better this way.
We think or even crazy things like well, we don't want to get that much faster, because we like the longer interaction.
It's like well, the longer interaction well, you can still be just as friendly, but quick as they want to get out the door anyway.
But talking them into things took too long.
And I was spending I mean, the team were spending too much time on something that should have been implemented overnight.
And I'm like our company restaurants.
Once we tested out in like five restaurants and we felt good about it.
Our operator said man, great system boom, let's roll it.
And so that time was less efficiency on us building the business and making our existing restaurants better and getting higher same restaurant sales, and so I ended up buying all them back and uh, they did really well and they were great and they they're all happy and actually too, is they looked at like a more of a merger because we kept their teams and they had more opportunities for growth and it it worked out really well.
But for me is, like you know, franchisee is never gonna run it like you do because it's your baby, it's your thing, and they're not getting quite as personally and they're not quite as fanatical as you are right.
I'm a fry cooking cashier, man.
That's what I live to do, right?
And they were, 85, I was at 95.
And so I could hire the people that had those same types of values as I did.
And so like franchising for me, it's just you're going to lose quality service.
You're going to lose those things.
And you're also going to lose a tremendous amount of efficiency because you're talking them into things versus just adopting something system-wide really quick.
So we got way more efficient.
We bought them out.
We actually operated 95.
Sales went up in all the franchise markets.
Sales went up.
Oh, wow.
Wages went up, everything went up, and it actually improved out better.
So look, I think it works for some organizations.
For me personally, especially in the restaurant business, I think the company model just rules.
Well, I think the important part that a lot of people are like, hey, should I work on this?
Or what's the idea I should pursue?
And I actually got this idea from Michael Dell, where I used to say well, you just have to build a business authentic to you.
It doesn't even matter if you could make more money from franchising.
It's not suited for your personality.
So it doesn't matter.
It has to be... And I used to use the word authentic all the time.
You should build a business authentic to you.
And then I was reading Michael Dell's autobiography, and he... you know, he was in his early 20s.
So he's like, shit, man, this is really hard competing with IBM.
So he actually gets a guy to come in and be, I think, the vice president or president and help him.
And the guy's like 20 years older than him.
And I found an interview with that guy, who's now in his 80s, talking about what it was like working with Michael Dell in his 20s.
And he's like you know, I loved it, but it can only last four years because we're playing for high stakes.
There's a thousand other computer companies.
We're taking on some of the biggest companies in the world.
He's like, so after four years, like, I'm losing my hair.
My back hurts.
He's like, I got digestive issues.
I'm drinking too much.
And he goes, and Michael is thrilled.
He's like energized.
Because then he said in this great line he goes because Michael built a business that was natural to him.
It was unnatural to me where my body is shutting down.
And Michael's like, yes, let's do this.
It's like natural is a better description than authentic.
It has to be natural to the creator.
It has to be natural to the founder.
It's just like, I'm the same way.
I'm obsessed.
I spent eight hours yesterday hand editing the transcript that no one gives a shit about, because I care about it.
Everybody tells me, outsource, delegate.
They use that word all the time.
No, I don't want to delegate.
I want to feel it.
I have a feeling for it.
That's the key to success.
That's common in everybody that's successful, I believe.
The time period you're describing, where in Kane's history was this happening?
For the franchising?
Yeah.
Was that five years in?
Yeah.
Yeah.
Yeah, probably three years I started talking about it.
No, no, no.
So second restaurant was 18 months after the first restaurant.
Then from there, I had an opportunity when I really knew I wanted to grow.
And that's when my partner got out, which was really interesting.
He said, it has to be natural to you.
My partner, Craig, who was great, he loved the finance part of it.
He loved the IT.
He loved the business administration stuff.
He wasn't a fry cook like me.
And he's like, Todd, when I get a night off, I go read the Wall Street Journal.
He goes, you know what you do?
You get a night off.
You're writing new schedules that are on the deal.
He's like, this just doesn't make me happy.
We didn't have much money to buy out then, but he ended up getting a scholarship at Wake Forest.
Did business.
He did all the things he did.
He actually came back to Canes for several years doing the things he likes to do.
Has his own business now.
He does really well.
Still one of my dear friends.
But he wasn't happy.
He had the courage to say, I don't.
I don't like this.
This is all we're doing is being fry cooks.
It doesn't turn me on, it doesn't do it.
And so I encourage people, do something you love and you'll never work a day in your life, right?
It's just a part of your DNA.
There's no work, there's no, I'm working, I'm not working now.
I'll be at the beach and it's like checking in and we've got calls and I'll be well, roll heads on the beat.
You know you're talking doing and then you get back to hey, let's have a margarita.
You know, it's like, it's a part of what you do.
So you have to do what you love, right?
You have to, and if you do, you'll never work.
Words like career.
It's not a career.
It's a passion.
It's just what you do.
It's the same thing as I get up and I go take a walk and I love my dogs.
I love my business, love my kids.
Things like that are what makes the difference in being whole, I believe.
So one of the disadvantages of having other partners in your business is that they might have different goals in mind that you have in your business, right?
So an entrepreneur and a founder brings on an equity partner, whether it's an individual or whether it's a professional group, private equity.
I mean, very careful on what their motives are.
And if their motives is about a financial return, you're generally gonna end up bad, because you have a fiduciary responsibility to the other owners of your business to meet their goals right.
And if those goals are financial, On that deal list, it can change your thinking.
You can change your thinking on quality.
In my business, you could change vision on quality food.
You could try to lower food to make more profitability, which is a short-term game.
You could cut wages, right?
And so your crew members aren't as happy.
They're not as appreciated on the deal.
You could try to do different avenues of sales just to raise sales that's going to lose your focus.
There's all kinds of bad things that go with that.
The only way I do a partner if they believe 100 in what you believe in And then you also believe that they're not going to sell that stock to somebody else that does it in the future.
And rarely does that work out, especially you hold on to your equity.
Take the risk, get more financing, but keep it yours, because you'll always be able to protect your baby.
You know what makes it work better than anybody else.
I have one thing to add to that.
I think it's super important that you said that.
There is this, something that I've come across in a lot of the biographies.
It's like many times the best financial decision are not financial at all.
And so there's this investor named Nick Sleep who wrote these legendary letters to his partners.
And he made a great line.
He's like, the best investors aren't investors at all.
They're entrepreneurs who never sold.
And what he was talking about is the fact that like, if you took, obviously Sam Walton, right?
He gave away the equity in Walmart to his kids before it was valuable.
And that's how they wound up being very tax efficient.
If you look at his combined wealth that came from Walmart right, that's still concentrated in the family today.
The last time I looked it up was like a month ago.
It's like $432 billion, okay?
So one of the greatest fortunes that have ever been created.
Do you think Sam Walton woke up every day like, oh, I need to maximize shareholder value.
What's my stock price?
No, he woke up serving his customers.
And then they're like, why didn't you ever sell?
He's like, why would I?
He's like, I'm not doing this for money.
I'm doing this because I wake up with a burning.
He says something like he wakes up with a burning desire every day to improve something.
And he's the most wealthy man in the world.
He drove the old pickup truck and went to work every day.
Yes.
It's not about the money.
I've heard this for 200 years of entrepreneur history.
It's like, people think it's like some Willy Foo Foo stuff.
Oh yeah, you should do what you love.
There's an underlying reason to that because work is going to be a grind.
You are going to run into times where you are crying, when you're in pain, when you want to give up.
And if you don't love it, You will give up because you're sane.
And so you have to love it.
You have to be irrationally obsessed with it.
And then what happens?
It goes back to the anti-business billionaires.
The people that are irrationally obsessed with it, they make better products.
And then customers, you know how many people I've told about Raising Cane's?
Even before I knew I was going to meet you.
It's in human nature.
When we find anything that we love, it could be a quality chicken finger meal.
It could be a movie.
It could be a podcast.
It could be a piece of art.
It could be a city.
Non-profit.
No one keeps it to themselves.
Humans don't do that.
They're just like, you've got to have this chicken.
It's incredible.
And so all this stuff, the love, being hyper-focused, staying in something for a long time.
Mildly obsessive-compulsive.
Mildly obsessive-compulsive.
Yeah, 100%.
Oh, it's funny you say that because there's this line in this Elon biography.
So Larry Ellison, founder of Oracle, he only ever joined two boards.
And he was best friends with Steve Jobs.
He was on Apple's board.
He's good friends with Elon.
Elon consistent mentor.
He's on Tesla's board.
And he's like, oh, and he was asked one time, what do they both have in common?
He goes, OCD.
OCD, 100%.
100%.
What do you mean what they have in common?
Like, it's obvious, like, what they have in common to him.
Yeah, being molly obsessive compulsive is actually a good thing.
I'm only interested in fanatics.
My entire podcast is just about, think about, like, to get on the podcast, right?
It's like you had to live a life, you had to be so good at your job.
That somebody wrote a book about your life.
It's like that's the tiniest.
And in cases that people I'm super fascinated with, like you, it's like, oh, no book?
Fine, I'm going to make my own.
I literally printed out the transcripts for every single one of your interviews and I went through it, just like I did for this book.
It looks the exact same way.
It's the same personalities, like whether you're playing basketball or you're building, Raising Cane's.
So wait, so how many years of doing a franchise are you like, shit?
This is not the right move.
Yeah, I mean, so it was exciting getting in.
It was exciting to open up New Russia and exciting to teach what we do and do well.
Exciting to learn.
A couple years into it is when I started seeing the lack of efficiencies and a little bit less.
You know, like I said, they still did a good job.
And so I want to give them credit.
They did a good job, but not as good as we could do it.
So if we couldn't do it as well, you know, we might be like, oh wow look, they took us to another level.
They just didn't operate as good as we did.
They cared about the crew.
They cared about the customers.
They just didn't operate as well as we did.
And so a couple of years into it, I started seeing it.
We bought them out, probably about the 10-year mark, which was good because they were able to grow there and make good money.
Another advantage of having company-owned restaurants is the business is valued way higher.
Like for franchises, you get a valuation of the 6% you're getting off that restaurant.
That's part of the idea.
But it's based off a valuation of what franchises' markets go.
So let's say franchise multiples off of EBITDA minus debt.
Franchise multiple would be like four to 7 is what they could sell in their market, right?
We're trading on, not trading, we don't trade, but we're valued on over 20 times EBITDA.
Those company restaurants go into that.
So the profitability that comes into all of it gets on that higher multiple.
That's why we have the 20 billion plus valuation for the business.
So it's a better valuation model too, if you do company.
Okay, so let's go from two, how did you finance when you got up to 28.
Oh man.
So, so this is, this is interesting, man.
I said I said look after the second restaurant.
I had an opportunity to go into some of these failing uh double drive-thru burger places.
And so Greg got Dr. Hill, another great mentor of mine.
He's like, look, we're just not operators, man.
We, we, we, they had like 30 something, you know, they're called fast track and then burger joints.
We're down to like four of this, our best units and our best week's holiday, the best crew.
We just, we want to be landlords.
Like we're not operators and you can use equipment and you can have all this.
Look uh, whatever you need and look, just we'll give you cheaper at.
And so I didn't want to go into them because I was like it was these like double drive-thrus.
I thought like, you know, this place had a lot of soul, big dine-ins and all that.
But I said, you know what?
It's an opportunity to get in cheap and prove what I want to prove that we can work on.
We can, we can not just on campus that we can do well, we can do well all over town.
And we went into those places, we just painted them, used the equipment they had in there.
And we started just doing sales, man.
I mean, like people loved it everywhere and they loved it.
And so eventually turned all those into big, you know, dine-in drive-thru locations.
So I was able to do that and do a mall food court.
So I was able to get all these places.
So we went from, what is that, two to eight restaurants.
We opened five restaurants in five months, man.
We started rolling.
Made a lot of mistakes, learned a lot, burned myself out.
Like I couldn't be at all the locations.
So then I really learned how to set up leaders at different restaurants and give them the support they need, versus me bopping around the restaurants and then like putting out fires basically is all I was doing.
But I did that.
And then from there, so I was able to get into those.
There I was like, okay, I'm gonna come up with a prototype.
Like, what is Raising Cane's ultimate location, the prototype I want to do?
And I want to do it out of town, and so out of Baton Rouge.
Why?
Because I wanted to prove the prototype starting off, when no one really has the brand recognition that we have, and show what this thing can really do.
So literally, one year, I'm like, no more growth.
We're going to set up what the prototype is.
And by prototype I didn't mean just architectural design, kitchen design and what our look and feel was.
Everything.
Marketing systems, human resource systems, training systems. everything globally.
And I used to go to restaurant conferences to learn from people that were experienced.
I was able there to get.
I know the marketing guy, I know the human resources training and operations person.
I know the crew relations.
So I was able to assemble a team together with architects and with interior designers and branding people.
And I was able to assemble a team coming in.
We call them partners, not consultants.
It was like they were partnered into the success of the business.
And we came with that first prototype.
Raising Cane's opened up in Lafayette and we just went gangbusters, dude.
We killed it.
It was just like, we had operational efficiencies.
Our drive-thrus got faster.
We could stack more people around the restaurant.
I had all these really good people that came in and gave us great.
We came up with original black and white logo.
We changed it to this logo because we got it.
So we came up with Raising Cane's One Love.
All those things went into it.
Comboing meals.
I didn't combo.
I had, you know it was the box and a drink.
And then we said let's combo it because people makes it easier, you don't have to decide to.
It's like, just get, get those menu items.
And we created that and so, but I got that on another conventional loan.
Now I'm like you know, with the money coming in and doing this thing is I'm bankable, but I'm not bankable to where I want to grow, which ended being the 28, and so back then bank regulations were a lot more lenient man.
So what I said was why don't we go in and to go to these community banks?
So let's say we want to open up in Houma, Houma, Louisiana.
Go to the community bank in Houma and let me go to Angel Investor.
And this was Dr. Hill who had those fast tracks.
He wanted to be a landlord.
He also liked to do deals.
And he said, hey, let me buy equity in the company.
I don't want to have equity partners, but I'll give you a sub-debt deal.
So Dr. Hill, let's say I borrow $200,000 from you.
I'll give you a 15% interest. rate, subordinated debt.
I mean, it's a one-page deal.
Subordinated debt means subordinated to the banks.
I know I can take that subordinated debt at 200000 and the bank will look at that as equity right.
So it's $200,000 and a million-dollar deal, so I could go into the location, get that financed.
Boom.
And I was creating cash when I did that because Basically, I could open up.
I didn't have to pay my rent for 30 days.
I didn't have to pay my vendors for 30 days.
All those things came.
So I opened up, got this cash flow in, and do it.
Boom, do the next one.
Subordinated debt, no equity.
And it was a really stupid way to finance a business, man.
But I was young.
I was 10 feet tall on the bulletproof.
We're going to work.
I mean, I had zero fear of any kind of risk on debt, right?
And so I was going in, creating cash, doing this stuff.
I get up to 28 restaurants, and all of a sudden, we have a storm coming in named Katrina.
It's coming into Louisiana.
We're used to used to hurricanes.
We knew what to do.
We put crew to safety, shut down the restaurants, buckled everything down.
Hurricanes would come through.
We open up the next day.
We'd have some power outage, whatever.
But Katrina was different because it came up, went over New Orleans and it hovered.
And then the levees broke.
Right.
And we're watching on TV from our second location across here where you all go.
We got this whatever cracks up this power to where we could actually watch television.
And when the levees broke, we're like, we've never seen this before.
What is this? flooding, terrible, awful, whole bit.
And I thought, I said, man, you just screwed up bad.
You screwed up bad.
You just put this company in such bad financial condition because now there ain't no sales coming in.
And we knew it was going to take a while to open up.
And every single Keynes location is 21 out of the 28 were down from either power to damage, to flooding, to whatever it was.
And so no cash is coming in.
I got the company levered to the hilt, right?
I owe everybody.
And in times like that, you think that, you know, you think that the banks still want their money.
Landlords still want their money.
And I gathered people together.
We had teams that helped people that actually had damaged houses and do all these things.
And we had to keep up through like SMS texting to make sure everybody and we actually set that up pretty good before
And I'm like, look, we need to rally.
And when I tell you we need to rally, I said, we need to rally to save this business.
And I explained to them how we had financed everything and they understood.
And I said, we need to open up because one, we need to save the business.
Two, We need a place for our crew to come back to work because they have bills too.
You got managers and things like that displaced.
They're coming back and they don't have a job.
And we don't have money now.
Like we have vendors and things like that to pay for their livelihood.
And then three, people are going to start coming back to New Orleans and they need a place to eat.
And we symbolize as a team and we have that same fanatical view of We're gonna do it.
We figured out.
I figured out how to get into New Orleans right away, talking to the governor's office.
They got us passes to go in.
They weren't letting anybody in.
We worked with the state on doing Boil Water Acts because we didn't have formalized Boil Water Acts.
You have to boil the water because I mean, like some of the rivers and all these things that hit everything, you had to boil the water.
But we came up with working with them on like, how do you boil the water?
How do you test it to where it's safe?
Those sorts of things.
And we reopened, man.
We reopened, like, we started off on the North Shore, you know, Slidell, those areas.
On the West Bank, like some areas we opened up, like in Metairie, which is just a mass population of people.
We're the only restaurant open.
We opened up 30 days after the storm.
Other restaurants didn't open in, like, 90 days.
We opened up in the West Bank.
So you had the whole market to yourself.
The whole market opened up in, like, the West Bank.
We opened up in Harvey.
And, like, it was in, like, 120 days or whatever for the next restaurant open.
We fed first responders first.
And when people came back, they just came in and we were the only place to eat.
They come in and eat, more come in and eat, right?
Because it was like you can come in.
We got powers, all generator power.
We got generators in all the country.
Got them to set it up.
And we galvanized that point, like the team and the community. and like us being open.
And then sales were nuts.
Like it was nuts.
So now we had cashflow coming in.
We could do these massive crew bonuses.
We could give back to the community organizations.
And I mean, I was just really, really proud of the team.
And at the same time proud, I was disappointed in myself.
And I was disappointed in myself because I put all that in jeopardy.
You know what I mean?
I put all that in jeopardy for financing.
From that day when I watched the levies break, I said I'll never, ever ever put the position, the company, in a position that we're financially strapped.
Like, I'll never do that again.
And from that day we got our metrics and we worked towards it.
Took us a couple of years to get there, but we worked towards those right.
You know it's like three times dead equity.
You know sales all that stuff is.
We'll never cross that.
Like I, have a capacity to get all kind of you know lending, but we won't go past our metrics, right?
We won't go past that.
So we learned that one the hard way.
And a lot of the same things with COVID.
You know, when COVID happened we're like oh my God, like you can't get, you can't serve, can't do food.
We were a necessary business.
They said essential business to be open because we need to feed the public, because they felt okay with going through drive-thru, through COVID, because there's limited contact.
But we had to learn everything.
It was like literally, hey guys, we talked to the restaurant industries and all the authorities were like We're going to tape off every six feet for people to be.
We're going to put shields between people.
It's like symbolizing the team like that.
And then we took parking lots, and we had three drive-through lanes.
When I tell you we were the first that figured that out.
Can you imagine people now have a place to go get some food and not just eat at their house what they get from the grocery store?
Man,
It's like our sales went crazy.
We were able to do huge crew bonuses, customer bonuses.
But it's that fanaticism. to figure it out right now.
And it's like me leading with the people.
And I have so many people who are better at it than me, but like in the weeds, with them in the restaurants.
I flew to all of our markets and saw everybody.
But at that point too, I couldn't even go in the restaurant because it'd be cross-contamination.
Like if I had it and went in, so I would just wave to everybody outside.
Go to the next restaurant, wave, fly to the next market. wave, you know, and do that sort of thing.
But like, that's how you get galvanized.
But that same entrepreneurial fanaticism like I'm sorry you're not going to get that from some private equity group with a bunch of corporate people.
I mean, are they going to fly out of the country to do that and say, let's go take this in the restaurants and do this?
Stuff is when it's personal to founders.
You know, these are my people.
These are my customers.
These are my communities.
You figure out a way, you know, you figure out a way.
And that's why I just wish more founders would hold on and stay with the business.
I love what you said.
It's like, I watched the levees break and there's no way I'm ever going to jeopardize.
Like, this is my life's work.
This is a part of me.
I cannot let this die.
One of my great favorite quotes about this is Steve Jobs says victory in our industry is spelled survival.
You see this over and over again in biography.
It's like, just stay in the game long enough to get lucky.
You took two gigantic, you know tragedies that were outside of your control which, of course, you're going to run into things that are outside of your control.
And you turn them into You flipped it from a liability to an asset.
And it goes back to what have we been talking about?
The fact that you're a fanatic.
The fact that you're trying to create the world's best product in the category that you're in.
The fact that you limit the amount of details.
You perfect every single detail.
So now these people, they maybe never would have tried racing canes if that didn't happen.
But you're the only game in town.
And then you're like, oh, this is pretty good.
And then think about how many customers that one person has given you.
The one thing that comes to mind about this.
It sounds crazy, but one of my favorite entrepreneurs I've ever come across.
I found this autobiography of Estee Lauder, published in the 1980s.
At the time, Estee Lauder was not the public company.
It was still very successful.
It was a family-owned business.
And she would get a lot of shit from people because her main distribution channel was she wants your Bloomingdale's or Neiman Marcus to take care as a distribution center.
So she goes okay if you're willing to sell my products that I love, that I gave my life to.
I'm going to show up when you do that.
So she would go, a big Neiman Marcus open in Houston, that makes a lot of sense.
You're going to have 1,000 customers.
Why Estee?
Why are you going down to Corpus Christi?
There's going to be 20 people there.
She's like, every single customer matters.
So what she would do is on these trips.
She didn't have any money to fly, so she'd have to take trains and buses.
Let's say, you're sitting across from Estee, just like me, and you're sitting across from her and she sees a woman.
She's like, hi, I'm Estee Lauder.
Would you mind giving me 20 minutes of your time?
I'll give you a free makeup.
I make beauty products.
Or makeover, rather.
She's like, oh, I guess.
We're just sitting here.
Let's do this.
And then she does it one-on-one attention.
People are like, oh, that doesn't scale.
You can't do that.
Bullshit.
It's going to scale because you're going to do this for the rest of your life.
And so she says 30 years later she would get letters from people that she gave a free makeup on a train, talking about how much they loved the products.
Think about how many people that one woman that you spend 20 minutes with has told if she's a customer of your story.
Absolutely.
Fanatical fans telling everybody they know.
Listen to this story.
Exactly.
I've been a customer of yours for, I don't know, four years.
And then you make a podcast that's been listened to by like half a million people.
You couldn't have predicted that.
There's probably going to be millions of people that watch what we're doing.
That's right.
The fact is it all stems from the fact that you're a fanatic.
In purpose, right?
And so what excites me about talking to you today is that the people that listen, if they get a little nugget from this, little nugget that changed their life, that helps people like that fires me up.
The reason why you're doing this and you're so fanatical about having any questions you sent me before.
Right.
I had those questions.
I was able to get to wrap my mind around it because you want it to be good for the listeners.
But that's the purpose, man.
It's just slapping something out to say this is success and do it.
It's what people learn and what people will benefit out of this conversation is what matters.
You have. an insane amount of information and knowledge.
How many people work on the same thing for 30 years?
Just like so few people, because everybody wants to what we talked about earlier.
They want to start a scale sell.
And it's just like, my favorite entrepreneurs, like sometimes I've got to speak to entrepreneurs.
I just had dinner with one of the wealthiest people in the world.
He's 76 years old.
He's been working in the family business since he was six.
Do you understand what's in that guy's head?
Absolutely.
It's so much more impressive than no disrespect to anybody else, but like the startup founder that ran the business for two years.
Nothing.
They're like a baby.
They're still in diapers.
And even you.
I love that you keep hitting you haven't met.
I'm just implying here, but like you're like yeah, we can get to 95.
Yeah, because you know there's no such thing as ever getting to 100.
You're always looking for different ways to improve.
Todd, you're going to do this for the rest of your life.
I'm going to have conversations with founders for the rest of your life.
I really appreciate you taking a risk and being one of my first guests.
Absolutely.
I'm a big fan of what you do, man.
It fired me up that I made one of the first, man.
Because everybody's going to want to watch it and see it.
So I'm going to keep having these conversations forever.
I think we'll hopefully talk, you know, come back on the show every year, two years.
You have so much to give and to, like, share.
I really appreciate you taking the time, and I really admire you.
Oh, I appreciate what you do.
I appreciate you having me on.
I love the conversation.
And we could actually talk for another five hours.
All right, let's go check out the apartment.
I want to show you the kitchen here and then I want to go back and let's go check out the apartment.
All right, let's do it.
I hope you enjoyed this episode.
Please remember to subscribe wherever you're listening and leave a review, and make sure you listen to my other podcast founders.
For almost a decade, I've obsessively read over 400 biographies of history's greatest entrepreneurs, searching for ideas that you can use in your work.
Most of the guests you hear on this show first found me through founders.
