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Inside Red Lobster's comeback
Red Lobster CEO Damola Adamolekun first came to the U.S. as a child after growing up in Nigeria, Zimbabwe and the Netherlands. After stints in finance, he found himself leading restaurant chain P.F Chang's and last year was appointed CEO of Red Lobst...
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- [00:01]
A
Hey, everybody, it's Jeff Bennett, and welcome to another episode of Settle In Red Lobster CEO Dimola Adam Malaikin is one of the youngest leaders shaping the future of American dining. Before taking the helm at Red Lobster, Dimola built his reputation in private equity and restaurant turnarounds. He previously served as CEO of PF Chang's, where he helped return that company to growth. And now he's bringing that same turnaround expertise to Red Lobster at a moment of real upheaval. The chain had faced headline making challenges, from bankruptcy and store closures to shifting consumer habits to broader questions about the future of casual dining. So he's stepping in with a mandate to stabilize the business, to rethink the model and chart a new path forward. We talked about his own journey and why he believes there's still a powerful future for the Red Lobster brand. So settle in and enjoy my conversation with Damola Adamaleka. So to understand your work and your success, I think it's helpful to understand your background. So you grew up in Nigeria, moved to the US when you were in elementary school. How did that cross cultural experience shape your worldview and your approach to leadership?
- [01:07]
B
Yeah, it's. It's a good question. I think that, you know, growing up in very different countries with very different, you know, cultures and languages and sorts of people across Nigeria and Zimbabwe and Amsterdam and then finally in the U.S. you know, I think for me there's a lesson in adaptability, right? And being able to observe a new environment and find a way to thrive in that environment. And I think also importantly, there's a lesson on despite how different people can be, what are the things that are similar across them? Right? You learn to read people and understand psychologically and sociologically within groups, how people behave across cultures that are similar and that are intrinsic to people regardless of where you are and, and where you live. So a lot of good, I think, life lessons for sure, that have shaped my view on how I interact with people, being able to connect with many different types of people, different cultures, as well as, I think, a resilience and adaptability from living in all these different places.
- [02:13]
A
So, fast forward, you earned your MBA from Harvard. You spent time in investment banking, private equity. What drew you to the world of hospitality?
- [02:22]
B
You know, my initial interest in consumer retail came when I was in investment banking. Actually, I had the option to work in the consumer retail group or in Fig when I got my first job out of Brown when I was 21 or 22 years old. And for me, what I loved about the consumer Retail space was just the tangibility of the. Of the businesses that you work with. Right. I remember we covered. My first staffing was on Walgreens. Right. Helping them do a deal with Alliance Boots at the time, I remember I'd been in so many Walgreens, had a point of view on the company and the merchandise and the experience in a Walgreens. You know, then I covered Macy's, and I had a point of view on Macy's and shopping there and having a feeling for it. So almost immediately, I loved kind of the consumer element of it, the having a point of view on the product, on the experience, the impact it has on people. You know, these. A lot of these companies exist to serve joy and experience and to serve as an escape for people. So, you know, that's always been a great part of the space that we're in and something that I continue to enjoy to this day.
- [03:27]
A
You said that your parents instilled a deep sense of purpose and discipline. What lessons from your upbringing do you take with you into the boardroom?
- [03:36]
B
You know, I think there's just an authentic pride in work that I was raised with. My parents are both very hardworking people, both educated professionals. My father's a neurologist. My mother's a pharmacist. But they took an incredible amount of pride in their work and taught us to do the same. You know, no matter what you do, small things are important things. Try to do them to the best of your ability. And that's a mentality that. That one can instill in children and can carry them through their lives, and they did with us, you know, very fortunately. So, you know, I think that's, you know, that pride. Pride in work is important. The willingness to devote time is important. Authenticity and honesty and integrity and how you work is important. And I think these are all things that my parents valued and were transmitted to myself and my siblings.
- [04:27]
A
Well, before we talk about your work at Red Lobster, I want to talk to you about the turnaround that you were responsible for at P F Chang's. You were CEO. You brought back that company amid massive shifts in the restaurant industry during the COVID 19 lockdown. What was the. The greatest lesson you learned from that experience that you then applied to Red Lobster?
- [04:50]
B
You know, in a moment of crisis, it's important not only the strategy and the tactical plan of how you're going to improve the business, but morale and psychology within the organization is equally important. Right. So I took over in the middle of COVID and it's a tremendous moment of panic and discomfort and fear within the organization about what's going on and what's going to come next. So I think one of the first lessons I learned was how to manage not only the, again, the balance sheet and the P L and the strategy and the tactics of how we're going to manage through this situation, but also the mindset of people via town halls and communication and Q and A and a lot of transparent communication to the organization to get them in a mindset to succeed and to dig us out of that hole, which was just as important as any other part of it. So that's something that, you know, crisis compresses leadership lessons, right? It's leading in Covid or through a bankruptcies like lead. You know, one year of that might be 10 years of normal operating. Right? So a lot of compressed lessons. But that's probably the key one that is most important within a crisis.
- [06:00]
A
It's interesting because you've been described as a numbers guy and a culture guy, But I hear you say in a time of crisis, you really have to lean in on the culture.
- [06:09]
B
You have to do both because the numbers, you know, I think both are, you know, critically important. Some people dismiss numbers people as unimportant, but I, you know, the numbers are just. It's just a measurement of the business, right? So numbers are simply a way to evaluate how the business is performing, what's going well, what's not going well, where the strengths are, where the weaknesses are. So fluency in numbers and financials is, I think, really important now. Fortunately, I was trained in it from a very young professional age since my first internship at Goldman when I was 18 or 19. So I've spent a lot of time speaking that language fluently. In shifting from investing to operating, the new language that was important was managing people right? You do much less of that as an investor and you do a lot more of that as an operator. So that is, you know, equally important. Understanding the numbers of your business is important, but then also understanding the psychology and the mindset of the people that you're leading and how to transfer people from point A to point B is equally important.
- [07:20]
A
Was that difficult for you? It seems like quite a challenge to translate the analytical mindset from. From the finance world into an industry, the restaurant world, that's ultimately about human connection and experience.
- [07:35]
B
You know, I think I'm lucky that my nature is more the latter. Building experiences and connections with people. Part of that is my upbringing, part of that is my nature. So I think that comes actually more naturally to me. And then I've just been trained in finance for so long that that's almost equally naturally to me. So I think I'm fortunate in a sense that I have the ability to speak and communicate and connect with people I always have as a natural skill set and one that's been developed, of course, through time via different leadership positions and focus on it. And then, yeah, look, I mean, analytically, I've always been pretty good. But you work at Goldman for a few years and TPG for a few years and go work for John Paulson for a few years, you're going to be very good. Right. It's impossible to not be at that point. So I do think, again, both are important. Balance is important. And if people are watching that are leaders themselves, there's a self reflection that's important to understand where your strengths are and what areas you need to improve. And it's different for everybody. But you want to be great at both.
- [08:38]
A
At 36 years old, you are one of the youngest, if not the youngest CEO in the industry, one with only few black leaders in that space. How do you navigate the expectations that come with being a visible first, first or only?
- [08:52]
B
It's tricky, you know, especially because the jobs I've taken are so hard. Right. You know, I took Red Lobster out of bankruptcy. It's not a, you know, it'd be simpler if it was a business that was running well already and it was about managing and growing. This is about like a turnaround. So it's very high stakes and it's very high risk in terms of the outcome of the, of the, of the business. And so, you know, with that, that's part of why I think there's so much attention on it. So, you know, comes with, with, with a degree of, you know, people care about what happens to Red Lobster a lot more than a lot of other companies, which can be a positive. And I try to use that as a positive, like get people excited about what we're doing and to be aware of what's going on in the company. But then also, yeah, like you said, you know, it's, it makes it higher profile for me. Right. So that's just something that I try, you know, in my mind, it's not about me, it's about the business. It's about the people that work for us. It's about the team members in the restaurants. But then I get outside of my office and, you know, a lot of people want to talk about me, which is okay, I don't mind it. But it doesn't change what I need to do or what we need to do as a business. So I just, you know, I answer questions honestly and I get back to thinking about the people who work here.
- [10:08]
A
To your point about Red Lobster being such a well known brand is very much a part of Americana. I think everybody of a certain age has a Red Lobster story. I would go to Red Lobster with my family after church or on big milestone occasions. How do you now as CEO, walk this line between leveraging nostalgia and updating the brand for a younger audience or for a different audience to make it relevant in a new way?
- [10:34]
B
Yeah, it's again, you need to do both and it needs to be balanced. Right. Because you do have a core group of people that have loved this brand for a long time. And I like to start with the core, I. E. Make sure the people, your customers today are very happy and enjoying what you're presenting to them and enjoying the experience in the restaurants. So you start there and see where you can improve with the core consumer and then you expand the tent. Right. Once you've satisfied the core. So that becomes kind of where could we be better to bring in new consumers and younger diners and new guests that haven't tried us before. Right. And so an example of, of that is, you know, we fixed a lot of things that were already on the menu when we started. Right. There was an issue with the tartar sauce. There was questions around certain products that we needed to, to improve. And we did that while maintaining the things that people love the most, like the cheddar bay biscuits, et cetera. And then we had an opportunity to bring a new guest with our seafood boils, which is a new product, and aim more towards younger guests and the different demographic. And that's done really well. So you have to do both. And I start with the core because the business doesn't exist with your core guests. You really need to pay the most attention to them and then bring folks in as you can go along.
- [11:49]
A
The new innovations, the seafood boil that you mentioned, how do you make sure that you are able to retain the quality and the consistency from restaurant to restaurant given all of the cost pressures, the labor pressures that exist these days.
- [12:06]
B
Yeah. It starts with trying to simplify the process. Right. A simpler process is easier to replicate than a complicated one. So a simple process will help you maintain consistency, I. E. Don't over complicate how people need to work and they'll be able to do it, repeat it with more consistency across 500 locations, seven days a week, you know, however many times that process gets done. Right. So simplicity is, is key and then, you know, training is key, really effective training. So when you roll a new product out, training that well, you know, you kind of go level by level tra, training the multi unit leaders, training the restaurant managers, training the managers in the restaurants, training, you know, the hourly team members. So a very effective kind of cascade of information to the teams is critical and then there's manage, ongoing management. Right. So who's doing well, who's not, how do you improve? How do you make sure that you, you know, you don't train it once, then forget about it. You train and then you measure and monitor and try to improve and that's going to go on as long as you have the product. Right. So it's, it's, it's not simple. Right. Multi unit is a very difficult business for that reason. But, but you know, if you become effective at it, it can be a competitive advantage if you can deliver a consistent experience across restaurants, across states, across cities and across time periods.
- [13:29]
A
The fact that for so many people, their connection to Red Lobster is built around milestones in many ways that could be a blessing, can also be a burden if you're trying to get the business to a point where people could see that as something they could just go to on a regular Monday or Tuesday. How do you see the brand evolving in that way?
- [13:48]
B
Yeah, it's a great question. People naturally use Red Lobster for milestones, as you say, and that's something we observed. Birthdays, dates, anniversary, special occasions, which is nice, you know, it's good to be thought of in that way. And you want to make sure people who come for those sort of experiences have a great time because it means a lot more than your average meal experience if it's a birthday dinner or date night or something like that. So it's, it's a, it's not a problem in and of itself. But obviously the way traffic gets built over the long term is people coming frequently and coming for more and more occasions, even just normal kind of Wednesday night dinners. Right. So you want to become more kind of everyday use in terms of how people utilize the brand. And the way you do that is by having a menu that people want to come and eat often. Right. So having enough variety, having a good price point, having products that, that you know, people can eat frequently. And so that's menu, then that's positioning, that's a bit of marketing in terms of how you position the brand. And you know, that's how you work to improve that, but everybody's trying to do that. So it's not a simple thing, but it is something that is helpful for the business.
- [14:59]
A
When you were announced as the CEO and then when you successfully brought Red Lobster out of bankruptcy and introduced the new menu, I saw on social media, all over social media, people were going to Red Lobster in many ways to support, support you because they were invested in your success. I mean, there are some people who said that explicitly in the videos that they would post. Did you see any of that? And I wonder how did that make you feel?
- [15:22]
B
Yeah, we saw some of that and it's, it's, you know, it's really an inspiring thing. It's, it's motivating. You know, I think it is partially because of me, but I think these are people that loved Red Lobster a lot of times in the past or used to frequent Red Lobster and more or less gave up on it. Right. And I think what I have represented to these people is hope that it can come back and be as good as they remember. Right. So, you know, it's, it's something I appreciate and I don't take for granted and I think speaks to the strength of the brand as much as anything, which is, you know, is there a chance it could be what I, what they grew up with? Right. Or what they recall from the last time they came? And so, you know, I'm glad to inspire people to come back and hopefully we'll get them to come back more often and with more frequencies. You said before who have been some.
- [16:06]
A
Of the key mentors in your career and what's some of the advice from them that you hold dear?
- [16:12]
B
Yeah, you know, the people I work for, my, my key mentors, at the end of the day, you know, you spend a lot of time with the people that, that you work for and you learn a lot from them. So that, that'll be, you know, some of the partners at Goldman that I worked for, some of the partners at tpg, John Paulson, who I hold as a, as a, as a, you know, top and dear mentor. And, you know, they all teach you different things, but I think overall what they have in common probably is a dedication to their craft, regardless of what that is, a desire to, to make an impact, conviction in their beliefs. You know, especially John. You know, John's a great investor because he does the work and then he's convicted when he's done the work. And, and, and, and, you know, he trusts himself and he trusts the process and he trusts his, his Results. So, you know, there's a lot to learn from that. And with John, I'll also say he's an incredible statesman. Right. He, you know, John will meet with important people and they all. They all love him when they meet him. Right. They feel like they're. They're connected to him. He knows them, they know him. So he does a tremendous job, not just as an investor, but as an important person dealing with other people and making them feel special. So lots to be learned. And I've been fortunate to know a lot of great people, but those are some of the lessons that I've learned.
- [17:35]
A
I saw where you said that success for you isn't just about turning around Red Lobster, but about creating opportunity. So what does that mean in practice in terms of who you hire, who you promote, and how you invest in people?
- [17:48]
B
Well, the way you create opportunity is to create jobs. And the way you create jobs is by building a business that's sustainable. Right. So the best way to make a positive impact in terms of creating jobs and creating opportunities is to run a business that is profitable and sustainable and that can last long into the future and grow. Right. The more you grow, the more jobs you're able to. To. To add. So, so it. It for me, it comes back to, you know, numbers are. Are numbers, but they are. They. They do yield a result. Right. And good numbers mean you can hire more people. Right. So it's running the business well is the. The best thing we can do? And again, when I took over this, this company was. Was in pretty horrific shape. It was coming out of the. And not doing well from a numbers perspective. And so it's been about improving that and trying to build a base that's sustainable that the company can go forward with.
- [18:39]
A
What's your North Star metric for Red Lobster right now for the revival of the company?
- [18:44]
B
Yeah, I think guest score and guest frequency are the two most important metrics to me. So when people come visit us, how do they rate their experience and then how frequently do they come back? Right. So those are the metrics that kind of set the tone for everything else in terms of what the guest is perceiving and how frequently they're visiting. And then everything kind of flows from that.
- [19:04]
A
Yeah. What's your favorite thing on the menu?
- [19:06]
B
The Mariner seafood boil. Extra, extra spicy.
- [19:10]
A
It's good one. Not so much with the spice for me, but that's a good pick. Is there a habit or like a personal routine that you follow every day that you. You believe contributes to your success?
- [19:25]
B
Yeah, I Did. I think morning workouts for me have been something. You know, I did that since I played football when I was young. We had to at the time. And I do it by choice, you know, self, self, self immolation, I guess. But. But, you know, for me, the morning workouts are important because it sets the tone for the day. You almost start with the hardest thing, which is getting out of bed and going for a run or, you know, whatever the workout is, and it makes the rest of the day, I think, easier or feel. Feel easier. Right. You start. You basically start rolling downhill for the rest of the day. Right. Which. Which I like. So morning. And then, of course, there's a ton of health benefits, longevity benefits, psychological benefits, confidence, et cetera. So I think there's. That there's one thing you do every day, just make sure you move, do some exercise, and it'll. It'll benefit you tremendously.
- [20:18]
A
What motivates you at this point in your career?
- [20:21]
B
You know, that's trend that's shifted a bit. I think when I was younger, I was just trying to, you know, do well and make some money when I got into finance. But as things progress, you know, I think the. The point you made about, you know, what I'm doing is inspiring a lot of people, and a lot of people are watching and taking inspiration and, and reevaluating their own lives and projecting maybe that they can do different things, more impactful things. So I think that sense of impact to people more broadly into certain communities that are inspired by me, that becomes more and more of the calculus for me in terms of what inspires me.
- [20:58]
A
Demola. Adam Malekin, CEO of Red Lobster, thanks again for your time. We appreciate it.
- [21:02]
B
Pleasure. It's a pleasure. Thanks for having me.