Finding Balance Through Salads and Doughnuts: Tech in Fast Casual Today with Daniel Londono

0:02Who's ready to rock today, Fire Nation? JLD here and welcome to Entrepreneurs on Fire, brought to you by the HubSpot. Podcast Network, the audio destination for business professionals with great shows like Online Marketing Made Easy. Today, we'll be breaking down how to find balance through salads and donuts, tech and fast casual today. To drop these value bombs, I brought to Daniel Londano and to EO Fire Studios. Daniel is co-founder and co-CEO of Alfalfa, a tech-enabled bicoastal eatery known for his premium salads and gluten-free donuts. He previously spent eight years as a management consultant.

0:38And today, Fire Nation, we'll talk about starting a restaurant with little to no money. We'll talk about going from proof of concept to brick and mortar step by step. We'll talk about AI-based ingredient forecasting and so much more. And a big thank you for sponsoring today's episode goes to Daniel and our sponsors. Business Made Simple, hosted by Donald Miller, is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Business Made Simple takes the mystery out of growing your business. Join my friend, Donna Miller, each week as he shares value bombs on topics like the secret to making better marketing decisions.

1:16Listen to Business Made Simple wherever you get your podcasts. Ever thought of giving a TEDx talk? It's one of the most powerful ways to share your message with the world and four-time TEDx speaker, Taylor Conroy from Thought Leader can help you get there. Visit thought-leader.com to join Taylor's free training where he teaches you how to land a TEDx talk and spread your message to millions. Daniel, say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with. Yeah, thanks, John. And thanks again for having me. I would start with taking risks.

1:56A lot of people think that to be successful, you have to take risks. And it's something that even in the restaurant industry, where obviously there's a ton of risk, I actually, I don't agree with that traditional sentiment. So we started Alfalfa as a tiny little farmer's market stand back in 2018 with a simple idea, which is that we wanted to build a place that served delicious, healthy salads with a really welcoming kind of hospitality forward point of view. And it's something that we did, honestly, with very little money, just with time, doing it every Saturday at a little farmer's market in Hoboken, New Jersey, and kind of scaled up from there.

2:38We didn't really raise money and we just kind of took our time. It was hard, but we didn't really take a risk. And don't forget about those gluten-free donuts, because I will tell you that when I used to go to a place like Subway, I would feel good about eating quote unquote healthy, but I would always get those chocolate cookies afterwards and I'd be like, oh, I just ruined everything. So you give that nice kind of sweet option for a gluten-free dessert as well. It's just that good combo, Fire Nation. That's what we're talking about, finding balance through salads and donuts, tech and fast casual today.

3:14So a lot of people, Daniel, they have dreams of starting a restaurant, but they want to know, is it possible? Is it possible to start a restaurant with little to no money? I would say yes. Obviously, the range of what you're trying to do could limit you. right so if you're trying to start a restaurant that is in a category that you know typically has a super nice build out or has a lot of cooking um this might not be possible but from our point of view you know we were making salads right so what we did is back in 2018 we had a pretty simple idea and we executed that idea just prepping the vegetables at commissary kitchens and then putting our salads in front of consumers um with paying you know very little to have a tent at a farmer's market and no employees, just ourselves talking to customers and refining our product.

4:05And then because we did that for a long time, we actually did it all of 2018. And I actually had a day job at the time, Monday through Friday. So it was pretty challenging. My two co-founders and I would then refine our processes. And so by the time that we had an opportunity to do a pop-up at a brick and mortar restaurant in early 2019, we had actually saved enough from the farmer's market to hire our first employee. And so we had that employee helping us fulfill orders through all the third party platforms. Again, just kind of not really having to pay too much, just making enough to pay that one employee and also buy ingredients for the next day.

4:44And then ultimately, when we had an opportunity to take over that initial brick and mortar place where we're doing the pop up, we, you know, without spending too much, we had an opportunity to kind of make that space fit Alfalfa. So it involved a lot of manual labor, us, you know, physically kind of painting the space, doing a lot of the physical work ourselves, it was a pretty crazy time. And ultimately, when we opened what is still kind of our flagship restaurant in Hoboken, New Jersey, it was really a labor of love from many of our friends, families, and early kind of believers and team members.

5:18Now to your point around salads and donuts, that's actually something that came from that first restaurant. So we took over a 30s diner in Hoboken, which happened to have a very talented set of folks, including a baker. So at the time, we were only doing salads and wraps. And we're like, man, we really just don't want to let this baker go when we take over the space. And also, there was a lot of donut making equipment in the restaurant. So we kind of had this big aha moment, you know, whereas founders, even though we like eating healthy and living kind of a healthy life, we also are balanced people.

5:50And we'll have a burger on a weekend, right? We're not like a salad 30 days out of the month kind of people. And donuts are delicious. And so we, you know, we kind of said, well, is there a way to do salad through a balanced lens? And so we started doing donuts. And a lot of people said, you know, you guys are crazy salads and donuts doesn't make any sense. But really, it became this magical combination. And we later kind of refined the donuts to be gluten free and a little bit smaller, not too sweet, so that it actually, you know, you can have a salad and a donut and feel good and not feel too full and feel like you're ultimately helping not only your physical health, but also your mental health and not being too hard on yourself.

6:28And this is something that we've carried through and is now our mission to inspire joy through balance. And our way of helping people stay balanced is by giving them salads and donuts. But obviously, as a brand, we do much more than that now. We're actually doing a big event next Saturday in Jersey City called Embracing Balance. And we have a lot of partners kind of working with us to help people do that, right? Via cold plunges and other things like that. Love cold plunges. I have one here at my house and I actually do it every single day. And just for the record, Fire Nation, 41 degrees for five minutes.

7:02It is a very, very cold, cold plunge for a legitimate amount of time for five minutes. And when I'm in there, I'm actually doing a three-minute speed chest to kind of keep my mind off of how cold the cold plunge is. But that's for another episode for sure. Now, Daniel, you did talk a little bit about going the step-by-step process of what you did. But I want to talk about scaling from proof of concept to actual brick and mortar. Let's really go through those steps. Yeah, happy to do so. So I do think, like you said, before brick and mortar and before, you know, most people say, oh, yeah, you got to find a space and sign a lease.

7:41I really disagree with that. I think it's a really terrible idea. Leases are expensive. Equipment is expensive. So starting, I think farmers markets are fantastic. I love them, obviously, as a consumer. But I also think to incubate brands, it's great because you make something and that weekend you sell it. And more importantly, you talk to customers and you get that immediate feedback as they're eating your salad. What do they like about it? What do they not like about it? And through that process, we discovered that people really were not just enjoying the food, but also the experience and talking to us.

8:09And it's something that we carry through to our brand today. And today, we actually don't have a sound line in front of customers, because we discovered that those conversations and that interaction with customers was actually much more important than having the food laid out in front of you. And it also also makes us a better employer, which I can get into. But back to your question, taking the proof of concept, before you do anything with brick and mortar, I think getting to that point where you have a line at your stand every single weekend and people are looking forward to eating your food or trying your product, that's what success looks like.

8:43And that's when you really should think about going beyond that. But when we signed our lease and built our space, we were really busy from the start because all those customers that we had been acquiring every single weekend were super excited and just kind of had to line out the door by the time that we had opened our doors. And then we also just were pretty intentional with getting those early adopters to be our champions in the community. So very early on, we built a social media following and we created a brand that people really wanted to align themselves with. We had merch super early. We had like these really funny t-shirts.

9:22Actually had the alfalfa kid from Little Rascals on the shirt, which we obviously got in trouble for and had to stop doing. But we did all sorts of things early to get that excitement and de-risk our brick and mortar expansion. So I would say that's one. And then the second thing is just do the work yourself, right? It's easy to just pay someone to go like build your space. But like, you know, stay up all night, do it. I still remember I had a flight. I was in management consulting at the time, and I had a flight to catch at 6 a.m., and my co-founder, Andrew, and I were like, you know what? Let's paint this shelf tonight.

9:54And we stayed up all night painting the shelf, and then I went home, showered, and got on a plane. And you have to do things like that early on to just completely de-risk what you're trying to do with brick and mortar. That's my view. Now, totally off topic, but have you seen the show on Hulu, The Bear? Love it. Absolutely. Fire Nation, if you have any interest in how a smallish restaurant works with a pretty interesting cast, check out The Bear on Hulu. Somebody else told me this, and I'm glad they did. They said, get through the first season because season two is awesome. And I don't think I would have got through the first season without that advice, but they were correct.

10:37So if you decide to watch The Bear get through the first season, it's still good, but I mean, the second season really takes it to the next level. And Fire Nation, on that note, we'll be right back after thanking our sponsors. Are you ready to close 2023 out strong by surpassing your revenue targets? Q4 is the time to make it happen. But in order to do that, you need the right tools to help you fill your pipeline, nurture prospects, and close deals. Lucky for you, there's the new HubSpot Sales Hub. With HubSpot's Sales Hub, you're able to supercharge your sales process so you can find, track, and close deals all in one powerful, easy-to-use platform.

11:12Imagine having your data, tools, and team all in one place. Picture being able to prospect smarter with the new prospecting workspace, which makes connecting with customers easier than ever, looking to create more content to fuel your sales process. HubSpot's AI assistant can help. As you can tell, Sales Hub is great alone, but it's even better when united by HubSpot's smart CRM. Leads don't slip through the cracks. Data is connected across marketing, sales, and operations, and teams can better measure their impact on the bottom line. Stop sticking to the same old strategies and start closing more deals with HubSpot Sales Hub.

11:45Make the switch to HubSpot Sales Hub at hubspot.com slash sales. I love the holidays, especially time spent with family celebrating everything we're grateful for. One thing I'm grateful for, my health, but I know anything can happen and that's why life insurance and planning ahead for my family's future is important. Luckily, Policy Genius helps you compare your options from top companies and their team of licensed experts are on hand to help talk you through it With PolicyGenius, you can find life insurance policies that start at just$292 per year for$1 million of coverage. Some options offer same-day approval and avoid unnecessary medical exams.

12:23PolicyGenius also makes it super easy to compare life insurance quotes from America's top insurers in just a few clicks. Plus, they work for you, not the insurance companies, so you can trust their guidance. No wonder they have thousands of five-star reviews on Google and Trustpilot. Your family deserves peace of mind. A life insurance policy through Policy Genius can give it to them. Head to policygenius.com or click the link in the description to get your free life insurance quotes and see how much you could save. That's policygenius.com. Do you have a message inside that you know is meant to be shared with the world?

12:55Giving a TEDx talk is one of the most powerful ways to share your message with the world and Thought Leader can help you get there. Thought Leader is a speaker coaching company that has helped over 550 and counting coaches, speakers, entrepreneurs, authors, and experts land TEDx Talks. Thought Leader is not affiliated with TED or TEDx, but they're able to get these results because their founder, Taylor Conroy, is a four-time TEDx speaker himself and past EO Fire guest. You might be thinking a TEDx Talk sounds great, but where do you start? Taylor has put together a free training that is going to teach you how to land a TEDx Talk in as little as 90 days.

13:30Join Taylor to learn exactly what TEDx organizers are looking for in their speakers, how to write a talk that goes viral once it goes online and more. Visit thought-leader.com slash fire. Join Taylor for his free training and get your message out of your head, out of your heart and out into the world where it belongs. That's thought-leader.com slash fire. Daniel, we're back and I want to talk about operating bi-coastal restaurants because that's no joke. So let's talk about how tech plays a role in this. Whether it's bi-coastal or just multi-unit, tech is huge. It really, it doesn't have to be the most expensive thing that you do.

14:11And I think a lot of folks probably overspend in tech, but I do think it's critical to have the right tech infrastructure to ultimately have a better product and make it easier to work at your concept, pretty simply, frankly. So when we decided to open our second location, it was COVID. it was like 2020. I was moving to Los Angeles from New Jersey with my wife before we expanded Alpapa to the West Coast. And my two co-founders had different ties to the West Coast. And we always envisioned our brand to be a Southern California inspired brand that ultimately would scale to LA. During COVID, it was very difficult for us, certainly in New Jersey, ultimately, when we were able to reopen and life sort of got back to normal in that summer 2020.

15:00we happen to kind of benefit from folks working from home and wanting to eat delicious, healthy meals and balanced meals from alfalfa. So we had an opportunity to grow. And being that I was moving to LA, it actually started as a joke. My co-founder sent us a listing for what became our Santa Monica location. And we laughed about it. And we're like, oh, yeah, that'd be hilarious to open our second location 3 ,000 miles away from the first one. But ultimately, he ended up calling the broker without telling us. And we ultimately signed the lease three months later. And the reason we wanted to do it is we wanted, we knew we wanted to build a big company.

15:36And we knew that the faster and more painful the lessons, the better. And so, and it ended up being true. It was probably one of the hardest things we've all ever done to open our second location that far away. But it really forced the entire organization to get super organized and make sure that all our recipes were in the cloud through a platform that we use, make sure that the operating systems within each location were super well organized. And really, there's like no paper at Alpafa, everything lives on different online places in different online places. And the way that we communicate has made it so that now we actually just opened our fourth location.

16:15And we're opening our fifth early next year. And now that as we scale, it's becoming clear that because of those early systems and the technology that we put in place, it is now just so much easier to scale. So we're really excited for the path forward. In terms of the specific ways that we are using technology, I like to break it down into three big buckets. The first is our consumer kind of facing brand and how consumers are interacting with Alphaba through technology. The second is our product. So ultimately, you know, what you put in your mouth. And the third is our people side of the business and ultimately what everyone is doing, how they're doing it, and what their day-to-day looks like.

16:55Fire Nation, a lot of great content here when it comes to utilizing tech in your business and specifically within the restaurant business. And one thing, Daniel, that's pretty interesting is people are using AI for everything. And in the restaurant business, they're using it for something called ingredient forecasting. So first and foremost, What is ingredient forecasting and what are the limits to AI-based ingredient forecasting? Every week, there's a new startup or a new product that an existing startup is launching that is using AI to help with things. So specific to ingredient forecasting, we've been fortunate to partner with a couple of providers that are using AI to help us predict our sales volumes.

17:45And so the way it works is they have access to our sales data at every location. And then using that and also using other variables like weather and holidays and just kind of previous performance, they're able to help us forecast more precisely what we're going to do that day, whether it's in sales, whether it's in bay parts, whether it's in down to the category and ultimately the SKU level. Now, what we do with that information is we take it in-house and we run it through some calculators that we've built out that translate sales down to the ingredient level for alfalfa. So most of what we do at alfalfa is very fresh scratch cooking every single day to make our salads and make all the ingredients that go into our donuts, our breakfast burritos.

18:34We really try really hard to use the highest quality ingredients and stay as far from processed food as we can in doing what we do. And so to pull that off, we try to get down to, you know, how many tomatoes are we going to need today? How much chicken do we need today? And the way we then translate that information to our team members on the ground in our kitchens is we've developed these dashboards that are in our kitchens, which are showing them every single day, our best guess using the AI predictions and just our own analysis of that to understand how much of the ingredient they're going to need.

19:12Now, the limit is it's always wrong, right? I was told something earlier in my career that's true, which is every forecast is wrong. The question is, how wrong is it, right? So we really leave it up to our team to make their best decisions day to day using our forecast as a guide, but certainly not sticking to it. Because ultimately, they're in the kitchen every single day, they see what's happening. And so we really try to make sure that they understand that it's a helpful tool and a guide, but it really is not like something they should rely on, you know, 100 % of the time. And we're also, you know, understanding if we ever get it wrong, and we have to go prep more food in the middle of the day, that's totally okay.

19:53Really, what we're using this whole tool for is to make it better to work at Alfalfa. We want to be the best restaurant as a team member where you're less stressed, you have all the tools at your disposal to be successful. And that our belief is that ultimately translates to a better product, a better experience for our customers. And ultimately, it's going to be the key to our success as we scale. Now, people love overcomplicating everything. Let's talk about how restaurants can simplify their operations? Yeah, absolutely. And I'll be honest, we've probably been fighting this since we started.

20:33A restaurant is so complicated. Every single day, a thousand things can go wrong. And so I think it's something we'll always fight, which is as we scale, continually making it just easier to work at Alfalfa, simpler in terms of the day-to-day things that people are doing. and so my advice would be listen to your people you know I think I'm friends with a lot of restaurateurs and and folks and I think there's some great ideas and you go to a conference and you hear about the latest tool and the coolest new toy to bring into your restaurant and where the rubber hits the road is you you're implementing the thing whether it's a new app or a new piece of hardware and it's your team on the ground that has to do it and all of a sudden if you're asking these folks in the kitchen or with your front facing staff to implement this new way of doing something, but you're doing that times 15, it just gets really, really difficult for any of it to go right or for that person to even be happy.

21:33So we talk to our people. We go to the kitchen, my co-founders and I and our leadership team, and we are like every week just in constant communication with the folks on the ground that are using these tools and working with these systems. And a lot of times we actually, with their help, make big changes in how we operate and how we bring in new tools and solutions. We might kill an idea that we thought was great. We do it all the time. And we're okay with that. Because ultimately, it's what it's going to take, I think, to get to a place where the product is consistent and the customer experiences are fantastic.

22:08And also the team member experiences are great, which is something we believe in. We're always going to have to be tweaking, adding, removing. It's really something that's never going to stop. But my fundamental advice is listen to your people. Go sit down, watch them do it. You do it. You do the thing that you just asked someone to do. And you're going to see that pretty quickly. Maybe it wasn't a good idea. Fire Nation, I hope that you've enjoyed this masterclass on restaurant running, bicosal, utilizing tech, keeping it simple, all that jazz. Daniel, what is the one single key takeaway you want to make sure our listeners get from our conversation today?

22:48Go start something and figure out how to do it in a low risk way, but just go get after it. I think a lot of people try to go raise capital and go like, you know, or talk about doing something and then not do it. And yeah, my advice is go do it, but go do it in a way where you don't have to get huge risk. I think you'll thank yourself for it. I think you'll learn a ton and it's a ton of fun and And it definitely got me out of bed and got me to quit my day job eventually. And I love what I do every single day. How can Fire Nation connect with you? What call to action do you have for our listeners today?

23:23Thank you. Follow us at Ealfalfa. If you're in Southern California or New Jersey or New York, come have a salad and a donut. We would love to show you what we're all about. Fire Nation, you're the average of the five people you spend the most time with. And you've been hanging out with DL and JLD today. So keep up that heat. Links to everything we talked about today are at eofire.com. Type Daniel in the search bar and the show notes page will pop right up. Daniel, thank you for sharing your truth, your knowledge, your value with Fire Nation. For that, we salute you and we'll catch you on the flip side.

23:57Thank you, GLD. Really appreciated you having me on. I appreciate it. Hey, Fire Nation, a huge thank you to our sponsors and Daniel for sponsoring today's episode and Fire Nation. What can 4 ,000 of the world's most successful entrepreneurs teach you? how about how to achieve financial freedom and fulfillment. My first traditionally published book, The Common Path to Uncommon Success, is a revolutionary 17-step roadmap that will lead you to the lifestyle that you've been dreaming about. This book took me 10 years of accumulating the genius of the world's top entrepreneurs, and you can get it all in one place when you visit UncommonSuccessBook.com.

24:34I'll catch you there or on the flip side. business made simple hosted by donald miller is brought to you by the hubspot podcast network the audio destination for business professionals business made simple takes the mystery out of growing your business join my friend donald miller each week as he shares value bombs on topics like the secret to making better marketing decisions listen to business made simple wherever you get your podcasts ever thought of giving a tedx talk it's one of the most powerful ways to share your message with the world and four-time TEDx speaker Taylor Conroy from Thought Leader can help you get there.

25:11Visit thought-leader.com to join Taylor's free training where he teaches you how to land a TEDx talk and spread your message to millions.