How Shamil Thakrar built Dishoom into one of Britain's best-loved restaurants

0:00The restaurant business is like the first 10 minutes of the movie Saving Private Ryan, where you all get on the beach, 10 minutes later everyone's dead except a few of you. Is your son an idiot? Like what is he doing? Like he's got all these great opportunities and he wants to open a curry house. I think that the way we relate to the world is stories. I don't think we relate to the world in facts and logic. We need to make decisions with facts and logic clearly. You have to be obsessed with deepening the quality of what you do. There has to be a little poetry right at the heart of it. And the culture at that point should have been one of generosity and saying, look, this lady needs an umbrella.

0:30She's going to bring it back. And if she doesn't, it's not a big deal. In 2010, two cousins with no restaurant experience opened a cafe in Covent Garden, inspired by a world that had almost disappeared. The Irani cafes of the 1960s Bombay. 16 years later, De Shum has grown into one of Britain's most talked about restaurant groups with queues down the street and turning over more than£130 million a year, feeding around 100 ,000 people a week and for the first time ever, backed by outside investment from a firm owned by the luxury group behind Louis Vuitton and Dior. Now that business is heading to New York.

1:14Our guest today has spent his career insisting that the numbers should follow the story, not the other way round, and has built a company that somehow proves him right. He's the co-founder and now executive chair of Dishoom.

1:35the business leader podcast is partnering with rbc wealth management who share our values in supporting entrepreneurs at every stage of their journey your business was the first idea the rest are still waiting

1:55Ideas happen here. RBC Wealth Management. Shamil, welcome to the Business Leader podcast. Thank you, Richard. Your early career was you, what, you did an MBA? For my sins, I did. I mean, I was in management consulting for quite a few years, badly at Bain & Company, and that's a good training, I would say. I think that I had to unlearn some of that to start a business and maybe we'll talk about that what was the one thing that you did have to unlearn i'm not sure if this is uh everyone will agree with this but i think that when you leave um an institution like you know i was at harvard business school and then bain and company these are esteemed institutions but i think this is maybe true for business education you see the world in terms of a p &l and why not you know it's a logical thing to do you have volume you have revenue uh costs and profit then you have capital in return and that's how the world works and why not and everything that I come across should serve one of those that's how a business model works and I think I understand that framework however a key learning for me afterwards and this took several years of operating restaurants to learn this was that actually that software wasn't serving as well and what we found was that once we rewired it to to say actually what we do in business is awesome food and drink this is restaurants awesome food enduring, awesome service and a happy team.

3:14You control the costs. And assuming you understand your business model, the revenue and the profit are the applause that follow. And that changed our economics. Best way to low costs in a restaurant business is high revenues, high volume. And avoid a big spend on marketing. Well, we took to heart the lessons of people like Seth Godin in Purple Cow, who said that marketing is dead. He said that very glibly or blithely. And you should be building remarkability into your product so that it markets itself. And between all of that, we ended up, I think, with a proposition that then propelled itself.

3:47And the best way to low cost was high volumes and high revenues and quality. And you didn't just go from an MBA to setting up Dishoom. You joined the family rice business in between, didn't you? I did, yeah. I joined my family's business, and that was an interesting time. I enjoyed being there, and it was a good learning. And I think if I'm very candid with you, I probably had good smarts. You know, you leave Bain and, you know, you have an MBA and there's stuff that you do know. I'm not sure if I had the emotional intelligence to navigate an environment and maybe do the things that I thought were right, which I think we eventually did do.

4:28But it was a fantastic experience and many, many learnings, which I've since applied to Dishim. What were the biggest couple that you learned at Tilda, the rice business? I mean, I think that for me, a key learning was that the people really matter. And you can have all the answers. And NBA style, you know, you know all the answers. Fine. Like, I know what to do, yada, yada. But I think really inspiring and motivating and navigating the people is an incredibly important part of the puzzle. And to the extent that you can do that, it will give you wings. It'll turbocharge you to put together a team that's motivated, believes in what you're doing.

5:06I just think that was a flat out biggest lesson that I've learned and taken to heart, I think. I'm Richard Harpin, a Yorkshireman who sold my company, HomeServe, for£4 billion. And this is the Business Leader podcast, where we look at the stories and the strategies behind modern businesses. Are you a CEO or founder of a British mid-sized business? Are you ambitious and want to scale your business? If so, join the Business Leader community. Our members benefit from coaching, peer-to-peer forums and exclusive learning events. To find out more, sign up to our free weekly newsletter at businessleader.co.uk slash newsletters.

5:51Together we can help British businesses scale and succeed. What did your friends and family think when you said, oh, I'm going to set up a restaurant business? Well, mostly they thought I was bananas. And maybe they were right. I mean, it was 2008, the financial crisis, as you'll remember. Everything's crashing around us. You know, the headlines about Northern Rock or whatever. It didn't seem like a good time. And moreover, it didn't look like Britain had a shortage of Indian food. You know, we had curry houses everywhere. And certainly when you think about immigrant journeys, and my family came over from Uganda, and I was technically a refugee.

6:28I was six months old only, and don't remember it, obviously. But we were immigrants. And the immigrant journey is education. You leave the corner shop. You leave the factory. You do other things. And eventually, you work at Goldman Sachs and become prime minister, as we've experienced. This was going backwards. I was opening a curry house. And my father's friends were like, is your son an idiot? What is he doing? He's got all these great opportunities, and he wants to open a curry house. So their reaction was stupid. Obviously, I took it on the chin. It was stupid. It wasn't stupid. but their reaction was probably good.

6:59But I took that on the chin that they thought I was stupid and, you know, eventually made it work. And why did you want to do it? I think I had twin motivations. The first motivation was commercial, and I really thought we could make a buck. I thought there was a different way of doing things, seeing things. I was seeing businesses like Wagamama take successfully a quite obscure Japanese way of eating, make it mainstream. Yo, sushi. Sushi is raw fish. And bringing that to the national palate, like it was cool. and I really thought it was time to commercialize Indian food to some extent to bring it more widely but actually I think I also had a cultural agenda and I felt that India in the UK whilst there's a long relationship and that's a whole interesting other discussion over centuries relationship but it was seen in terms of a few cultural cliches Bollywood cricket curry house days of the Raj and I wanted to dispel those to to see it fresh again and I think by building on curry houses and what was there understanding how we could serve that in in a manner that would produce for war libida and and creating i would say some poetry some beauty in bringing people into the restaurants and eating there i i had a thing about that i thought this is this could work and that that was my you know the bee in my bonnet what were the steps that you took to get it set up and opening that first restaurant from idea from very embarrassing powerpoint um you know just sketches and thoughts and uh i found some partners marina dash and we we worked on it uh you know brought them on board we we developed the idea brought more team members on board my cousin joined as well covey uh and and we eventually had enough of an idea to persuade simon quayle at shaftesbury uh to give us a lease on a very nice property in covent garden 5 000 square foot and again it was maybe a pretty far reach i remember also that we pitched to simon and his team at Shaftesbury a lovely guy and a good team and they said well we quite like this and I talked to my dad I said I like this site and he says well what are you doing about it I said well we're waiting for them and he said that's nonsense just do something invite them home cook for them I said okay so we invited them home to my house in Bell's House Park because that lease and getting the right location really really important the key I think because obviously you need to have some financing as you put that into place because the capex is reasonably ambitious but we we once we took on the lease the idea got wings and it was a good property decision it really worked it took a while for it to work of course but i think the lease was was unlocking the sort of momentum of getting this business off the ground and what were the key things that made it different from every other curry house i mean i'd like to think that almost everything was different the menu was very different There were very few curries on the menu.

9:34I think actually the key distinction was that we made it deliberately feel in position, not curry house. And one of the decisions we made was to serve breakfast. And it was around these old, we sort of drew inspiration from these old cafes of South Bombay, the Iranian cafes, and they serve breakfast. and for us to serve breakfast i wanted to do that little math in people's head or the logical syllogism which says this place serves breakfast a curry house couldn't possibly serve breakfast therefore this isn't the curry house it took us a long time to get anyone to really eat breakfast but we marketed it you know really talked about it and having said we don't do marketing we did a lot of pr around breakfast uh and and sort of word of mouth social media developed and eventually people started coming we actually developed a very decent sized lunch which was what people thought was a problem with making Indian restaurants work, you couldn't do lunch.

10:27And then people realised that this was very distinct. You know, it was a very different place. The menu was different. The style was different. The dining room was cool. It felt like a cafe. It had marble tables and high ceilings and spinning fans. And I think it really established it in people's minds as not Curry House. So great utilisation, breakfast, lunch and dinner. And I think 20 % of your customers are breakfast customers. Yeah, they are. I mean, it was just Covey and myself staring at each other over bacon on rolls for many, many months, maybe years. And then it grew and it was it's 20 percent of it.

10:59And we get great utilization and it feels light. It's a lovely day part. It's my favorite meal at Dishoom. So I think it works really well for us. How important is storytelling to the Dishoom business? I would say absolutely critical. And it's hard to express it in functional terms. but I think a lot about the emotional relationship that you have with a guest. In fact, your team member too. And we use storytelling to design all the restaurants. We invent a story of fictional owner. We build the restaurant of the fictional owner each time. It allows us to massively change the design of the restaurant.

11:34But I think most importantly, it allows us to bring you into an environment where you're transported, you're dislocated. It feels beautiful. And we work and think very hard about that sort of beauty of what you're experiencing. and maybe also placing the food in its cultural context as well is very important to us. The one that I saw was the King's Cross story of a immigrant stumbling into a railway station in 1928. Yeah, that's a great story. And the King's Cross was quite a bet for us. It's a big site, 10 ,000 square foot, our third site. And in fact, I was with the FT food critic, Nick Lander, yesterday, who doesn't write for the FT anymore, but did for many years.

12:15And he was the one who persuaded us to do that site. And we were both reminiscing. And he said, I know we persuaded you to do it, but we thought it was a big leap as well. And we wrote the story, which is based on an idea around Victoria Terminus, which is a similar station to St. Pancras. And a young immigrant comes in, and eventually he takes over the whole goods shed, which is what it is, and builds a restaurant and takes over it. So we built that story. and I remember we worked pretty hard to finance that from cash flow so we financed that from the first two restaurants cash and we had to duck and dive we called suppliers we've we made all the bills work for everyone and we built the restaurant and the first day we opened I mean it was it's a beautiful restaurant you walk in and it is I think it's quite hard to find initially because no one knew where King's Cross was you know the new King's Cross and eventually you go in and it's beautiful but we had a queue that stretched all the way down the street and then back around all the way back to the main square again.

13:09And I think by really going for it, we established it and people came and they loved it. How did that feel? Because you'd taken a big bet and it wasn't necessarily going to work. And then you saw that cue. We thought it was a conservative, I mean, it wasn't a conservative bet. We fooled ourselves, maybe rationalized and did the downside numbers and said, we can live with these, which I think actually might not have worked. It was pretty awesome to feel that it did work. And a piece of advice from my father, who has been a great mentor to me who's no longer around. But he said there's two approaches to risk.

13:43When you see a risk, when you've got to jump across something, the first way is to mitigate it, to put a bit less in so that you're mitigating your losses if it doesn't work. The second is to say, I've got to jump across the ravine and we're going to flip and go for it. And with King's Cross, we went for it, made it better than we wanted it to be or needed it to be, and that paid off. So my learning there was do it right, make it really work and create something that is beautiful. And then hopefully people will come if you do it right. But that was very satisfying that it did work that way. But you did model a downside that if it didn't quite work, you weren't going to bust the business.

14:18I think, I mean, we definitely did that. In retrospect, that restaurant is quite hard to operate. Not easy because it's on a few different levels. I think the downside was quite optimistic. Mercifully, we didn't get to the downside. But, you know, it served a purpose. Why did you decide not to take any investment in the early days and bootstrap the business? I mean, we were able to, we did have the ability to raise equity. It was my family invested. But we also were able to grow from cash flow. And I think that, I suppose if you can grow from cash flow, your question is, do you want to grow faster?

14:53I think we decided that, and I'm not sure if it was an explicit decision more than a cultural one in us, which is that we wanted to build great restaurants and we just weren't cranking it up at that point. Each one, great restaurants look like one a year, you know, for many, many years. And that then came out of cash flow. And you talk about deepen, don't dilute. Yeah, indeed. And that's a really important principle for us. And I would say that different businesses are different. But for a consumer business that has a relationship with a customer, maybe all businesses, I'm not sure. But we put in place a growth principle pretty early on, which said that we would only grow at the rate which is consistent with a deepening in quality.

15:33and many times you would have a discussion in a boardroom which would posit a business plan, show a great hockey stick growth number and maybe on the way out someone would say don't mess up the quality or it might not even be discussed, it would be assumed and I think it should be the other way which is you think about quality first what are the systems both cultural and process wise that you need to just maintain quality and in fact increase it then you have to think about the growth rate which will allow that to stay in place and in fact get better and that's not an easy thing to think about it turns out I think once you install that in your thinking you can grow it a fair clip but you have to be obsessed with deepening the quality of what you do.

16:10Were there any early mistakes that you made? Well one was incredibly instructive I would say was the best mistake we made. We had a pop-up on the south bank of London and it was just I think there's a Oaxaca there now which is nice and there's a it was built in a container but it was just it was just a porter cabin and the guys at the south bank and nick lander again interestingly persuaded us to take that pop-up on and we didn't want to do it but they said you must do it they did a deal for us and we built it out of recycled materials it was a lovely sort of thing and we imagined uh an old cafe having an acid trip in bombay's job party which is a beach cool food cool drink and it was full of people wednesday night drinking spiked coconuts you know rum in a coconut and we had all sorts of great things however we also bought dodgy equipment and we had an old tundur which didn't really work we developed a recipe which is the um the kima frankie and it was a naan you know some bread and and some kima some lamb on the inside and rolled up and one time there was somebody on the ground who made a call there was lamb in the kitchen the bread machine the tundur had broken there were customers with money in their wallets why wouldn't you put that together somebody sent out to Tesco, bought some buns and put the buns and then lamb, fine.

17:25And it worked. I'm sure we got some money in the till. The next day I read a blog review and we had some very cute t-shirts which said Frankie goes to Bollywood and, you know, hot chai guys, cool girl or girls, whatever. And the blog review said, I came along, I saw this place. It was fantastic. Loved it. Then I ate the food and it was as if Frankie had gone to Bollywood and shat in a bun. and it was a blur i remember experiencing this physically like oh and the lesson there was that actually what we should be doing is producing fantastic food and and and if we do that and we have the right cost structure the revenue and the profit will come the money will come if you're too focused on the money it will be a problem and once we install that back into the business as a way of thinking it took a little while to understand it we found that instead of negotiating the price of lamb chops every couple of weeks or sending the team home when it wasn't busy.

18:17The team focused on the quality of the proposition, the revenue went through the roof. It was a fantastic learning. And my learning too is that what's most important in the team is intrinsic motivation. I really want people to care about what they're doing, not necessarily counting the numbers. They have to have the disciplines, like brushing your teeth every day. But what they do is produce this magic that customers love. And that is what we monetize. And you tell an umbrella story, which reinforces the difference between culture and process. I do. In fact, you're right. There was a time a very good friend came to the front door.

18:51It was raining and she comes to the front door and she asks for an umbrella and says, can I borrow the umbrella? I'll bring it back soon. And somebody at the door told her no, that she couldn't have the umbrella. And all restaurateurs will know that we have a lot of umbrellas. People leave their umbrellas in our restaurants. It's just something that happens. We also have our own. And she called me. I was aghast. I was like, I called like, please give her an umbrella. And we didn't have a process. And why would we have a process? We might now around giving people umbrellas if it's raining, but it should be a cultural point.

19:22And the culture is what happens when there is no process or, you know, when no one's looking or, you know, what happens when, when there isn't a way to measure something. And the culture at that point should have been one of generosity and saying, look, this lady needs an umbrella. She's going to bring it back. And if she doesn't, it's not a big deal. Give her the umbrella. And empowerment of the staff to have the ability to give out those umbrellas, even if they know that they might not get them back? I think so. It's both empowerment, but it's also the cultural air that they breathe. They need to know that this is how the business is and that if they give away an umbrella, someone's not going to come along and say, what, you gave an umbrella?

19:56That's a cost of a few quid. They need to know that that's both a positive motivation and a removal of a negative control, which might be perceived, which is that we cost control umbrellas, which we clearly don't. The generosity is much, much more important. So I think it's a subtle lesson, but really, really important. How do you determine the price that you charge in your restaurants? My thinking on price is that, you know, you've talked about this a bit in your businesses too, but the business model, I think, and particularly for us, should be one that generates excess demand. So if you set your price where people want to come, maybe more than you can serve, and particularly in a four-wall business where I quite like having the excess demand.

20:39And, you know, we grow into that. But if you can do that and then convert it through into a business model, which produces a proposition and create the right EBITDA. And, you know, we think quite thoughtfully about that as well. And we did a lot of benchmarking and understood where we wanted to be. That's where your pricing should be. And I think that my view is that you should never be greedy. We're very thoughtful about making sure we price at a level which respects that and allows us to convert to a good EBITDA at the business level, but always feels to the customer like they're coming in and getting great value.

21:12And our job, I think, in business, my strong view is that the job in business is to give excess value to the customer, excess value to the team member. If you're doing that right and you've understood your business model, you'll make a great return. And I like giving value to people in return. Are the prices different between London and Birmingham and Manchester? Yeah, they're a little bit different and not hugely different. And we made that decision. It was quite important for us a few years ago not to do that. We made that decision to do that. But it made sense because people have different expectations and different price expectations.

21:42They have different comparisons. And I think it works well. How important has innovation and product development been to the business? Hugely. And even from day one where we came out with a bacon naan roll, which is, I don't think anyone had done that before. I think there's a chef in the US who had opened a restaurant called Tabla with Danny Meyer, whom we were talking about, Floyd, who had done some bacon in a naan. But we put bacon in naan. And there was a great chef called Stephen Parkinson and I who helped us with that. and it was brilliant because it was London's favourite dish, a bacon sandwich.

22:20It was freshly baked bread, delicious chilli jam, and it could outcompete a traditional bacon sandwich because we made the bread fresh. I think that was a fantastic innovation, and no one had thought of that. For northerners, can it have brown sauce in it? It definitely can. I don't think we serve that very much, but we could put some tamarind in there, which is very similar. But that innovation served us so well, and even the innovation at the time where, oddly, to take it back to a place which is natural to the way Indians eat, which is smaller plates. We didn't do main plated food, which is how curry houses sometimes serve food.

22:51That was innovation. Like we changed the way it was and we changed the way the restaurant felt. And even today, we do a lot of innovation, which is based on our roots, traditions in Bombay. You know, we eat all over the world. We understand it. We bring that influence into bear, but we're very faithful to our roots with the food, but we're really keen to keep thinking fast about and hard about what we can do better. And you need to be strict on the menu to say that if we're introducing a new dish, then we've got to remove one. We're variously strict. I really think that's an important rule because you introduce complexity in the kitchen.

23:24Otherwise people just want more and more, don't they? And it doesn't serve you. And there's too much choice. Yeah, and there's a lot of work by an interesting author called Sheena Iyengar, I think, on choice. And she talks about an experiment where there was 10 jams on one island and three jams on another island. And of course, the three jams sold way more than the 10 jams because people can get their head around the right guided choice. So I completely believe that. Recently, we've actually taken dishes that aren't working well, that people don't like off the menu. And it's quite hard because sometimes we really love them.

23:54But we are reasonably disciplined about making sure we give a well-curated menu that isn't too long. And then you've also opened permit rooms over and above the Deschumes restaurants, so separate brands. What was the thinking behind that? I mean, initially, and I might give you both poetry and prose, if you like, we had been going to the old cafes in Bombay for many years and had great relationships with all the owners and in the evenings and as we were doing our Bombay explorations and understanding and doing sourcing of furniture and so forth in the evenings we would end up drinking in the permit rooms and Bombay has a very checkered relationship with alcohol in 1948 or 49 they banned alcohol completely there was a sort of post-Gandian sort of surge of Puritan feeling and they didn't like alcohol.

24:42So it was completely banned in Bombay. Eventually it was liberalized. I mean, they were enterprising going aunties would serve you from their back room, keep an egg cellar outside, bribe the policeman and you would drink moonshine in their house. And then eventually permit rooms were invented because you had to have a medical permit to drink alcohol. The doctor could issue one. Apparently it says so in the law that you can have an emergency permit for cognac and champagne, which gives you a clue as to how the law operates. But we still have a copy of that law. still in place in our bars. But we were drinking in these places and they're really cool, proper dive bars, Bombay dive bars.

25:17So we thought there's something quite exciting here. We could do this. We could do food that is a bit more drinking forward. But at the same time, we really wanted to serve a great cracking breakfast. And we thought lunch is important as well. And then the other motivation, I gave you the sort of poetic motivation, the commercial motivation, was that when we open a Dishoum, they're quite large. And for a Dishoum to work with the menu and the complexity of it, We need really decent sized sites. And for decent sized sites, you need a lot of population. But we wanted to open in places like Oxford, Cambridge, Brighton.

25:48And the permit room was a much better format for those places. And that was a sort of motivation there. And it seems to work really well. I really love permit room as a concept. And I quite enjoy going there. Sometimes I prefer it to a Dishoom. How many of each have you got now? What are the plans to develop both of those brands? So now we have 12 Dishooms, about to be 13, because we're opening in borough and we have five permit rooms. So we'll continue opening steadily. We're not in a mad rush to open, but we'll continue. We've got a borough coming up now. I think we can open a Dishuma year more or less or maybe a bit less than that sometimes.

26:27We've got plans to open in New York as well. And permit rooms, we're finding the right cities and places that we can open it up and where we can tell our stories, find our voice, really feed people, really enjoy that. and again we're not in a sort of breakneck hurry to do things. And overnight accommodation? Yeah we did that in the Portobello permit room and they're beautiful rooms. It's two rooms, a two room suite, two rooms, two bathrooms and a small sitting area and we got a lot of attention for it. There was really great interest from everyone. They're doing very well. It was lovely to extend the idea that you're walking into a story.

27:00We had a fictional owner and you experience the fictional owner's rooms and you see his record collection and his books and you can play as vinyls and we make reservations for you in different places in the city and it's a lovely experience. It was really just a toe in the water to see how that might work and I think a Dushum Hotel would be a fantastic thing. We'll be thinking through that. Certainly as part of when I reluctantly turned around my village pub in Yorkshire and borted against everybody else's advice, key part of that was building bedrooms because then you've got a captive audience that are going to eat more, drink more, stay over.

27:40And that was a big part of turning around the village pub. Yeah, I can imagine that. And you do have a lovely experience. And if you stay there, it is a more fun and beautiful experience. And obviously you're paying more for it, but you get the value for that. So I think it's great. I mean, I've stayed there one night in the permit room and we had a fantastic time. My wife and I enjoyed the food, stayed up a little later as a result. I didn't have the kids with us, stayed upstairs you know brilliant after 14 years of running the business as the chief executive you decided to promote one of your team that i think had joined you back in 2010 and had worked his way through the business was that a yeah really hard decision for a founder chief exec to make to hire your replacement yeah in a way i mean initially we had run the business pretty informally and myself and my cousin covey were running it and you know we then we found our roles and i took more of an overview of the business.

28:33But eventually, we, yeah, I mean, Brian, I have to give him credit for being a good man. He's put up with me for the last 15 years, now almost. I don't know, like if you join in 10, it's now the end of 16, so 15 years. And I think you must go through that process. As a business expands in scope, and, you know, Brian has many strengths that I don't have. and I'm really, really quite proud that Brian has stepped up. He's understanding things. He deeply understands what makes Dushim work. He has deep respect amongst the whole team and I think we're a team of around 2 ,500 now. And he really carries so much and gets it.

29:16And I think that perhaps we could have done that earlier, but I think it was the right transition at the right time and massive respect. And I'd urge all founders listening to this to think hard about that, whether it's a homegrown, someone who's there with you for the journey, which I think is ideal, but it doesn't always have to be that necessarily. But to think about that succession very explicitly is a really important thing to do and to be honest about your own strengths and weaknesses. And looking back, should you have done it? How many years earlier do you think you could have had the courage to do it?

29:46I think we could have done it a few years earlier. I think the challenge of our business or maybe hospitality was we had the pandemic and we came out into post-pandemic. So once we escaped the pandemic, we immediately started that process. And I think Brian became MD fairly shortly after the pandemic and then stepped up into CEO and, you know, we made that transition. So I think it was probably the right time for us as a business. Perhaps absent pandemic, we could have done that earlier. What was his background and experience before joining you in 2010? And then what roles did he take on as he sort of um developed i think brian had had done um he'd spent some time at uni doing a law degree previous to that but he he was running a couple of restaurants in west london and we brought him on as a um a sort of development manager he was running one of the sites as well and but fairly quickly a senior team formed around myself my cousin covey uh sarah who was very young came on board, Navid, our executive chef, and Brian.

30:45So we ran the business then together. We instituted weekly meetings. When we had more than one restaurant, we had a weekly meeting in each restaurant. It was two, so it was one every two weeks, three every three weeks. And he was part of that team. So we all grew organically. And the beauty of that in many ways was that we built the cultural values together. We understood how to navigate it together. The shared lessons came together. All of that was priceless learning. And hiring somebody in is, you know, often very helpful, like you need to do that. And we've done that for quite a few roles in the business, as you would expect.

31:17But having someone homegrown means that you really understand, you know, you've been through battle together, and you've seen it together. And so I think it was an amazing journey for, well, I'll speak for me, I think it was an amazing journey for Brian, but he's been very patient with me too. And those other senior roles that you hired, What stage did you do that? And what were the key roles? Those roles were the executive chef marketing. And Sarah was very young when she joined, 26. And she eventually become the CMO. The other roles that came in were the head of people, the director of people.

31:53And that was a guy called Andy O 'Callaghan, appeared in about 16, 17, when we decided we needed much more formal people expertise and development for culture. Andy was a brilliant hire. Really, really helped us. ex-Tesco Harrison Hall he was more or less grown up by the time he got to us Stephen Neudegg was CFO now and you know started off as FD or you know head of finance and again you need those key roles and the right stages will speak to you I would instinctively say go earlier rather than later my instinct has always been to hire people who would grow with the business and we learn together and I think both Stephen and Andy have done that latterly we hired Lucy who replaced Sarah in marketing and she's very good as well but I think because as a senior team we spend so much time together and we understand each other so well there's a real seamlessness amongst the team and they perform so well and and they know where the ball is going to be passed without even necessarily looking and they catch it and they move on and I'm really in awe sometimes of seeing the way they work together and it's because they have a real shared cultural appreciation and understanding of how we do business.

32:53When did you start thinking that maybe Dishoom would work in a foreign country? We almost did something about it before the pandemic. I'm so glad we didn't. We had a site in New York, didn't take it, and it would have been a disaster to sign anything before the pandemic going into. But we sort of had a feeling that it would be received well. America has always been interesting for us because, I mean, today, I think about 20 % of our customers in London are Americans. So we fill restaurants full of Americans already. And certainly when I go to America or when I talk to American friends, they're all very, very interested in what we do.

33:28They love it. And there's a real buzz about it. Latterly, we did a pop-up in Pastis in the meatpacking district, and we filled that out. There was queues around the block and it was a breakfast pop-up on a weekday, but it created an enormous amount of buzz. And we filled our reservation slots in a few minutes. We broke resi at the time, which is quite nice. And you did that as a test for the concepts. I think so, just to put a toe, feel the demand. And it was a fantastic test. And I think those data points, And even before that, we sort of had a feeling that we could take this. It's very distinct.

33:58And more recently, we've had the guts to then sign a lease in the US and do New York. And that is in Flatiron District, and it opens in... Q1, Q2 next year. I would say Q2, to be safe. I think every restaurant in the history of New York has probably been delayed. Ours, hopefully, will be different, but we'll see. And it's a big step. I often say that the restaurant business is like the first 10 minutes of the movie Saving Private Ryan, where you all get on the beach, 10 minutes later, everyone's dead except a few of you. We've now made it to the second half of the movie, but we're dumb, courageous enough to do a second beach landing.

34:32I'm excited, maybe equally nervous. And I think it's maybe a healthy nervousness, but we'll make it work. But we're really cognizant that New York is not an easy place to open a restaurant. Restaurants aren't an easy business, and we'll go in there and put our best foot forward. When you come to the restaurant and we have breakfast there, I hope you'll experience it as the best of our restaurants. I think it'll be the best one we've built. And have you got a plan now for how you'd open more internationally or certainly more in America? We slowly is the answer. And I think you've got to make it work.

35:00Be happy about who you are and what you do with your, you know, how the business model works. And so we would love to do more. I think New York makes sense maybe to do more. Cities like Toronto are pretty interesting. We've looked at Chicago. We've looked at the West Coast. So I think there's plenty of places we could open in New York. sorry in the US the US is going through an interesting time in its relationship with India and Indian food there are a lot more Indians now all over the US and my experience in the rice business I used to run the US territory was I spent a lot of time in different parts of the US really lots of Indians everywhere so Indian cuisine is being penetrated a leading indicator of this also is the grocery aisle where people are buying more and more Indian food and are saying they want Indian food and I think they're underserved so I think it's a really good time to be getting into it New York is seeing a real a fantastic sort of birth of great Indian food.

35:50There are restaurants like Sema and Udder and Bungalow, which are really sensational. So it's a good time, I think, for us now. Ambassadors is now there as a clubhouse in New York, not far from where we would be. So I'm pretty excited about that. We also are bullish about the Middle East, medium term perhaps. There is a war that's sort of going, I don't know if it's going on right now, perhaps it is, but once that calms down, I think Dubai will be amazing again eventually. And I think Saudi is quite exciting. So I think there are opportunities. All the Brits that are now living over there. Right.

36:18Used to eat in your restaurants in London. Indeed, yeah. And, you know, I mean, people are, Dubai is more muted these days, but I think it will come back. And I'm quite excited about that as and when it settles. How do you think, Shamil, about management teams and structure in America? Who do you need to have on the ground over there as the business develops? We have just hired a very good operations lead there, so operations director a very good gm and a very good people lead and i think those are three key roles for us and those are all americans those are americans yeah and and actually a marketing lead as well those were all americans really expensive americans because americans are as you know we have to gulp and um and worry about the the extra salaries that americans command compared to their british equivalents i mean all the pricing you know you go to new york and you get sticker shock and and then you know you might ask somebody this is mad and you realize that the earnings are much greater there.

37:13So it's a different, you know, it's ratcheted differently the economy is. But so we're facing that and that's fine. You know, we'll work that into our business model and, you know, we understand that. But I think those few key hires are really important. It's very important for us to have local hires in those key positions. We will supplement that with good people from here. And we're making sure that we're really transmitting the culture and we're now getting right into that in a way that allows it to feel like a fantastic DeSum experience in the context of New York, which I think we can make it do.

37:45I definitely recommend having one of your team that is transplanted into the US business as it grows, helps with that sort of making sure that you've retained the culture, but no more than one Brit, because you do need locals on the ground, but somebody that's the conduit of the operating model and the best practice between the two. I'd agree, and maybe more than one, but I think you're right, there needs to be somebody who is that and we'll be doing a lot of that and we'll be spending a lot of time on the ground, not least Brian, myself, the rest of the team. So that's something that's top of mind for us.

38:20After many years of bootstrapping the business and funding it with family money, a year ago, you decided that you'd finally take an investor bringing in private equity. Just talk a little bit about that. We brought in El Caterton and they, I have to say, we thought very hard about that decision. And for me, there's a, I often think that the way we think about businesses, we create a poetry and a magic and a beauty and then we monetize that. We filter it through our plumbing and the business model and we make it work. And what we didn't want is an investor who didn't understand that. So an investor who doesn't get that the poetry and the magic are important was going to mess up this business.

39:04And they're going to come on board and push us in different directions. It might not be helpful. And through the process, and we had quite a tough process. We spoke to a lot of people and we really understood the different flavors of people out there. I think it's not possible to evaluate that until you see the whites of people's eyes, until you meet people and understand and you ask them how they would think about things. And then it begins to be clear who you can work with and who you can't, who you have chemistry with, who shares some philosophical beliefs. And eventually we drew it down to El Caterton and we agreed the shape of what we were doing.

39:40They're pretty excited about the expansion plan. And I have to say they've been absolutely exemplary. The partner we work with over there, their team, the operational people we work with there are fantastic. They support us. They bring resource. And touch wood so far, it's been a really great experience. And I think that I'd like to think that our U.S. adventure is more likely to succeed and will do a better job as a result of having that investor on board. So really happy to have them. How long was the process and did you have a corporate finance advisor? We did use Goldman to advise us and I'd been involved in the transaction before in my family's business.

40:20so understood that. I briefly was an M &A banker as well, myself at Goldman. So understood that world. And we took it very seriously. We did it properly. We had OC &C help us with the commercial diligence. We had our accountants. We had our lawyers. We had the financial advisor, which is Goldman. And they really helped us to conduct a process by which we really understood what sort of relationship we were getting into. So I advise anyone who's looking into it to take it seriously and do it properly. Any other tips on what a founder should look for in an investor? What are the top three things that they should be considering?

40:58Clearly, there are different aspects of a deal. And we wanted to do a deal. We set up a framework, the four W's. We said there's going to be four wins. And we worked very hard at this. And it was maybe a very idealistic thing, but I think we achieved it. And the four W's were the right deal in the terms. And we wanted to make sure we were happy with the way that worked. We wanted to have the right deal for the team. And it was important that the team had continuity and were happy with what they were getting. They had significant equity in the business before that and now as well. We wanted the right business plan signed off and agreed that we would do and the right partner.

41:30Your business plan, not the private equity investor bringing their plan. Indeed, which meant that in the process and before the process, we were going into the process and during the process, we were agreeing the plan as well. And that was pretty important to us. And, you know, clearly there's some flex in that afterwards, but it's something that we're co-creating and doing well together, which I think is important. And I think we did those four things. And what I maybe would draw out as the most important thing beyond all of those, and I could talk at length about all of those, is finding an investor who'll back you, who understands the management team, who'll really back the business.

42:04And, you know, clearly I'm still very involved with my fellow co-founder, Covey. We're still here in the business, still loving it. We're part of it. And I think it was important to have somebody who would work with us and enhance our capability to grow and to do good things around the world. I'm a big believer in the omni-channel model. And part of your business is online, mail kits and delivered to home. What are your thoughts on that and how big a proportion of the business is it? And could it be bigger or is that in decline? Our delivery business was invented in the pandemic and we invented a meal kit business as well.

42:45And they did very well. And I think both of those got us out of trouble in the pandemic. They created cash flow. We emerged from the pandemic. We made a promise actually to our team that we would keep everyone on and we supplemented their pay. We supplemented the furlough when we had that and delivery allowed us to fulfill that promise. And the meal kits were actually very good at the time as well. Since then, the delivery business has grown well. And I think it's a good channel. and we like being able to serve people in their homes with fantastic food and drink. Initially, my view is that we shouldn't do it because it wasn't the magic that we really do well.

43:16But I think we did make it magical. And I think our delivery, for all sorts of reasons, we worked hard to make it a fantastic thing that you have. And that business continues to grow, although it's a reducing percentage of our business. Our restaurants in person are growing faster than delivery. The meal kit business, I think, was a very exciting business. We thought it would become a thing. And earlier we talked about businesses like Dishpatch, which I think we might have briefly worked with. But we then didn't see great growth in that business and didn't invest greatly in it. And then that's something that we still might look at.

43:49But we still do have meal kits. And there's still an interesting thing. They're a lovely way to experience what we do at home. We have in front of us here, if you wanted to just show a copy of it, Shamil, your fantastic cookbook. Indeed. You wrote that back in 2019. Why did you do that? It's quite a doorstop, isn't it? I'm looking at it. We had so much knowledge and love for Bombay and all the food, and we really wanted to share that. And we wanted to give people a lot more sort of texture behind the thinking and the stories behind the thinking. And this book is not really just a cookbook. It's called A Cookery Book and Highly Subjective Guide to Bombay with Map.

44:29and there is a fold-out map that comes out, which is an old map of Bombay. But it is actually as well, not just a recipe book, and you can see that there, not just a recipe book. It says some points of interest on a mostly reliable map of South Bombay. It's an old map. But it's structured in 10 chapters. So we start with breakfast and we'll take you around our favorite places, starting with a place called Kayani & Co for breakfast. We'll stroll around and then we'll give you all the recipes for breakfast. And then we repeat that 10 times, covering early, you know, mid-morning snacks and lunch and afternoon snacks and eventually a couple of dinners and drinks.

45:02But it allows us to give you all the historical and cultural context. And one belief I have is that food, I think, needs to be put into its cultural context. Food is something that has great roots. You know, it's been handed down maybe over centuries and millennia, oral recipes, eventually written recipes. And sometimes we experience food just cut off from its cultural context. this book was really an attempt to intrinsically really just strongly link the food back into its cultural context and say this is where the food comes from enjoy the food this is our source and and it tastes different once you understand the history and the culture of this food and and how people experience it in the city of Bombay and this was our attempt to do that and I think we've sold uh probably seven right here 800 ,000 books now over the course of the years and I think people have cooked from every recipe we've had people take it on you know guided tours of Bombay They go by themselves and they really use it as a tour.

45:56We've written it very faithfully. So you can say, you know, look up, you'll see a statue. The statue is Lakshmi looking over the wealth creation district. And also reinforces that importance of storytelling in a business. I think so. I think that the way we relate to the world is stories. I don't think we relate to the world in facts and logic. I think we, you know, we need to make decisions with facts and logic clearly. But I think the way we relate to each other is through understanding people's stories, is to hearing them. What's the context there? What are you saying? What are you feeling?

46:26And this allows us really to do that in a rich and textured, detailed way. What advice have you got from others along the way? You had your MBA and Bain consulting experience, but have you had any coaches or mentors? I think I'd have to say my father was my biggest mentor and maybe even coach. It feels like a very modern word for a father-son relationship. You know, he wouldn't have used that word, but I don't think I would, but I think maybe he was. He had real faith in me, deep faith in me in a way that I didn't for myself. And back when I was, you know, Bain or looking at staying or joining Goldman, he would say to me, that's fine.

47:07You know, you can do all that. It's not for you. And I'd feel patronized. I'd say, dad, what do you think? What do you mean by that? That's really annoying. And he'd say, no, no, you're an entrepreneur. You know, you really are. He saw something in me, which clearly I didn't see. Eventually I did start this business and uh or weed as such should i say and and he he gave such strong moral support and he he really said look go for it he guided us on our site decision um you know we talked about simon quail in sharsbury he he had a saying which i might talk about which in fact is mentioned in the preface of the book or the the front matter he he used to say that for something to truly succeed there has to be a little poetry right at the heart of it and we really took that to heart and we try and bake that into everything we do at De Shum.

47:51And he was a fantastic mentor to have. I've learned such a lot. Looking back at the story so far, and it's been a tremendous success, what would be your final two or three tips that any other entrepreneur that's looking to scale a business in the way that you successfully have? Everyone's journey is different. And I can only describe my own way up into the mountain. But I feel that if you have a bee in your bonnet, you understand something, especially if you're seeing it a different way. You know, Steve Jobs used to talk about connecting the dots your way. You know, these dots don't look connected, but if I stand here, they're intrinsically connected.

48:28Nobody else maybe can see that. You know, he understood deeply that calligraphy and letters mattered. And eventually we had fonts. You know, not everyone was faffing around with dots at the time. And, you know, brilliant insight. And of course, even Jim Henson was a guy who played with toys until he invented the Muppets and Sesame Street. And I think to the extent that you see the world differently, understand why you're different, understand where you think there is real beauty and poetry and magic or a proposition that is different. Just try and make that into something that you can understand and coherent.

49:00Then the second part of your job is to filter that into a business model, is to understand how you might monetize that, how you might create an organization which serves the customer and the team member enough value that you can turn that into something that can sustain. And I think you need both. You need that bee in your bonnet, that business insight, that sort of sense of magic. At the same time, you need the discipline to turn that into a business model. And I think if you begin to think like that, you can be well on your way to creating something that's very special. Shamil, thank you very much.

49:27Richard, a pleasure. Thank you. Some really important lessons on how a business should scale. Don't try and grow too fast in the early days. Make sure the quality and consistency is there. Bootstrap and fund the business internally before taking on outside investment. And wait until the time is right to expand internationally. Thank you for joining us. Please do rate us and subscribe and make sure to sign up to our weekly newsletter at businessleader.co.uk slash newsletters. With more people on board Business Leader, we can have better conversations and inspire the UK's next wave of business leaders.

50:15Your business was the first idea. The rest are still waiting.

50:24Ideas happen here. RBC Wealth Management.