Todd Graves, Raising Cane's | David Senra

21:30So what that means is like when I can 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 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 down, and all your friends and family are like, oh, man, that's a good gumbo, that's good.

21:57And 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. I made you a pie you love. And I'm like, 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-throughs 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-earned money and they give you their money and they look at that chicken finger box and they're like, oh, yeah.

22:28Like that's a good feeling. It's immediate gratification. So much stuff with corporate work and administration work and things like that. That's not mediagrification. It comes over time. My favorite job is if I can literally come in the restaurant and just crank out a ship. Like that to me is fun, man. That vibe, that energy. And you still do that? Right, yeah. Yeah, when I go to restaurants, I'll 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. Hey, you know, my main job when I do that is saying thank you. Y 'all are doing great.

22:57Thank 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 they're 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. It'd be better if we could do this, that. Great. Let's get some input because you can get system-wide really good things from focus groups with crew or management, and you get good stuff from surveys. But when you actually talk, you can pull it out of them a little bit more and do it.

23:24Maybe 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.

23:53It was just always – I'd set up like Halloween haunted houses at my house and like, you know, go around and put flyers out. 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, we're calling it Folly's Chicken Fingers. That was the original business plan, terrible name. But we had, we had a friend that was, nickname was Folly, called each other Folly.

24:24But anyway, we wrote that business plan and literally I wrote the, I wrote the Bible of Chicken Fingers, man. It was like, I knew what our aprons would cost. I knew what the cost, I knew what college students needed to make, I knew the environment they needed 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 simple grader. 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.

25:01And 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. They're 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 know you're like, oh yeah, wait, I will prove it to you. Literally, I took that.

25:27And people thought that'd be discouraging. Actually, it was that fuel. I will 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 businessmen got a t-shirt out, bought the briefcase. I had the same one. Did you? But didn't you feel like a businessman? You were like, I went to school for business. You don't know anything. You don't know, man. You're going into a bank, which is pretty intimidating, right? You're like these bankers, and you think they know everything, and literally brought it in and be like, you know, unlock the little safe, you know, little combo.

26:02Was the combo all zero? I don't even remember what it was. Yeah, something like you would open it up, and it'd 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. Everybody was nice enough, right? They're nice enough, but the banker's response was, you know, just chicken fingers off to Louisiana. You know, that's not how we eat lunch and never heard of that. I'm like, well, hold on a second. Like, you know, you order pizza. You know, pizza's real popular, right? Yeah, yeah, yeah. You probably order the same pizza every time, don't you?

26:34What do you get? I like pepperoni or like whatever. I'm like, you get that every time. I'm like, this meal's 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, good, good job. You go work for a break for like 10 years. Then you'll really know the business and then you'll have some money and then da, da, da. And then you'll be bankable at that point, you know, because you have no money, right? I'm like, no, don't have any money. And they're like, you know, you can't get a loan.

27:00You 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 bouler maker working in refineries. Louisiana has a lot of refinery work. And so, what is this turnaround shift work? But this is super intense work. This is like 95-hour. It is 95-hour work weeks.

27:28So, 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 worked 95-hour weeks, and you just worked straight through. There's no days off. There's no nothing. You just worked straight through. So there's overtime. There's double time. There's some kind of crazy thing that goes into another level.

27:55So you can 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. 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 going to – well, they call me Hollywood. We all had nicknames. Interesting story on the Hollywood deal, but we'll leave that out. But so they were encouraging. And Wild Bill, Tolar, we all have nicknames. So Wild Bill was like, hey, Graves, man, you know, Hollywood, you know, I see you got what it takes.

28:26If 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 Naknak, Alaska. And he goes, you can go up there, get a job, and you can make a lot more money doing that. Then you can't bull or make it. So I was like, well, what do I do? He's like, basically get up to Knackneck, Alaska. I'm like, where is that? He says, above the Lucian chain, looking 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 I looked, I called a plane to Anchorage.

28:57I called a float plane to King Sam in Alaska. I hitchhiked to Knackneck, 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 they're looking for some help just few boats most people are 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 of the 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 as regulated.

29:36You 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 silver fish for 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 net, it's gill net. 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.

30:07So 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. It was crazy. We catch so much fish. We're out 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.

30:37It was just unbelievable work. We worked 20-hour days during the peak of the season, which is 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.

31:04You hear on the radio, somebody just got scalped. I heard that, simply 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 fish and 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 in a wonderful way.

31:36And the way I summarize this is like, how bad do you actually want it? And like, you have to actually ask yourself, like, if you're going to compete against Todd Graves, are you willing to work 95 hours a week for a boilermaker after the, if you buy your suit and your briefcase and they're like, get out of here, kid. We're not 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, my life. Trying to convince captains of boats that you could die on to hire you.

32:10And 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. 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 I was like a nerd in the entrepreneurial club in college. Like we had people would start up, hey, I got this, you know, like I steam clean floors.

32:45I do these different things. And I saw 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, you'd be like, 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.

33:14Then you don't stop. Because during the time, man, there's two years it 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. Yeah. 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. So, wait, 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 a campfire.

33:45I 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.

34:13Like 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. 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. You need that fuel to keep rolling. And it's good to hear other people are doing what you do.

34:47And 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 the people that are successful at whether they're an entertainer, whether they're actor or 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.

35:18So you say never satisfied. It's like, well, y 'all aren't happy what we did, you know, with this opening? No, no, no. So we changed the work of never satisfied. It's just like we're always going to raise the bar. So we'll raise 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.

35:43We 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, the rest of the 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 because it's like, 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.

36:11Like, there's this huge entrepreneurial industry that didn't exist, especially when you were starting your company. And the entrepreneurial industry is influenced by investors, not entrepreneurs. It's like, start, scale, sell. Then what? Then what are we going to do? And you have a great line where you're like, if you create and do, you never want to 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 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.

36:50Who are the founders in your business anymore? That's right. They're either dead or they sold out. and then I love somebody asked you the question where like out of like the competitors like who get 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 don't understand this is what I do this is in my DNA this is this is like this is how I feed my family so if you want to come Just understand, I'm on this 24-7 all the time.

37:28You 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.

37:56It's like the same personality type, just pointing at a different endeavor. Jon Jones, you know, probably the greatest UFC fighter. UFC is 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 game. And he's just like, you know, and he was studying him. Just like you and understanding the detail.

38:21And he's like, I know what he does when he wants to go left. 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 to come in and compete, like you're competing with me. My livelihood and my managers and my crew members depend on this restaurant. You're going to open up across the street here. These people feed their families off this. We're going to go at it.

38:48You better be strong because we're not going to give up. 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 for 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.

39:24You always feel appreciative. So you always want to take care of people. It's like it comes in. People are like, oh, man, you need us to sell the business worth all these billions. You can just not worry, da, da, da. 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.

39:50They 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. Well, it goes from fanaticism and passion and a dream. Then you get purpose. And so my purpose of Raising Cane's is, look, 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.

40:22I love part-time quick service crew members that come in. We have an opportunity. It's most people's first job is a restaurant retail. They have 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 are we 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 its values of billions of dollars.

40:49And someday when I clear debt, I'm like$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 cash flow 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. And 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 people do is to keep that purpose because too many great restaurant entrepreneurs and founders of the business, especially in the restaurant business, they sell.

41:20They 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, da, da, da, da, da. 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 make it international. Multiples go up and they're like, hey, we'll come in. We'll give you five million or we'll give you 10 million.

41:47But they take control in 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 you're 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.

42:21We 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 overhaul 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.

42:47Crew 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 is their baby, you start making the wrong decisions right now. You really do. And so profit 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.

43:15Maybe 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 don't do the bonus plug. good programs aren't as good as the year before. All those things start to make the business not special. And so I just encourage 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.

43:54learn 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 at 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 great people to still add value. That makes sense. I just wish founders would hold on, hold on. Don't get rid of it, man. Like, and why would you, if it's something you're so passionate about, find that purpose.

44:26Find that purpose. The best leaders in business are able to spot patterns, but you can't spot patterns if you can't see your data. And most businesses are only using 20 % of their data because 80 % of your customer intelligence is invisible, hidden in emails, transcripts, and conversations. Unless you have HubSpot. HubSpot is where all of your data comes together so you can see the patterns that matter. Because when you know more, you grow more. And that is a pattern that never fails. Visit HubSpot.com today. That is HubSpot.com. I think that's one of the most important messages that we could possibly get out there.

45:01There'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 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.

45:30And 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's 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.

46:06What'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.

46:43I wish I wasn't so scared. I wish I could stay to me. 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 Orfalia, 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 Podcast. It's like these anti-business billionaires, right?

47:13They'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, right? 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 owned 100 % of all his old investors, owned 100 % of Ford Motor Company. It's very equivalent. It'd be like owning a$20 billion company today.

47:46He says money comes naturally as a result of service. That's what you said. Stop fucking worrying about the money. If you just serve, can you make somebody else's life better by an act of 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, 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.

48:13Absolutely. If you do things for the right reasons in business, money will come. Yes. 100 % money will come. You know, 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, than cutting it shorter to try to save labor.

48:50You're going to need 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, then 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, 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.

49:17It's like serve the customers, and then your shareholders will make plenty of money. The dollars are coming. It's proven time and time again, and I'm an example of that. But we talk about entrepreneurs going to a certain point, and they get scared at certain times. Great example is Tony Tanchikong, 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, but 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.

49:50He goes, that's what I was interested in. I was watching them do the ice cream and run the register. So he started an ice cream shop. Then he added a burger. Then he added spaghetti. Crazy, crazy menu. And it became this, like, success. He opened that one little ice cream shop, turns it into a restaurant, and then he starts growing it. So he's like, my goal, I want to be the largest restaurateur in the Philippines. So he's setting on this goal. He has his fanaticism. All of a sudden, McDonald's announces, we're going to the Philippines. They saw success that he was selling all these burgers. And his accountant and his, like, financial people were like, you got to sell.

50:19You got to sell. This concept's amazing. McDonald's started in the U.S. They're just going to blow us away. Sell now. You're going to 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, it 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 going to put the goal. I'm going to beat McDonald's.

50:46I will still be the largest restaurant 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. That's what I want to do. And this is the big boys. This is McDonald's.

51:14This 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 were growing in that deal. That's the hardest part.

51:37Don'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 the next 20-8 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, yeah, yeah. I had to do it the whole time when I graduated, right? I bartended at night when I was working on the business plan and then trying to start the business.

52:08Literally, 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 are 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 sent in, yeah, I have a job bartending, and okay, well, sure, here's$5 ,000 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.

52:40These are people like - So these are called like angel investors. Yeah, yeah. I mean, you know, these are like my bookie. Guys I worked, Buller making. Hey, bookie's got cash. Yeah, yeah. It was, can you take this$10 ,000 investment in cash? I'm like, sure. If I get to the bank, I'm like, came from my investor. But I was able to raise that and I was able to get a$90 ,000 SBA loan. And it was enough money for me to come in. I had 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.

53:20I believe in you. I believe in your fanaticism. You will make this work. So I'm telling her to hold it. Basically held the location for a year for me. How impactful were those words of encouragement? Because you're young. Like somebody you respect that was just a good man and a really good real estate broker. 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 bullet makers, he believed in me. I'm like, okay, okay. That's his little wind in my sails to do this. And basically told her, hey, it's going to take him a year to put all this together, but I believe he'll do it.

53:56And 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 hundred-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 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.

54:25It's part of larger shopping centers, larger developments. A lot of it's in trust, family trust and things like that. But everyone I can buy, I buy. Absolutely. They won't sell you this one? No, no, no. They like being a part of it, right? I got a good lease term on here. And plus, what I put into this place, I had to learn things. Like I said, I had to learn plumbing. I had to learn construction. I had to learn the steps. 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 on our discussion, I'll show you all these little points of this.

54:57This 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 this somewhere. that's a damn good idea but just in pajamas too right but it means something right and keeping this like this like this I can bring in management to here and show them this place we have big pretty buildings all functional everything they come here and go this is our soul just remember this is this is where we started and we got to keep that spirit going here dude the one in Miami Beach by my house looks like a nightclub yeah yeah yeah it's 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?

55:36Yeah, no, so it didn't sign the lease that doesn't 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 somebody had a deal. I went, got that SBA loan and got the investors.

56:09And from there, then we started the construction process. We started getting the used equipment. And luckily the equipment I went, I got from, I went into Houston and Dallas, restaurant supply houses, because, 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. And they had to be 85 pound fryers. And they're like, well, this one's good. I'm like, yeah, it's 10 times as much. I need something to last because I know as soon as I prove this will work, I know I can get another loan.

56:35You know, thank goodness we made money. And so we opened up like I was I was so excited. We reconstructed. We're ready to open up. We got registers back to Office Depot. There's little registers. And once they figured out how to program them, I went and started waiting people in the restaurant and people came and people liked it. And then we made thirty dollars the first month. That's what we made. People 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 is taken care of. I can pay the vendors. We're working.

57:02And 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, I was 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. 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.

57:34And it showed efficiencies there. And what was really amazing with that location is that it was on the other side 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. up to what I thought it was if I just worked for college kids. I'm like, this works for everybody.

58:01And 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, 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 the world?

58:33I'm like, because I want to go in 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 involvement. And I'm like, but we have this cool culture, man. I want to emulate that other places.

58:59I 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. No music in the kitchen. Can you imagine working back there? It was just negative environment because the manager 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 restaurants without treating you right. And they're not giving good customer service. They come here, they're treated right.

59:26They 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 for taking the trash out to the dumpster. Wow, that's good toast. Hey, good job on the shift, man. 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, why I love operators is it's like when I was on the football team. It's constant coaching. Oh, yeah, it's a good pass. Oh, man, you screwed that up, man. Like, make sure your arm goes back.

59:56And, 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 Cain's corporate is the people that. Can't take constant, constant coaching and it's coaching, right? You know, it's like, No, we should meet every six months on an eval and how we're doing and blah, blah, blah and all that stuff.

1:00:28It's like, no, every day is an eval. Like every day when we 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 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. And so 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.

1:01:02Right now. Yeah, right now. As we do that, a lot of the culture is you don't admit mistakes. You don't want to – one, you don't want to admit mistakes. And two, you don't want to be coached. It's this academia type of things that I'm 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, but we do need to learn from him. Like, Todd's not going to make that same mistake over and over.

1:01:31Like, we know that, and I won't either, right? And so that's some of the challenging growth. 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 title.

1:02:08They'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 because it 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 haven't had the experience, but it will learn that, right?

1:02:36They have intelligence to do it, but it's hard. It's a hundred percent hard, man. If you're intrinsically motivated, you do really well, okay? 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. Like what is actually happening? Separate from the customer and separate 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?

1:03:07Everybody else is in a suit and tie. But there are crew members in the restaurant wearing like, you know, jeans and t-shirts. 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.

1:03:36Like, oh, that's the boss. They're like, oh, that's the founder. 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 one of my heroes. And he had a 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 Lesh because he sounds exactly what you're saying, where he competed in a very difficult business. You come into fast food, QSRs. That was an established thing. You're coming in and there's competition everywhere.

1:04:09and he goes into selling tires and he just smokes every single other person. And the book starts because he's like in his 60s. The business is named after him, okay? So, and 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, you know, old school guy. He's cursing all the other books. Like, God damn it. And he's just like, I always tell the goddamn people in the office, like the only reason they have a job is because the people in the store selling tires.

1:04:43And then he would talk about this. He's like, if you're out, you're going to love this guy. I already know this for a fact. I'll send it to you. 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 it a restaurant support office. We're not a 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.

1:05:16I 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 got 75 ,000 crew members across the system. We're here to support them.

1:05:46We're here to make their job better, easier, more efficient, more fulfilling, the whole bit. And keeping that going. You have to like, entrepreneurs are very erratic, unscheduled, bad. You know what I mean? So most of us, as a general deal, it's like people are like, what's your schedule like? I'm like, my schedule's all the time, everywhere, however, whatever. It could be 3 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 call for the business, then you answer that.

1:06:21So 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 for me is to scale, I created the Cain's Love 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.

1:06:50It'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 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 for 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?

1:07:16But they're like, oh, because all their friends were doing something fun. Their family doing something fun. I was like, you know what? That's not worth it. So that's respect. Recognition is something you should recognize achievement. You should recognize tenure. You should recognize all these things. There seems to recognize all the things. It starts from the 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. They're like, you work a year at Raising Cane's, you get a hard hat. It symbolizes the first year I was there.

1:07:41All crew members signs it. It's fun, right? Five years you're getting the salmon. Those are the recognizing things, recognizing that deal, then rewarding. So it's like, whether it's a, you know, 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, literally a department that thinks of nothing but respect, recognizing, and rewarding crew members every day.

1:08:10And put a bunch of brilliant people, most of them came from operations, in the restaurant, and they know this stuff about build systems. So our next thing with that is, versus saying, here's the gift card, or 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, and 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.

1:08:39That's smart. 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 who built that massive, remember the Mary Kay Cosmetics? They would work 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.

1:09:12And 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 a 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. And it makes a difference even to hard driving, you know, psychotically obsessed fanatical people like you.

1:09:51It 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.

1:10:26Henry Ford, no one knows who he is. He's not successful. I think he's already failed. He had two or three failed car companies before he finally succeeded with his third, too. Again, just I'm coming 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 like 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 go he hits the table and he goes that's it young man you have it keep at it and then henry ford says his autobiography which he's writing 40 years later he's like those seven or eight words of encouragement.

1:11:10There 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 gonna 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. Yeah, it's really important. Absolutely, but it's earned encouragement. Edison knew he had it, right? And so, some of that's 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.

1:11:46And 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 going to have to learn tough love. Like Cuban knew me, right? And then being around Mr. Wonderful, then they're like, I know it's heartbreaking, but sometimes the ideas aren't good. And are they doing it the wrong way and you're not doing them a service doing it that way. And the tough love is to say, 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.

1:12:17It'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 there and think that 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 millions of founders who listen to founders. And I get emails and all this kind of stuff. And we have conversations.

1:12:43It'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. It was 10 years ago. There's no podcast 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. Like, that's ridiculous. It's like, it doesn't matter. I actually hate that show. No offense to them. But it's just like the idea of I'm all-knowing. I'm an expert. There is no such thing as an expert in entrepreneurship.

1:13:13You 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 a example. There's again 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. Okay, they sold it to eBay for, I don't know,$1.8 billion or something like that, if you want exits. So they sell that. Then he already knew who Elon was.

1:13:44He 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.

1:14:17You 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 started. Okay. The reason that I've read 400 biographies of history's greatest entrepreneur. 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.

1:14:52He gets screwed over by partners.

1:14:57joint 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.

1:15:32He would go in the back, do prototypes, be covered in dust because he's doing vacuum cleaners, carry himself inside and I 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 like not to give up, but because I'm on the other side of that. And at the, 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 happened? Now his company is doing billions of dollars a year. And he's got a bunch of different products. He's in markets all across the world.

1:16:01The 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 Eck 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.

1:16:35I signed up for Function long before they were a sponsor of this podcast. And when you sign up, they ask you what your health goals are. And my response, in all caps, was maximum energy. All of the founders, CEOs, and extreme winners I have studied have excessively high energy levels. If you're going to be the best at what you do, you need to maximize your energy and output, and that is why I've partnered with Function. Function provides access to comprehensive blood tests and other lab testing to help you improve your health so you can perform at your highest level. Function has made it easy for me to monitor and improve my internal health markers so that I feel at my absolute strongest.

1:17:07As a member of Function, you get access to test over 100-plus biomarkers, from hormones to toxins to markers of heart health, inflammation, and stress. Function gives you a straightforward analysis of all your results, along with advice from expert doctors on how to improve things like your testosterone, your stress hormones, how to reduce toxins in your bodies, and much more. The platform is absolutely beautiful and provides an easy-to-understand picture of your overall health. Once you try Function, you'll immediately understand why it's the fastest-growing health platform in the country. To learn more about Function and join, go to functionhealth.com forward slash Senra.

1:17:40Right now, Function is offering$100 credit to the first 1 ,000 people who sign up for a Function membership. To get this$100 credit, just visit functionhealth.com forward slash Senra and then get the data you need to maximize your energy. Again, that's functionhealth.com forward slash Senra. 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're just you're you're so much in the details that you just need to delegate the delegate.

1:18:17I hated hearing that word delegate. I mean, explain to me. I'm like, explain, explain delegating to me. What do you mean by that? Well, delegate means you give other. I'm like, you know, I know what the word means. But how do I how do I delegate this? Well, you just hire good people and 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 at 85, but we need to be at that 95 to have success. I can't just delegate that.

1:18:58I 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. how you can run this better than me. So now I'm going to ease off on some of those things that I was supplementing on the deal list, but I'll still check and make them, but I still know enough to, 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, you're down to the minutia and all this stuff.

1:19:27You're wasting your time doing that stuff. You should be big picture. You should be there. I'm like, well, yeah, it got to 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 Swess knows exactly what the bottled water costs at his place. And he's like, look, and there's formulas to give it to him.

1:20:01He 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 too, 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.

1:20:30They 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 and drive-throughs 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 list. 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.

1:20:57If 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. Y '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 in the things that stick to what you know second on the concept man i'm fully believe be good at one thing and do it better than anybody else be relentless i do it better than anybody else can you expand on but that i told if it 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 like if that's the first thing i ever heard i was I was like, I know him.

1:21:32I 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 people have an emotional reaction to your company. Right. Your product evokes emotion just like his evoked emotion. Right. But the reason, the very first, I didn't, I was unaware of Raising Cane's. There weren't any in Florida where I live. and I actually saw a clip when you were on Theo Vaughn's podcast. It was a TikTok and you said something and I was like, I know him.

1:22:08Like, I have to find out who this is. And then my brother-in-law lives in 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.

1:22:37And you would talk about in that podcast where it's just like, well, simple menu has all these other positive effects that, you know, 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 shorter order time. When did you figure that out? Did you know at the beginning? Yeah, no, no, no, I didn't. What I wanted was craveable product. And I knew from restaurants, you had that one craveable product on their menu. And then they have all these other menu items, all these other distractions.

1:23:07You're like, but everybody goes to Gino's to get that delicious carbonaro, right? 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. What they, in the restaurant business, craveable. So, But what I want to do is create that credible 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 a customer pulls up to the order deal. The first time at a Raising Gains, they look. They have to decide what they want.

1:23:36They do it. After that, they know what they want. Box combo, sweet tea, extra sauce, 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 it back to 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're making one, basically, one meal just with three, four, six chicken fingers.

1:24:10So you can make an assembly quicker. You'll have your drinks that are popular. It comes up in and out. It gets out there. Thank you very much 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, serve with fast food, speed, and convenience. That's what it is, right? Fast food, speed, and convenience, craveable products. So 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 it up is then I'll put heat lamps and keep all this other food assembled, done. So then quality goes down.

1:24:46So your speed goes down, then your quality goes down. And then you're probably going to do it now worse if you've been adding heat lamps. And we don't have heat lamps. We don't hold times without any of that stuff. We're having that cook-to-order process. It's like if you go up to In-N-Out Burger, 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 Raisin Cane's, it's going to 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.

1:25:10Then during your rushes, you're cooking way ahead. You're just meaning it's coming out. It's getting served immediately, right? We're 2 minutes, 35 seconds, drive-thru and counter service, right? If we added different products and we lost 2 seconds, every 2 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$60 million in sales you can do if you can tweak that order time? 2 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.

1:25:52Once you get to the flow through point, then you lose that 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.

1:26:19And 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 of expectation, all that. Where's the time to encourage the crew and do positive motivational management? Point out, that's good toast. You know, you're great in the drive. Where's the time to walk out and talk to the customers and actually see their food? How clean is our restaurant right now?

1:26:49What'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 V2O doesn't happen. And 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.

1:27:13Our frequency is 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. is actually frequency. Our frequency is as high as anybody else is 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.

1:27:44It doesn't affect it because people say, they might try it, but two days later, 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 want people to talk about chicken fingers, chicken strips, or whatever they're talking about, boneless chicken being dipped, I want them to say Grazing Canes in their mind, like Xerox, you know, it's not a copy anymore.

1:28:08Go 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 Cane's Love. You have time to do those other things that enhance that crew member experience.

1:28:37And 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 Cane's because of the food 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 our 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 landed and went directly to one last night and just greeting every single person that went to the door.

1:29:06It was obvious how obsessed. I love this idea because, again, focusing on one thing and being the best in the world at it, to me, that should be completely obvious. I think humans crave simplicity, but our default state is we tend to overcomplicate things. So your competitors are 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.

1:29:35People 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 was a part of that, but maybe they looked at Canes and said, wait a minute, I bring my kids here.

1:30:00We 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, actually. You can. I have a friend that does that 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 I'm about to do and I'm going to serve it.

1:30:29Brilliant. It's actually nice. I don't have to think of it. As long as you can get in, then I don't have to think of anything else. I'll flip through the menu. No, like the restaurant that has 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. I got other shit in my head. I don't want to think about this. It calls it anxiety. What am I going to get here? This is what we love. Last night we were like, okay, what do you want? You want three chicken fingers, four chicken fingers, or six.

1:30:57Like, 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, they're the franchise model. Why did you not choose to go down that path? You know, when I started out, you know, when I had that vision, you know, grow canes, you know, so franchising was like 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 cost. 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.

1:31:40Restaurants are very expensive. You can't, you know, literally, and that's not a manufacturing plant. If I could do all chicken fingers at one location and send it out, right, the cost wouldn't be there, the capital cost. 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.

1:32:08It's literally we don't have to keep growing with our capital. We'll take a royalty off the deal. So I had the model of like I'm going to grow 50%. I knew I wanted to grow 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 people from the industry, people that were CEOs and other great big billion dollar businesses. And they were good people. They're people that I trust, trusted in 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, we'll grow quicker.

1:32:36And so I did open up in different boxes of country, opened up in Ohio, opened up in Minnesota, opened up in Nevada, opened 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, we were saying 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, 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.

1:33:08I know I could do it better. It was a significant change of operational procedure. We had tested 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. You had the respect to show them, like, ah, that just doesn't work for us because it's different. It's like, well, what's different? The crew and customers are the exact same in both these areas. No, we just like it better this way. We think da-da-da. Or even crazy things.

1:33:39It's like, well, we don't want to get that much faster because we like the longer interactions. It's like, well, the longer interaction, 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 it 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.

1:34:12And so I ended up buying all them back. And they did really well. And they were great. And they're all happy. And actually, too, is they looked at like more of a merger because we kept their teams. And they had more opportunities for growth. And it worked out really well. But for me, it's like, you know, franchisee is never going to 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.

1:34:49And so like franchising for me is 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. 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.

1:35:21Well, I think the important part that, you know, a lot of people are like, hey, should I work on this? Or what's the idea I should pursue? And I actually get this idea from Michael Dell where I used to say well like you just have to build a business authentic to you It doesn't even matter if you could make more money from franchises You just it's not suited for your personality, right? 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's in his early 20s So he's like shit man.

1:35:52This is really hard competing with IBM So he actually gets a guy to come in to be I think the vice president 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 Donald's 20s. And he's like, you know, I loved it, but I 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. Like, I got digest.

1:36:20He'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 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 with control. I spent eight hours yesterday hand editing the transcript that no one gives a shit about because I care about it.

1:36:54This is like, I don't, and everybody's like, everybody tells me, outsource, delegate. They use that word all the time. No, I don't want to delegate. Like, I want to feel it. I have a feeling for it. But that's the key. 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. Yeah. Was that five years in time? Yeah. Probably three years I started talking about it. Okay. No, 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.

1:37:28And that's when my partner got out, which was really interesting. You 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 we've done on the deal list. He's like, this just doesn't make me happy. And so he ended up getting a scholarship at Wake Forest, did business, he did all the things he did.

1:37:57He actually came back to Canes for several years doing the things he likes to do. He has his own business now, he does really well. Still one of my dear friends. But it wasn't happening. He had the courage to say, I don't like this. This is all we're doing is being fried 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. Like there's no work. There's no, I'm working. I'm not working now. I mean, like I'll be at the beach and it's like, you know, checking in and we've got calls and I'm being well, roll heads on the beach, you know, you're talking and doing, and then you get back to, Hey, what's happening?

1:38:32Margarita. 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, you'll never work. There will 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, with my kids, things like that is 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.

1:39:07I mean, very careful on what their motives are. And if their motives is about a financial return, you're generally going to 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. It can change your thinking on quality in my business. It 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.

1:39:41You 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 is 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 doesn't in the future. And rarely does that work out. If it's special to 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.

1:40:14I 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 decisions 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 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.

1:40:46But if you look at his combined wealth that came from Walmart, right, that's still concentrating on 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.

1:41:14And 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 Fufu stuff. Oh yeah, you should do what you love. There's a underlying reason to that because work is going to be a grind. You are going to run at times where you are crying when you're in pain and you want to give up. And if you don't love it, you will give up because you're sane. Right. And so you have to love it. It has to be, you have to be irrationally obsessed with it.

1:41:43And then what happens? It goes back to the anti-business billionaires. The people that are irrationally obsessed with it, they make better products. That's right. And then customers, you know how many people I've told about Raising Cane's? Like, I didn't, even before I knew I was going to meet you. It's just like, because I, it's in human nature. When we find anything that we love, it could be a chicken, 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. Nonprofit. No one keeps it to themselves. That's just, humans don't do that.

1:42:09That's right. They're just like, you got to have this chicken. This is, it's incredible. And so that, all this stuff, the love, staying in, 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 friend to Steve Jobs. He was on Apple's board. He's good friends with Elon. Elon considers an inventor. He's on Tesla's board. And he's like, oh, and he was asked one time, what do they both have in common?

1:42:39He goes, OCD. OCD? 100%. 100%. What do you mean what they have in common? It's obvious what they have in common to him. Yeah, being Molly obsessed with Balsam 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 of 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.

1:43:12It looks the exact same way. It's the same with the personalities, like whether you're playing basketball or you're building Raisin Cane. So wait, so how many years of doing the 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 Rust and exciting to teach. what we do and do well, it's exciting to learn. A couple of 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.

1:43:40So 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'll get a valuation of the 6 % you're getting off that restaurant.

1:44:08That'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 4 % 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. 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?

1:44:48Oh, man. So this is interesting, man. And I said, look, after the second restaurant, I had an opportunity to go into some of these failing double drive-through burger places. And so Greg got Dr. Hill, another great mentor of mine. He's like, look, we're just not operators, man. They had like 30-something, you know, they're called Fast Track. And then burger joints. We're down to like four of just our best units and our best. We consolidate the best crew. We want to be landlords. Like we're not operators. And you can use equipment. You can have all this. Look, whatever you need. And look, we'll give you cheaper rent.

1:45:18And 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 dinings 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 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 I eventually turned all those into big, you know, dine-in drive-through locations.

1:45:49So I was able to do that into 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 to 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. was there, I was like, okay, I'm gonna come up with a prototype.

1:46:16Like 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 where our look and feel was, everything marketing systems human resource systems training systems everything globally and i had i used to go to restaurant conferences to learn from people that were experienced i was able there to get i know the i know the marketing guy i know the human resources training and operations person i know the you know the the crew relations so i was able to assemble a team together with architects and with uh interior designers and branding people and i was able to assemble a team coming in we call them partners not consultants because like they were partnered into the success of the business.

1:47:12And 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 a box and a drink. You know, we said let's combo it because people make it easier.

1:47:39You don't have to decide to. It's like just get those menu items. And we created that. And so, but I got that on another commercial 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 up 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 to all 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 had those fast tracks.

1:48:13He 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$200 ,000, 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 finance. Boom. And I was creating cash when I did that because basically I could open up.

1:48:50I 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 really stupid way to finance a business, man. But I was, I was young. I was 10 feet tall and bulletproof. We're going to work. I mean, I'd have 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, we have a storm coming in named Katrina. It's coming into Louisiana. We're used to, used to hurricanes.

1:49:21We knew what to do. We put crew to safety, shut down the restaurants, buckled everything down. Hurricanes would come through. We'd 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 we could all go. We got this whatever cranks 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.

1:49:50And I thought, I said, man, you just screwed up bad. You screwed up bad. had you 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's 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, I gathered people together.

1:50:24We had teams that help 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, we actually said that 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.

1:50:57They're coming back and they don't have a job and we don't have money now. We have vendors and things like that to pay for their livelihood. And then three, people are gonna 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 bull water acts because we didn't have formalized bull water acts. You had to bull the water because, I mean, like some of the rivers and all these things had hit everything.

1:51:31You 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 sort of things. And we reopened, man. And 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, like, 90 days. We opened up in the West Bank. So you had the whole market to yourself? The whole market to yourself opened up in, like, the West Bank.

1:52:02We opened up in the 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. They like more come in and eat, right? Because it was like, you can come in. We got power. He's all generated power. We got generation all over the country. Got him in and 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.

1:52:32We 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 with 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.

1:53:05Like 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-through COVID because there was limited contact. But we had to learn everything. It was like literally, hey, guys, we talked to the restaurant industries, all the authorities were like, we're going to tape off every six feet for people to be.

1:53:39We'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-thru lanes. When I tell you, when like 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, the restaurants, I flew to all of our markets and saw everybody.

1:54:15But that point too, I couldn't even go in the restaurant because it'd be cross-contamination. Like if I had it, it went in. So I would just wave there by 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 all over the country to do that and say, let's go take this in the restaurants and do this stuff? It's the one that's personal to founders.

1:54:43You 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.

1:55:14You 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 not a liability. 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 raising canes if that didn't happen. But you're the only game in town.

1:55:46And 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, like 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.

1:56:25And so she would go, oh, 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. And she's like, every single customer matters. And 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. And let's say you're sitting across from Estee, just like me and you're sitting across from Estee. And she sees a woman. She says, hi, I'm Estee Lauder. Would you mind giving me 20 minutes of your time? I'll give you a free makeup.

1:56:53I make beauty products. Or makeover, rather. It's like, oh, I guess we're just in her studio. And then she does it to 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 love their 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. And Aquafans telling everybody they know.

1:57:20Listen to this story. Exactly. I've been a customer of yours for, I don't know, four years. and then they make a podcast that's been listened to by like half a million people. Like you couldn't have predicted that. There's probably going to be millions of people that watch what we're doing. 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, a little nugget that changes their life, that helps people, like that fires me up. The reason why you're doing this and you're so fanatical about having, and the questions you sent me before, right?

1:57:53had those questions, I was able to wrap my mind around it because you want it to be good for the listeners. But that's purpose, man. If it was 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 scale, sell. It's just like my favorite entrepreneurs, like sometimes I've got to speak to entrepreneurs.

1:58:20I just had dinner with one of the wealthiest people in the world. He's 76 years old. He's been working 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 the, no disrespect anybody else, but like the startup founder that ran the business for two years. He's like, 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. Cause you know, there's no such thing as ever getting to a hundred.

1:58:45You're always looking for different ways to improve. Todd, you're going to do this for the rest of your life. I'm going appreciate you taking a risk and being one of my first guests absolutely i'm a big fan of what you do man i i fired me up that i made one of the first man it's like because everybody's going to want to watch it and see it and it's like uh 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 yeah yeah I want to show you the kitchen here, and then I want to go back, and let's go check out the apartment.

1:59:25All 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.