Advice Line with Todd Graves of Raising Cane's

Raising Cane’s founder Todd Graves joins Guy on the Advice Line to answer questions from three early-stage founders who are each considering a big, next step to grow their businesses. First, Evan in Texas wants to know if he should franchise drive-thrus for his coffee business. Then, David in St. Louis is trying to get around dents in his financial history to secure financing for his pasta company. And finally, Shane in Los Angeles is weighing the pros and cons of opening a brick-and-mortar restaurant for his focaccia sandwich retail and catering concept. Thank you to the founders of Whiskey Morning Coffee, Midwest Pasta Company, and Vesti for being a part of our show. If you’d like to be featured on a future Advice Line episode, leave us a one-minute message that tells us about your business and a specific question you’d like answered. Send a voice memo to [email protected] or call 1-800-433-1298. And be sure to listen to the founding story of Raising Cane’s https://art19.com/shows/831bd173-0992-41b7-b1eb-112db904d947/episodes/f71b2a3e-2451-4995-817e-77155e5b67e0/embed as told by Todd on the show in 2022. This episode was produced by Alex Cheng with music by Ramtin Arablouei. It was edited by Andrea Bruce. Our audio engineer was Jimmy Keeley. You can follow HIBT on X https://twitter.com/HowIBuiltThis & Instagram https://www.instagram.com/howibuiltthis and sign up for Guy's free newsletter at guyraz.com http://guyraz.com or on Substack https://guyraz.substack.com/. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

• 0:00Speaker 00

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  Hello and welcome to the Advice Line on How I Built This Lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on this show, who will help me try to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-1298. Leave us a one-minute message that tells us about your business and the issues or questions that you'd like help with. All right, let's get to it. Joining me today is Todd Graves, founder of Raising Canes. Todd, welcome back to the show.

• 6:05Speaker 01

  Hey, guy. How you been?

• 6:06Speaker 00

  Great, great to have you back. You were first on the show a few years ago in 2022. A lot of people ask me, what's your favorite episode of the show? And I don't have one because I love all my kids. But I do cite yours often because it was so funny and fun. And I think you remember that. Do you hear from people about that episode now and again?

• 6:23Speaker 01

  Oh, I do. All the time. Yeah.

• 6:25Speaker 00

  Of course, it was so funny. And if you guys haven't heard that episode, go back and listen to it. It's so good. And we'll put a link to it in the show notes. A story about how you had this dream of starting a fried chicken joint in Baton Rouge where you grew up. And you couldn't get a loan, so you worked in oil refineries and in commercial salmon in Alaska. And you basically saved enough money to open the first restaurant and then, you know, it took a while. But of course, today, it's just an unbelievable story. I think I read that this past summer of 2025, Canes surpassed Kentucky Fried Chicken as the third largest chicken quick service restaurant in the US.

• 7:03Speaker 01

  Yeah, you know, I grew up with KFC.

• 7:06Speaker 00

  Right.

• 7:06Speaker 01

  Chicken and.

• 7:07Speaker 00

  Buckets of chicken.

• 7:08Speaker 01

  And the Colonel and the red and white striped buckets. And then just all of a sudden, you're like, wow. You know, it just blows you away.

• 7:13Speaker 00

  You're bigger than the Colonel.

• 7:15Speaker 01

  It's also really interesting, too, our unit count, you know, we don't even have 1,000 restaurants. And looking at the average unit volumes, it's kind of a different way to grow, right? We're just not having smashed volumes, but having the highest of the highest average unit volumes per restaurant. That really adds up. So anyway, sometimes that stuff hits you. And I told the team, well, let's enjoy it. You know, let's enjoy it for a minute.

• 7:34Speaker 00

  I bet. I mean, you know, one of the things I think that you guys have done well and smartly is you've got kind of a hybrid model. You're not a, you're, you're, I think mainly corporate owned locations, but you do have some franchises. And I think overseas, they're mainly franchises. That's harder because you've got this quality standard, right? It's easier in a corporate owned store, but when you've got a franchisee, it's a different ballgame. So what are the ways you're able to, or you guys focus on maintaining those standards when it's, it's not you guys who are directly controlling it?

• 8:07Speaker 01

  Yeah, you know, it's number one is picking a good partner, obviously, right? If you're going to have a, you're going to have a franchisee, you're basically, you know, you're licensing the brand package, you know, the not know how, the training, the. Product knowledge, all those things, but it's their business and they're running it. So picking the best franchisee is so clutch, so clutch. So, so let me give you an example. Mohammed Al Shaya, the Al Shaya Company in the Middle East. That's my partner, been partner now for over 10 years.

• 8:31Speaker 00

  Yep.

• 8:32Speaker 01

  I courted, we talked, Mohammed and I talked for two years before we did something. We got to know each other, we mystery shopped our, each other's brands, right? Look, I spent weeks at a time over in the Middle East and the different regions, seeing all the brands that, that his, his team ran. And I saw the same thing I do at Cane's, you know, happy, happy people, giving good customer service, selling a good product. Uh, integrity, the brand standards were handled well. And then the, I had been in business now with this franchisee over 10 years and we've had no problems. Now, doesn't mean we hadn't made mistakes, but we can work together to make them better because they were the right partner.

• 9:07Speaker 00

  Yeah. You know, one of the things I'm sure you're asked this all the time, and we are too, as a show, it's like, oh, well, what are you gonna, how are you gonna change? How you gonna, how you gonna, what are the radical things you're gonna do? And it's a common question, it's a good question people often ask. And one thing that I think a lot of people fail to recognize is consistency, especially when you've got a strong brand is critical, right? It's actually oftentimes better to double down on what you do well. And I know you cited In-N-Out in our interview, In-N-Out was an inspiration for you because they did a very simple thing. They've been doing the same thing for whatever 50 plus years. You know, very minor modifications, like the double double, but it's like a menu with three things, hamburger, cheeseburger, double double, right?

• 9:45Speaker 00

  And you walk into a Cane's, it's got the one love, it's got the lemonade and the soda fountain, and it's got a very simple menu. So when people say to you, hey, Todd, how are you gonna, what are you gonna do next? You're gonna introduce tacos, you know, chicken tacos and stuff? And you guys gonna do like, uh, I don't know, chicken cheese dip things? What do you say?

• 10:06Speaker 01

  Yeah, I mean, look, I don't get it as much as I, I used to, but, uh, man, just from starting out and going through, even though our sales were of the highest unit volumes, it was literally us and Chick-fil-A, we blew away everybody's suggestions still kept coming in. Knowing from my core and having, you know, seen restaurants that do very well off that craveable product, you know, and staying true to that has had so much to do with our. Success, right? Because the so-called experts will tell you to in the food industry, you're gonna have to change. You're gonna have to add spicy, spicy chicken.

• 10:35Speaker 00

  Right. They're saying, oh, people are gonna get tired of this and you're gonna have to.

• 10:38Speaker 01

  You're gonna get a veto vote. You don't have the variety. And then look, when, when, when the success of Nashville hot chicken, like in Dave's Chicken, you know, growing all over the country and the world. And, you know, even bankers would be like, well, you considering a spicy alternative? I'm like, no, we're not considering spicy alternative because, because our concept is quality food, quality craveable food served with fast food speed and convenience. You know, from speed, if you add choices and you add people thinking in their head, oh, no, you know what? I do want spicier. I do want this. It's gonna add a second or two, second or two adds up. And it adds up to a lot of profitability because as many cars you can get through, they're on low, low margins and high volumes, which you do. Now, let's also think about quality. I have a cook to order process, just like In-N-Out Burger, right?

• 11:19Speaker 01

  You walk into In-N-Out Burger, you see that grill's filled with those burger patties and they're selling that product. Now, if it's slow during the day, you might actually see them put that raw beef down and start cooking. Same at KFC's, right? If you're the first one of the day, you're gonna, you're gonna wait your five minutes. But when we pick up volume, we're, we're having the cooked orders process. We don't have heat lamps. We're selling that food. It's going out hot and fresh. Right? If you added the spicy, now I got two things to cook. You would start doing what the other quick servers do. They start cooking food, holding it in warming bins and assembling it to orders, what they do. So my quality and my speed will go down. So knowing I don't want to be all things to all people. Cause if you try to be all things to all people, you're not really gonna serve any of them very well. Uh, knowing that and staying disciplined to that is what's important.

• 12:02Speaker 00

  I think that's right. I think in a, in a world where there's infinite choices, having fewer great choices is actually an advantage. You think of Trader Joe's, you know, they have 3,000 products compared to a Walmart, which has, you know, 200,000 products in, in their grocery. And, uh, I think people see a Trader Joe's peanut butter and it's like creamy or crunchy. They don't need like 15 different kinds. They know that the vetting's been done for them and that's why they're doing 16 billion in revenue a year.

• 12:28Speaker 01

  Agreed. You know, it's a natural human. Condition to want to keep changing, evolution and growing. It's, it's, it's just in us. Like if you're doing something really well, it's, ooh, you know what would make it even better? I mean, look, it's just for young entrepreneurs, staying focused is so clutch. It's so key. Knowing what you're good at and doing that and focusing your efforts on that is what will make you successful. So like, let me just tell you, me specifically is like not having all these different LTOs, limited time offers, right? I've served the same menu for 29 years now, almost 30 years. If I had LTOs, which might spike business for a tiny bit, right? Something new at Canes. My managers would have to like then be putting up point of purchase materials, getting, training everybody on how you cook this one thing during this small period of time.

• 13:13Speaker 01

  And it would wear them all out, then my customer service would go down because the crew members are a little bit frustrated. And we wouldn't be doing what we do great every day consistently by adding different things to that. So we, you know, same menu served for 30 years, good craveable food and good customer service.

• 13:28Speaker 00

  I love that. And it's so counterintuitive today because, and we've done brand, we've done awesome brands that do drops. Okay. But there's, it's gimmicky. It's like, that's a thing that, that marketers and social media people, that you gotta do these drops. You gotta be on social media and Instagram, hey, this week we're gonna do a raising Canes, you know, whatever, chicken rolled in Doritos. But the thing is, you're right. It's like, that might get you hyped for, oh, a couple of weeks, but it's not, it doesn't necessarily bring in the repeat customers. That's what matters.

• 13:59Speaker 01

  Right.

• 14:00Speaker 00

  Actually, that kind of be great, rolling in Doritos, crispy Doritos, frying them. You might, if you do that, I want my name on that product, Todd.

• 14:08Speaker 01

  You won't have to worry about that.

• 14:10Speaker 00

  Anyway, you ready to take some calls?

• 14:12Speaker 01

  Yeah, it'd be fun.

• 14:13Speaker 00

  All right, let's bring in our first caller. Welcome to the advice line caller. Tell us your name, where you're calling from, and a little bit about your business.

• 14:21Speaker 02

  Hey, guy. Hey, Todd. It's Evan Sledge here. I'm out here in Toler, Texas, and I'm the owner of Whiskey Morning Coffee.

• 14:30Speaker 01

  Evan.

• 14:31Speaker 02

  Yes, sir.

• 14:31Speaker 01

  Evan, how you doing, man?

• 14:32Speaker 02

  Doing good.

• 14:33Speaker 00

  Tell us, yeah, tell us a little bit about the business, just a line.

• 14:36Speaker 02

  Yeah, so pretty much we're a flavored coffee company that uses non-traditional ways to flavor, such as bourbon barrels, barbecue smokers, things like that.

• 14:48Speaker 00

  I love that. Welcome to the show, Evan. Thanks for calling in. All right. So do you know, many years ago, we had Howard Schultz on the show and then I went out to Seattle to the roastery there with him and he gave me, this is like 10 years ago, he gave me a whiskey flavored Starbucks coffee. It was so good. I still remember it now. So I love this idea. How did you get into this business?

• 15:08Speaker 02

  So I'll be honest, we grew up like drinking Folgers in community. So the last thing we thought we'd be doing is coffee.

• 15:15Speaker 00

  Folgers at the church, like through the big coffee, whatever, percolators?

• 15:20Speaker 02

  Yes, sir. But my granddad, he's an old moonshiner. So we have a family distillery. So we grew up making whiskey and bourbon, still do that. And I had to start a business in college at TCU and said I could get ahold of some bourbon barrels. And another kid said he knew how to get ahold of coffee beans and we just started aging it in our apartments and roasting it out in the parking lot.

• 15:44Speaker 00

  So how did a guy like you who grew up on Folgers Crystals or whatever in kind of small town Texas, did you get into, were you into coffee?

• 15:52Speaker 02

  Oh, no. We didn't know nothing about it. We drank it every day. That's for sure. But yeah, we made our first coffee roasters, got some barbecue pits from Tractor Supplies and welded up a drum and definitely just learned by failure. That's for sure.

• 16:09Speaker 00

  How did you know that whiskey barrels was going to make coffee taste delicious?

• 16:14Speaker 02

  We didn't. We heard from a guy that if they keep the coffee in the burlap too long, it'll start to taste like burlap. So that was the only research we had really done. And yeah, we got, we had 320 bucks as a group from the class and we bought green beans off of Amazon and aged it. And luckily, people around school bought it.

• 16:39Speaker 00

  How long ago was that?

• 16:40Speaker 02

  That would have been 2018, senior year.

• 16:43Speaker 00

  Wow. Okay. So tell me where, tell me where the business is now. Do you guys have a store? Do you guys have a shop in, are you in Toler, Texas, you said?

• 16:51Speaker 02

  Yes, sir. So really, right now, we're mostly online e-commerce, direct to consumer. We do a lot of events and trade shows as well as roast for other coffee companies or coffee shops now.

• 17:06Speaker 02

  Last year, it's still me and three buddies. So there's four of us on the team full time. Last year, we did about 924,000, which is

• 17:15Speaker 00

  Wow.

• 17:15Speaker 02

  crazy.

• 17:16Speaker 00

  That's amazing. So what percentage of your business is roasting and what percentage of your business is is selling beans?

• 17:22Speaker 02

  So we're about 60% direct to consumer from the website. Whether it be subscription or just one-time purchases. Um, the remaining 40%, that's either what they consider total roast and for other people or coffee shops or events.

• 17:39Speaker 00

  That's a great business. You've got a nice diversified business. Okay. Before we dive in more, what's your question for us?

• 17:43Speaker 02

  So my question is, we seem to be stalled, stalling at growth and we kind of looked at what we're good at. And it's definitely the customer service, small town deal, word of mouth. And what we're starting to do is build these mini drive-through coffee shops in small towns that, you know, your seven brewing Dutch brothers aren't going to.

• 18:04Speaker 00

  You haven't done this yet. This is your idea.

• 18:06Speaker 02

  We're building out our first one right now that'll open in March.

• 18:10Speaker 00

  In Toler, Texas?

• 18:11Speaker 02

  In Granberry, which is same town pretty much.

• 18:15Speaker 00

  Okay, I'm looking at the map. I see it. So you guys are like an hour or half hour out of Fort Worth?

• 18:19Speaker 02

  Yeah. So it's going to be different because, you know, for us to build our stand, it's going to cost about 150 grand for all the equipment and buildings. It's going to be ran by one to two people. And we're trying to figure out as we start to grow, is there an advantage to franchising and partnering with other influential people in these small towns? Or should we look to grow kind of as our own and grow slowly?

• 18:46Speaker 00

  Oh, man, you've come to the right place with Todd Graves. Todd, I want to bring you in. Do you have any questions for Evan or thoughts?

• 18:52Speaker 01

  Yeah, Evan, so when you just said 150,000, that is, um, that's all in, that's building, um, equipment, everything you need to open up.

• 19:03Speaker 02

  Yes, sir. Besides the, the land.

• 19:05Speaker 01

  Got it. And so maybe you're ground leasing the land?

• 19:08Speaker 02

  Yes, sir. The first one, we're, uh, we purchased it.

• 19:11Speaker 01

  Okay.

• 19:11Speaker 02

  So we're going to own that.

• 19:13Speaker 01

  And you're building a facility. You're actually building a drive-through location.

• 19:17Speaker 02

  Yes, sir. They're kind of like these modular buildings you're seeing popped up.

• 19:20Speaker 01

  Okay.

• 19:21Speaker 02

  But, um, a lot smaller scale. So it's going to be about. Sixteen by twenty.

• 19:28Speaker 01

  Okay, okay.

• 19:29Speaker 02

  And it drive through only.

• 19:30Speaker 00

  And espresso drinks too, or just like, like more like Dutch Brothers?

• 19:35Speaker 02

  So it's gonna be espresso drinks and it's gonna be Tex Mex. So the only food is gonna be tamales.

• 19:42Speaker 00

  Oh, okay. Food too. All right, all right.

• 19:44Speaker 02

  Something different.

• 19:45Speaker 01

  So actually, I kind of, it's kind of funky. I kind of like it. It's, you know, it's our espresso drinks and some tamales. Um, for you, what are you estimating your sales will be at this first, first unit?

• 19:55Speaker 02

  So at the location, we're hoping to do about, I think we're gonna try or get about fifteen hundred to two thousand dollars a day. In revenue and we're basing that off of other coffee shops that we supply beans for in, in similar locations.

• 20:12Speaker 00

  That seems a little high to me, Todd.

• 20:14Speaker 01

  It, it is. But if he's basing it off of other drive-through sales with other coffee shops that they're selling to, it sounds like there are a lot of coffee drinkers in your part of Texas, man.

• 20:25Speaker 02

  Yes, sir. They do. Early in the morning.

• 20:27Speaker 01

  And then throughout the day. And are you basing your sales off the tamale sales too, or no?

• 20:31Speaker 02

  Yes, sir. We sell tamales at the distillery. So that's kind of taking information from ourselves at the distillery and, and Christmas orders, things like that.

• 20:41Speaker 01

  Okay. Well, look, it sounds a little high to me too, guy, but I think, you know, look, a normal Starbucks would be doing a lot higher than that every, every day. Uh, Dutch Brothers, et cetera. So I think that could be achievable. And then do you, just real quick on your margins, last thing I'll ask you. Do you have, you know, financial projections and what's your cost of goods sold margins will be and what you think you'll make on the bottom line?

• 21:00Speaker 02

  So I don't have all of that figured out. I've got, um, the coffee market's kind of crazy right now. So, uh,

• 21:06Speaker 00

  Yeah. Oh, yeah.

• 21:08Speaker 02

  So that part's changing every day.

• 21:10Speaker 01

  Yeah, it'd be good to do some financial projections, right? And you can get those models just looking, just Google it. But I would look at that and your, your labor, your things like that is for opening because you'll know what, where you're tied about and where you need to, where you need to work on to be profitable. Cause that's the first thing you have to do is, man, you got a cash flow. Cause the quickest thing out there. You bought bought this property. You got $150,000 in that. I don't know if you're paying cash or you're financing that, but you're gonna have payroll. You're gonna have vendors to pay. You're gonna have all those things and those payments don't stop, right? So being profitable right out of the gates is very, very important. I made 30 bucks my first month. Which was, which was pretty funny, right? But, but, but what that meant is I could pay everybody and I wasn't going further in the hole. So, and then God, I don't know if you want me to answer the franchising question on this perspective.

• 21:53Speaker 00

  I have some thoughts, but I, I know I'd love to hear your thoughts on it. I mean, you're, you've done this.

• 21:58Speaker 01

  Yeah, I mean, Evan, like I, there's different ways to grow your business, right? And, you know, the first way to grow it is at your mothership, which I call the first raisin canes. All right. You're opening your mothership and learning the business inside and out while you do that. That will be your plan. And then if it's something that's profitable can be replicated, then you gotta look at growth and you can grow, you know, three different models. You could grow all company restaurants. You could grow all franchise restaurants, or you could do a mix of both. Now, I wanted to do a mix of both when I started. So I liked running my restaurants. I felt like I could run my restaurants very well. I like hiring people, bringing them to have new jobs. I like teaching them how to, how to become managers and lead and earn people's money. It's, it's a calling for me.

• 22:40Speaker 01

  And then I, when I'm doing that, I wanted to grow quicker and I couldn't grow quicker without using franchisees in my mind because one, I couldn't have that much access to capital. There's only a certain amount of money I could borrow from the banks. These franchisees had their own money to grow and it wasn't for me about being debt averse. I, I'm not. I would take all the debt on I could. I just didn't have the capacity. So franchisees served, they could grow. And the second thing was I thought that the franchisees, like I picked really good restaurant people, that they would actually be better in their community, being, you know, right down the road of all the restaurants than I would. And so I went that route and I had exceptional franchisees and we grew company restaurants as quickly as we could, you know, as much money as we can get lent and.

• 23:24Speaker 01

  But over time, I saw that the franchisees didn't run their restaurants as good as I did. Okay. And so we'll say a hundred point scale. If we're running our restaurants at a 95, which is like just you gotta care so much to do that. Run 95. Our franchisees were about at 85, which is exceptional in the franchise world because most of them in quick service food run at about a 65, 70. Wow. And so we should be very thrilled about our, you know, about our franchise partners. And I appreciated them because they did care. But that 85 to 95 just drove me crazy, man. I mean, like, it was just like, oh, if you just do this, your customer service will get better. Or if you just did this, the quality would get better. Now, an advantage about company is you can control that.

• 24:08Speaker 01

  Second thing that I thought was inefficient about franchising is we needed to change something that we were doing. Right? Like, here's a better operational procedure. There was so much time you had to talk in these franchisees because it's their business. And they're like, well, we don't agree with that. We think it should be this. And but that wasted time to me that when, you know, we have company restaurants, we can roll something out. Three months later, it's adopted and we roll. The efficiency goes away. So that's there. Another advantage of having your own restaurants, company restaurants is that your valuations are way higher. Right? So your sales, your profitability, your EBITDA that goes through as you grow company restaurants. Just the company's worth so much more, man. Because if you think about it, if you were taking a franchise system, and let's say you were charging them 6% of sales.

• 24:49Speaker 01

  Right? But that's what you're making. Then you have your G and A that's going to the constant support systems, branding, processes, et cetera, et cetera. You're just not going to be worth nearly as much. So I would, if I were you, if you, I would think about some things and questions about. Am I debt adverse? Because if you are, company restaurant model is not going to be a great model for you to grow because you're going to grow and you're going to need to take on more debt and grow. You can do the other franchisees. How, how much is this a baby? And you'll see that in that first year you're opening this, your mothership down the road. If this is something where you're just like, you don't even leave your shift if things aren't right, even though you had a great date planned that night, you're not going to feel good. With franchisees don't might have that same type of passion as yours. So I just would figure out, is there so good or bad to it? It's just a personality thing and really see where you're at.

• 25:33Speaker 00

  I totally agree. And I would, I would say in your case, again, Evan, it's not, I don't know if you can make that decision now. You have to first prove the model, right? You've got to take that store one and just instrument it like crazy. It's just, everything is data in that store. And once you figure out how to make that work, then you open two or three more stores. And you write everything down because to make it successful as a franchise model has to be, you've got to have repeatable unit economics, you've got a training system, there's got to be a brand voice, you've got to have quality control, you've got to have a solid menu, operational simplicity, all of these things. If and only if it works after three to five corporate owned stores,

• 26:17Speaker 00

  then you can start thinking about whether it makes sense. So I think it's a multi-step process. And step one is you've got this great laboratory now in Granbury. And then you can answer the question if and when you get to a point where it does tick all these boxes. Does that make sense?

• 26:33Speaker 02

  Yes, sir. That makes total sense. I think both of y'all just hit it right on the head because like what you were saying, Todd, with the baby part in 95 and 85. We run everything at 105 miles an hour. And if it falls short, that's cool, but as long as you're all out. And I think the franchise model, like you said, people aren't going to do that. And, and that would probably frustrate us. And this really helped a lot and I appreciate it.

• 27:01Speaker 00

  Awesome. The brand is called Whiskey Morning Coffee, Evan Sledge. Thanks for calling in, man. Congrats. Good luck.

• 27:07Speaker 02

  Thank you, guys.

• 27:08Speaker 01

  Good luck, Evan.

• 27:09Speaker 02

  Yes, sir.

• 27:10Speaker 00

  Uh, that's awesome. I have been, I've done some work with a huge quick service restaurant a couple of years ago. And I went to their annual convention and man, the franchisees, they have the power. It's not corporate. You've got a guy who's got 200 franchise locations of this quick service restaurant. Like he's the guy that everybody's got to talk to, not the CEO of the company.

• 27:32Speaker 01

  That is right. Which is the way it should be.

• 27:34Speaker 00

  Yeah. But of course, it can be like Dave's Hot Chicken is an example. They went franchise right away. And that's, that's one of the ways they scaled so quickly. And it worked out for them, right? I mean, eventually they sold the business, but. That was a model that worked for them.

• 27:47Speaker 01

  It is, right? And they wanted to expand rapidly. They want to do it with people that had other concepts and knew how to do it and roll through it. And then ultimately, you nailed it on the head right there. The ultimate thing is they sold the business, right? So what's the quickest to get to scale to sell, right? And so for me is I'm not selling the business. I love the business. I want it to be a generational business and to keep rolling. And the best way to have something I'd be proud of for me personally was to own a company restaurants.

• 28:13Speaker 00

  We're going to take a quick break, but when we come back, another caller, another question and another round of advice. I'm Guy Raz. Stick around. You're listening to the advice line on how I built this.

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• 31:06Speaker 00

  Welcome back to the advice line on How I Built This Lab. I'm Guy Raz. My guest today is the legendary Todd Graves, founder of Raising Canes. And we're taking your calls. Todd, are you ready for the next call?

• 31:17Speaker 01

  Yeah, let's go.

• 31:18Speaker 00

  Awesome. All right, let's bring on our next caller. Welcome to the advice line. Tell us your name, where you're calling from, and just a line or two about your business, please.

• 31:25Speaker 05

  Thank you. I'm David Berwaischer calling from St. Louis. I have Midwest Pasta Company and I manufacture fresh pasta and frozen pasta for restaurants and grocery stores and farmers markets and the like.

• 31:35Speaker 00

  Awesome. Welcome to the show, David. I just went to a delicious restaurant in Nashville and had fresh pasta. So there are restaurants that will sell fresh pasta, but you guys basically are the white label. You make it for them.

• 31:46Speaker 05

  Right, I make fresh pasta for about 80 different restaurants, about 130 different grocery stores, food distribution, hotels, farmers markets.

• 31:54Speaker 00

  So with the exception of the farmers markets, you're B to B, basically?

• 31:57Speaker 05

  Yes.

• 31:58Speaker 00

  Tell me a little bit about how you got into this business. Have you been in food your whole career?

• 32:02Speaker 05

  Yeah, yeah, well, I grew up in restaurants and when I was 25, I had $1,000 on an idea and me and some friends bought a restaurant in South St. Louis and had a small pasta making component. Fast forward 10 years, I had a four-year-old and at that point it went from being 40 seats to 120 seats, 3 o'clock bar.

• 32:21Speaker 00

  Wow.

• 32:22Speaker 05

  And so we sold the restaurant and I took the pasta component with me. And then I had some help along the way and it's been about 13 years since then.

• 32:29Speaker 00

  And give me a sense of what you guys are doing in terms of sales a year.

• 32:33Speaker 05

  Sure, we're gonna be pushing 800 grand this year. I hope to be pushing a million by the end of next year.

• 32:38Speaker 00

  And how big is your facility?

• 32:39Speaker 05

  3,000 square feet.

• 32:40Speaker 00

  Okay, awesome. All right, before we dive in further, tell us your question.

• 32:43Speaker 05

  Sure, so scaling up is something that I'm about ready to do. And I don't have access to traditional capital streams. So I'm trying to figure out how do I finance and how do I get access to capital without sacrificing my equity?

• 32:56Speaker 00

  Okay, before we answer the question, tell us why you don't have access to traditional finance?

• 33:00Speaker 05

  Sure, well, part of the sale of the restaurant had to do with some tax liability and default on an SBA loan.

• 33:07Speaker 00

  Aha.

• 33:07Speaker 05

  So I've been blacklisted by the SBA and I had to take a personal bankruptcy in that transaction. So I don't have bad credit, but I don't have any credit.

• 33:17Speaker 00

  Right, so you can't get a traditional loan because of this default and listen, restaurant is a tough business, even as it's growing, margins are small and so.

• 33:25Speaker 05

  Well, we were also hit by the rather recession.

• 33:28Speaker 00

  Got it, okay. So I want to bring in Todd Graves. Todd, pasta business, 95% of his business is to food services, restaurants. He's looking to expand. Thoughts, questions, concerns?

• 33:39Speaker 01

  Yeah, so David, it sounds like you're doing pretty good, my man. I mean, something to be really proud of, 800,000 in sales right now. And you were saying by the end of next year, you're looking to do 1 million. That's 20% growth right there that you're just doing organically right now is fantastic. Especially at 3,000 square foot. Can I ask you, when you say you want to expand, what does that mean? What is the, how much capital you need to do that growth plan?

• 34:05Speaker 05

  I've got two different plans. The initial plan is about 1.4 million. The further plan is more like five and a half. What that would do is gain me capacity. So freezer space, for instance, is something that is a premium. I could expand my capacity, I could expand my offerings, I could improve equipment. The industry is very equipment reliant. Most of my gear has been on for years. I've been rebuilding and repairing, but a lot of my expenses are caught up in keeping that equipment going and producing. So new equipment, better facilities, and also more marketing.

• 34:39Speaker 05

  I could hire someone to handle more front end things. My focus is on the creation and the production and the quality of the product and managing my team. Not as much focus as I could have on outward sales, internet presence, these kinds of front of the house tasks.

• 34:55Speaker 00

  Quick question for you, does the current demand, David, outstrip your capacity?

• 35:00Speaker 05

  There is more demand than I have the ability to touch. I've actually been approached by national players asking to do co packing.

• 35:06Speaker 00

  Wow.

• 35:07Speaker 05

  And I just couldn't, I just don't have the capacity to hold what they wanted. They were talking about 20,000 pounds a week, uh, which with a larger facility, that's, you know, big players in this, in this industry has nothing, but for me, that's, uh, more than I could take.

• 35:21Speaker 01

  So for the 1.4 million or the five and a half million, I mean, just right off the bat, my, my gut says go the lower amount.

• 35:27Speaker 05

  Yeah.

• 35:28Speaker 01

  Um, because of the exposure, right? Get good traction and roll. So, and David, have you run through those numbers? 1.4 million gets me X amount of more freezer space, this equipment, and that's going to relate to X amount of sales, which means bottom line, I make this so you can measure that return. You've done that?

• 35:44Speaker 05

  Yes.

• 35:45Speaker 01

  Great. Your challenge is, is that you can't get conventional financing, which would be ideal, obviously, right? Uh, right now, be, you've got a proven business model and you need to go get, um, you know, equity types of investments, but you don't want to give up equity.

• 36:00Speaker 05

  Well, I don't want to lose control of it. Yeah, that's what I did with the restaurant. And, um, I ended up with a small slice of big pie. Uh, where currently I have my own, my very own whole small pie.

• 36:12Speaker 01

  Yeah. So there's, you know, there's lots of different ways to finance a business. It depends on, um, what's your, your appetite for debt is, right? What your appetite is for how much equity you want to sell. And you, obviously it's already non-negotiable for you. You don't want to lose controlling interest of the business, which I highly recommend. This is your baby. You started it. You're making it success. Now there's other ways that you can do things. Um, there's, you know, angel investor, uh, networks. And these are the people that, you know, love your pasta. They're very passionate about this and there are people that have enough money put away that they can do investments. Tips to be a part of something, right? Be a part of. Something special and these are generally more favorable. That's why I call them angels.

• 36:53Speaker 01

  Right. And so I got angel investors to help me as I grew the business because I did not want to give up equity. I didn't want to give up control. I didn't even want having other equity shareholders just to have that in my head. Am I doing a good job for them? Because it took me off my focus of what I knew was the right thing to do for our business. And so generally these higher interest rate things. So what I had was angel investors that I would do a 15% interest rate subordinated debt. Okay. It was a one pager and I personally endorse these. I mean, if I personally signed on to it. So they knew anything I had in the world, which is all just tied up the business anyway, back then, that I was going to be 100% into this and but there was no equity being done, but it was a 15% interest rate, but my cash flow could pay for that. So that's why I was asking

• 37:35Speaker 01

  you about that. You run your numbers in that million four and you feel real solid for that. I was able to do a higher interest rate, but they were a part of it. I made them feel a part of the business. They got Kane's gear all the time. They came to restaurant openings and you know, their family was thrilled and we, you know, we went and we put together, you know, photo albums of look, look at, look at how great this Homer, Louisiana new restaurant is and how much the community loves it. And then they made a 15% return, which actually was really good. But as soon as I could pay that thing off, I did.

• 38:03Speaker 00

  And that wasn't convertible debt. It was just a straight up loan.

• 38:06Speaker 01

  Straight up loan. And look, banking back then was a lot, you know, more lenient. I could actually take that subordinated debt and actually use that as equity to get, get loans, traditional loans. But you know, for, for a million four, if you had five to 10 angel investors, you know, that really want to be a part of this and everybody could break off, you know, put in a hundred thousand dollars, put in $200,000. There's plenty of people in St. Louis that do have that kind of money, but subordinated debt, they have no, no voting rights, no anything. They're just like, hey, look, here's this. I hope you can pay me back my interest rate and do that. It's an idea. Yeah. You know, look at anything from a 10% to a, up to a 20% type of like, like that up to mezzanine type lenders. That's a route you could go.

• 38:46Speaker 00

  Right. Yeah. Uh, there are a couple of options for you. So as Todd mentioned, there are going to be local angel investors who are focused entirely on St. Louis makers. And you can find them on LinkedIn, but they may have Facebook groups, a little sleuthing on the internet, you'll find those groups if you don't already know where they are. There are probably even some agricultural or food production grants available in the state of Missouri, I bet. These are ways to support businesses in the state that employ people in the state. There are probably even some food investment groups. So those are all really interesting paths where you can do what Todd did with loans, or you could basically give away some equity, or you could take some convertible debt. The other option, the other idea, which I don't know if you've explored, is you mentioned

• 39:31Speaker 00

  some of these big producers on the coast want to do co-packing with you. Have you explored some kind of strategic financing from them? Where they basically, they do a minimum volume contract, or they commit to a certain amount every month, they prepay it. Or you do some kind of joint venture with them for just one line, right? So they don't own your company, but they co-own one production line. Or even financing some of the equipment through those equipment manufacturers, or they're even equipment lenders. So I think that there are a couple of interesting options for you that don't necessarily rely on traditional financing.

• 40:10Speaker 05

  Yeah, absolutely. And actually, one of the companies that I was talking to is owned by a private equity firm when I did a little digging. Although I have a sense that I'm too small to even sit at that table. I know that venture capital, when I looked into that, it was way higher. The floor for that kind of a transaction was way higher than anywhere close to where I'm at.

• 40:31Speaker 00

  You're too small for that. But you're not too small for, especially for passionate, committed, local. I mean, Todd, Baton Rouge has groups of people who are committed to investing in Baton Rouge, right? I mean, you are probably one of those people today.

• 40:43Speaker 01

  That's right. They want to see St. Louis exceed, and they want to see them do better. And so the community people will invest. I love it, Guy. You said there's plenty of government resources to go into looking at what are grants, what are any of those things going on that you're creating jobs and doing well, you're a proven, hardworking person. And the equipment leasing companies, since you have a successful company, look, it can be higher interest than if you went in and you financed it traditionally, but that's how restaurateurs. Stores like us grow, man. You can go in and get it. It'll be a higher interest rate, but the equipment lending is another really big one. I love the idea of talking to these companies. I want you to come in and do all this pasta for them and just saying, look, here's where I'm at. You know, you're just gonna be, you're an honest guy. So you're gonna tell them, here's where I'm at. I can do this, but I need this. And would you be interested in helping

• 41:26Speaker 01

  me do that? These are all just creative ways to where you don't have to give up equity.

• 41:30Speaker 00

  That's right. There's a lot of creativity that you can build into those conversations. Yeah, great. I don't think you've got a capital problem. I actually think it's more of an opportunity for you to identify those places where you can get the cash from. And it may, it may work out ultimately in your favor. Right, right.

• 41:47Speaker 01

  I agree. And look at the restaurants you currently sell to now. I'm sure they're thrilled with your product. I'm sure they love you because you give them good product. Those are those angel investors, you know, they're doing well and just saying, hey, look, I want to grow. I'd like you to make a good return. Are you interested in this? I'm asking for smaller increments. I'll put together a group of this many people. And look, they start talking, they know each other, they start talking, hey, this is exciting. This is, you know, have them come out to your plant and look, this is what I'm gonna do. And they feel a part of something. And you can do good for St. Louis. I think those restaurant owners you're selling to right now are a good place to go look.

• 42:18Speaker 00

  Hundred percent agree, yeah. David Burmeister, Midwest Pasta Company. Thanks for calling in. Good luck. Thank you. Wow. It's interesting because a lot of people think that once you default or something like you're finished. But it's actually, there are all kinds of ways to find. It's not easy. There's no question about it. But there are all kinds of ways to find, to find that cash.

• 42:38Speaker 01

  Absolutely. Man, that was a good advice, guy. That was some good stuff.

• 42:43Speaker 00

  Stay with us because after the break, we'll talk to another founder working to take their business to the next level. That's after the break. I'm Guy Raz and you're listening to the Advice Line right here on How I Built This.

• 43:16Speaker 00

  Welcome back to the Advice Line on How I Built This Lab. I'm Guy Raz and today I'm taking calls with Todd Graves of Raising Canes. And let's bring in our next caller.

• 43:24Speaker 01

  Yeah, I'm ready. This is fun.

• 43:26Speaker 06

  Hi Todd and hi Guy. I'm Shane Lyons, longtime listener, first time caller.

• 43:31Speaker 00

  Awesome.

• 43:32Speaker 06

  I'm the co-founder of Vestia in Los Angeles, California. We specialize in delivering chef crafted snacks and signature sandwiches made on homemade focaccia to retail partners, offices and corporate campuses, and direct to consumers via web orders all over LA and Orange County.

• 43:46Speaker 00

  Awesome. Vestia, so you make sandwich, focaccia bread sandwiches, you're in LA. Tell me a little bit about where you're, like, where are you selling your stuff?

• 43:56Speaker 06

  Sure. So, we've been on quite the journey, my partners and I. We're just about three years in and we have 45 retail partners that we work with. So Alfred Coffee being one of our most notable. They've got, I believe, 22 locations in Los Angeles and we service 18 of them with sandwiches, as well as gourmet grocers and other coffee shops.

• 44:17Speaker 00

  So you make the sandwiches in like a central kitchen and deliver them fresh every day to these different places?

• 44:21Speaker 06

  That's right. Yeah, we call it like a chef driven factory model because we're all chefs, my partners and I, longtime fine dining boys and girls, and we love great food. We also wanted to make a really scalable profitable business, so we're trying to find the balance of the two and we landed on sandwiches. And the sandwiches we design actually, believe it or not, get better as they sit because of how we've designed them. They're low moisture, relatively high fat due to the nice olive oil that we use. And so they have a shelf life up to, we say three days, but in actuality it's four days where you really see almost no degradation in the product.

• 44:55Speaker 00

  And just really quick, what, you guys are profitable and what's roughly, what are your sales?

• 45:01Speaker 06

  Sure. Yeah, we had our first months of profit in June and July. We are targeting just under a million in sales this year.

• 45:10Speaker 00

  Nice. And you mentioned you were, you were a fine dining chef. Tell me a little bit about your background and why did you, I can imagine why you left that world, but why'd you leave that world?

• 45:19Speaker 06

  Sure. I've actually had dual careers my whole life. When I was a kid, I was a kid actor on Nickelodeon and Disney for many years. And then that train stopped and at 16, I went to culinary school. I went to the CIA Culinary Institute of America. My mom's also a graduate from there. So it's sort of in the blood. And then I worked with some really fantastic chefs, David Chang and Daniel Blued. And then I had the opportunity to open up a restaurant in New York City with my cousin Nicky O'Vikini and legendary restaurateur Drew Neapont. We did that for about eight years and eventually sold the lease to other restaurateurs. So after that, I was sort of beat on, you know, done with restaurants. I was working

• 46:01Speaker 06

  six, seven days a week, back to back lunch, dinner into brunch, all that sort of good stuff that chefs do. And I was burnt out and then found myself working in film and TV again and during COVID. And like many people during COVID, you know, I was going one direction, then I was given a COVID diagnosis. I was supposed to actually star in a TV show and they recast immediately.

• 46:23Speaker 00

  Wow.

• 46:23Speaker 06

  And so I had to regroup and I really spent a lot of time thinking about the background of being a chef and as well as an actor and the things I liked and the things I didn't like from the cultures that I was in. And I was just dedicated to doing something with my friends.

• 46:35Speaker 00

  Hmm. So it sounds like you got your weekends back, basically.

• 46:38Speaker 06

  I do have my weekends and I've seen what a Friday night not at a restaurant looks like and it's really nice.

• 46:44Speaker 00

  Tell us what your question is before we dive in a little more.

• 46:46Speaker 06

  So our question relates to brick and mortar. You know, should we invest in a brick and mortar? And if so, when? It comes up often in conversation. We have internal debates about it. We have some active investor interests and then constant guest inquiries. You know, and our model right now as a chef driven factory allows us to excel at high volume, high quality food production, but it's not currently set up for on demand, single sandwich orders, which as you can imagine, leaves some of our guests really frustrated and potentially turned off from the brand entirely. But given that our model's low fixed costs and high margins, what are the compelling reasons that we should be exploring and investing in a traditional bricks and sticks location?

• 47:25Speaker 00

  Okay, great. Todd, I want to bring you in. Former Michelin star chefs and making focaccia bread sandwiches to offices and coffee shops. But they're thinking about opening a brick and mortar.

• 47:38Speaker 01

  Shane, I'll give you a few things just from my experience. What happens is when you start to have success, you have other influences that come in saying, hey, you're doing great doing this. But you know what? Maybe you should go do this. And that's where I think this brick and mortar is coming. These people are like, your products are incredible and why don't you go do this? And what's worked in my, you know, my passion, my career doing raising canes. It's been being staying focused, right? Focused on I know what I'm good at. I know what I can do to successfully make money, which you have to continue to make money. So for me, the whole thought of brick and mortar, and I'm not saying it's a bad one, but it's a, as you know, it's a completely different business.

• 48:20Speaker 01

  You know, you're still selling your product, but now, now you're the one doing, you know, all the front of house, back of house with people. You're taking on substantial debt doing that. And to me, it's a distraction away from building your current business that's doing very well. You can take that 45 retail partners and you can make a goal to say, we want 90 retail partners. And this is how we're going to go out and do this and double your sales. So my advice would be go for the goals to keep doing great what you're doing right now. Focus on that, make it better. And I would table that brick and mortar thought until after you get that next goal. Let's say it's 90 retail partners. Say, hey, do we really want to do that now and change our focus right now? Because this little guy Todd Graves in Baton Rouge, Louisiana, had a chicken finger dream and stuck with it.

• 49:03Speaker 01

  And now I got a thousand brick and mortars and we're planning on the next thousand, you know what I mean? But if I tried to get into retail line, you know, grocery stores want canes frozen in the, in the, in the grocery stores. Retail, they want our sauce bottle. They want all these different lines. And if I look at all those different product lines, it can take my focus away from doing what I'm really good at.

• 49:21Speaker 00

  Yeah, I, you know, it's so interesting. A couple of questions for you, Shane. I mean, the first is, do you guys do pop-ups?

• 49:27Speaker 06

  It's funny you should say that. I'm actually suited up because right now, we're working at the Midan Market in Los Angeles. It's a really cool hybrid concept, which we kind of consider an asset like brick and mortar. Basically, we have a six-week lease. So for us, you know, we've exactly what you're describing, Todd. It's back. You know, we're there every day. I'm there from 9:00 a.m. to, you know, 11, 12 o'clock at night, and it's full-on six days a week. And it's reminded me of, you know, that I really like my core business. As much fun as it is to interact with guests, we're in hospitality for a reason. We love people. We love to make them feel great. We love delivering on the promise of providing a fantasy, which I think is what restaurants are ultimately there for, is to provide fantasy to some degree and fulfill on that promise. So it's been really nice

• 50:09Speaker 06

  to kind of be in a restaurant for this period, but then we'll be exiting.

• 50:14Speaker 00

  Yeah. I mean, to me, that's a brand-building exercise, which is important because it, a lot of chefs go into catering. It's just more efficient. It's more profitable, better margins. And by doing these pop-ups, right, you're exposing more and more consumers to what you offer. And really, it's the lunchtimes, you know, it's at 500 sandwiches or 200 sandwiches for the lunchtime, you know, offices. That's really going to be your bread and butter. What's interesting to me about brick and mortar is that, and I totally agree with Todd, it's like, do you want to get back into that restaurant lifestyle that you walked away from? I think there's a kind of a happy middle there, which is, is there a world where down the road, it may not happen right away, you basically open up a commissary kitchen that

• 50:57Speaker 00

  is a, like an embassy, right, like almost like a brand embassy, where you, you might have a little counter where you can go in, a little bit of a brick and mortar, where you do offer maybe a window, but really, it's just about putting your brand out there and just building more awareness, but also having a kitchen, your own kitchen, where you're making the product.

• 51:15Speaker 06

  I think that's right. It makes total sense. And we've talked around ideas like that. And we really love the hub and spoke model. We've kind of reversed engineered. A lot of restaurants move into catering because their à la carte sales are lagging. And instead, we've started exclusively catering. And now there's demand for à la carte. So trying to find that hybridization of the two is really what we're looking at now. And we do know that we would like to expand across, at least North America. And there's the internal conversation of, well, can you have a brand that can leave LA and go somewhere else and not have a brick and mortar presence? Is it even possible? And we don't know.

• 51:52Speaker 01

  As far as expanding, right? Now you'll have some aspiring goals. It's a dream. You know, you want to expand across the country. When using retail partners, they need good products, right? And I like what Guy is saying, some of your product having its own brand. It's a pop up in the new area, right? You set up that hub and spoke model. You're going to set up your commissary there and do it great. Some pop ups where people go, man, that's the best focaccia sandwich I've ever had. Using influencers to where people know it's your brand. But I don't think you need to have the brick and mortar. You also run the risk of that brick and mortar not hitting the way you want it to hit. And the retail partners are like, hey, you know what? You weren't that successful in your brick and mortar. I don't want to get your product. You have something that's working very well right now. And I would focus you and your team, all that energy on that and growing that side of your business.

• 52:36Speaker 00

  Yeah.

• 52:37Speaker 06

  Yeah, we've been sort of like a slow growing indie band in LA, but the word's getting out. And like, we can see that the opportunities are sort of everywhere now. And I'm very afraid of the shiny objects. I've been around enough to say most of them are a distraction. And so it's a little challenging to navigate all the different feedback. And we have three lines of CPG goods. I've never had anything on a shelf before. But I'm learning that I really like selling potato chips and I love the margins on them. And people really love our potato chips. So I guess this is really helpful. And what I'm hearing is to stay focused and go back to the core product, which is making sure that taste, texture, and temperature on all of the things that we create are deliver on that promise. Because that's what we can control.

• 53:21Speaker 00

  Yeah, Todd, they do a muffuletta.

• 53:22Speaker 01

  Oh.

• 53:23Speaker 00

  They're doing a New Orleans sandwich.

• 53:25Speaker 01

  Man, that's not easy to do that right.

• 53:27Speaker 06

  Oh, we'll take the Pepsi challenge, Todd. Well, we'll take the challenge.

• 53:31Speaker 01

  I can't wait to try it.

• 53:33Speaker 00

  Awesome. Shane Lyons, a brand is called Vestia sandwiches and snacks in LA. Congrats. Good luck, man.

• 53:38Speaker 06

  Thanks, guys.

• 53:38Speaker 01

  Good luck, Shane.

• 53:39Speaker 06

  Such a pleasure.

• 53:40Speaker 00

  Thank you.

• 53:42Speaker 00

  Yeah, it's, I mean, it's, it's interesting because do you guys, I mean, do you do, is catering a significant business for you? I mean, your, your stores are so packed. So I don't know.

• 53:50Speaker 01

  Yeah, it's, it's really not, you know, it's, it can be up to like maybe 3% of total sales, right? So we, we actually even looked at like when we could, different times and experimented like going out, taking catering to places. And it didn't have the extra manpower to go get that done. Didn't make sense. So now we just make it easily packageable. You can pick it up at the restaurant and, but for us, it's just like stay in our model. Because if you're going after 3% and putting muscle behind that, you're losing focus. You're distracting. And just like with Shane, like him, like we said that too, he said something interesting. He's like, then I can make the great potato chips to go with that. That's still in that same vein. That's a great add on. Your margins are even better on potato chips. But you start doing two different businesses, which it is in that deal. He loses focus. He screws up something that's really working well right now. It is, it happens to all success, right? It's, you're doing great, but, but you could also do this.

• 54:34Speaker 01

  And when you lose the focus, you mess up with what really is your, your concept.

• 54:39Speaker 00

  At the end of the day, I call it God, faith, whatever, Buddha, divine intervention. It's gonna, what's supposed to happen is gonna happen. I think about Stacy's Pita Chips. It started out as a Pita Wrap sandwich place. But people wanted the Pita Chips and then it turned into a different business and you never know. Potato chips, that might become the business.

• 54:56Speaker 01

  You're right, man. It's cool.

• 54:59Speaker 00

  Todd, before I let you go, a quick question for you. If you go back to the guy that was, worked at the oil refinery on the ship and starting the first Canes, right? And down the street from Louisiana State, what advice would you have given him that would have been helpful?

• 55:13Speaker 01

  You know, I think number one would be concentrate more on progress rather than perfection. And, you know, entrepreneurs, when you start something, it's your baby, right? You just, everything's into it. It is, it's about an expression of yourself. And so I want everything to be perfect, right? So we'd be starting a new training program, but I wouldn't release it because it wasn't perfect yet. Well, y'all give me a couple more weeks. You're like, Todd, we need this program. Like two more weeks, I'll get it right. I missed out on a lot of progress just trying to make it perfect. And then some older mentors, they taught me, look, Todd, nothing's ever going to be perfect and progress is way more important than perfection. So get that training program out, but it's version one and you can get to your version 100 that you're going to do and get better.

• 55:57Speaker 01

  I still use that today, you know, here 30 years into the business because I will literally want something to be so perfect and a new marketing campaign and new thing is, and then I'm like, I can't stop progression in our business. Progress, progress, progress.

• 56:11Speaker 00

  Yeah, that's right. Todd, thanks so much for coming back on the show, man. Really great having you.

• 56:15Speaker 01

  Thanks for having me on.

• 56:17Speaker 00

  That's Todd Graves, founder of Raising Canes. And by the way, if you haven't heard that episode, it's so good. I swear to God, if you don't like it, send me a letter, I'll send you a dollar. And if you do like it, you can send me a dollar. Go back, check it out. It's just so good. We're going to put a link to it in the show notes and here's one of my favorite moments from that episode.

• 56:35Speaker 01

  You know, back then we thought you could actually, this is being naive, you could actually go to a bank, bring a business plan and they'd lend you money.

• 56:42Speaker 00

  Here's my plan. I need a hundred thousand dollars.

• 56:46Speaker 01

  Yeah. And I thought they'd give it to you. Isn't this a great plan? Isn't this a great idea?

• 56:50Speaker 00

  And, and so did you do that?

• 56:52Speaker 01

  Yeah, yeah, yeah. Look, we bought a couple of cheap suits and, um, and went to Office Depot and bought boxy briefcases with the brass combination locks. You remember those?

• 57:02Speaker 00

  Yep, yep.

• 57:03Speaker 01

  We went and we went and saw every bank in town. I had a briefcase, Craig had a briefcase and we would put it on their desk, sitting across from them in our chairs and we would open the brass combination lock like somebody was going to steal our chicken finger business plan.

• 57:19Speaker 00

  Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at guyraz.com or on Substack. And of course, if you are working on a business and you'd like to be on this show, send us a one-minute message that tells us a little bit about your business and the questions or issues that you're currently facing, because we would love to try and help you solve them. You can send us a voice memo at [email protected] or call us at 1-800-433-1298. Leave a message there and make sure to tell us how to reach you, and we'll put all of this information in the podcast description as well. This episode was produced by Alex Cheng with music composed by Ramtin Arablouei.

• 58:03Speaker 00

  It was edited by Andrea Bruce. Our audio engineer was Jimmy Keeley. Our production staff also includes Chris Messini, Jacey Howard, Casey Herman, Sam Paulson, Kerry Thompson, Catherine Seifert, Ramel Wood, Neva Grant, and Elaine Coats. I'm Guy Raz, and you've been listening to The Advice Line right here on How I Built This Lab.