Advice Line with Brett Schulman of CAVA (July 2024)

Summary

How I Built This with Guy Raz – Episode Summary: Advice Line with Brett Schulman of CAVA

Release Date: January 2, 2025

In this insightful episode of How I Built This with Guy Raz, host Guy Raz welcomes Brett Schulman, co-founder and CEO of the fast-casual Mediterranean restaurant chain CAVA, to the Advice Line segment. Brett joins Guy to provide expert guidance to entrepreneurs navigating the complexities of scaling their businesses. The episode features engaging conversations with three passionate entrepreneurs seeking advice on various challenges, ranging from imposter syndrome to marketing strategies and securing growth funding.

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Introduction to the Advice Line

Guy Raz introduces the episode as an "Advice Line" where seasoned entrepreneurs like Brett Schulman assist callers with pressing business issues. Brett, renowned for scaling CAVA from a single restaurant to a nationwide chain, brings a wealth of experience to help listeners overcome their entrepreneurial hurdles.

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Caller 1: Devin Strahan of Devin Spiked Root Beer

Background: Devin Strahan, founder of Devin Spiked Root Beer, shares his entrepreneurial journey. Transitioning from a private chef and owner of a healthy muffin company, Devin pivoted to creating an alcohol-infused root beer after his muffin business failed financially.

Challenges: Devin grapples with imposter syndrome and the pressures of scaling his rapidly growing business, now present in approximately 160 locations in the Houston and Austin areas. He also faces operational challenges, such as unreliable co-packers, which have recently exacerbated his feelings of inadequacy.

Advice and Insights:

• Dealing with Imposter Syndrome:
  Guy Raz [13:34]: “Most of us have an experience, a version of this at times in our lives. Some people are just better at hiding it.”
  Guy emphasizes that imposter syndrome is a common and often healthy feeling that prevents overconfidence. He encourages Devin to recognize his accomplishments and the expertise he brings to his business.

• Seeking Mentorship:
  Brett Schulman [15:37]: “Don’t be shy about cold reaching out to business leaders that you maybe admire or respect.”
  Brett advises Devin to seek mentors and advisors who can provide valuable insights and support, especially during challenging times.

• Operational Stability:
  Devin discusses recent issues with co-packers, highlighting the importance of reliable partnerships. Brett underscores the necessity of having trusted advisors and partners to navigate such setbacks.

Notable Quote: Devin Strahan [08:07]: “What a pivot.”

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Caller 2: Sophia Bowden of Little Me Allergy

Background: Sophia Bowden is the founder of Little Me Allergy, a company that creates bright and colorful allergy accessories for children. Inspired by her daughter's severe food allergies, Sophia aimed to design appealing and functional products that advocate for kids with allergies.

Challenges: Sophia seeks advice on expanding her marketing reach and sales channels. As a mission-driven business, she aims to effectively reach parents and guardians to promote her allergy-friendly products.

Advice and Insights:

• Marketing Strategies:
  Brett Schulman [35:55]: “I love partnering with the allergen friendly food brands, and especially when you think about social collaborations and giveaways for the back to school season to help amplify what you’re doing.”
  Brett recommends collaborating with established brands and leveraging social collaborations to enhance visibility and credibility.

• Sales Channels Expansion:
  Guy Raz explores the potential of participating in trade shows and entering brick-and-mortar retail spaces like gift shops. Brett concurs, emphasizing the importance of understanding the marketplace and selecting distribution channels that align with the business's goals.

• Target Audience:
  Guy advises Sophia to focus on marketing to parents rather than children, ensuring that the messaging resonates with those making purchasing decisions for their kids.

Notable Quote: Sophia Bowden [27:01]: “Yeah. And you launched this in July of 2023, so about a year ago.”

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Caller 3: Sean Murray of Rootless Coffee Company

Background: Sean Murray is the founder of Rootless Coffee Company based in Flint, Michigan. Rootless is a craft coffee roasting company that stands out through its unique, artist-designed packaging and commitment to high-quality, ethically sourced beans.

Challenges: Sean seeks advice on determining the right time to seek growth funding and the best methods for doing so. He aims to scale his business sustainably while maintaining quality and operational efficiency.

Advice and Insights:

• Channel Focus and Scalability:
  Brett Schulman [53:05]: “Scaling restaurants is not like scaling SaaS software. It takes people, it takes process.”
  Brett explains the importance of prioritizing growth channels that offer the highest return and align with the company's long-term vision. He suggests focusing resources on the most profitable channels before expanding further.

• Financial Strategy:
  Guy Raz advises Sean to consider short-term consulting to gain industry-specific insights without committing to long-term hires immediately. This approach can provide the necessary expertise to prepare for larger-scale funding rounds.

• Revenue Growth and Funding:
  Brett highlights the significance of presenting a clear scaling strategy to investors, showing how capital will be utilized to drive growth effectively. This clarity helps build investor confidence and secures the necessary funding.

Notable Quote: Brett Schulman [47:40]: “It's going back to my original question about instinctively, were there any kind of bricks and mortar places that you thought about going?”

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Key Takeaways and Final Advice

Prioritization and Focus: Brett underscores the importance of prioritizing what not to do as much as what to do. By focusing on core strengths and strategic channels, businesses can navigate growth more effectively.

Building the Right Team: Hiring the right people for specific roles at each growth stage is crucial. Brett advises entrepreneurs to seek out experienced professionals, including fractional executives, to bolster their teams without overextending financially.

Emotional Resilience: Both Guy and Brett emphasize the significance of emotional resilience in entrepreneurship. Overcoming self-doubt and staying committed through challenges are essential traits for long-term success.

Notable Quote: Brett Schulman [54:15]: “Prioritization. You know, what I said earlier about what you don't do is often more important than what you do do.”

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Conclusion

The episode wraps up with Brett sharing valuable lessons learned from his journey with CAVA, particularly the importance of having the right people and maintaining focus during expansion. Guy Raz encourages listeners to reach out with their business challenges, fostering a community of shared knowledge and support among entrepreneurs.

Final Notable Quote: Guy Raz [55:34]: “And by the way, if you haven't heard Brett's episode, the Story of Cava and how they turned it into this incredible chain, go back and check it out.”

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This episode of How I Built This serves as a masterclass in navigating the complexities of scaling a business, emphasizing the need for strategic focus, robust support systems, and resilient leadership. Brett Schulman's practical advice offers invaluable guidance for entrepreneurs aiming to transform their ventures into enduring successes.

Transcript

[Guy Raz]

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[Guy Raz]

To you by Klaviyo. Klaviyo helps you build smarter digital relationships with your customers with its unified data and marketing platform featuring email, SMS reviews, and more. Make every moment count with Klaviyo. Learn more at k L-A-V-I-Y-O.com hey everyone, it's Guy here. I hope everyone's been having a great holiday season so far, and as you can imagine, our team is taking a little time off to be with their families and loved ones. So we're bringing you an advice line episode that we really loved. It's the one with Brett Schulman, co founder of Cava. And I was so happy to have Brett back on the show to give our callers some adv because he was the perfect person to guide them through the growing pains of trying to scale a business. And in a lot of ways, I think it's also a great episode for the new year since a lot of us will very likely experience growing pains of our own with like, new resolutions and goals. Speaking of which, I hope you have a very, very happy new year that is filled with lots of growth and learning and joy. And hopefully this episode will give you some inspiration. And without further ado, here it is. Hello and welcome to the advice line on How I Built this Lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week I'm joined by a legendary founder, a former guest on the show who will attempt with me to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-129. Send us a 1 minute message that tells us about your business and the issues or questions that you'd like help with. You can also send us a voice [e-mail] and make sure to tell us.

[NerdWallet]

How to reach you.

[Guy Raz]

And also, don't forget to sign up for my newsletter. It's full of insights and ideas from the world's greatest entrepreneurs. You can sign up for [e-mail] and we'll put all this info in the podcast description. All right, let's get to it. My guest today is Brett Schulman, the co founder of Cava, a chain of fast casual restaurants that serve a Mediterranean menu inspired by his co founder's Greek upbringing. Brett, welcome to the show.

[Brett Schulman]

Hey Guy, thanks for having me. It's good to be back. Happy to pay it forward. I had a lot of guidance and advice during my journey and happy to share the trials, tribulations and the dumb tax I've paid along the way. So hopefully they don't have to pay it as much.

[Guy Raz]

It's great to have you back. Last time you were on the show, of course you told us the story of Cava and you were really the fourth founder of that company. You came in when it was just a single sit down restaurant in suburban Maryland and you really helped to scale the brand into what it is today, this chain of many restaurants, hundreds. And by the way, if you guys listening haven't heard Brett's story, which he told alongside his co founder, Ted Chenokristos, it is a fantastic episode. It is so good. And you can find it by just scrolling back in your feed or searching wherever you listen to this podcast. And we'll also put a link to it in the podcast description. I think your experience, the experience you had is really going to help our callers today because it sounds like they all have great business ideas, but a lot of them are at decision points where they need to figure out how to best scale or where to focus their limited resources. Let me start by asking you, Brett, about that. I mean, how do you think about how to focus a business? Or more specifically, like with cava, you decided to focus on, you know, to take this concept that they had at the restaurant. It was fresh food, it was healthy, but you were able to kind of transfer that to a fast casual format. Tell me about how you. How you were able to kind of see that opportunity.

[Brett Schulman]

Yeah, well, it was interesting because as I mentioned, the consumer packaged goods, the dips and spreads being sold in grocery stores predated the fast casual. And we had initially thought about growing and scaling that business, but there was clear that this food resonated to a larger audience. And the idea was really about how do we bring this to more people. And that's where this fast format really lent itself, to be able or be a vehicle to be able to do that. And I think oftentimes it's listening to the business or listening to your guests and kind of understanding the need you're filling and leaning into that. And one of the things I've learned along the way and that we've learned is sometimes what you don't do is more important than what you do do. And really prioritizing and focusing on where your strengths are and leaning into that.

[Guy Raz]

Yeah. All right, Brett, what do you say? Should we take our first caller?

[Brett Schulman]

Yeah, let's do it.

[Guy Raz]

All right, let's do it, caller. Hello, I think it's Devin. Hello, Devin. Are you in a line?

[Devin Strahan]

How you doing there? Appreciate it. Thank you.

[Guy Raz]

Devin, welcome, welcome. It's great to have you on. Tell us your first and last name, where you're call, and just a little bit about your business.

[Devin Strahan]

I am Devin Strahan. I'm calling from the great state of Houston, Texas.

[Guy Raz]

Nice.

[Devin Strahan]

And the name of the business is Devin Spiked Root Beer.

[Guy Raz]

So assuming you. I'm assuming you make spiked root beer Root beer with alcohol.

[Devin Strahan]

I do.

[Guy Raz]

Okay.

[Devin Strahan]

Yes.

[Guy Raz]

Amazing. Which I can't wait to dive into. What question do you have for us today?

[Devin Strahan]

My question is, as an entrepreneur and as you start to grow, how do you deal with the sinking feeling of imposter syndrome?

[Guy Raz]

I love that question. Okay, let's dive into your business. First of all, how did. Tell me how you got into making spiked root beer.

[Devin Strahan]

So to back date it a little bit, I used to be a private chef, and I also owned a healthy muffin company, so. What a pivot.

[Guy Raz]

Wow.

[Devin Strahan]

Yeah. So from 2000 to 2013, I did healthy muffins, and then I broke a carton rule. I put all my eggs in one basket with this one particular company. And when they went under, my whole life changed financially. So I had to get go back into the workforce. Started working at a liquor store. And about a month later, I was like, well, you got bitten by the entrepreneurial bug and just looked around and I was really impressed with the craft beer market at the time.

[NerdWallet]

Yeah.

[Devin Strahan]

And how they was, like, really creative with the different types of flavors they put in. Chocolate cake and cinnamon rolls and fruity pebbles in there. But I don't drink beer. But I'm a huge fan of root beer. My children are a huge fan of root beer. But I was like, let me give this a swing, and let's see if we can make this into an adult beverage. So that's how I got into the spike root beer business.

[Guy Raz]

So cool. So you were. You were a private chef before that for many years, yes. So tell me, like, and you worked for. For, like, at home or. Did you ever work at restaurants?

[Devin Strahan]

No, I never worked in restaurants. I did not want to go in the restaurant field. Sorry, Brett.

[Brett Schulman]

I don't blame you.

[Devin Strahan]

I want to have a life.

[Guy Raz]

And you had a muffin company for a couple years, which didn't work out.

[Devin Strahan]

I had that for a solid 13 years.

[Guy Raz]

Wow. I mean, what a gift that was, Devin, because imagine how much you learned from that experience. And it's so interesting. You go and work at the liquor store just to make ends meet. And like any great entrepreneur, you're looking at the shelves and you're saying, where's their opportunity? Which is exactly how so many businesses, certainly on how I built this, have started. You're like, root beer. There's nothing. There's no one doing this root beer thing. So. And I love. I mean, you're a chef, so you understood flavors. You understood what? You tell me how you started to, like, experiment and make it. Did you Start to make it in your kitchen at home.

[Devin Strahan]

I did. Exactly. I started to make it in my kitchen at home. Of course, I YouTubed everything and read about it. So interesting part is the original formulation was actually made with rum and champagne yeast for fermentation. I didn't understand any part of that chemistry and I was getting people really, really buzzed of my first concoction of this product. But I learned my lesson over time. So it was a lot of trial and error and I think I got it done in about a good month or so. And I end up going with a wine based product.

[Guy Raz]

With wine, yes. Because there's less different kinds of regulations that make it easier.

[Devin Strahan]

Yes, correct, correct. And distribution and taxes and everything else that comes with that.

[Guy Raz]

Okay, so I'm looking at your website. You've got at least what, eight different flavors now?

[Devin Strahan]

Correct.

[Guy Raz]

Okay. Dark cherry to pumpkin, vanilla, basically. But it's all. The main flavor profile is root beer, but it might be dark cherry or orange cre or Texas pecan or.

[Devin Strahan]

Yes.

[Guy Raz]

And you're now in how many sort of. How many stores? Mainly in the Houston area.

[Devin Strahan]

I'm in the Houston area, Austin surrounding area. So I'm in about 160 locations. But this happened extremely fast. And this is where the problem lies right now, because now it's. It's still solely me. I do have a. A dear friend of mine who handles the finance part of it and all the administrative things or whatever. He's on the equity play of the business, but everything is still solely up to me.

[Guy Raz]

I got a million thoughts, but I want to turn it over to Brett because I think you have a million questions, Brett, so go at it.

[Brett Schulman]

Oh, you answered a lot. I mean, and first of all, credit to you, Devin.

[Devin Strahan]

Thank you.

[Brett Schulman]

I love the story, love the resiliency. You've already done it. You ran a successful business for 13 years and now you've come back for a second act. Most people don't even do a first act. So congratulations to you.

[Devin Strahan]

Thank you. I appreciate it.

[Brett Schulman]

Let's talk about entrepreneurial spirit. My question, is it an inventory, cash flow, funding, the growth issue, or is it simply a bandwidth issue of being able to get out and market the product, to continue to have it grow and be successful, or both?

[Devin Strahan]

It's actually both. Those are really good questions. Actually both.

[Brett Schulman]

And so have you thought about raising capital and do you have the velocities proven in these outlets to kind of support your growth story?

[Devin Strahan]

So I have. I brought in one gentleman and he came in on a small equity play Just last year, which his cash infusion helped a lot. And what I'm finding out is a lot of people, really, the people that I've talked to are really interested in the business, but they also see it as still a young business as well. So I don't have the track record with these new outlets to show what the true potential of the business can be.

[Guy Raz]

I am looking at what you're doing here. And on so many levels. You're doing so many things right. Your branding, your logo, the little red state of Texas on the front. It looks like something. Even though it says established 2015, it looks like it's been around for 100 years. This looks like.

[Devin Strahan]

Thank you. I designed that too, by the way. Like, when I say I was hands on, I was hands on. I designed the look, the color profiles, everything.

[Guy Raz]

It's so great. I'm gonna start with your original question, which is about imposter syndrome. And I think that the answer to this question really is mostly a pep talk. Because, I mean, people who have or feel like they have imposter syndrome are not imposters. That's what I found in my entire life. Most of us have an experience, a version of this at times in our lives. Some people are just better at hiding it. And so what I see in you when I'm looking at this business is somebody who comes to this with incredible standing. I mean, you have over a decade, more than a decade, as a personal chef. So you're a trained chef. You understand flavor profiles. You started a business that you ran for 13 years. It didn't work out, but you managed to build it into something really big. Now you're in spiked root beer. To me, there is nothing about you that is an imposter. Everything that you've done up until this point, you've seen so much standing in this space as an expert. So I think the imposter syndrome is a very healthy feeling. And you just need that pep talk. And sometimes, if me and Brett aren't here to give it to you and you can't find somebody, you gotta give it to yourself. Yes. Because you're coming to this with all of those experiences behind you. And so you are exactly the right person to be doing this. Okay, I'm gonna stop there and turn over to Brett. Cause you might have more thoughts about this and about.

[Brett Schulman]

Yeah, I couldn't agree with you more, guy. I mean, that's what I was saying earlier. It's. You know, I think we all have a little bit of imposter syndrome, which Isn't the worst thing in the world because it doesn't allow you to get overconfident and think that you're invincible, which is really important being an entrepreneur. But I think you've proven yourself to be far from an imposter with everything you've accomplished to date and what you've been able to persevere. A question for you, Devin. Do you have any advisors or mentors around you around the table?

[Devin Strahan]

I don't, to be honest. I don't. I bounce things off my. My business partner when we work out in the morning. And it's just a systems check, you know, to see, you know, what's the next stages, what are we trying to do next. The answer is no, to be honest.

[Brett Schulman]

Don't be shy about cold reaching out to business leaders that you maybe admire or respect. I think, you know, when I found throughout the journey, if I had moments of doubt or the business might have seemed overwhelming at the moment or a problem, how is I going to overcome this? Having folks around you as sounding boards that you can lean on and bounce that stuff on can help validate your thinking or maybe help you think about it from a different angle. I found invaluable and I found could help get through some of those moments where you may have a little bit more doubt than other times.

[Guy Raz]

Yeah.

[Devin Strahan]

And I think also the problem set in as of recently because of what I just gone through with the business where my first co packer, they sold their business. The new owners didn't communicate with me about no longer being my co packer, found another co packer and then he was a fully transparent about his finances and that was a doozy. And all this happened within two months of each other. And the last one just happened a month ago. And now I'm working to find my third co packer. I think that's where that kicked in at. I was like, I feel like I don't know what I'm doing.

[Brett Schulman]

Yeah. And you know what, what you just said, every business goes through and know that you've got a lot of company and that I still wake up every day and I'm faced with challenges in our business. That is business. Right. Cause if it was that easy, everyone would be running a business.

[Devin Strahan]

Everybody would do it.

[Brett Schulman]

Everybody would do it. Right. And it's those who are able to persevere, have that emotional resilience and continue to keep finding a way, have that determination to try and figure out how to deal with all the adversity that's thrown your way. You Know when we bought a company, Zoe's kitchen, back in 2018. Right. Yeah, I remember, man, 2019 was the hardest year of my career. And there were moments, and I used the metaphor that I felt like I was digging through the tunnel and I thought I was about to break through and a bunch more dirt would fall in front of me, and I could never get to the light. But, you know, just kept digging. And I was fortunate to have some great co founders, some partners, and we helped get each other through it and kept digging, working to figure out there's always a way to solve the problem. And when you focus on solving the problem, eventually it got us to that light. So, man, I feel you. I've been there. We're often there through the journey of a business. But that's why businesses become successful, because they're able to deal with that adversity and get through it.

[Devin Strahan]

Yeah, I appreciate that.

[Guy Raz]

The brand is Devin. Spiked Root Beer founder is Devin Strahan. Devin, thanks so much. Good luck. I can't wait to see what happens.

[Devin Strahan]

Hey, thank you much. I appreciate it, guy.

[Guy Raz]

All right. I've never had spiked root beer. I'm gonna try it.

[Brett Schulman]

I have not either. I need to try it.

[Guy Raz]

Yeah. And wine based. So it's a really interesting idea, which.

[Brett Schulman]

I think is an opportunity because it's differentiated. It's something novel. Right. That you haven't seen yet. It's not like another version of something you've seen.

[Guy Raz]

No seltzer or one of these, like, you know, white claw things.

[Brett Schulman]

Right.

[Guy Raz]

It's true.

[Sophia Bowden]

Right, right.

[Guy Raz]

It's a completely different. It's a. Just a different. Yeah, it's a different thing. So curious to see what happens. By the way, imposter syndrome is a big theme in this episode that we have with Tara Bosch, the founder of Smart Sweets, which is a massive brand, Low sugar candy brand. And she started this when she was, like, 21, dropped out of college, and really had no money, nothing. She was just doing it on her own and applied for every competition and business grant that she could get and eventually built it into the brand it is today. And she talked about how when she was 22, 23, she'd go into meetings with distributors or buyers for just small local chains in Vancouver, and just the knots in her stomach and the fear and the terror, but she would just breathe through it. And she didn't say it was easy, but she just kind of breathed through it and figured it out. And I think we've all been there, we've all had that, those moments and still do.

[Brett Schulman]

Absolutely. I think people aren't being real if they're not saying they haven't had those moments of self doubt, especially trying to build a business.

[Guy Raz]

Yeah. And I agree with you. I think overconfidence is a is deadly. I think that's really dangerous.

[Brett Schulman]

Yes. It will steer you into decisions in places that you do not want to be.

[Guy Raz]

Yeah. All right, Brett, we're going to go ahead and take a quick break, but when we come back, a mom who turned her child's allergies into a business idea. Stay with us. I'm Guy Raz and you're listening to the advice line right here on How I Built this Lab.

[NerdWallet]

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[Guy Raz]

Or a bike ride. I don't really want to crack open.

[NerdWallet]

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[Guy Raz]

It tastes so good you'd be hard.

[NerdWallet]

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Huge variety.

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[Guy Raz]

Welcome back to the advice line on.

[NerdWallet]

How I built this lab.

[Guy Raz]

And taking calls with me today is CAVA co founder and CEO Brett Schulman. Brett, let's bring in our next caller. I think we have Sophia on the line.

[Sean Murray]

Hi there.

[Guy Raz]

Hello, Sofia. Welcome to the show.

[Sean Murray]

Thank you so much.

[Guy Raz]

Tell us your first and last name, where you're calling from and a little bit about your business.

[Sean Murray]

Yeah, I'm Sophia Bowden and I'm the founder of Little Me Allergy and I'm from Los Angeles, California. And we make really bright and colorful allergy accessories like placemats, lunchbox magnets, patches and wristbands to help advocate for kids who have serious food allergies.

[Guy Raz]

Okay, Sophia, what's your question for us today that you brought for us?

[Sean Murray]

Yeah, so my question is as a niche mission based business, I wanted to know how I should expand my marketing reach and sales channels.

[Guy Raz]

Got it. Okay, we'll get to your question in a moment. Let me just ask you a couple of questions about the business. So these are just to clarify. These are if a kid has a metal lunchbox, you can put a bunch of these metal magnets. Magnets on the box that say peanut allergy, dairy allergy, egg allergy. On the lunchbox.

[Sean Murray]

Yeah, just to make sure everyone stays aware.

[Guy Raz]

And also patches that they could put on their clothing.

[Sean Murray]

Yeah. And their backpacks.

[Guy Raz]

Or lunch bags.

[Sophia Bowden]

Okay.

[Sean Murray]

Yeah, or lunch bags.

[Guy Raz]

Cool. I love it. That's a cool idea. Tell me, I have to assume that there is a personal connection here.

[Sean Murray]

Yes, definitely.

[Guy Raz]

Okay. How did this, Tell me how this started.

[Sean Murray]

Yeah, so when my daughter was a year old, she was diagnosed with a severe food allergy to se sesame and I was terrified. I was a first time parent and honestly I didn't want her to leave the house after that. But I knew at some point I had to send her to preschool. So with her being so little and honestly still learning how to speak, I knew that I needed to find allergy accessories that would essentially advocate for her in my absence. So I searched everywhere for the right allergy accessories, but I honestly couldn't find anything that didn't feel. Feel cold or clinical. So I channeled my creativity and I decided to design her own allergy accessories that would essentially make me feel confident in knowing that at every touch point throughout the day, whether it be snack time or lunchtime, her allergy would be kept top of mind for teachers, family, friends, essentially anyone that came into contact with her to keep her safe.

[Guy Raz]

Cool. And so I'm looking at the website. So you've got stickers, waterproof stickers that you could put on, I guess, clothing and patches, even those bracelets, I call them Livestrong bracelets, but they shouldn't really call those rubber bracelets with allergy, whatever allergies on it. And so you would know like if there's a five year old and they're going to summer like a day camp on their backpack, you'll just see, it'll say sesame allergy, peanut allergy, shellfish allergy. And you're like, yep, good. Because even though, by the way, a lot of kids who grow up with allergies are used to telling people these things all the time, but as a parent, it probably gives you peace of mind to know that it's out there.

[Sean Murray]

Yeah. And you know, I think allergy allergies among the really young population, like newborns even, and six month a year old, who are really still learning to speak, to advocate for themselves. And so this kind of provides a kit for parents and families to at least feel confident in knowing that as they're sending them to camp or grandparents house or school, that their accessories are going to do the work for them to keep them safe.

[Guy Raz]

Yeah. And you launched this in July of 2023, so about a year ago.

[Sean Murray]

Yes. Yeah. So I'm really new.

[Guy Raz]

You're new. And so I'm assuming that it's not easy that easy to get the word out because your website and do you have any. You've probably put all your own money into this so far.

[Sean Murray]

Yes. Yeah. Yeah. I do have a daytime job which affords me to do this in the evenings. So it's my evening job after the kids go down.

[Guy Raz]

Do you mind telling us what your other job is?

[Sean Murray]

Yeah. So I work for a tech company and I lead creative for 3D design.

[Guy Raz]

Nice. So this is your side hustle right now?

[Sean Murray]

It is.

[Guy Raz]

And who knows? Who knows, right? I mean, this is how a lot of great brands start as side hustle. Sam Adams Beer started as a side hustle. Yeah. And presumably, I mean, because you're in design, you design all these things, all these patches and do all the artwork.

[Sean Murray]

I do, yes. I did all the artwork for all the top nine allergens. And then we do like a design your own section for those with multiple allergies as well.

[Guy Raz]

Cool. And how have sales been in year one? Have you hit 25,000 or still below that or.

[Sean Murray]

I would say still below that. We have been getting really great feedback as soon as people find out about us. And we've also been partnering with more established brands. We just did a partnership with Planet Box and Abe's Allergy Friendly Muffins, which turned out to be really, really wonderful. So my goal is to continue kind of on that path to really get our name out there.

[Guy Raz]

Planet Box is a. It's like a bento box, sort of, right?

[Sean Murray]

Yeah, it's a metal bento box for lunch.

[Guy Raz]

Oh, and perfect, because you can use the magnets on the bento box.

[Sean Murray]

Exactly.

[Guy Raz]

Nice. Okay, Brett, any questions for Sophia before we dive into her question?

[Brett Schulman]

Yeah, Sophia, when the allergy issues first came up in your home, when you said you went out and you started to look, what was instinctively the first places you started to look for products like this?

[Sean Murray]

You know, honestly, it was just Google and it would bring me not a ton of companies that provided allergy accessories. And if there were, it was piecemeal. There's lots of also like Etsy makers that do kind of one off things. It could be a sticker or a patch, but not a full kit or collection. And my goal was to really create something where a parent can come and to the website and say, okay, I need all of these things for school, rather than kind of figuring it out on their own, which I had to do. But again, you know, in my search, everything that I found was just really cold and clinical and just felt almost like. Like a, I don't know, like a badge of shame in a way. And it's hard enough, obviously for kids to deal with having food allergies. I didn't want their accessories or their labels to make them feel othered in a way.

[Guy Raz]

I think your question is about marketing reach and sales channels. Right. And you have essentially a pro. Basically allergies are mainstream. It's a mainstream issue. Right. This is something that affects a significant percentage of the population. One or more allergies. Right. Like I don't know the number. You might. But a lot of people. So this is not a niche thing. It's not like a lot of kids have peanut allergies. Very common. I feel like there's a world. And Brett, I'd be curious if Sophia was looking to expand maybe is there a world where, like going to a gift, like a gift trade show, you know, one of these trade shows that's for gift shops. Because I think about going into a gift shop or even a card store and seeing cool things like this there. It's the kind of place that I would imagine buying something like this, like my nephew's got peanut allergies and I'd see that and I'd say, oh, he's now a grown man, so I don't think he needs it on his lunchbox. But I can imagine going to a gift shop and seeing these little patches or stickers or magnets and thinking, oh, that's cool. Brett, do you think there's something to that, to going to a trade show?

[Brett Schulman]

Yeah, that was going back to my original question about instinctively, were there any kind of bricks and mortar places that you thought about going? Because certainly what we've seen post Pandemic, the cost of acquisition or just awareness on the Internet or being a DTC brand has gotten really expensive and people have gotten back out in the world. And even with the changes in third party data privacy laws, it's restricted the ability to drive awareness online solely. So where are there potential bricks and mortar outlets that you can be in front of, where your consumer, your parent that has a child with allergen issues or maybe have them themselves are trafficking and where is that need state happening, whether it's Target, whether it's a gift shop? I think often in any of these industries, going to a trade show is such a great idea. And just understanding the landscape, the lay of the land, what the marketplace is, what the potential avenues of distribution are, how it all works. I remember when I was working with my wife on a snack food company, we would do that, we'd go to the trade shows and it helped us really understand the industry and how it all worked and where our product or offering could fit within that.

[Sean Murray]

Yeah, I would love to be at a Target at like, even if there was an end cap that was for back to school allergy friendly end cap that partnered with other allergy friendly, you know, foods, I think that would be really awesome. And even though, you know, allergies are everywhere and it's become some, you know, mainstream in a way, there's still kind of, you know, it'd be nice out of Whole Foods to have an allergy friendly section. I think I still have yet to see things like that, but would love to be a part of that.

[Brett Schulman]

And these, these retailers will do small tests and, and small market or regional tests. So at Target you they will do a 30, 50, 100 store test if you can, you know, cold email, contact the right person and pitch the idea. Because I do think it's a viable idea, especially for a lot of times. They'll do like an in and out for back to school season as a test, right?

[Sean Murray]

Yeah, definitely. Guy, I had a question for you because I know you have podcasts that's geared towards kids. Do you find yourself marketing differently or doing things differently for kids versus your, you know, more podcasts that are geared towards adults 100%.

[Guy Raz]

Yeah. I mean with kids there's all kinds of rules on how you, you know, you can market to them. And on WOW in the world, unlike on this show on how I built this, I don't read ads. We do have ads on the show, but my voice is not as an ad reader because kids don't differentiate between I'm a character on the show and they wouldn't differentiate between my voice on WOW in the world and me reading an ad. And so we're really careful about that. But we do have ads and we do. Obviously these ads are designed to appeal to the parents because we have kid, parent co listening on that show. And so that's really what you're going for. You're marketing to the parents, not to the kids. And that's who's gonna be interested in this. But you know, that's a great channel to think about too. But there are millions of podcasts out there. And I think that you start with take a page out of Tim Ferriss world. You start with a thousand people, a tribe. You build a tribe of a thousand people that you can gather around your brand and those become your force multipliers. And so maybe it's like I think about my sister who had a kid with really deathly peanut allergies. Now a grown man, she was constantly vigilant. I mean, before they went to a restaurant, she would call up to make well then airplanes, she would call up to make sure they didn't serve peanuts on the plane. So this is the kind of thing that somebody like my sister, when her kids were younger would have said to other moms. You gotta get this thing you put on the backpack and on the lunchbox and that's really where you're gonna find the momentum.

[Sean Murray]

Yeah.

[Brett Schulman]

I was gonna say, I love partnering with the allergen friendly food brands, and especially when you think about social collaborations and giveaways for the back to school season to help amplify what you're doing and be a trusted partner, because that is your target customer. They are already an allergen purchaser, an allergen free, friendly purchaser. And it's almost again like a validation and a friendly referral that you can partner with them. And whether it's through influencers, creators, or the brands themselves, I think those are powerful channels to help amplify with an audience that already has that built in passion for what you're doing.

[Sean Murray]

Yeah, absolutely.

[Guy Raz]

Yeah. Awesome. The brand is called Little Me Allergy. Sophia Boden, thank you so much for calling in. Good luck.

[Sean Murray]

Thank you so much. So grateful for this opportunity.

[Guy Raz]

All right, Brett, we're gonna go ahead and take another quick break, but when we come back, the founder of a Midwestern coffee brand who's found a really interesting way to stand out in the crowd. Stay with us. I'm Guy Raz, and you're listening to the advice line right here on How I Built this Lab.

[NerdWallet]

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[Grinch]

Hello, ladies and germs, boys and girls. The Grinch is back again to ruin your Christmas season with Tis the Grinch Holiday Podcast. After last year, he's learned a thing or two about hosting, and he's ready to rant against Christmas cheer and roast his celebrity guests like chestnuts on an open fire. You can listen with the whole family as guest stars like Jon Hamm, Brittany brooks, and Danny DeVito try to persuade the mean old Grinch that there's a lot to love about the insufferable holiday season. But that's not all. Somebody stole all the children of Whoville's letters to Santa. And everybody thinks the Grinch is responsible. It's a real Whoville whodunit. Can Cindy Lou and Max help clear the Grinch's name? Grab your hot cocoa and cozy slippers to find out. Follow tis the Grinch holiday podcast on the Wondery app or wherever you get your podcasts. Unlock weekly Christmas mystery bonus content and listen to every episode ad free by joining Wondery plus in the Wondery app, Spotify or Apple Podcasts.

[Guy Raz]

Welcome back to the advice line on how I built this label. My guest today is Brett Schulman, co founder and CEO of the fast casual Mediterranean restaurant chain Cava. All right, let's bring in one more caller. Brett, I think it's Sean is on the line. Sean, are you there?

[Sophia Bowden]

I am here. Hey, Brett. Hey, Guy.

[Guy Raz]

Hello, Sean. Welcome to the show. Tell us your name, where you're calling from, and just a tiny bit about your business.

[Sophia Bowden]

Yeah, my name is Sean Murray. I am the founder of Rootless Coffee Company and. And we are in Flint, Michigan. So Rootless Coffee, We're a roasting company and we make craft coffee. Not boring. Ultimately, we bridge the gap for consumers that are looking for better coffee than they can find at a chain or in a grocery store, but are a bit intimidated, maybe put off by the sometimes pretentious and dull nature of third wave coffee.

[Guy Raz]

And are you at the Coffee Roastery right now? Because it sounds like you're in a loud place.

[Sophia Bowden]

I am.

[Guy Raz]

Oh, yeah. Nice. Not airplane hanger. That is a Coffee Roastery behind you.

[Sophia Bowden]

It is, yes. It was between this and my home, which is right on a main road, which can be even louder than this.

[Guy Raz]

So it's very appropriate. I'm glad. Tell us what question you have for us today.

[Sophia Bowden]

Yeah. So, Guy and Brett, basically my question is how can I be certain it's the right time to seek growth funding for Rootless, and what is the best method for doing so?

[Guy Raz]

All right, lots of questions. As you know, Sean, we've done a couple of coffee brands in the show, of course, Starbucks, and we've done La Colombe and Dutch Bros. Coffee, too, which is a big, big chain. So how did you get into it? How did you get into this business?

[Sophia Bowden]

Yeah, so it actually started with the craft beer business in the early 2000s. I was a bartender and brewed beer at home. And. And I really wanted to start a brew pub. That was like, my dream, my goal. But I ended up removing alcohol from my life for various reasons. But, you know, and I was. I still had the dream. I've been kind of that entrepreneur. Shovel, you know, people's driveways in the winter. Had a couple of businesses when I was in college and stuff. So I had that drive in me, and I was like, all right, what can I do? And I was just like, let's do coffee. I love coffee. I'm going to roast coffee. And I just started pursuing that.

[Guy Raz]

So you pivoted to coffee or you sort of kind of moved towards coffee and decided to start a coffee brand and. Tell me about the brand. I mean, it's a. Obviously you're roasting it in Flint, but are you sourcing it in a special way? Is there something about the way you're presenting the coffee that's different or that is kind of influenced by your time in craft beer?

[Sophia Bowden]

Yeah, absolutely. That was a strategy coming in. So we work with artists, primarily comic book artists, you know, locally, but also across the country. And they design our packaging. And it's really like what I saw in craft beer was people were like, hey, that looks kind of cool. I'm gonna try it. And then all of a sudden, they come back to it, and they come back to it. And I've seen the same thing happen with Rootless where, you know, people will see this cool artwork and they'll be like, all right, a damn fine cup of coffee that looks cool. They try it and they fall in love with it.

[Guy Raz]

Yeah, it's cool. I'm looking at it now. It's. It's like the artwork is super cool. That one that you mentioned, that that bag, A damn fine cup of coffee is like an owl's head on a person with. Wearing a business suit at a cafe, drinking a cup of coffee with a slice of cherry pie. A really, really cool artwork. And so the. The entry point to you for. For people like it was you knew that you were making good coffee, but it's hard to kind of distinguish good coffee because some people don't really know, you know, and they don't really know what to look for. But your entry point was just creating these eye catching, beautiful pieces of artwork on the bags.

[Sophia Bowden]

Absolutely. So my thing was, let's just give people that quality, give people that craft still. I mean, we're small batch. We source our coffee beans. It's all ethically sourced, specialty grade coffee. And you can still deliver people the highest quality product, but just in a different way.

[Guy Raz]

How many? Do you have a coffee store or do you just distribute the roasted and sell it elsewhere?

[Sophia Bowden]

Yeah, we have a bunch of Channels, actually. So we are of course online. We started with E Commerce. It was like smack dab, middle of the pandemic, so nothing was open. And then we moved into wholesale. So we do B2B stuff with coffee shops, businesses, all sorts of places. And then our third channel is grocery stores. So we picked up our first, like four grocery stores two months after we opened. It was insane. And we are now in a regional chain here with like 30 plus stores. And then we also have a coffee trailer where we do events.

[Guy Raz]

And how many employees do you have now?

[Sophia Bowden]

Including myself, there are 10 of us.

[Guy Raz]

Wow. Okay, so you start in 2020. You're in more than 30 retail locations in and around metro Detroit Flint area. You got 10 employees and you're trying to figure out what you need to do to grow. Should you bring in outside investment? Before we get to your question, Brett, do you have any more questions for Sean about the business?

[Brett Schulman]

Yeah, I'm curious. With those four different channels, is there any one channel that stands out? What's the kind of channel mix of your revenue? Is it equally weighted?

[Sophia Bowden]

It used to be E Commerce was the biggest by far. It was like 60, 70% E commerce, 30% wholesale. Those two are kind of neck and neck now. And then the event part of it is very low, Very, very low. So it really is between E Commerce and the wholesale retail part are pretty neck and neck.

[Brett Schulman]

And are the profitability of those channels pretty similar or do you see any differences between them?

[Sophia Bowden]

They actually do work out to be very similar. The wholesale is a little bit more profitable and it's also a bit easier to fulfill because it's, hey, give me 50 pounds of coffee. All right, here's 10 bags versus here's 50 orders from individuals who want different grinds. And, you know, so wholesale is absolutely where I have been doing my best to focus on, particularly this year. To grow.

[Brett Schulman]

Yeah, I think, you know, this is like the age old question of what do you want to be when you grow up? Right. Where do you ultimately want to take this business? Because you're going to be the best one to answer how much you want to grow, when you want to grow, as far as taking on investment or not. And so I'd love to hear from you how you're thinking about that.

[Sophia Bowden]

Yeah, so the vision is quite large, actually. Very inspired by the Dutch Brothers episode of How I Built this. I would love to eventually have shops all over the country, whether that be a franchise model or whether that be, you know, kind of the corporate model that we're doing. That. But I love marrying quality and efficiency. I think, as you know, Brett, like, fast casual did that where they took something where there was only fast food. And it's now like, hey, you can get really good food and you can get it fast, but it's. You're not sacrificing that quality to do so. And that's like my big, big dream. I've really been like, hey, how do we get there? How do we do this in the next, like, five or so years? It's really a matter of, like, we need the revenue to fund things in order for me to be able to kind of put off, like, all right, wholesale is now managed by this person, et cetera, et cetera.

[Guy Raz]

Can you give us a rough sense of what. What your ballpark revenue is? Are you under three a year, roughly? Where are you?

[Sophia Bowden]

We are actually under a million.

[Guy Raz]

Under a million. Okay.

[Sophia Bowden]

Yep. We've seen really great growth, though. In our first year, we did just about a quarter million, and then we did a 65% year over year growth. And then last year we had 35% year over year growth.

[Guy Raz]

Wow. Brett, there's some parallels to where you guys were when you joined Kava. I mean, small business and just still at the beginning of its journey, but with potential.

[Brett Schulman]

Well, I think there's a lot of interesting parallels here. I love your vertical integration. We have our dips and spreads production facilities to supply our restaurants, as well as we sell in Whole Foods Markets and other grocery stores across the country. And you've got your Roastery, and you're leveraging it through a few different channels. And one of the things we quickly realized early on is that we were going to focus raising capital to grow the restaurant channel. And we've kept the consumer packaged goods channel growing slowly, but we focused our efforts on the restaurants because we found it very challenging to grow multiple channels at once. And so we tried to lean into where we thought the greatest opportunity was to bring this food to people across the country. And I think it also presented a clear story for investors. It gave them a clear understanding of what we were going to do with this capital and connect those dots clearly to the return. Because ultimately, when you're raising money from investors, we're ultimately stewards of their capital, and we're good stewards of capital. We'll continue to attract capital, but that allows us to do what we love to do, right, and build our brand and bring this great food to folks across the country. So how are you going to do that? How are you going to focus that, and, you know, I think it goes back to the question I posed to you earlier. What do you want to be when you grow up? Right. What pace do you want to grow at? And that's going to determine how much money you raise. Because I like to say scaling restaurants is not like scaling SaaS software. It takes people, it takes process. It's building physical restaurants, you're building physical roasteries. So that takes capital and it's hard to scale these things. So being able to afford the capabilities, the talent, the infrastructure before the business necessarily affords it for you through your profits allows you to scale faster and grow faster and do it it sustainably and successfully.

[Sophia Bowden]

Yeah, absolutely.

[Guy Raz]

I mean, my advice to you also would be, and you may have done this already, but to think about finding a consultant on just a short term basis. I mean, that's how these guys found Brett. Right. And it was serendipitous because it was like Ted's cousin said, hey, this guy Brett, and he came out as a consultant. So I wouldn't jump in and just hire somebody right away. I'd look for somebody who could maybe do some consulting. I would look out, especially because you're in the Midwest. I would really look for somebody who has experience in the food and beverage industry in the Midwest, who understands what your values are, where you come from, how you think about what you're trying to do. I mean, maybe there are some retired executives who are on LinkedIn who might be willing to do some consulting for you that you could find.

[Sophia Bowden]

Yeah, that's actually a really great idea. I think that, that what I found with people who have been in business for a very long time is they love giving back, love working with small businesses and. Yeah, exactly. And yeah, that's, that's a great idea. I actually, I do have a question for Brett, if I could. Yeah, Brett, how did you focus Cava when you had all those channels and, you know, you decided on the restaurants, that was going to be the growth. My fear is that I'm like, okay, if I want to do coffee shops, am I going to neglect my wholesale or my E Commerce? Or did you just kind of bring people in to manage those things and let them have their natural growth? Like, how did that work?

[Brett Schulman]

Well, yeah, I mean, if you think about it, the channels operate very differently. Right. Dealing with grocery stores or wholesale distributors is a different channel and value chain than a retail shop and different than dtc. So you would often need different capabilities, which would then be something that you'd have to hire more people For Right. So I think if you're trying to stay nimble and agile at a small stage and be cost effective and capital efficient, hiring folks that can do everything you need in the channel you're trying to grow is how we thought about it and how we looked at it. And even today we opened our new production facility. So we have capacity now to get more intentional about growing the consumer packaged goods business. But we've talked about if we're going to do that, we need to really hire a focused, dedicated team that's fully integrated with our larger team because it operates very differently than our restaurants do and that whole distribution channel. So I think it's trying to, we like to try and do fewer things better. It's hard, it's hard to pick and choose. But having that focus helped us have the energy to really make it what it is today. And other things I see a lot of small companies leverage is there's more and more folks who used to be executives at private or public companies that have gone on to become now fractional CFOs or fractional COOs that can bring that experience to you and not have the necessarily the commitment on your end. And sometimes those folks go into full time roles if they find an opportunity that they really hit it off with the founder or entrepreneur with. And it also gives you a chance to leverage their experience and leverage in a bit of an asset light way.

[Sophia Bowden]

Yeah, that's great.

[Guy Raz]

Sean Murray, Rootless Coffee company in Flint. Thanks so much for calling in. Good luck.

[Sophia Bowden]

Thank you so much for having me, Brett and Guy. I really appreciate it and yeah, I love the show and Brett, I love what you guys are doing at Cava. So thanks again.

[Guy Raz]

Awesome, Brett. We are coming to the end of our time together again and hopefully we can see each other and eat some tzatziki. You might be sick of the food that you make, I don't know. But maybe not. We can have like some lamb kebabs and tzatziki and some spiked root beer. Some spiked root beer.

[Brett Schulman]

Throw back some coffee.

[Guy Raz]

Yeah. Before I let you go, tell me this is a question that I'm asking a lot of founders who come back on the show, which we may have touched on when you were originally on the show. But knowing now what you know about the world you're in and you talked earlier about the stress of expanding when you guys acquired Zoe's. What do you wish you knew when you first got into this business that would have been helpful for you and maybe caused maybe cost a fewer sleepless nights.

[Brett Schulman]

Two things come to mind. One is right people, right roles is a mantra I say a lot these days. It's understanding what kind of capabilities and what kind of people you need at every stage of growth. And I think sometimes I wanted to believe certain things to be true that weren't necessarily true and wouldn't really force myself to see it as soon as I should have. And I think that the other thing was prioritization. You know, what I said earlier about what you don't do is often more important than what you do do. And that really helped us turn the tide in the challenges of Zoe's is when I finally figured that out. And we simplified and focused and did fewer things a lot better. And that helped us get out of the challenging situation we were in. And then again, bringing in people with the capabilities that were needed at that stage of the business because you can't do it yourself, and being able to find people and bring in that you can lean on and that can be a force multiplier of you really helped us get to where we are today.

[Guy Raz]

Awesome. Brett Shulman, thanks so much for coming back onto the show.

[Brett Schulman]

Thanks guy. Appreciate it.

[Guy Raz]

And by the way, if you haven't heard Brett's episode, the Story of Kava and how they turned it into this incredible chain, go back and check it out. It's an incredible story. Look for it wherever you listen to podcasts, just type in Cava and how I built this or just just go to the link in in the podcast description on your phone and thank you for listening to the show this week. It's if you are working on a business and you would like to be on the show, send us a one minute message. Tell us about your business, tell us about the issues or questions that you'd like help with and hopefully we can help you. And make sure to tell us how to reach you, please. You can send us a voice [e-mail] or give us a call 1-800-433-1298 and leave a message there and we'll put all this information in the podcast description as well. And thanks so much for listening to the show this week. This episode was produced by Carla Estevez with music composed by Ramtina Erbloue. It was edited by John Isabella and our audio engineer was James Willits. Our production staff also includes Alex Chung, Elaine Coates, Neva Grant, J.C. howard, Chris Masini, Sam Paulson, Devin Schwartz, Kathryn Seifer, and Kerry Thompson. I'm Guy Raz and you've been listening to How I Built this this. If you like How I built this, you can listen early and ad free right now by joining Wondery plus in the Wondery app or on Apple Podcasts. Prime members can listen ad free on Amazon Music. Before you go, tell us about yourself by filling out a short [e-mail] survey.

[Grinch]

Hello ladies and germs, boys and girls. The Grinch is back again to ruin your Christmas season with Tis the Grinch Holiday Podcast. After last year, he's learned a thing or two about hosting, and he's ready to rant against Christmas cheer and roast his celebrity guests like chestnuts on an open fire. You can listen with the whole family as guest stars like Jon Hamm, Brittney Broski and Danny DeVito try to persuade the mean old Grinch that there's a lot to love about the insufferable holiday season. But that's not all. Somebody stole all the Children of Whoville's letters to Santa, and everybody thinks the Grinch is responsible. It's a real who, Bill Whodunit? Can Cindy Lou and Max help clear the Grinch's name? Grab your hot cocoa and cozy slippers to find out. Follow Tis the Grinch Holiday Podcast on the Wondery App or wherever you get your podcasts. Unlock weekly Christmas mystery bonus content and listen to every episode ad free by joining Wondery in the Wondery App, Spotify or Apple Podcasts.