Todd Graves 如何打造 Raising Cane's

I was not expecting to start here, Todd. We were just talking before recording, and I didn’t expect to start on sleep. But what you just said is exactly how most of history’s greatest entrepreneurs are: They just can’t stop thinking about their business. I was asking you, “How much caffeine do you take? How much sleep do you need?” And then your answer was what?

I have really erratic sleep. Some nights, I’ll get maybe 3 hours of sleep. The next night might be 3 to 4 hours, and the next night might be 5 hours. Usually, at that point, the next night I have to crash, so I’ll sleep 10 or 11 hours to catch up. Then I’ll wake up feeling great and feel like I don’t have to muscle through the day, keeping myself awake.

Then I’ll be caught up. I’ll go another 3 hours that night, 4 hours, and 5 hours. But what really dictates it is what I have going on in the business, what I have to be thinking about, what might give me a little bit of anxiety about things I have to decide on, the teams, and what I have to work through. My brain will be working as I’m sleeping, and I think it’s trying to figure out solutions.

Then I’ll wake up pretty refreshed, thinking about that problem I had, and jump on the computer in my underwear in the middle of the night. The first thing I’m going to do is start sending out emails to actually solve that problem. But if I get caught up at work and there’s nothing really pressing, then I can sleep like a baby. I don’t have a problem sleeping; I have a problem sleeping when I have real business on my mind.

This keeps recurring in all these biographies of history’s greatest entrepreneurs that I read. I just did this episode on Jiro, the best sushi chef in Japan. The documentary on him is—

Right.

“Jiro Dreams of Sushi.” Why?

Mm-hmm.

Because in his sleep, he is thinking about his work. Then I did this episode on a guy named Michael Ferrero. It’s another family-held business: the Ferrero chocolate company.

Mm-hmm.

He would say that he dreamed up what he called “confections,” which were new products and new chocolates to make, in his sleep. The Michelin brothers did the same thing; they would dream up marketing ideas for how to market tires in their sleep. Leonardo Del Vecchio of Luxottica, one of the biggest businesses in the world, passed away recently. He said he would literally wake up dreaming. He would dream about ideas for his business and have to either keep a tape recorder next to his bed—

Or, in your case, you’re in—

Nope.

Your underwear and you’re at a computer.

On the computer.

Or he’d have a notebook.

Notepad, just to write it down.

It’s very fascinating how you see the same personality type appear over and over again throughout history. We are in the very first Raising Cane’s. You were kind enough to let us record in here.

The mothership.

You’re almost at your 30-year anniversary of running Raising Cane’s and starting this.

Mm-hmm.

I want to ask you a question. I’ve heard you say this before. What was the bad advice these so-called experts gave you when you were trying to start the very first Raising Cane’s?

Having a dream to start a chicken-finger-only concept was unheard of in Louisiana back then. It was a totally new idea. We’re known for our Cajun and Creole food here. At lunch, people could get a plate lunch, some Cajun dish, and that’s what people were used to.

Also, in the industry at that time, McDonald’s and the other big quick-service restaurant chains were adding menu items because they didn’t want the “veto vote,” as they called it. One person in the car might not have a choice at that restaurant, so they would veto the whole car and go somewhere else that had that menu item for their meal. They were also adding healthy items back then.

Starting a restaurant with an idea focused on just one thing—a singular-product-focused menu—was really unheard of at that time. We didn’t have In-N-Out Burger in Louisiana, right? And a lot of people—

But you knew about Harry Snyder.

Not until I went to Los Angeles to work in the refineries. When I went out there to work in the refineries and went to In-N-Out Burger, that reaffirmed my belief that you can do one thing and do it better than anybody else. Then I researched it and started studying the In-N-Out model.

Since 1948, they’ve had the exact same menu. People know what to order when they go in. It took me one time to go there and have someone recommend, “Get a Double-Double, and get it animal style. Get the fries, get whatever beverage you like, and then get a chocolate shake.” That became my same order every time.

When I first went, I kind of held up the order line for a second, went inside, and was done. The next time I went there, I went through the drive-through: a Double-Double, animal style, fries, and a Coke. Then I also went to get that chocolate shake.

Seeing that really reaffirmed that belief for me. Since 1948, you think about how many different burger chains opened up and expanded all around In-N-Out Burger. They added all different kinds of menu items and unbelievable marketing. In-N-Out Burger’s marketing isn’t much. Generally, they put big billboards on the interstate and say, “Here’s where it is. Here’s where we’re at.”

They continue to do well and raise their sales because they stuck to what they’re good at. For me, that really reaffirmed my belief. When I was able to come back after going to Los Angeles to work in the refineries and then going to Alaska, I think that was a big selling point with the banks at that time: being able to point to In-N-Out Burger as a successful chain since 1948. That’s when I got that SBA loan after I raised that capital.

When I did the episode on you, this is where I got really angry, because I read Harry Snyder’s biography. He’s one of my favorite founders. The guy was completely obsessed. There’s a great line in one of his biographies where he lived across the street from the first In-N-Out. He’d work all day, then sit in his living room and watch TV, but he’d look out the window. As soon as the drive-through backed up, he’d get out of his chair and run across the street. He was completely obsessed.

Just like you, he bucked the trend in his industry. When everyone was saying, “We’re going to freeze our beef,” or whatever the case was, he said, “I’m going to have my own butchers.” He said, “I’m going to get the fresh tomatoes.”

That’s right.

He was like, “No, no, I’m not going to do that. I’m all about quality.” There’s a line—they just gave me a tour of the kitchen—that says you guys have a mantra: “Never sacrifice quality for speed.”

That’s right.

He was completely quality-obsessed. If you sit there and think about your business over and over again, he’s the one who, as a lot of people don’t know, invented the drive-through speaker.

Absolutely.

He was like, “How can we do this better?”

That’s right.

Because remember, the prehistory to that was that you had drive-up restaurants.

That’s right.

You didn’t have drive-through restaurants.

That’s right.

So, in that episode, I was induced into a state of rage because all these people were telling you, “You can’t have a simple menu.” I was like, “No! Just go to the West Coast. They’re thriving. They have a cult-like following.”

I went to visit my brother and sister in Orlando. You guys had just opened there; you weren’t in Orlando before. I asked, “Have you guys ever had Raising Cane’s?” This was after I did your episode. They said, “No, what’s that?” I said, “First of all, you should’ve listened to the goddamn episode. Second of all, I’m going to take you to Raising Cane’s.”

I saw exactly what you said, where you said, “I don’t hide. We put Raising Cane’s right next to McDonald’s, a Chipotle, or whatever the case is. I’m just going to do one thing and do it better than anyone else.”

We pulled up, and my brother and sister were like, “What the hell is going on here?” It looked exactly like when you pull into an In-N-Out. They said, “Why is there a line out the drive-through? Why can’t we find anywhere to sit?” We literally had to wait for people to get up. I said, “Just taste it, and you will understand.”

Then I thought of you that day, because we were eating outside. I looked across the street and saw poor old little Wendy’s, and there was a single car—

I know.

—in the drive-through.

Yeah.

I said, “It’s because Todd is obsessed. He wants to do one thing and do it better than anybody else.”

You have to focus on doing one thing and doing it better than anybody else. Since I have that singular-product focus, some people call it a simple menu. I say, “It’s not simple. It’s focused.”

Here’s why it’s not simple: Our chicken has to be exactly right. It comes from the weight of the bird that gives us the size tender we want. It comes from the species of bird that gives the most tender and flavorful chicken. There’s a lot of technical stuff.

There’s rigor mortis on the bone after the chicken is slaughtered. Then it stays on the bone for a certain amount of time. Then you get it fresh. Then you brine it for 24 hours. All those things go into it.

Our fries, right? We have a crinkle-cut fry, but a thinner crinkle-cut fry. You get fries from different times of the year. They do the crop harvest, and it sits in the warehouses.

At certain times of the year, you get more sugar tips in the fries. Those sugar tips have to come out, so we have to remind our crew, “Hey, when you see those black sugar-tip ends, take those out. It’s not visually pleasing.”

Our bread is made by bakeries all over the country, but that recipe has to be exactly right. It’s little dough balls put together and baked together, so it’s pull-apart bread. It’s not sliced loaves. Sliced loaves end up being more stale. This is dense, moist, flavorful bread.

Our coleslaw—we source it all over the country. We have to make sure all those vendors have the right type of slaw that we want, from the right type of growers, grown for a certain amount of time. In that slaw, you have cabbage, but you also have purple cabbage and carrots. All those things. Then you go down to your tea. Our tea leaves come from 3 different countries, but we have to get them at the right time of the year. We might pay more for that, but it’s that focus on those details.

My team can focus on those menu items and deliver them every time so that they taste exactly the same at every Cane’s across the country. Since we’re focused, it’s not a simple thing, but we can focus on those things. We have a large culinary department. It’s not R&D. It’s culinary, making sure that all those products, those raw products we get, are perfect.

It was the same thing when we opened in the Middle East. It took 2 years to get the supply chain just right and make sure it tasted exactly the same. It took 2 years to procure the chicken and 2 years to get all the ingredients right, because a lot of stuff you can’t import. Plus, it’s very expensive for them to import it from the United States, where we currently get it. You have to spend the time to do that.

People would look at that and say, “You should be open in a year. That extra year is going to cost you X amount of dollars.” I’m like, “No, those X amount of dollars are going to make us more money, because our sales are going to be higher, because our food—and quality ingredients and a proper cook system create a craveable product.”

In the food business, I say this to all entrepreneurs, whether they’re wanting to open up or already have restaurants open: Your food has to be craveable. “Oh, my God, I love that chicken parm from Craig’s.” When I go there, I’m like, “I want to go back and get that chicken parm.” The other stuff on the menu is pretty good or whatever. I’ll sample it just to try different things, because I like food, but I want to go back for that chicken parm.

If they didn’t have that craveable chicken parm at Craig’s, I wouldn’t make it a point to go there. There are so many good restaurants and so many great places you can choose from in L.A. There are so many great places that have a good vibe, good atmosphere, and good people. But that craveable product is what brings you back.

If you cut that quality—and I’ve had CFOs over time, not current CFOs, but over time, who have been like, “Hey, if we just cut this just a little bit, you know how much money…” Because it’s a pennies business, right?

Yeah. We’re doing well if we make $0.10 on a dollar.

But if you start cutting a little bit here to save a penny, and you start cutting a little bit here and a little bit here, it’s death by a thousand cuts. Then your food one day is not craveable. That’s what’s happened with so many quick-service chains over the years. They mess with their quality so much, then they lose the craveability. So then it comes down to just being a cheap calorie option versus a craveable meal that I’m dying to go get.

Yeah. The way Steve Jobs would describe that is, you want to make products that people lust over.

Lust over, yes.

You nailed the “craveable,” because I told you I brought my 13-year-old daughter with me today. She’s obsessed with Raising Cane’s, and she DoorDashes it to our house constantly. She’s definitely craving the quality chicken-finger meals.

So, go back to these people who are giving you this advice, like you don’t know what you’re doing. I know the answer to this, but I want to get it on record. Is it just your personality type, like history’s greatest entrepreneurs are all the same? If you tell them that they can’t do something, you get the opposite reaction that you think you’re going to get.

Yeah.

It’s just going to make you want to do it more.

Absolutely. The best thing for an aspiring entrepreneur to be told is, “I don’t think that’s a good idea. I don’t think you can do that. People haven’t done that before. Why do you think you can do that?”

Entrepreneurs have something to prove. They have a vision, an idea, and a passion. If you’re an entrepreneur, you’re passionate about what you want to start. You’re like, “I know this is going to work.” You’re so passionate about it that when someone tells you, “Ah,” and makes that facial expression—“I just don’t think that’s a good idea”—your first thought immediately is, “You know what? I’m going to prove to you that it is a great idea.”

All those no’s that you get, you use that as fuel. It’s entrepreneurial fuel. It’s like putting gasoline on a fire, because you have something to prove.

Later in life, now that we’re established and doing well, I can take those things and not let them fire me up. We still get it at times. Going into different countries, they’ll say, “This mayonnaise-type sauce is much more popular as a dipping sauce. They’re not going to be using your sauce. You need to add that.”

If I would’ve heard that in the early days, I would’ve said, “You wait until Cane’s Sauce gets out.” Now I can say, “Actually, we’ve had the same thing all over the United States.” Ranch was popular out West—

Yeah.

—and different things like that. We went into Texas, and they said, “You have to have cream gravy. You’ve got to have barbecue sauce,” and things like that. But through tried and true, over time, customers love Cane’s Sauce. We want people to have Cane’s Sauce with their meal, not ranch, because it’s not nearly as good with ranch. They can understand that.

You calm down later, after you’ve proven yourself. But when you’re getting started out, it’s fuel.

You don’t seem calm to me.

Yeah, I just don’t have to prove people wrong anymore.

But I can feel your intensity over the table. I’m very curious about this: the hours that you’re working now, 30 years in, compared to the beginning.

I just flew to Austin. I got to spend 5 hours with Michael Dell. Michael Dell is hilarious. He’s been running his business for 41 years. He’s one of the most impressive people I’ve ever met—very calm and measured, but underneath, just a super-relentless person, as you can imagine.

I was talking to him, and I was like, “Hey, I heard you on a podcast one time. You said one of the funniest things.” Somebody asked him, “When you were starting Dell in your University of Texas dorm room with $1,000, and you were going to take on the biggest company in the world at the time, which was IBM, that’s so crazy. How many hours did you work when you started your company?”

Dell’s face was like, “All of them.” He’s just like—

Literally all of them.

“I slept at the office.”

We had a long conversation, because he’s also married and has kids.

Uh-huh.

He was just like, “At the beginning, it’s intensity. But the value is the consistency and the compounding over decade after decade after decade.”

Right.

He’s like, “Listen, I love my business.” Because I asked him. I was like, “Austin in July is not…”

A little bit hot.

“If I had your place in Hawaii, I know where I’m going to be in July.” I was like, “Why are you here?” And he was like, “I just love my business.”

Right.

One of the pieces of advice he gave me for younger entrepreneurs—he’s like, “Listen…”

He's like, “I've seen so much over 41 years. You think you're going to be knocked out by a competitor. You're not going to be knocked out. You're going to sabotage yourself. It's much more likely that you sabotage yourself than somebody else sabotages you.”

Absolutely.

He's just like, “What you want to do is make sure that you're surviving to the next day.” He's like, “I work all the time. Do I work? I'm not sleeping under my desk.” Then he's like, “I have a team around me.” When they say, “Hey, we have an important customer in Japan,” he's like, “Do I actually have to be the one to be there? Are you sure that I have to be the one to be there?”

So his whole point was that, over time, you're still working a lot, but you're more measured. It's not even that you're less fanatical, because you're definitely fanatical, and I want to ask you about your great quote about that. You're going to live to survive the next day.

Right.

How do you compare the hours you're working now to when you started this thing?

When I started up, I gave young entrepreneurs this advice: “Imagine how hard it is to start your business, then multiply that by infinity.” If you're still committed to doing it and you have the stamina to stick with that, then you'll be successful.

Obviously, you have to have a good product and concept, and you have to have something that's going to work to make something go, which is often hard for people to see. The vision of chicken fingers down here in Baton Rouge was like, “Just chicken fingers? Just chicken fingers?” We like our plate lunches. We want variety, things like that. I'm like, “Wait until you have this product.”

Mm-hmm.

When you start up, there are so many amazing ideas by promising entrepreneurs, but they stop, and the world never sees that product or service because it's so hard to open a business, and it's so hard to make that business successful. Then it's so hard to scale that business and grow.

If they just didn't stop, and they knew how hard it was going to be—because they'll ask, “How do you have quality of life and work-life balance when you're starting a business?”—I'm like, “You don't. Flat out, you don't.” You're going to live the business every day. You're going to think about the business every day. You're going to be tired. You're going to be fighting through a bad mood because you're not getting enough sleep and things like that. You don't have it, so you have to be committed to not having it.

Now, once you get your business open, established, and working, then if you want to grow, you're not going to have quality of life then.

Yeah.

Going from 1 to 2 is the hardest step you'll ever have. Then 2 to 6, and 6 to 12, and all those growth phases are there. But I just wish people wouldn't stop when they go.

My hours in the beginning—when we started this restaurant, we were open every day of the week. We were open until 3:30 a.m., except for Sundays, when we closed at 3:00 a.m. When we were closing up, it took us 2 hours to close down.

Yeah.

When we opened up in the morning at 10:30, we had to be here at 8:00 in the morning. You were getting about 3 hours of sleep a night. I had my apartment right back here, and I would go upstairs. During the day, they'd be like, “Hey, go take a nap. Go get a nap.” I'd go get a nap for 2 hours, then wake up and come back to work.

The hours were all the time. It was nonstop. I was young enough to have that stamina, just to roll. Plus, I love this environment. Cooking in this restaurant, it was very important for me to be in this restaurant so you could feel the vibe here, you could feel the soul of—

It's right there.

—this place.

It's just here, man.

You're not separated from your customers.

You're not separated from your customers.

Right here in the middle of this place that I constructed with my own hands. You just work constantly.

Wait, you constructed what with your own hands?

This restaurant. I literally reconstructed all this with my own hands—everything except the electrical, because I literally don't know electricity. But plumbing, I did plumbing. I learned how to do plumbing. I learned how to do minor construction.

When you came in this place, there were a lot of different concepts, college concepts that just didn't work. They had layered on paneling. Even an arcade was here—paneling after paneling. So I ripped off one layer of paneling, and there was a rainbow-striped paneling going down this way because there was an arcade at one time. They had ripped through this old paneling here on the wall, which was actually an Italian restaurant when it started. This was the outside of the building, and they built this onto here.

When I pulled all these things off, I noticed this stucco all down the wall. But there was one little place where I saw brick. I was like, “Oh, man, we have a brick wall.” So I started ripping it out with a crowbar, which left stucco down the side. Then I got here and uncovered this old mural.

I took it as a sign, man. This old mural was an outside advertisement for a bread bakery in downtown Baton Rouge, where we actually started with our first bread at Cane's. I came up with the recipe with the bread purveyors there. Highland Road, going from downtown Baton Rouge through LSU, was the main thoroughfare here.

We took this as a sign. This is how we came up with our logo for Raising Cane's. We took this design. I literally took it as a sign to say this was going to be the Raising Cane's logo. That's what we ended up with.

But I learned this stuff because I didn't have enough money. I got a small SBA loan for $90,000. I raised about $60,000 in equity with original shareholders, and I carried them over a little. They own a little bit of the business today. It's been fun being with them.

I don't even want you to tell me if it's true or not. I want to talk about how you financed the business because it's one of the craziest stories I've ever heard. But I just pray that today there is a boilermaker named Wild Bill who owns a couple hundred million dollars of equity in Raising Cane's because he bet on your chicken-finger dream when you were in your 20s.

He did. But let me take you back a little bit on the start of it.

I worked in restaurants in high school and college. I love the restaurant business. Food symbolized love to me. What that means is, when I could spend time with my mother cooking in the kitchen, she's the one who taught me how to cook.

We cook Cajun meals, so we would make a gumbo. You make a gumbo, you start with a roux, and you add your onions. 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. We're cooking for the family and our friends that we love, so it's about that time together.

Then you make a good gumbo, and you sit down, and all your friends and family are like, “Oh, man, that's a good gumbo. That's good.” They start talking about, “Well, I do mine a little different. I do this,” and those conversations.

My grandmother would make me a pie, a chocolate pie. She'd come visit, and she's like, “I made you a pie you love.” To me, that meant, “I love you.”

For me, restaurants, food, and delivering food are expressions of love. Then there's the camaraderie when you're working in a kitchen and it's rolling, and the drive-through's going, and I can work any position. It's that teamwork.

It's immediate gratification when someone has spent their hard-earned money, given you their money, and looks at that chicken-finger box and says, “Oh, yeah.” That's a good feeling. It's immediate gratification. So much corporate work, administration work, and things like that don't offer immediate gratification. It comes over time.

My favorite job is when I can literally come into the restaurant and just crank out a shift. That, to me, is fun, man. That vibe, that energy.

And you still do that?

Yeah. When I go to restaurants, I'll go visit a market.

Yeah.

I'll go to one restaurant and get all the crew to come there, and we have a town meeting. My main job when I do that is to say, “Thank you. You all are doing great. Thank you so much.” And then, “What can we do better?”

I can get that out of the crew and management. At first, they're 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, the uniform program would be better if we could do this and that.”

“Great, let's get some input.”

You can get really good system-wide things from focus groups with crew or management. You get good stuff from surveys. But when you actually talk, you can pull it out of them—

Yeah.

—a little bit more. With me, they feel comfortable, and then they'll tell me.

Then I'll work with them during that shift, and it's fun because everything goes away. You're focused on delivering a good product and good service to customers right there. It's great.

I was in the restaurant business. When I went to college, I actually studied scriptwriting 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 who had the lemonade stand. I was the kid who was going to cut your grass for $10.

Yeah.

I'd set up Halloween haunted houses at my house, put flyers out, and charge $5 for kids to go through. I knew I wanted to be an entrepreneur, and that's when I got serious about it in my senior year.

I graduated and went to the University of Georgia, but I was from Baton Rouge originally, and I knew I wanted to come home. I had a partner when I started the business, and we wrote the business plan for Raising Cane's. It started off with us calling it Folly's Chicken Fingers. That was the original business plan. Terrible name, but we had a friend whose nickname was Folly. We called each other Folly.

We wrote that business plan, and literally, I wrote the Bible of chicken fingers, man. I knew what our aprons would cost. I knew what the cost would be. I was just a college student, but I knew what college students needed to make, and I knew the environment they needed to work in. I knew what college students wanted to eat and what price points they would pay for it. I knew all these things.

That professor gave me the worst grade in the class, which is classic. The rumor went out that it was a failing grade and all this stuff, but it was only a B-minus. He was actually a simple grader. He said, “No, the plan was great. You gave the most detailed plan in the whole class, but the concept won’t work.”

I said, “Why wouldn’t the concept work?”

“Well, because you didn’t study the industry. We told you to study your industry. McDonald’s has been at it a long time, and they’re the best in the business. They’re adding these menu items. There’s this thing called a veto vote, and people won’t come to your restaurant if Mom didn’t want it. They’re also adding healthy items. Someone’s going to want a salad and things like that.”

You tell that entrepreneur no, and you’re like, “Oh, yeah, wait. I will prove it to you.” People would have thought that would be discouraging. Actually, it was fuel. I thought, “I will show you that this will work.”

So, I took that business plan, bought a cheap suit, went to Office Depot, and bought a briefcase. I thought businessmen needed to wear a suit and carry a briefcase.

You ended up buying a briefcase.

I’m in a T-shirt now. I bought the briefcase.

I had the same one.

Did you?

Yeah.

But didn’t it feel like you were a businessman? You were like, “Yeah.”

I went to school for business. You don’t know anything. It’s like, yeah.

I don’t know, man. You’re going into a bank, which is pretty intimidating, right? You’re looking at these bankers, and you think they know everything. I literally brought it in and unlocked the little safe—the little combination lock.

The all-zeroes? Was the combination all zeroes?

Yeah, I don’t even remember what it was. Something like that. I opened it up and said, “Here’s a business plan for you. Here’s mine.” I put the business plan down and proceeded to talk about this chicken-finger concept I wanted to start at LSU.

Everybody was nice enough. I’ll give them credit for that. They were nice enough to take the meeting, but the banker’s response was, “Just chicken fingers in South Louisiana? That’s not how we eat lunch. I’ve never heard of that.”

I said, “Hold on a second. You order pizza. Pizza’s really popular, right?”

“Yeah, yeah, yeah.”

“You probably order the same pizza every time, don’t you? What do you get?”

“Well, I like pepperoni,” or “I like whatever.”

“You get that every time. This meal is that flavorful and craveable. You’re going to want to get this meal over and over.”

“Yeah, but you don’t have years of management experience. You probably should go work for Brinker for 10 years. Then you’ll really know the business, and you’ll have some money. Then you’ll be bankable at that point.”

They said, “Because you have no money, right?”

I said, “No, I don’t have any money.”

They said, “You can’t get a loan. You can’t just get a 100% loan.”

I thought you could do that. But with every no I got—and they were nice enough, I’ll give them credit for that—I thought, “I need to go make money myself.”

Through a friend of a friend, I got a job as a boilermaker working in refineries. Louisiana has a lot of refinery work. It’s turnaround shift work.

But this is superintense work. This is like 95 hours.

It is 95-hour workweeks. They’ll shut down a certain sector of an oil refinery, and they’re missing out on production, which is just big money they’re losing. They’ll pay whatever it takes to get that thing back up and running.

You go in and fix things, put new equipment in, and things like that. You work 95-hour weeks and work straight through. There are no days off. There’s nothing. You just work straight through.

There’s overtime, double time, and some kind of crazy thing that goes into another level. You can make a lot of money in a short period of time.

That was the first group that was encouraging to me in my chicken-finger dream because they could see me working hard on something. I didn’t know what I was doing, but I was willing to do whatever, earn my money when I was out there, and take on any job. They were like, “Todd, you’re going to…”

Well, they called me Hollywood. We all had nicknames. There’s an interesting story about the Hollywood deal, but we’ll leave that out.

They were encouraging. Wild Bill Tolar—we all had nicknames—was like, “Hey, Graves. Hollywood, I see you’ve got what it takes. But if you really want to make some money and you’re not afraid of hard work, this is a really dangerous trade. I fish in the summers—commercial fishing, sockeye salmon in Naknek, Alaska.”

He said, “You can go up there and get a job, and you can make a lot more money doing that than you can boilermaking.”

I said, “What do I do?”

He said, “Basically, get up to Naknek, Alaska.”

I said, “Where is that?”

He said, “Above the Aleutian chain.”

I looked it up on a map. Back then, you couldn’t look it up on a computer. You actually had to pull out a map and buy an Alaska map.

I caught a plane to Anchorage, then a floatplane to King Salmon, Alaska. I hitchhiked to Naknek, Alaska. There was no Uber back then. I literally hitchhiked in and 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 go around to the boats asking for a job. You’re basically a greenhorn. It means you’re a rookie out there.

You have to convince them to let you on their crew.

You have to convince them that you can get on the crew. They’re looking for help. Just a few of the boats need someone. Most people are fully staffed, but a few of them needed a greenhorn they could pay a lot less. You get a smaller cut of the take from the boat.

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. You couldn’t keep going out to get the salmon. The salmon are born in a stream, they swim out to the ocean, and sockeye salmon live out in the ocean—beautiful silver fish—for 5 years. Somehow, in 5 years, they know it’s time to swim back to the original river, go up and spawn, and then they die. It’s a crazy cycle.

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 was a LORAN line back then, and you couldn’t cross that line.

If you set your net—this gill net—in front of another boat’s net, you’re going to catch 3 times as much because you’re catching the first fish coming in. These captains make their entire income during the summer, so they’re heavily motivated to catch that perfect set in front of the other boat.

You play chicken. Literally, somebody veers off at the end, somebody chickens out, and sometimes you don’t. We rammed boats. We got rammed. It was crazy.

We’d catch so much fish. We were out in 6-foot seas in a 32-foot boat, and the back of the boat would get weighed down so much with salmon before you could unload them onto a tender boat out there in the ocean that you’d literally be getting waves over the side. Some boats sank. It was just unbelievable work.

We worked 20-hour days during the peak of the season, which is about 2 to 3 weeks. When you work 20-hour days, you only get a nap here and there. You get an hour—“Go take a nap real quick”—or you get a break to eat real quick.

You’re so exhausted that you stop being careful. People were thrown out with nets. They wouldn’t hold on to the boat when it got into a bad wave, and they’d crack their heads or skulls open.

Imagine this: You’re out there fishing, getting rammed by boats, picking fish, and you hear on the radio that somebody just got scalped. I heard that. Scalped. I don’t know how they got scalped from the boat. Medical helicopters were going in, National Geographic was coming over and filming the boat action, and I was out there for this chicken-finger dream.

Nothing was going to stop me from doing it.

And sure enough, I made good money doing both boilermaking and working in the Alaskan fishery. I came back and lived off credit cards because I had no other income.

Before we get there, there's this recurring theme in all these biographies. There's a story just like this. Your story's pretty extreme, and you tell it in a wonderful way. The way I summarize this is: How bad do you actually want it?

You have to ask yourself, if you're going to compete against Todd Graves, are you willing to work 95 hours a week as a boilermaker after you buy your suit and your briefcase, and they're like, “Get out of here, kid. We're not giving you money”? It's like, “That's fine. I'll find another way.”

Ninety-five hours doing shift work as a boilermaker. You're going to take a flight to Alaska, you're going to hitchhike, and you're going to live in a fucking tent.

Right. For a month, before I got the job, by the way.

Trying to convince captains of boats that you could die on to hire you, then doing that and working 20 hours. And the entire time, what I love about your story is, “I'm not thinking about sockeye salmon. I'm thinking about my chicken-finger dream.”

Exactly. I would have worked construction in Nebraska if that's what paid. I love the fact that I went to Alaska and did that, and did something as cool-sounding as being a boilermaker, right? But I would have worked—I would have gone and knitted blankets—

Yeah.

—if that's where the money was. Anything I could do to make the money, because I was determined, man. I was like a nerd in the entrepreneurial club in college.

People would start up businesses and say, “Hey, I got this. I steam-clean floors. I do these different things.” I saw some of these entrepreneurs have these really cool ideas, and that's when technology was really rolling, but they would just stop. Over the couple of years in college, they'd be like, “I just don't think I can do that,” and I'm like, “That's the key, man. When you set a goal, you do it to success or failure, but you don't stop.”

You don't stop. With my original partner, we went on a camping trip in North Carolina. I'm like, “We need to make this happen. We're going to go in, we're going to camp, and we're literally going to commit to this.” You set an oath that you're never, ever going to stop, then you don't stop. During that time, those 2 years it took me to raise money for this—

Wait.

2 years.

Tell me. 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're 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 we have to do. So wait, you went on this camping trip to make an oath?

Yeah. He was literally—

But he gave up.

Yeah. It was literally to say, around a campfire—I mean, we did everything but become blood brothers—to do the deal. It was like, “We're going to do this, right? We're committing to this. We're going to make this happen. We're going to see it through, and if somehow it doesn't work, we're going to die trying.”

And literally, he put that on the line by going out and fishing in Alaska. People died in that fishery. God bless them. But yeah, that's just how it was.

I think another thing, too, is when you have that relentless focus. During that time, I came up with a quote, man. I was like, “Nothing ever happens unless someone pursues a vision fanatically.” You have to be so fanatical when you have a dream that others don't believe in and you see it, but you have to be fanatical. Fanaticism is what carries you through.

And so I see this fanaticism, and I study people, right? Like your podcast, I hear things and I'll get reaffirmed with things, then I'll learn new things—new ways I can look at things and do them.

High five, man.

Yeah, man.

There we go.

It's great. I like it, too, because you can learn from it and get inspired by it once it's established, because you need that fuel to keep rolling. It's good to hear other people are doing what you do, and then you learn from other people. I'm constantly a student of the business.

You learn things from businessmen and businesswomen, but for me, too, I love to be around celebrities—people who are successful, whether they're entertainers, actors, or athletes.

Athletes.

Whether they're athletes, they all have this common core. You know what I see as the most common core of all the people who are successful? For me, 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. You say “never satisfied,” and it's like, “You all aren't happy with what we did with this opening?”

No, no, no. So we changed the wording from “never satisfied,” and it's just like we're always going to raise the bar. We did great at that opening. That was awesome. These were all the good things we did. But you know what else? These are some of the things we can get better at.

We can actually get 2 seconds faster, and this is how we're going to do it. Look, we needed to staff more. We messed up here. We didn't give enough support because we wore out our crew. We should've had more crew members on staff.

Yeah.

You can always learn. I see that with people, and I see it with the best athletes. I see it with the best actors. It's just like, “That film was good, but I could've done this better. I could've done that better.”

Yeah.

If you don't rest on your laurels, 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 just like, “We got other people that are gunning after us.”

You said the funniest thing. One, I think one of your most important messages is that we need more founders who refuse to sell their businesses.

Yeah.

There's this huge entrepreneurial industry that didn't exist, especially when you were starting your company. The entrepreneurial industry is influenced by investors—

Right.

—not entrepreneurs.

Right.

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.”

Right.

And now you've just sold the vehicle that you create and do your creating in.

Right.

And so then what? Then you're working on your second-best idea or your third-best idea.

Mm-hmm.

And I think one of the most important ideas that you have is that everybody in your business—the reason I said this on the episode I did about you—is that Todd's smoking them because he's competing against corporations. Who are the founders in your business anymore?

That's right.

They're either dead or they've sold out.

Right.

And then I love—somebody asked you the question: Out of the competitors, who gets you fired up or maybe will keep you up at night? And you're like, “They may never 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 who has that fire in his soul and wants to do exactly what I'm doing. You're like, “That's fine, but you have to understand, this is what I do. This is in my DNA. This is how I feed my family. So if you want to come, just understand I'm on this 24/7, all the time.”

And you're going to be there.

You better be ready. You better be ready, because I'm coming after you. I just saw you at the UFC. Are you a UFC fan, or are you—

Yeah. I like all sports. Dana invited me to come, and I got to see Poirier do his last fight—a Louisiana legend, man.

It's the same personality type. The reason I brought that up—

They're going at it.

—is because earlier in the conversation, you were breaking down the species of bird and the amount of detail you just explained to us.

The thought I had in my mind was not about chicken fingers. This is an important point you're making. It's the same personality type, just pointed at a different endeavor. Jon Jones is probably the greatest UFC fighter.

UFC is the only sport I'm obsessed with, and I watch all the time because I don't have time to watch anything else. But I can watch 1 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. He was fighting Ciryl Gane, studying him just like you and understanding the detail. He's like, “I know what he does when he wants to go left and when he goes right and everything else.”

He goes, “I assume that this guy's trying to destroy my legacy and trying to take the food off my family's table.”

Yeah.

“And I will not allow that to happen.”

That's right.

The same level of intensity that you're applying to your business.

Absolutely, man. If I got somebody who's coming to compete—you're competing with me, and my livelihood, my managers, and my crew members depend on this restaurant, right? You're coming in, and you're going to open up across the street here. People feed their families off this.

If we're going to go at it, you better be strong, because we're not going to give up, man. I've done this for 30 years, and I'm just as fired up as I was the first day.

Like it never leaves you. It's a blessing that entrepreneurs have because when it's so hard to start your business, you gain a great sense of appreciation: appreciation for your crew who are working so hard beside you, a great appreciation for customers coming in and paying their hard-earned money to do this, and appreciation for communities that embrace you. That sense of appreciation, which is what our culture is all built off of—100% appreciation—never leaves you. You always feel appreciative, so you always want to take care of people.

People come in and say, “Oh man, you just have to sell the business. It's worth all these billions. You can just not worry.” I'm like, “Yeah, well, then what happens? What happens to my management? Who's supporting their families? What happens to the crew members that come up?” If I sold the business, do you think they might have the same values? It would be really hard to find a buyer that would have the same values that I do, that I believe in, and that has that deep sense of appreciation.

They bought it for this. They want it to be worth this because they're probably going to sell it themselves. They're looking at it as an investment, not a vehicle to help people. I think when entrepreneurs get successful, grow the business, succeed at growth, and create something, it goes to another level. It goes from fanaticism and passion and a dream, then you get purpose.

My purpose with Raising Cane's is, well, God made me good at chicken fingers to help people. What I mean by that is I have 75,000 crew members. We have so many part-time people who work. I love part-time, quick-service crew members who come in. We have an opportunity because most people's first job is in a restaurant or retail. They get to come in and learn values, man.

Mm-hmm.

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, and we're going to deliver that craveable chicken finger box.” Why? Because people are spending their hard-earned money here. That's why we're going to do that. And what we're going to do with the money that we make, we're going to help out our communities. We're going to give back to people.

As we scale this business and it grows, this thing is getting into the billions of dollars in value. Someday, when I clear debt—we're looking at $3 billion in debt now—eventually, with our growth, God willing, we'll be able to pay down that debt. When I have this free cash flow coming out, 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 the purpose, man. You start realizing it's not what you make; it's what you give. That's a better way to keep score. When you have that purpose, I want people to keep that purpose, because too many great restaurant entrepreneurs and founders of businesses, especially in the restaurant business, sell.

They're so passionate about it, and they talk about it like, “Man, I have the passion and I love what I do.” 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 $5 million or $10 million because entrepreneurs put everything back into the business, growing it.

They prove it in a successful model, either regionally or in different regions of the country, which then makes it national. Multiples go up, and they're like, “Hey, we'll come in, we'll give you $5 million or we'll give you $10 million.” But they take control of the business, and these entrepreneurs are like, “Oh my God, we've struggled so long. We're still living within our means. I have debt. I have all this stuff.” They sell, and then they lose control of the business.

If you're in private equity, private equity serves a lot of good purposes, but it also serves some bad purposes. It takes founders out of the deal, and so decisions get made differently. A founder is powerful because, for a founder, it's their baby. It's personal to them. It's personal.

Even today, I read customer comments. Look, we don't deliver every time. We will screw up. We'll have somebody who was rude, or we'll have something that you didn't like. I take it personally. My family, I take it personally. I'm like, “You spent your money here, and we didn't deliver on that promise.”

I don't know if private equity really cares because it doesn't affect overall sales. It's a small percentage of what we're doing. But it's personal to you. Your crew is personal to you because they're working their ass off to fulfill your dream. You're sitting there in a good financial position, but they're busting their butts. Management's busting their butts. Crew members are busting their butts.

I know when I'm working at 3:00 AM and I'm tired, I'm going to bed. I know there are crew members still closing up somewhere around the country. Somewhere around the world, somebody's closing up that way, and it's that appreciation. When you lose that founder's personal connection—that it's their baby—you start making the wrong decisions. You really do.

Private equity has its shareholders, and it has to make a certain amount of money. If it's not getting the returns on its dollar, it will make other decisions. Maybe it raises prices, and maybe it's not the right time to raise prices. Maybe it cuts quality, maybe it cuts wages for the crew, maybe it doesn't do the bonus program. The programs aren't as good as the year before. All those things start to make the business not special.

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, and bring in other people to help you with the things you need help with. Learn it and do it. Private equity can come in and say, “Hey, look at the staff 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. You can figure that out.

Bring in some great people, stretch yourself, hire those people, bring them in, and learn the details yourself. I'm not good at IT, but I know enough to work with great people and still add value. I just wish founders would hold on. Don't get rid of it, man. Why would you? If it's something you're so passionate about, find that purpose.

I think that's one of the most important messages that we could possibly get out there. Here are 2 things. I have this idea, this maxim of an anti-business billionaire, which I'll get to in 1 second.

What I'm trying to do is bring attention to exactly what you're talking about. We celebrate the sale, but we don't ask what happened to the guy for the rest of his life. Is he still happy about this?

Trader Joe's, right? The founder of Trader Joe's—his name is Joe Colombo or something like that. I can't even pronounce his last name. He did such a wonderful service to future generations of entrepreneurs because he wrote an autobiography that's excellent, and he tells the story of Trader Joe's.

90% of the book, okay, he wound up selling Trader Joe's in the 1970s. He lives for another 40 years. 90% of the book is this guy 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 and all the different ideas. He has the same personality type that you had, right?

But he made the mistake that you didn't. He got scared. There was a bad economic climate. He wound up selling, I think it was to Aldi, which still owns the business today, if I'm not mistaken.

What's fascinating is, just look at the time and effort he dedicated to Trader Joe's in the book. Then the last 10% is, “Yeah, I invested in some real estate. I did some consulting.” It goes from, “This guy is fired up every day—”

Yeah.

“I'm in love,” to, “I sold my baby.”

Yeah.

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 Coulombe.”

Wow.

Okay? That's the last page. The book is published, and he dies the same week.

That gives me chills.

Think about that.

Yeah.

He's like, “Don't do this. I wish I had the courage. I wish I wasn't so scared. I wish I had just stayed in.”

Yeah. What a good man to just be honest, right, to everybody: “I wish I didn't do it.”

Because he wants to inspire people not to make the same mistake.

Paul Orfalea, the founder of Kinko's—I did an episode on him, too. He thought, “Oh, I sell for billions of dollars. I'm a success.” He's like, “I can't even go in the store. I can't look at it. I got the money, but I don't have the purpose.”

I love the word they used: purpose. This is something I'm trying to draw attention to on Founders Podcast: these anti-business billionaires. They're not in it for the money.

Somebody like James Dyson, Steve Jobs, or Yvon Chouinard from Patagonia—these people are so obsessed with the quality of the product they’re making. That is the main goal: “I’m going to make the best product in the world.” Then they retain control.

The point I make on this is that one of my favorite maxims from the history of entrepreneurship comes from Henry Ford, who also owned 100% of his business. In 1919, he owned 100%. He bought out all his old investors and owned 100% of Ford Motor Company. It’s equivalent to owning a $20 billion company today. He said, “Money comes naturally as a result of service.”

Which is exactly what you said.

A hundred percent.

Stop fucking worrying about the money. Can you make somebody else’s life better by doing an act of service? Then keep doing that, and figure out a way to scale up to serve more people. Guess what? The money will come automatically to you.

It will come.

So the anti-business billionaires are obsessed with the quality of the product they’re making, and they retain control. If you’re obsessed with the quality of the product you’re making and you retain control, you wind up with the money anyway.

Absolutely. If you do things for the right reasons in business, money will come.

Yes. A hundred percent, money will come. It’s sales-driven. Do you want to be profit-driven, or do you want to be sales-driven? Sales cure all woes.

You can raise your sales, and we’re number 2 on average unit volumes in quick-service restaurants. It’s Chick-fil-A, then us, and I think McDonald’s might be $1 million behind us per unit, per restaurant. A lot of our competitors are doing a third of what we do in sales.

But if you’re sales-driven, you’re going to do exceptional customer service. You’re going to have more people on shift rather than cutting it shorter to try to save labor. You need the highest-quality products to be craveable. All those things lead to more sales, more happy customers, more repeat business, and more volume. You get the volume, you get the 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 like, “No, no. Over the long term, if you put the interests of customers first, that is in the interests of the shareholders. It just takes longer, but that’s where you actually create the value.”

Absolutely. Serve the customers, and then your shareholders will make plenty of money.

The dollars will come.

Yes.

It’s proven time and time again, and I’m an example of that. When you talk about entrepreneurs getting to a certain point and getting scared at certain times, a great example is Tony Tan Caktiong, who had Jollibee.

Jollibee is a Filipino concept, and he explained to me that he was an engineering student. He said, “Look, if you were a smart Filipino kid, your parents were like, ‘You’re going to be an engineer.’” He said, “I hated engineering. But one time, I went and looked at a dairy to see the engineering behind making dairy products. They had a little ice cream shop up front, and that’s what I was interested in. I was watching them make the ice cream and run the register.”

So he started an ice cream shop. Then he added a burger, then he added spaghetti—a crazy, crazy menu—and it became a success. He opened that one little ice cream shop, turned it into a restaurant, and then started growing it.

He said, “My goal is to be the largest restaurateur in the Philippines.” So he set that goal. He had this fanaticism.

All of a sudden, McDonald’s announced, “We’re going to the Philippines.” They saw the success he was having selling all these burgers, and his accountant and financial people were like, “You have to sell. You have to sell. This concept is amazing. McDonald’s started in the United States. They’re just going to blow us away. Sell now. You’re going to make all kinds of money. You can live the rest of your life and be happy.”

He said, “No, I won’t be happy. I like what I do.” Then he said, “What do I do? It made me nervous as hell.” That’s what being a founder will do. They were showing him what could happen if McDonald’s put him out of business. He could be a millionaire, or he could be worth nothing. They could put him completely out of business.

He said, “You know what? I’m going to set the goal: I’m going to beat McDonald’s. I will still be the largest restaurateur in all the Philippines.”

Well, he did that. McDonald’s came in, and he blew them away. He grew throughout the Philippines and became the largest restaurateur in the country.

He set his next goal: “I’m not stopping there. I want to be the largest restaurateur in all of Asia.” Think of all of Asia. He did that. He acquired other restaurants and became the largest restaurateur in Asia.

Then they asked, “What’s the next goal?”

“I want to be one of the 5 largest restaurateurs in the world. This is what I want to do.”

These are the big boys. This is McDonald’s and all the big ones. That’s his next goal. But that fanaticism keeps him going instead of getting scared.

It’s okay to be scared. It’s actually a good thing. But then say, “I’m fanatical. I’m going to beat it. I’m going to see it through.”

I wish more entrepreneurs would do that, because so many things out there can scare you. So many people are going to tell you to give up. 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 an idea. That’s the hardest part. Don’t give up now. Go, go.

You don’t need those other things, because if you lose your baby, you lose your purpose, and then you lose your purpose in life. There are other things to do, but they’re not your passion.

Let’s go back to how you were financing this one. Then I want to go to how you financed the next 28 in that insane story. You got the Wild Bill money, the refinery money, and the sockeye salmon money. Now you’re playing credit-card roulette?

Yeah. But I had to do that the whole time after I graduated.

Yeah.

I bartended at night while we were working on the business plan. Then, trying to start the business, I literally didn’t have any income. I was living off bartender money from tips at night.

Back then, you could get credit cards with interest rates of 18% to 22%, and you could get as many as you wanted with $5,000 limits. That’s what I did. I just sent in, “Yeah, I have a job bartending.”

They’d say, “Okay, well, sure. Here’s a $5,000 credit line, but you’re going to pay 20% to 22% on that.” So I lived off of that.

I had enough money of my own to live off of and put into the project. At that point, I was able to raise some preferred shareholders. I raised maybe $60,000.

So these are what you would call angel investors today?

Yeah. These were my bookie—well, guys I worked boilermaking with.

Hey, bookies got cash?

Yeah. It was, “Can you take this $10,000 investment in cash?” I’m like, “Sure.” When I got to the bank, I was like, “It came from my investor.”

I was able to raise that, and I was able to get a $90,000 SBA loan.

Mm-hmm.

It was enough money for me to come in. I had this place at the north gates of LSU. I had a wonderful real estate broker, one of my mentors, Mr. Red Reynolds.

This place had turned over so many different times. He said, “I want the landlord, the landowner, Tulula Arbor—she was 94 at that time—to have something solid. I believe in you. I believe in your fanaticism. You will make this work.”

So I told her to hold it, and she basically held the location for a year for me.

How impactful were those words of encouragement? Because you’re young.

Somebody you respect who was just a good man and a really good real estate broker—I really respected that. It was an affirmation of why I was being so fanatical in trying to talk everybody into it. He believed in me.

I’m like, “Okay, okay. That’s a little wind in my sails to do this.” I basically told her, “Hey, it’s going to take me a year to put all this together, but I believe I’ll do it, and then I believe you’ll have a long-term tenant.”

Sure enough, we’ve been here for almost 30 years, and we have a 100-year lease going forward. She passed away, but the family has said, “We just have pride in this, so we’ll keep doing a lease. 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 stores?

Wherever I can. Absolutely, wherever I can, I do. This is good, A-quality real estate. There are just so many people who own it. It’s part of larger shopping centers and larger developments. A lot of it is in trusts—family trusts and things like that. But every one I can buy, I buy.

Absolutely. They won’t sell you this one?

No. They like being a part of it. But I got a good lease term here, plus everything I put into this place.

Look, I had to learn things. Like I said, I had to learn plumbing, and I had to learn construction. I had to learn these things because I really didn’t have a lot of money to come in and spend on this.

But this place is sacred, man. I can tell you every square inch. Later on, after we get done with our discussion, I’ll show you all these little points in this place.

This is original furniture. I got a U-Haul and went around to all these equipment supply stores.

I hope you have bedsheets that look like this somewhere.

That’s a damn good idea. Maybe some pajamas, too, right? But it means something, right? Keeping this like this, I can bring management here and show them this place. We have pretty buildings—everything is functional—and they come here and go, “This is our soul. Just remember, this is where we started, and we have to keep that spirit going here.”

Dude, the one in Miami Beach by my house looks like a nightclub.

Yeah, yeah. I just like living the deal. I love that location.

It’s huge. So, credit cards and SBA loans. You said it took a year for the development of it. So, you had the lease before you opened it?

So—yeah, yeah. No, really, he didn’t sign the lease and doesn’t hold it for you.

Okay.

Right? But this location was available, and I knew it was going to be awesome.

Okay.

It took 2 years—2 years from the business plan to when I actually opened the restaurant. It took me 2 years. It was literally from writing the business plan in class, going to the banks and getting turned down, working in refineries, then working in Alaska for the summer, and coming back that fall. We opened in ’96, so that would be the fall of ’95 when I got back.

I had some money on the deal. I went and got that SBA loan and got the investors. From there, we started the construction process and started getting the used equipment. For the equipment, I went into Houston and Dallas restaurant supply houses, because restaurant businesses go out.

Yeah.

9 out of 10 go out of business. I could go buy stuff, and I’d be like, “I need a fryer that’ll work for 60 days. Give me your cheapest fryers.” They had to be 85-pound fryers, and they’d say, “Well, this one’s good.” I’d say, “Yeah, that’s 10 times as much. I need something that lasts, because I know as soon as I prove this will work, I can get another loan.”

Okay.

Thank goodness we made money, and when we opened up, I was so excited. We reconstructed everything, and we were ready to open up. We got registers at Office Depot. They were these little registers, and once they figured out how to program them, I went and started waving people into the restaurant.

People came, and people liked it. I mean, we made $30 the first month. That’s what we made. People were like, “That’s all you made?” I’m like, “No, dude. That means I could pay my crew, I could pay rent, and payroll was taken care of. I could pay the vendors. We’re working.” Steadily, from there, we started making more and more money. I could replace equipment as we went. I basically just dumped everything back into the restaurant.

Sure enough, I was like, “This is working great. We can go to the other side of campus and do that.” I brought the business plan to the SBA lenders who did our first loan, and I got that one. Literally, 18 months later, I was able to buy the piece of property, construct a new building, and open up 18 months after the first one.

It took 2 years to start this first one on a shoestring budget. For the second one, I had a piece of property and got a brand-new building that we opened up, and then we showed efficiencies there. What was really amazing about that location was that it was on the other side of campus and also had traffic flow from neighborhoods, office buildings, and things like that.

We didn’t just have 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. That’s when I got the vision. I was like, “This isn’t just a college concept.” It was what I thought it was—I thought I’d just work with college kids. I’m like, “This works for everybody.”

That’s when I got that fire, man, to grow. That’s when I got the vision. The vision at that point was—and it wasn’t articulated this way—but what I wanted was locations all over the world.

Mm-hmm.

I’m like, “I want to be known as the brand for craveable chicken-finger meals, a great crew, a cool culture, and active community involvement.” Those are the things that turned me on with that deal, right?

What do you mean it wasn’t articulated that way?

I thought the vision was there.

Was that subconscious?

I just didn’t put it down. I asked myself, “Why do you want locations all over the world?” I’m like, “Because I want to go into every community, because I love hiring people to come in and build teams, creating opportunities and job growth, and teaching them values.”

I get turned on by customers coming in and loving the food. I’m like, “I’m going to keep giving them quality chicken-finger meals—that craveable product.” I was like, “Now I’m able to give money back to the community.” I’m like, “I want to be able to give money back to the community and actively involve them.”

We have this cool culture, man. I want to emulate that in other places. Look, I worked in the restaurant business out of high school and college, man. It was not positive, motivational management. It was, “Do this, do that.”

They yelled at you?

“You screwed up.” Yeah, it was like crap. There was no music in the kitchen. Can you imagine working back there? It was just a negative environment because the manager was negative, because the owner didn’t appreciate everybody.

I can get people from other restaurants where they’re not treated right and they’re not giving good customer service. They come here, and they’re treated right. They have a good environment. We have music cranking in the kitchen. We’re having fun. We’re a team, and it’s positive, motivational management.

It’s like, “Good job. Hey, thanks for taking this stuff out to 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.

Means everything. Absolutely, man. It’s teamwork, and it’s good. That’s also why I love operators. When I was on the football team, it was constant coaching. “Oh, yeah, that was a good pass. Oh, man, you screwed that up. Make sure your arm goes back. Hey, block harder. Do this.”

You’re getting constantly coached, and nobody takes it badly. No one takes criticism badly because it’s all about doing better and winning the game. It’s all the same thing in the kitchen. “Hey, man, the toast needs to hurry up.” “Hey, great. That’s great toast.” You can mix those things in.

In a corporate environment, this is how you get weeded out of Cane’s corporate: people who can’t take constant coaching. It’s coaching, right? People say, “We should meet every 6 months for an evaluation of how we’re doing,” and all that stuff. No. Every day is an evaluation. Every day, we want to get better.

A lot of corporate people, if you make mistakes—first, I encourage making mistakes. If we’re not making mistakes, we’re not pushing ourselves, we’re not trying new things, and we’re not doing things. But let’s learn from them. Let’s admit our mistakes.

I see corporate people come in, and they don’t address an issue. They just say, “We’re doing…” 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.” It takes all of 30 seconds. When you create that kind of environment—in a coaching situation or in operations—it works.

That’s a challenge for me as we grow the business, because we’re bringing in some experienced people from other organizations.

Right now?

Yeah, right now, as we do that. A lot of the culture is that you don’t admit mistakes. One, you don’t admit mistakes, and two, you don’t want to be coached. It’s this academia-type of thing.

I’m like, “Look, man, I’m learning every day.” I’m the first one to always say, “Man, I screwed up on that, and that was a bad decision.” Then the team knows, well, first, it’s validation, too. He doesn’t think he knows everything. Second, it’s okay for me to make mistakes, you know? But we do need to learn from them.

Todd’s not going to make that same mistake over and over. We know that.

Yeah.

And I won’t either, right? That’s some of the challenge in growth. In restaurant growth, we need the operators. If you’re an operator, you just have that culture. We have to get people who are intrinsically motivated, right?

We can pay people really well because we do good. But pay isn’t what matters most to people, man. They want to make a good living, of course. Title doesn’t matter, right? It’s like, “VP, executive.” All these titles and stuff like that. People are chasing titles. I can literally interview somebody, and I can see that they’re going after the title and going after pay.

Mm-hmm.

They’re going after these things versus intrinsic motivation. “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 know they’re intrinsically motivated.

“I like what you all do back in the community. Have you ever thought about supporting this? I think this is a great organization.” When you hear that kind of stuff, there are plenty of brilliant people. There are so many brilliant people who can do the same job or who haven’t had the experience but will learn that, right? They have the intelligence to do it, but it’s heart.

It’s 100% heart, man. If you’re intrinsically motivated, you do really well at Cane’s.

I love the idea that you said they have this almost theoretical, academic understanding of business, and that usually only survives in an environment where you’re separated from the customers.

That’s right.

It’s like, if you’re working here, there is no theory. It’s like, “We made it. We can see the customer eating it. Look at their face. What is actually happening?”

Right. You’re separated from the customer and separated from the crew. In corporate environments, when I started off, I was the first guy to wear a Cane’s T-shirt to conferences.

Yeah.

Right? Everybody else is in a suit and tie, but there are crew members in the restaurant wearing 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 this suit. Immediately, when you go in with your suit into a restaurant, they’re like, “There’s a separation. There’s a divide.” When I walk into a restaurant, I’m dressed exactly like them.

Yeah.

I speak their language, and I talk to customers. They’re like, “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 the complete history of American business in his head. He was like, “You need to read about this guy.”

I just read the book. You would love Les, because he sounds exactly like what you’re saying. He competed in a very difficult business. You come into fast food, QSRs, and it’s like, that was an established thing. You’re coming in and you’re like, “Compete?” There’s competition everywhere. He goes into selling tires, and he just smokes every single other person.

The book starts when he’s in his 60s. The business is named after him, 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 an old-school guy, cursing at the other guys. He’s like, “Goddamn it, I’d always tell the goddamn people in the office, the only reason they have a job is because of the people in the store selling tires.”

Exactly.

And then he would talk about this. He’s like, “If you’re out—”

I love it.

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 forget half of what you know.” He’s like, “You have to be—” Every single thing, he’s like, “We exist to serve the people who are serving our customers.”

A hundred percent. It’s why we call it a restaurant support office. We’re not a corporate office.

Oh, that’s a great line.

We are a restaurant support office. We’re here to support the people who are serving our customers, 100%.

We have these monitors set up in our offices with our restaurants, and you can pull up any restaurant in our whole system. I want people, when they’re leaving our restaurant support office, to see that there are people still working. When they get there in the morning, there are people opening up and running the restaurant. There are people constantly working, so you see it every day.

You’re walking by that every day, and you’re like, “Ladies and gentlemen, that’s where we do our business.” 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 have 75,000 crew members across the system. We’re here to support them. We’re here to make their job better, easier, more efficient, more fulfilling—the whole bit—and keep that going.

Entrepreneurs are very erratic and unscheduled. Most of us are, as a general deal. When people are like, “What’s your schedule like?” I’m like, “My schedule is all the time, everywhere, however, whatever.”

What’s your schedule like?

It could be 3:00 in the morning.

Are my eyes open?

Yeah, until they’re not. If it means no sleep that week, it is what it is. If it means I can take a day off and go climb a mountain, I’m going to do that. Whatever the call is for the business, you answer that.

There is no schedule. The discipline comes from the focus and the fanaticism. You’re always going to be there, and you’re going to do it. But there are things you have to structure.

For me, to scale, I created the Cane’s Love department in our business: respect, recognition, and rewards. When you have crew members who are working hard, the things of respect are things that you should just do. You shouldn’t get credit for them.

We’re closed on every major holiday. That’s not a reward, and it’s not recognition. It’s just respect. Do I want to work on July 4th? No, I don’t. I want to be with my family and friends. I want to enjoy the holiday. I want to take off Christmas Eve. I want to not work on Christmas Day. I want to be there for holidays and things like that.

I have 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.

The first July 4th that I was open at this restaurant, I saw the crew was dragging. I was there working with them, but they were like, “Oh,” because all their friends were doing something fun. Their families were doing something fun.

Yeah.

I was like, “You know what? That’s not worth it.” So that’s respect.

Recognition is something else. You should recognize achievement, tenure, and all these things. There are things to recognize all day. It starts with the simple things: “Hey, that’s great toast. Thanks for being so friendly in the drive-through. Man, they loved you today.”

You work a year at Raising Cane’s, and you get a hard hat to symbolize the first year you were there. All the crew members sign it. It is fun, right? In 5 years, you’re getting the salmon. Those are the recognition things—recognizing that achievement.

Then there are rewards, whether it’s a $5 gift card to go get coffee at the local coffee shop or other bigger and better things that you get. There are rewards that you get, and I want to build that better and better.

If I just think of these ideas and they come and go, it’s like, no, create a department around that. Literally create a department that thinks of nothing but respecting, recognizing, and rewarding crew members every day. Put a bunch of brilliant people around that, most of whom came from operations in the restaurant, and they know this stuff about building systems.

The next thing with that is, instead of saying, “Here’s the gift card,” or, “Here’s a new Cane’s hat,” it’s building a point system.

It’s kind of fun, right? You come in and get points for every year you work, every month you work. You pick up shifts: “Hey, so-and-so is sick. Do you mind coming in and working?” They come in, and you get points. I want to build it up to really exclusive merchandise and things you could build up to and earn.

We’re constantly getting better at that and raising the bar.

That’s smart.

Have people around that. Not just the feeling—you have to put programs and things around these great thoughts. You have to get structure to do that. Sometimes that’s tough for an entrepreneur.

One of the best pieces of advice that I’ve ever read in a book came from Mary Kay, who built that massive—

Remember Mary Kay Cosmetics?

Mm-hmm. Yeah, absolutely.

And they’d reward people with the pink—

Out of Dallas.

Cadillacs and everything.

Uh-huh. I feel Mary Kay was a master at understanding sales and human psychology. She had one of the biggest and most successful sales departments.

The piece of advice that she gave—the organizing principle for her salespeople—sounds a lot like what you’re doing with crew love. She goes, “Remember that every single person goes through life with an invisible sign around their neck that says, ‘Make me feel special.’”

I’m a hard-driving person like you. I can be a bit of a dick, just to be clear. I’m kind of obsessed. Just knowing that actually helped me interact with other people better and modulate my behavior. That person wants to feel special just like you do, just like the person who helps you secure this.

Absolutely.

They’re like, “Man, Graves, I believe in you,” and it makes a difference, even to hard-driving, psychotically obsessed, fanatical people like you.

Yeah.

It does work.

Absolutely.

Words of encouragement matter. I remember reading a biography of Henry Ford, whom I already mentioned. At the time, he was not successful. He had this idea. All the cars that were on the road at that time were either electric or steam.

What people don’t understand is that 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 was 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.

So cool.

Henry Ford—no one knows who he is. He's not successful. I think he's already failed. He had 2 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.

Mm-hmm. He has a hard time hearing. They're at a huge dinner, but Henry Ford's an engineer, and so he gets a minute with his hero, Thomas Edison. He's having to yell in his good ear about this. And I think it's 7 words or something like that. But Edison, obviously brilliant, just gets it right away.

And he hits the table, and he goes, “That's it, young man. You have it. Keep at it.” Then Henry Ford says in his autobiography, which he's writing 40 years later, “Those 7 or 8 words of encouragement—there was a hell of a lot of pain between him telling me that and me succeeding at this idea. But I heard that in my mind. I was going to keep going, but a little boost was very freaking helpful. And I heard Edison, my hero, saying, ‘You're good at this. You have a good idea. Don't give up.’”

I think it's really important.

Fantastic. Yeah, it is. It's really important.

Yeah. It absolutely is.

But it's earned encouragement. Edison knew he had it.

Right?

Yes. You know, and so sometimes it'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. And I wasn't good at it. It was always encouraging: “You'll find a way,” and “Do.”

But on Shark Tank, they're like, “Hey, man, you're going to have to learn tough love.” Cuban knew me, right? And then, being around Mr. Wonderful, they were like, “I know it's heartbreaking, but sometimes the ideas aren't good.”

Yeah.

Are they doing it the wrong way? You're not doing them a service doing it that way.

Yeah.

So the tough love is to say, “Ah, this...” But then to help them focus on what's really important.

No disrespect to Shark Tank, but f*** that. I cannot stand it. I said this in the episode I did about you. The future is unpredictable. If you read history—I think I read history more than almost anybody else—it's all humans failing to predict the future accurately.

Why would you sit there? You're sitting on a stage in a suit with a bunch of makeup on, saying, “This kid's not going to succeed.” F*** you. How about that? Let's see how it's actually going to go.

I hate people that do that.

Yeah. And so, my idea is that millions of founders listen to Founders. I get emails and all this kind of stuff, and we have conversations. They're like, “What do you think?” What I think doesn't matter. I'm like, “I don't know. I have no way to predict the future.”

When I started my podcast, people were like, “There are too many podcasts out there.” That was 10 years ago. There were no podcasts out there. They're like, “No one's going to listen to a solo podcast. No one's going to listen to a podcast where you can't make a living reading books. That's ridiculous.”

It doesn't matter. I actually hate that show. No offense to them. But it's just the idea of, “I'm all-knowing. I'm an expert.” There is no such thing as an expert in entrepreneurship.

You know what you're going to be an expert in? Raising Cane's. You're an expert in Raising Cane's. And I'm sure you have a ton of ideas that are obviously transferable to other businesses. But we don't have predictive ability.

I just did this episode on Elon Musk. Let me give you an example. There's this guy named Michael Moritz, who might be the most successful venture capitalist of all time. He's at Sequoia. He invested in PayPal, which was a successful exit. 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.

He already knew who Elon was. He invested in PayPal, which was Elon's company. Then Elon goes to start Tesla, and he pitches Michael. Elon says, “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.”

That's a multibillion-dollar mistake on Michael's part. The funny part is—and I'm not doing this to shame Michael, because later on in the book he says, “That was a mistake, because I severely underestimated the level of Elon's determination.”

That's why I don't like shows like that. You don't know what's inside that person's heart, inside that soul. It might take him 5 years. It might take him 10 years.

There's a book next to me that I just showed you before we started. The reason that I've read 400 biographies of history's greatest entrepreneurs—

Look at your notes, man. I love it.

Yeah, I've read that book 4 times. I'm about to do another episode on it. The reason I bring that up, and the reason that, out of the 400 books that I've read, this is my number 1 recommendation, is because this is not a celebration of success.

Ninety percent of this book is James Dyson failing. He goes through 5,127 prototypes. He gets screwed over by partners and joint ventures. He was just like you: “Please, I want to sell you a piece of my company. I need to raise investment. Please take it.” Everybody's like, “No, your company's not worth anything,” so that's why he owns 100% of his company to this day.

But the reason it's so fascinating 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 and is now selling. And the book ends with him saying, “Listen, it's easy for me to say not to give up, but there were times when my kids grew up seeing their dad as a failure.”

He would go in the back, do prototypes, be covered in dust because he's making vacuum cleaners, carry himself inside at night, and cry himself to sleep covered in dust. That's what his kids see. But he's like, “It's easy for me to say not to give up because I'm on the other side of that.”

And where the book ends, he goes, “They have 1 product, which is the vacuum cleaner. They're in 1 market, and they're doing $300 million a year in sales.”

And then what happens?

This is working. Now his company is doing billions of dollars a year, and he's all over. He's got a bunch of different products. He's in all markets, all across the world. The compounding between 44 and 75 was so important, and it wouldn't have happened if he couldn't endure the pain.

I have 1 of my favorite quotes.

Mm-hmm.

Endure the pain.

It's accurate.

Excellence is the capacity to take pain.

It is.

And you see that over and over again.

It is. It absolutely is.

It really is.

And founders lead and they work with their heart and soul.

Yeah, absolutely.

For me, when I was growing up and seeking advice, I got a lot of really good advice. I also got a lot of bad advice that I was able to see through and learn from. You know what I mean? You learn from good and bad—good examples, bad examples.

People started saying stuff like, “Hey, look, Todd, you're so much in the details. You just need to delegate.” God, I hated hearing that word, “delegate.” I'd be like—

“Explain to me—” Yeah. High-five for that.

I'm like, “Explain delegating to me.”

Again, come on.

“What do you mean by that?” Like, “Well, delegate means you give other—”

“No, I know what the word means, but how do I just... How do I delegate this off?”

Yeah.

“Well, you just hire good people, and you delegate them to do the work.” And I'm like, “I hire good people.” Let's say, out of a 100-point scale, if I can do it at 95, pretty good.

Nothing’s perfect, but let’s say operations, I’m at a 95. But if I hire somebody good and they end up being at an 85, but we need to be at that 95 to have success, I can’t just delegate that. I have to supplement to get us back up to 95, working with that person to do it.

Over time, they might get to the 95. So at the point that they’re at 95, then I’m like, “Hey, you can run this well.” Then they get to 96, and I say, “You can run this better than me.” So now I’m going to ease off on some of those things that I was supplementing, but I’ll still check and make sure. I still know enough, too, to where I can add value by improving things and doing things like that.

People say, “You can’t be in the details. What do you mean, in the details?” “Oh, man, you’re down to the minutiae in all this stuff. You’re wasting your time doing this. You should be big-picture. You should be that.” I’m like, “Well, yeah, you’ve got to be big-picture, too, but the devil’s in the details on this thing.”

So that reaffirmed for me: Yes, being into the details matters. This is Edison's Chouest, a large shipping company here in Louisiana. Actually, one of his partners in another shipyard business had told me this when I was explaining to my YPO Forum business group that people were saying I was too much in the details.

They said, “Gary Chouest knows exactly what the bottled water costs at his place.” There are formulas to give it to him; he doesn’t go and count water bottles, right? He looks at the program because he says, “If we’re paying 25% too much for bottled water, and people aren’t going up to the thing and getting water out of the big thing, and they’re using little bottled waters, which is wasteful too, it means they’re doing that in every phase of the business.”

So knowing those details reaffirmed for me that being into the details matters. I say you don’t delegate. You hire great people and help them do it. They do it better than you, then you can back off, and you make sure all those components of the business are working.

Look, I’m not great at IT. I have an exceptional IT team. They do it better than me. But I’m still into the details to make sure we’re doing what we need to do, supporting our operators, being innovative, and getting faster in the drive-through.

My co-CEO in the business is a much better operator than me. I’m still in the details with him and the business, and I know enough about it—I’m good at it—to add value to the business.

The word “delegation” is used way too much. Trust your instincts, learn and grow, and let people grow themselves, but be involved in what they do and absolutely stay in the details of your business. If that’s what made you successful, don’t lose those things. Get better at it.

Yeah.

Get more efficient, get the reports, and things like that. You all have products, and you also refer people to products that can help consolidate information to make quicker, more efficient decisions. You get better at that, but stay in the things that—you know, stick to what you know.

Second, on the concept, man, I fully believe: be good at one thing and do it better than anybody else. Be relentless. I’d do it better than anybody else.

Can you expand on that? I said on this episode, sometimes you can just hear a person say a sentence, like what you just said about delegation, and it’s like, if that’s the first thing I ever heard, I’d say, “I know him.” I’m like that. I feel that way too.

Walt Disney has a great line about this, right? “If we lose the details, we lose everything.” These are not afterthoughts. This is not something you think about afterward. This is what makes the magic.

You called it craveable—the magical experience, and why people have an emotional reaction to your company. Your product evokes emotion, just like his did.

Right.

But the reason the very first—I was unaware of Raising Cane’s. There weren’t any in Florida, where I live. I actually saw a clip of you on Theo Von’s podcast. It was a TikTok, and you said something, and I was like, “I know him.”

I have to find out who this is.

You resonate with it, yeah.

Yeah. My brother-in-law lives in Austin, and that’s when I had my first Raising Cane’s. 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.” I had it for lunch and dinner, lunch and dinner, lunch and dinner, lunch and dinner the whole week I was there.

It’s kindred spirits, man.

Yeah. But this is what I’m obsessed with: exactly what Harry Snyder thought, and the way he thought as well. It’s not just a principle of doing one thing and doing it better than everything else. This is how it applies to every single thing.

You talked about it on that podcast. A simple menu has all these other positive effects. You can really focus and get all the details right. You can make it better. But 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 that at the beginning?

Yeah. No, no, no, I didn’t. No.

Okay.

What I wanted was a craveable product.

Okay.

You know, and I knew from restaurants—

They have one craveable product on their menu, and then they have all these other menu items, all these other distractions. You’re like, “But everybody goes to Gino’s to get that delicious carbonara,” right? It’s like, focus on 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 crave, in the restaurant business. What I wanted to do was create that craveable product that everybody craves.

Mm-hmm.

Then I saw the value of how quickly I could do the drive-through, right? It starts from when the customer pulls up to the order station. The first time at a Raising Cane’s, they look and have to decide what they want. After that, they know what they want: box combo, sweet tea, extra sauce—whatever their order is. So the order is quick.

Coming through the drive-through, we have a singular product focus, right? For that one menu item, we have one line. I’ll tell you about the kitchen later. Toast is grilled on the end, you’ve got chicken fryers, you’ve got fry fryers, and you’ve got the board. You can watch that cook-to-order process happen.

You have that product, and you’re making basically one meal, just with 3, 4, or 6 chicken fingers, so you can make an assembly quicker. You have your popular drinks, they come up, and it gets out there. “Thank you very much for your order,” and you go through.

Then I saw the speed in that. Our concept is craveable food served with fast-food speed and convenience. That’s what it is: fast-food speed and convenience, plus a craveable product. Those two things go together.

If I added menu items, it would slow me down, right? I could say, “Well, what could speed it up?” Then I’d put in heat lamps and keep all this other food assembled and ready, so quality would go down. Your speed goes down, then your quality goes down. Your quality goes down even more if you’re adding heat lamps.

We don’t have heat lamps. We don’t have hold times. We don’t have any of that stuff. We have a cook-to-order process. It’s like if you go to In-N-Out Burger. You know what you want, and they’re cooking ahead.

Now, if you show up and you’re the first customer at Raising Cane’s, it could take you 4 or 5 minutes to get your order because we’re dropping the chicken.

Yeah.

We’re doing that. But when the line picks up, then you’re cooking a little bit ahead. During your rushes, you’re cooking way ahead, meaning it’s coming out and getting served immediately, right?

We’re at 2 minutes and 35 seconds for drive-through and counter service. If we added different products and lost 2 seconds, every 2 seconds that I can get faster is a point in sales. Let’s just say, roughly, 1%. If we do $6 billion in sales this year, what’s 1% of $6 billion? That’s $60 million in sales you can do if you can tweak that order time by 2 seconds.

Now it flips on the other side, right? If you add 2 seconds, then add 2 seconds, then add 2 seconds, those sales go down, and then the flow-through dollars—

Once you get to the flow-through point—

Yeah.

Then you lose. That’s money.

So not having all those different things keeps the concept focused. Knowing what your concept is and sticking to that concept means you know what the engine is, what drives sales, and what eventually drives profitability. It does.

There are 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, how it works in the service model, and how to deliver it.

As they learn that, it becomes a distraction from what you do. Then, over the next 60 days, there’s another one, then another one, then another one. There are all these things going on.

Management has to spend so much time learning those new products, delivering those new products, and hitting the sales expectations. Where’s the time to encourage the crew, do positive, motivational management, and point out, “That’s good toast”? You know, “You’re great in the drive-through.”

Yeah.

Where's the time to walk out and talk to the customers and actually see their food? How clean is our restaurant right now? What's the general vibe here? Oh, wait, the music is a little lower; someone knocked it down. Where are those things? Our management can focus on the crew member and customer experience and make sure that goes, because there are not these LTOs they have to learn, go through training modules, and do. You focus on what you do well.

You go back to that business plan. They talked about not having all these different menu items. No, the veto vote doesn't happen. They're like, "You're not going to get the frequency, because you need different menu items." Frequency gets driven by different menu items because you get all that stuff. Our frequency is just as high as any other quick-service restaurant, meaning how many times somebody comes back in a month's period of time.

Oh, I see the DoorDash bills.

How many times—

I know how frequent it is.

But they come back, right? Then you come back, and there's that. So it's the opposite of what they say is what drives this stuff.

Yeah.

There is no veto vote. There's no, "Variety drives more sales." It's actually frequency. Our frequency is as high as anybody else's. It's serving the exact same thing people have day in, day out, because it's good. Because it's good. Our competitors can run chicken finger, chicken strip, whatever type of sale. It doesn't affect our sales. They might try it, but 2 days later, they're coming back and getting their chicken finger meal from us because it's the best.

Actually, I love it when they run all these specials and do all this stuff, because it adds more advertising out there for chicken fingers, and we're known for the chicken fingers, man. When I want people talking about chicken fingers, chicken strips, or whatever they're talking about—boneless chicken being dipped—I want them to say Raising Cane's in their mind, like Xerox, you know?

It's not a copy anymore.

Yeah.

"Go get me a Xerox of that."

That's what you want to be known for. Do what you're good at, and you will execute on a consistent basis, consistently. You can teach other people how to do it, and they can execute and operate the same way. You stay focused on that and deliver that high-quality, craveable product with fast-food speed and convenience, while 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.

When crew is 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 the food is 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 them, right? Customers want to be appreciated. They want to hear, "Thank you for your food." And our people mean that. It's like, "We appreciate you spending your hard-earned dollars here." In fact, when 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, just greeting every single person who went through the door. It was obvious how obsessive—

Absolutely.

I love this idea because, again, focusing on one thing and being the best in the world at it, right? To me, that should be completely obvious. I think humans crave simplicity, but our default state is that we tend to overcomplicate things.

Right, we overcomplicate—

Your competitor is like, "Okay, Todd's just going to have chicken fingers."

"I'm going to have chicken fingers and 9 other things."

Right.

The problem with that is the distracted do not beat the focused.

That's exactly right.

The distracted don't beat the focused.

They're going to say, "We're going to do chicken fingers, but we're going to have 100 different sauces."

People go back and get their same sauce. They might come try it 1 time, but then they're going back to the same sauce. There's also the fact that you're slowing down their order process, slowing down turnover time, and all that stuff. How much time did you spend on all those different sauces when, at the end of the day, you might have narrowed it down to 3 sauces? What are the most popular? Narrow down your menu items.

You're seeing more and more fine-dining restaurants narrowing their menus. It's happening now. I'm not saying I was a part of that, but maybe they looked at Cane's and said, "Wait a minute, I bring my kids here. We come here all the time. Maybe I don't need 50 different menu items on this thing."

And people don't actually want to make choices.

They want you to make—

No, they want to know it. It's like, "What do you do the best?"

I went to Jiro in Tokyo. It's a 3-star Michelin restaurant with 10 seats.

Maybe you can get me in.

I can, actually.

I have a friend who knows how to do it.

You can? Thank you. Jiro is really old, so he only comes in infrequently, but his son was the one who served us. You don't even get to choose. You sit down, and he's like, "I'm the best in the world at what I do, and I'm going to serve it."

Brilliant.

It's actually nice. I don't have to think about anything else. As long as you can get in, then I don't have to think about anything else.

I don't flip through a menu.

No, like, the—

What's the restaurant that has a book this size? Something—

Cheesecake Factory.

Yeah, Cheesecake Factory.

Yeah.

I don't go there. It's like, I don't want homework. I'm like, "I've got other s*** in my head."

Yeah.

"I don't want to think about this."

It causes anxiety. "What am I going to get here?"

This is what we love. Last night, we were like, "Okay, what do you want? Do you want 3 chicken fingers, 4 chicken fingers, or 6?"

That's all you have to—

That's it.

You already know.

That's it.

That's all you have to think about.

So, another way that you buck the trend: You have this limited menu, right? Most people in your industry use the franchise model. Why did you not choose to go down that path?

When I started out, when I had that vision—

To grow Cane's.

Yeah.

Franchising was one of the obvious ways to do it, and everybody was franchising.

So, I thought—

Why do they do that?

There are a lot of advantages. One is less capital cost. If you can grow off the franchisee's money, let's say you have a good concept and a few locations, for you to grow company restaurants, you have to keep putting in and injecting a lot of capital. On top of that, you have to take on a lot of debt to do that. Restaurants are very expensive.

If I could do all the chicken fingers in 1 location and send them out, the cost wouldn't be there—the capital costs. But every month is a new restaurant, and that's a lot of money. People are like, "You can grow in different areas and use other people's money to grow."

There's also the thought that other restaurateurs will bring other things to the table and have other knowledge. They're good in their regions; they know the local knowledge better, and it's better to grow that way. But I think mainly it's the money play. It's literally, "We don't have to keep growing with our capital. We'll take a royalty off the deal."

I had a model where I was going to grow 50%. I knew I wanted to grow the company, but I thought, "I'm not going to be able 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 who were CEOs at other great, big, billion-dollar businesses. They were good people, people I trusted and who trusted in good people.

I'm like, "That will fuel my company growth, right? Getting franchise royalties in, I'll be able to grow, and we'll grow quicker." So I did. I opened up in different parts of the country. I opened up in Ohio, Minnesota, and Nevada. I opened up in these different areas.

They were good franchisees, and because I had a real friendship with them, we could talk through any problems or anything like that. The thing is, they operated—we'll say we're at 95 out of 100. They were about 85 out of 100, which I think other franchisees were more like 65 out of 100, honestly, in what they were doing.

Other people would have been thrilled with them as franchisees, but that 85-to-95 gap drove me crazy. I was just like, "I know we can operate these better."

Of course you did.

"I know I could do it better."

There was an operational procedure we wanted to change. We had tested it in our company restaurants. We knew it made us faster, or that it was better for management and crew—it was a better system.

To talk them into changing that system took so much time that it was totally inefficient, because it's their business. You had to respect them and show them, but they're like, "That just doesn't work for us, because it's different."

It's like, "Well, what's different? The crew and customer experience—your 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, like, "Well, we don't want to get that much faster, because we like the longer interactions."

"Well, you can still be just as friendly but quick, because they want to get out the door anyway."

Talking them into things took too long.

Yeah.

The team and I were spending too much time on something that should have been implemented overnight. Our company restaurants, once we tested it out in 5 restaurants and felt good about it, our operators said, "Man, great system."

Boom, let’s roll with it. That time was less efficient for us in building the business, making our existing restaurants better, and getting higher or at least the same-restaurant sales. I ended up buying all of them back, and they did really well. They were great, and they were all happy.

As they looked at more of a merger, we kept their teams, and they had more opportunities for growth. It worked out really well. But for me, a franchisee is never going to run it like you do, because it’s your baby and it’s your thing. They’re not going to take it 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. They were at 85; I was at 95. I could hire people who had those same types of values as I did. Franchising, for me, means you’re going to lose quality and service, and you’re also going to lose a tremendous amount of efficiency because you’re talking them into things instead of just adopting something system-wide really quickly.

We got way more efficient when we bought them out. We actually operated at 95. Sales went up in all of the franchise markets—literally, sales went up.

Oh, wow.

Wages went up, everything went up, and it actually worked 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.

I really do.

Well, I think the important part of that is that a lot of people ask, “Should I work on this?” or “What’s the idea I should pursue?” I got this idea from Michael Dell. I used to say, “You just have to build a business that’s authentic to you.”

It doesn’t even matter if you could make more money from franchising. It’s just not suited for your personality.

Right. It’s not suited for our personality.

So it doesn’t matter. It has to be natural to the creator. I used to use the word “authentic” all the time: “You should build a business that’s authentic to you.” Then I was reading Michael Dell’s autobiography. He was in his early 20s, so he was like, “Shit, man, this is really hard competing with IBM.”

He gets a guy to come in and be, I think, the vice president or president, to help him. The guy is about 20 years older than him. I found an interview with that guy, who is now in his 80s, talking about what it was like working with Michael Dell in his 20s.

He said, “You know, I loved it, but I could only last 4 years because we’re playing for high stakes. There are 1,000 other computer companies. We’re taking on some of the biggest companies in the world.” He said, “After 4 years, I’m losing my hair, my back hurts, and I have digestive issues. I’m drinking too much.”

He said, “And Michael is thrilled. He’s energized.” Then he said this great line: “Michael built a business that was natural to him. It was unnatural to me. My body was shutting down, and Michael was like, ‘Yes, let’s do this.’”

“Natural” is a better description than “authentic.” It has to be natural to the founder.

It has to be natural to the founder.

Absolutely. I’m the same way. I’m obsessed with control. I spent 8 hours yesterday hand-editing the transcript that no one gives a shit about because I care about it.

That’s right. Everybody tells me, “Outsource. Delegate.” They use that word all the time. No, I don’t want to delegate. I want to feel it. I have a feeling for it.

Well, that’s the key to success. That’s common in everyone who’s successful, I believe.

The time period you’re describing—where in Raising Cane’s history was this happening? How long was the franchising?

For the franchising?

Yeah.

Yeah, so I mean, I went for—

Was that 5 years into it?

Probably 3 years in, I started talking about it.

Okay.

No, no, no. The second restaurant was 18 months after the first restaurant. From there, I had an opportunity when I really knew I wanted to grow, and that’s when my partner got out. It was really interesting because you said it has to be natural to you.

My partner, Craig, was great. He loved the finance part of it, the IT, and the business administration stuff. He wasn’t a fry cook like me. He said, “Todd, when I get a night off—if I get a night off—I go read The Wall Street Journal. You know what you do when you get a night off? You’re writing new schedules that we vet on that deal list.”

He said, “I just…this doesn’t make me happy.”

Yeah.

He ended up getting a scholarship to Wake Forest. He studied business and did all the things he wanted to do. He actually came back to Raising Cane’s for several years, doing the things he liked to do. He has his own business now, and he does really well. He’s still one of my dear friends.

But it wasn’t making him happy. He had the courage to say, “I don’t like this. All we’re doing is being fry cooks. It doesn’t turn me on. It doesn’t do it for me.”

Yeah.

I encourage people to do something you love, and you’ll never work a day in your life. It’s just a part of your DNA. There’s no work and no “I’m working” or “I’m not working now.”

I’ll be at the beach, checking in, and we’ve got calls, and then being able to roll heads on the beach. You’re talking, doing, and then you get back to, “Hey, let’s have a margarita.” It’s a part of what you do, so you have to do what you love.

You have to. If you do, you’ll never work. Words like “career”—it’s not a career; it’s a passion. It’s just what you do, the same thing as getting up and taking a walk. I love my dogs, I love my business, and I love my kids. Things like that are what make the difference in being whole, I believe.

One of the disadvantages of having other partners in your business is that they might have different goals from the ones you have for your business. An entrepreneur and a founder might bring on an equity partner, whether that’s an individual or a professional group, like private equity. I’d be very careful about what their motives are.

If their motives are about a financial return, you’re generally going to end up badly because you have a fiduciary responsibility to the other owners of your business to meet their goals. If those goals are financial, it can change your thinking. It can change your thinking about quality in my business.

You can change your vision for quality food. You could try to lower food costs to make more profit, which is a short-term gain. You could cut wages, so your crew members aren’t as happy and aren’t as appreciated on the deal. You could try different avenues of sales just to raise sales. That’s going to lose your focus. There are all kinds of bad things that go with that.

The only way I would take on a partner is if they believed 100% in what you believe in, and you also believed they weren’t going to sell that stock to somebody else in the future who doesn’t share those beliefs. 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. I think it’s super important that you said it. Something I’ve come across in a lot of the biographies is that many times, the best financial decisions aren’t financial at all.

Oh, for sure.

There’s an investor named Nick Sleep who wrote these legendary letters to his partners. He had a great line: “The best investors aren’t investors at all. They’re entrepreneurs who never sold.”

What he was talking about is the fact that if you took Sam Walton, for example, he gave away the equity in Walmart to his kids before it was valuable, and that’s how they wound up being very tax-efficient. If you look at the combined wealth that came from Walmart, that’s still concentrated in the family today. The last time I looked it up was a month ago. It was about $432 billion—one of the greatest fortunes ever created.

Do you think Sam Walton woke up every day saying, “I need to maximize shareholder value. What’s my stock price?” No. He woke up serving his customers.

Customers.

Then people asked him, “Why didn’t you ever sell?” He said, “Why would I? I’m not doing this for money.”

Right.

He did it because he woke up with a burning desire every day to improve something.

And he was the wealthiest 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 throughout 200 years of entrepreneurial history. People think it’s some really foo-foo stuff: “Oh, yeah, you should do what you love.” There’s an underlying reason for that, because work is going to be a grind.

You are going to—

You’re going to get the grind.

You’re going to run into times when you’re crying and when you’re in pain.

And you want to give up.

Every day.

And if you don’t love it, you will give up because you’re sane.

Right.

So you have to love it. You have to be irrationally obsessed with it. And then what happens? It goes back to the anti-business billionaires—the people who are rushing so that they make better products.

That’s right.

And then customers.

You know how many people I’ve told about Raising Cane’s? I didn’t even know I was going to meet you, and I was telling people about it. It’s human nature: when we find anything that we love, it could be a quality chicken-finger meal, a movie, a podcast, or a piece of art—

It could be a city.

A nonprofit. It can be whatever. No one keeps it to themselves. Humans don’t do that. They’re just like, “You’ve got to have this chicken. This is great. It’s incredible.”

That’s right.

All this stuff—the love, staying in, being hyper-focused, staying in something for a long time—

Mildly obsessive-compulsive.

Say again?

Mildly obsessive-compulsive.

Yeah, 100%. It’s funny you say that, because there’s this line in this Elon biography. Larry Ellison, the founder of Oracle, only ever joined 2 boards. He was best friends with Steve Jobs, so he was on Apple’s board. He’s good friends with Elon, who considers him a mentor, so he’s on Tesla’s board. He was asked one time, “What do they both have in common?” He goes, “OCD.”

OCD, 100%. 100%.

What do you mean, what they have in common? It’s obviously what they have in common to him.

Yeah, being mildly obsessive-compulsive is actually a good thing. I’m only interested in fanatics. My entire podcast is just about that. Think about what it takes to get on the podcast. You had to live a life. You had to be so good at your job that somebody wrote a book about your life. That’s the tiniest requirement. 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 them just like I did for this book.

Like that.

It looks exactly the same way. It’s the same with personalities, whether you’re playing basketball—

Or you’re building Raising Cane’s.

Right. So, how many years into doing the franchises were you like, “Shit, this is not the right move”?

It was exciting getting in. It was exciting opening up a new restaurant. It was exciting to teach what we do and do well. It was exciting to learn. A couple of years into it is when I started seeing the lack of efficiencies.

They still did a good job, and I want to give them credit for that. They did a good job, but not as good as we could do it. If they had done it as well as we did, we might have said, “Wow, look, they took us to another level.” They just didn’t operate as well as we did. They cared about the crew, and they cared about the customers. They just didn’t operate as well as we did.

A couple of years into it, I started seeing that. We bought them out probably around the 10-year mark.

Which was good.

Right, because they were able to grow and make good money. Another advantage of having company-owned restaurants is that the business is valued much higher. With franchises, you get a valuation based on the 6% you’re getting off that restaurant. That’s part of their idea, but it’s based on the valuation of what a franchise market sells for.

Let’s say franchise multiples are based on EBITDA. A franchise multiple might be 4 to 7 times EBITDA, which is what they could sell for in their market, right?

Mm-hmm.

We’re valued at over 20 times EBITDA. Those company restaurants go into that, so the profitability that comes from all of it gets that higher multiple. That’s why we have a 20-billion-plus valuation for the business.

So it’s a better valuation model, too, if you do company-owned restaurants.

Okay, so let’s go from 2 restaurants to 28. How did you finance that?

This is interesting. After the second restaurant, I had an opportunity to go into some of these failing double-drive-through burger places. I got Dr. Hill, another great mentor of mine, and he said, “Look, we’re just not operators, man. We had 30-something of them. They were called Fast Track, and they were burger joints. We’re down to about 4 of our best units. We consolidated the best crew. We just want to be landlords. We’re not operators. You can use the equipment, you can have all this—whatever you need. We’ll give you cheap rent.”

I didn’t want to go into them. They were double-drive-throughs. I thought this place had a lot of soul, big dining rooms, 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 not just on campus, but that we can do well all over town.”

We went into those places, painted them, used the equipment they had in there, and started doing sales. People loved it everywhere. Eventually, I turned all of those into big dine-in, drive-through locations. I was able to do that and also do a mall food court. I was able to get all these places.

We went from 2 to 8 restaurants. We opened 5 restaurants in 5 months. We started rolling. We made a lot of mistakes and learned a lot. I burned myself out. 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 needed, instead of me bopping around to restaurants and putting out fires. That was basically all I was doing.

From there, I was able to get into those locations. I said, “Okay, I’m going to come up with a prototype. What is Raising Cane’s ultimate location? What is the prototype I want to do?” I wanted to do it out of town, outside of Baton Rouge.

Why?

We chose Lafayette.

Why was this important?

Because I wanted to prove the prototype starting off where no one really knew the brand yet, and show what this thing could really do.

So, literally, for 1 year, I said, “No more growth. We’re going to set up what the prototype is.” By the prototype, I didn’t just mean the architectural design, kitchen design, and our look and feel. I meant everything: marketing systems, human-resource systems, training systems, everything globally.

I used to go to restaurant conferences to learn from experienced people. I was able to find the marketing person, the human-resources, training, and operations people, and the crew-relations person. I was able to assemble a team, along with architects, interior designers, and branding people.

We called them partners, not consultants, because they were partners in the success of the business. We came up with that first prototype. Raising Cane’s opened in Lafayette, and we went gangbusters. We killed it.

We had operational efficiencies. Our drive-throughs got faster. We could stack more people around the restaurant. We had all these really good people who came in and gave us great ideas. We had an original black-and-white logo, and we changed it to this logo. That’s where we came up with Raising Cane’s “ONE LOVE.” All those things went into it.

We started combining meals. I didn’t have combo meals before. I had the box and a drink, and then we said, “Let’s combo it,” because it makes it easier. You only have to decide once. Just get those menu items. We created that.

Yeah.

I got that location through another conventional loan. With the money coming in and doing this thing, I was bankable, but I wasn’t bankable enough to grow to 28 restaurants.

Back then, banking regulations were a lot more lenient. I said, “Why don’t we go into all these community banks?” Let’s say we wanted to open up in Houma, Louisiana. I’d go to the community bank in Houma, and then I’d go to an angel investor. This was Dr. Hill, who had those Fast Tracks. He wanted to be a landlord, but he also liked to do deals. He said, “Let me buy equity in the company.”

I said, “I don’t want to have equity partners.”

He said, “But I’ll give you a subordinated-debt deal.”

I said, “Dr. Hill, let’s say I borrow $200,000 from you. I’ll give you a 15% interest rate—subordinated debt.” This was a 1-page deal. Subordinated debt means subordinated to the banks. I knew I could take that $200,000 in subordinated debt, and the bank would look at it as equity.

So, it was $200,000 on a $1 million deal. I could go into the location and get it financed. Boom. I was creating cash when I did that because I didn’t have to pay my rent for 30 days. I didn’t have to pay my vendors for 30 days. All those things came together.

I opened up, got the cash flowing, and did it again. Boom. Do the next one. Subordinated debt, no equity.

It was a really stupid way to finance a business, but I was young. I was 10 feet tall and bulletproof. We were going to make it work. I had zero fear of any kind of risk on debt. I was going in, creating cash, and doing this stuff.

I got up to 28 restaurants, and all of a sudden, we had a storm coming in named Katrina. It was coming into Louisiana. We were used to hurricanes. We knew what to do. We put the crew to safety, shut down the restaurants, and buckled everything down. Hurricanes would come through, and we’d open up the next day. We’d have some power outages, whatever.

But Katrina was different. It came up, went over New Orleans, and hovered. Then the levees broke.

We were watching on television from our second location across town, where we’d all go. We had something that cranked up enough power for us to actually watch television. When the levees broke, we were like, “We’ve never seen this before. What is this?”

Flooding, terrible, awful—the whole thing.

I thought, “Man, you just screwed up bad. You screwed up bad. You just put this company in such bad financial condition, because now there ain’t no sales coming in.” And we knew it was going to take a while to open up.

Twenty-one out of the 28 locations were down, either because of power outages, damage, flooding, or whatever it was. No cash was coming in. I had the company levered to the hilt, right? I owed everybody. In times like that, you would think that the banks would understand, but the banks still want their money. Landlords still want their money.

I gathered people together. We had teams helping people whose houses had been damaged, and we had to keep up through SMS texting to make sure everybody was accounted for. We had actually set that up pretty well before. I said, “Look, we need to rally. When I tell you we need to rally, I mean we need to rally to save this business.”

I explained to them how we had financed everything, and they understood. 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’ve got managers and things like that who are displaced. They’re coming back, and they don’t have a job. We don’t have money now, and we owe vendors and things like that. They need to pay for their livelihood. And three, people are going to start coming back to New Orleans, and they need a place to eat.”

We symbolized it as a team, and we had that same fanatical view: “We’re going to do it.” I figured out how to get into New Orleans right away by talking to the governor’s office. They got us passes to go in. They weren’t letting anybody in.

We worked with the state on doing boil-water advisories, because we didn’t have formalized boil-water advisories. You had to boil the water because some of the rivers and all these things had hit everything.

Oh, boil.

You had to boil the water.

Okay.

We worked with them on questions like, “How do you boil the water? How do you test it to make sure it’s safe?” Those sorts of things.

And we reopened, man. We reopened. We started off on the North Shore, in Slidell and those areas, and on the West Bank. We opened up in some areas, like Metairie, which has a massive population of people. We were the only restaurant open. We opened up 30 days after the storm. Other restaurants didn’t open for around 90 days. We opened up the West Bank. We opened up in Harvey, and it was around 120 days before the next restaurant opened.

So you had the whole market to yourself?

The whole market to ourselves. We opened up in the West Bank, in Harvey, and it was around 120 days before the next restaurant opened. We fed first responders first, and when people came back, they just came in. We were the only place to eat. They’d come in and eat, and more would come in and eat, right? They could come in because we had power. Everything was generator-powered.

Right.

We got generators from all over the country. We got them in and set everything up. At that point, we galvanized the team and the community around us being open. And then sales were nuts. They were nuts.

Now we had cash flow coming in. We could do these massive crew bonuses, and we could give back to community organizations. I was just really, really proud of the team. At the same time, I was disappointed in myself, because I had put all that in jeopardy. I put all that in jeopardy for financing.

From the day I watched the levees break, I said, “I’ll never, ever, ever put the company in a position where we’re financially strapped. I’ll never do that again.” From that day on, we established our metrics and worked toward them. It took us a couple of years to get there, but we worked toward those metrics. It’s like three times debt-to-equity, sales, all that stuff—we’ll never cross those thresholds.

I have the capacity to get all kinds of lending.

Oh, unlimited.

But we won’t go past our metrics, right?

Yeah.

We won’t go past that. So we learned that one the hard way.

A lot of the same things happened with COVID. When COVID happened, we were like, “Oh my God, you can’t serve. You can’t do food.” We were a necessary business. They said essential businesses could remain open because we needed to feed the public, and people felt okay going through drive-throughs during COVID because there was limited contact.

But we had to learn everything. It was literally, “Hey guys, we can do this.” We talked to the restaurant industry and all the authorities. We said, “We’re going to tape off every 6 feet so people know where to stand. We’re going to put shields between people.” We symbolized it for the team like that.

Then we took parking lots and created 3 drive-through lanes. When I tell you we were among the first to figure that out, we were. Could you imagine? People now had a place to go get some food, not just eat at home with whatever they could get from the grocery store. Our sales went crazy. We were able to do huge crew bonuses and customer bonuses.

But it’s that fanaticism to figure it out right now. It’s me leading with the people. I have so many people who are better at it than me, but I’m in the weeds with them in the restaurants. I flew to all of our markets and saw everybody.

At that point, I couldn’t even go into the restaurants because there could be cross-contamination.

Yeah.

If I had it and went inside—

Yeah.

So I just waved to everybody outside. I’d go to the next restaurant and wave, fly to the next market, wave, and do that sort of thing. That’s how you get galvanized.

But that same entrepreneurial fanaticism—you’re not going to get that from some private-equity group that’s a bunch of corporate people. Are they going to fly all over the country to do that, tape off the restaurants, and figure this stuff out? When it’s personal to founders—“These are my people, these are my customers, these are my communities”—you figure out a way. You figure out a way.

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 this. This is my life’s work. This is a part of me. I cannot let this die.”

One of my favorite quotes about this is Steve Jobs saying, “Victory in our industry is spelled survival.” You see this over and over again in biographies: just stay in the game long enough to get lucky.

You took 2 gigantic tragedies that were outside of your control—which, of course, you’re going to run into things that are outside of your control—

Acts of God, right.

—and you turned them into—not a lot. You flipped them from a liability to an asset. It goes back to what we’ve 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 and perfect every single detail.

Now these people maybe never would have tried Raising Cane’s if that hadn’t happened, because you were the only game in town.

Right.

And then they’re like, “Oh, this is pretty good.” Think about how many customers that one person has given you.

One thing that comes to mind about this is—this sounds crazy—but one of my favorite entrepreneurs I’ve ever come across is Estée Lauder. I found this autobiography of Estée Lauder published in the 1980s. At the time, Estée Lauder was not a public company. It was still really successful, but it was a family-owned business.

She would get a lot of criticism because her main distribution channel was department stores like Bloomingdale’s or Neiman Marcus. She said, “Okay, if you’re willing to sell my products, which I love and have given my life to, I’m going to show up when you do that.”

A big Neiman Marcus opened in Houston, and people would say, “That makes a lot of sense. You’re going to have 1,000 customers.” But then they’d ask, “Estée, why are you going down to Corpus Christi? There are going to be 20 people there.” She’d say, “Every single customer matters.”

On these trips, she didn’t have any money to fly, so she’d have to take trains and buses. Let’s say you’re sitting across from Estée, just like you and I are sitting across from each other right now, and she sees a woman. She says, “Hi, I’m Estée Lauder. Would you mind giving me 20 minutes of your time? I’ll give you a free makeup—or a makeover, rather. I make beauty products.”

The woman says, “I guess. We’re just sitting here. Let’s do this.” Then Estée does it, giving her one-on-one attention. People would say, “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 that 30 years later, she would get letters from people she had given a free makeover to on a train, telling her how much they loved the products.

Right.

Think about how many people that one woman you spent 20 minutes with has told, if she’s been a customer of yours for—

Oh, absolutely. Fanatical fans telling everybody they know, “Listen to this story.”

Exactly. I’ve been a customer of yours for, I don’t know, 4 years, and then I make a podcast that’s been listened to by around half a million people.

That’s right.

You couldn’t have predicted that. There are probably going to be millions of people who watch what we’re doing.

That’s right.

The fact is, it all stems from the fact that you’re a fanatic.

It’s purpose, right?

And so what excites me about talking to you today is that if the people listening get a little nugget from this, a little nugget that changes their life, that helps people, that fires me up. The reason why you’re doing this, and you’re so fanatical about having…

I mean, the questions you sent me before.

Yeah.

Right? I had those questions. I was able to wrap my mind around them because you want it to be good for the listeners.

Yeah.

But that's purpose, man.

You have an insane amount of information and knowledge. How many people work on the same thing for 30 years? So few people do, because everybody wants to start, scale, sell.

Yeah.

Sometimes I've got to speak to entrepreneurs. I had just had dinner with one of the wealthiest people in the world. He's 76 years old. He's been working in the family business since he was 6. Do you understand what's in that guy's head?

Absolutely, yeah.

It's so much more impressive than the—no disrespect to anyone else—the startup founder who ran the business for 2 years. They know nothing. They're like a baby. They're still in diapers.

Even you. I love that you keep hinting that you haven't met. I'm just implying here, but you're like, “Yeah, we can get to 95.” Yeah, because you know there's no such thing as ever getting to 100. You're always looking for different ways to improve.

Todd, you're going to do this for the rest of your life. I'm going to have conversations with founders for the rest of my life. I really appreciate you taking a risk and being one of my first guests.

Absolutely, man. I'm a big fan of what you do. It fired me up that I'm one of the first, man. Everybody's going to want to watch it and see it.

So, I'm going to keep having these conversations forever. I think we'll totally talk. Come back on the show every year or 2 years. You have so much to give and to share. I really appreciate you taking the time, and I really admire you.

I appreciate what you do. I appreciate you having me on.

Yeah.

I loved the conversation. We could actually talk for another 5 hours.

All right, let's go check out the apartment. I'm [unintelligible].

Yeah, yeah. I want to show you the kitchen here, and then I want to go back, and then let's go check out the apartment.

All right, let's do it.