EntreLeadership - #324: How Growing Cultural Cultivators Leads to Scale with Travis Boersma

Episode Date: May 27, 2019

Dutch Bros Coffee CEO and Founder Travis Boersma has big expansion plans—like opening 800 new stores in the next five years—but he wouldn’t even dream of scaling at that rate without one thing: a passionate team. In fact, he credits his almost 10,000 employees, who he likes to call cultural cultivators, for the coffee chain’s continued success. Tune in to hear Travis explain why culture is king at Dutch Bros and how he pours into his team every day. Also joining us is Ramsey Solutions Executive Vice President of Business and Leadership Daniel Tardy with a game-changing lesson on getting your team members to act like owners.   entreleadership.com/podcast Listen to episode #102: Travis Boersma—How to Avoid the Hiring Grind Dutch Bros website Upcoming EntreLeadership conferences Register for the 5 Fixes to Get Your Employees to Act Like Owners webinar   Want expert help with your business question? Call 844-944-1070 and leave a message or send an email to [e-mail]. You could be featured on a future podcast episode! Learn more about your ad choices. Visit megaphone.fm/adchoices

It's constant never-ending improvement, man. That's why we're here. I mean, we're all growing. Success is known. It's renting the rents do every day. So what are you going to do about that? Helping business leaders grow themselves, their team, and their profits. This is Entree Leadership. Now, here's your host, Ken Coleman. Coming to you from the Music City, this is the broadcast of leaders by leaders for leaders.

Thank you so much for joining the conversation. Here's what's coming up for you today. CEO and co-founder of Dutch Bros Coffee and good friend Travis Borsma joins us. And then Daniel Tarty, our executive vice president of business and leadership. We're going to bring you some teaching from Daniel on how to get your team members to act like owners. Well, I have enjoyed getting to know, Travis Borsma, the man, the leader, and I got to tell you, I've enjoyed just as much watching the culture that he created and has continued to foster. When we're around the team members of Dutch Bros, it's just like being around a warm light. Everything about them really permeates the culture that Travis and his leadership team have sought to create,

and they've done an incredible job doing it. Dutch Bros. Coffee is the largest privately held drive-through coffee company in the U.S. He started the company in 1992, and since then the company has grown to more than 325 locations with 10,000 team members in the U.S. seven states. And he also has brought about 400 team members to our Entree Leadership Summit this year. They've been at multiple summits. And it was at the summit that I got to spend a little time with Travis. Here is our conversation. Well, this is fun. Travis, back on the podcast with us. It was about the team is telling me two and a half years ago and we had just learned about Dutch bros. And I was like, this is an amazing story. We got to have him on the program. And we had you on the

program and then you've become a big part of this event, you and your leadership, and there's always like hundreds of people. So how many people at this year's summit are here from Dutch Bros? Oh man, we've got over 400 here. 400 plus. Yeah, mind blow. It is. Super cool. Why? Why do you keep coming back to this and more people keep coming? I'm just curious. Well, I'll tell you what, man, culture is everything for us. You know, so developing leadership and making sure people understand the depth and the bandwidth of what this whole message is all about. it's everything. You know, the vision of the company for us is a compelling future,

providing opportunities for people within the company to grow up. And, you know, maybe more importantly for them to grow outside the organization, make a difference in community. Yeah. Give us a snapshot best you can. If we go back to two, two and a half years, how much is the company grown as it relates to just team members coming on the team? Oh, gosh. I know that's impossible.

What would you guess? You know what? I mean, this is the thing. we're like close to 10,000 employees strong in seven states. It's incredible. You know, almost 350 stores. Yeah. Yeah.

Yeah. And people come to you, I imagine, because back at that time, they were coming to you because they were like, this is the best place. This is such a great place to work. They were seeking you out. You're not having to go find people. Well, yeah. I mean, the thing is, it's built for just growth.

It's built for community. It's built for impact in people's lives. And that's what it's all about. You know, so when you have those kind of things, you're like a magnet. You're attractive. And it's a great work environment, man. I mean, we're rocking music. We're having fun.

We're building coffees. We're building relationships. And the products love, man. Yeah. It's incredible. So as you look towards the future, you're in seven states now. And before we started recording, this was really great. I asked you, I said, what's the goal to go national?

And you said, well, yeah, but at the same time, it's just about providing an opportunity for people. So that growth rate, the speed, the rate, the size is all dictated on if you can continue to reproduce that initial vision. And I love that. The goal is to blow minds. You know, I mean, the bottom line at the end of the day is our rate of growth is predicated on the people that we have that are ready to rock. Right. And so it's like a giant farm league, if you will.

You know, when we have this pipeline of people that are passionate, that really have proven themselves as operational, like, excellence, cultural cultivators. That's the thing that really separates people. And those people that are hungry, that are willing to go the extra mile, that put in the hard work, that want to earn those opportunities, we want to reward those people, man. And we reward them with like six-digit income, you know, right out of the shoot going from a part-time position into a full-time leadership role that is all driven by, you know, helping other people. Right. Is what you just described those attributes, Is that what you're looking for in a brand new employee, somebody who may be joining the store in a part-time role or they're coming on board, they're an hourly wage, whatever the situation.

How do you keep that? This is the thing, man. I mean, we're diverse. So it doesn't matter what color's skin is or what your beliefs are. Whether you're an extrovert, you're an introvert. What happens when you come to work for Dutch is you get to develop skills and strengths that are to serve you in your life with wherever you may go. So it's a stepping stone, man.

I mean, this thing is way bigger than coffee. It's way bigger than Rebel, which is our energy drink. But the thing that really fuels the whole thing by miles and is a differentiator is the culture. Right. You know, I mean, that's the thing that I think people come for great product. They come back for the people. Yeah, that's right. How do you keep instilling and keep protecting that culture as you keep growing?

10,000 people, seven states, you can't be everywhere. Your leadership team can't be everywhere. How do you keep an eye on that all important thing of culture? It's constant never-ending improvement, man. That's what we're here. Yeah. Right. I mean, we're all growing.

Right. with work ethic and an attitude that's positive. That's what it's all about. So how do you, though? I mean, back to the practicality of you got all these stores, you get leaders of these stores, how do you keep the story alive and the values that they understand.

Wait a second. This is a different kind of company. This isn't even a coffee company. This is just an opportunity company. That's what you guys are about. How do you keep that? I mean, what's the practical side of this? Because I want leaders to understand,

certainly those that are listening that have multiple locations, teams that are in different places. How do you protect it? Well, I think some people think that you've got to hold on to people forever. And I think it's the opposite. I think you've got to help people design their life and live their dream. Right.

And so we plant that seed right from the very beginning. We want to know what some of your interests are, what some of your skills are. Some of the things that you may want to pursue, some of the strengths that you possess, do you have goals? You know, some of the young people that we get in, man, I mean, they're focused on playing video games and eating Doritos. And you're like, well, that's cool. and you live at home and you just need a part-time job, put gas in the tank. Cool.

But what are some things that you think about? What are some things that you could do? It's asking quality questions and getting answers at some point and planting seeds that may sprout and germinate into really strong plants. So we have some people that come in and they're part-time college students

and they know where they're going and what they're doing and they're well on their way. But it's a wide pendulum of people. And it's really at the end of the day. today is love all serve all mentality. Yeah. I know that you promote heavily from within. You talked about it just moments ago. What's the process that you as a leader and your leadership team have put in place for somebody to see a ladder and then actually get to move up the ladder? What is required of them?

Well, you know, I think you start as a part-time broista. And you get great tips. You get part-time hours that are flexible. So whether you're a high school student, a college student, a single mom, or a dad or maybe you just need an extra job because you're trying to put some bread on the table. Whatever that is, our schedule is really, it's really moldable around what their life is. And so it's conducive to wherever you are with whatever you've got going on. And it's really a way for you to earn extra money or really if you're on a path where you're driven and motivated to become a regional operator within the company and really get to a place where you're earning extraordinary income. I mean, we end up paying a six-digit salary,

a $100,000 salary when you open a shop in one given area, and you could oversee up to 10 shops, and you get half the net profits. And with that model, these guys, they have zero debt. Right. So, you know, it's if you're going to college and you go get your degree and in your four to six years down the line, how much debt do you have? What's the job that you've got? Is it the one that you signed up for with your degree? And then what kind of money do you make? And what's the net after that? Well, where we are, man, you're traveling a path and you may earn that college degree or maybe you want to go to a trade school or something like that. That's something that I heavily encourage is what skills can you develop? What can you bring to an organization that's valuable and going to

benefit the organization, but if it's Dutch, man, you can earn extraordinary income, have zero debt, and being as a leader developing people. Yeah, I love it. So as you have grown this thing, what are you and your, let's say, your closest leaders that are reporting to you because you can't have everybody reporting to you? How do you all continue to grow? I know you're at an event like this, so that would be part of it. What are some other things you're doing to make sure that you continue to grow and stay fresh? Well, I'll tell you, from the very beginning in 1992 with just a little push cart and Grantspouse Horegan, part of the DNA has been change.

You know, so as we evolve and change and things change around us, the objective is to adapt to the things that change around us that we don't have control over. What we do have control over is our minds. We have control over our thoughts that lead to feelings. And so with the scalability of the organization, bringing in key talent, people that have been there and done that, I've kind of looked at. it like this. You know, we've climbed some mountains.

But the one that we've got ahead is Mount Everest, and I want to do that with Sherpas, and I want to have coffee on the side. I love it. And I want to enjoy the crusade. So how do we best do that? How do we best accomplish that? That's going to be with people that really are extraordinary in their space with great experience to draw from. I love that.

Millennials get a bad rap. I'm very vocal about this. So at the beat, necks and the hippies. Exactly. But, I mean, it's just become for Generation X, which is my generation and older. That was a weird generation, too. It was jacked.

Yeah, we just got a bed. Like all we could come up with us is X. We're always a wreck. Everybody's a wreck. Everybody who's a wreck. I know. That's the point. Yeah, that's a joke.

I know. Everybody is value. I know. So this is what I want to say. This is good. So I'm glad you leaned in. So I've talked about the fact on this program and from the entree stage that you've got to be able to lead them.

Like, they may come to you with all kinds of cultural differences than your generation. That's just the way the world works. generations are generations for a reason. Things change. But you've got to lead them, and you're leading them well. And I just want you to speak to that. You talked about the cynicism to that, you know, that old millennials or snowflakes, whatever. Bottom line is, you're leading them well. I'm curious, what are you seeing out of this generation with your unique culture where people are, you just say, hey, if this is a stepping stone, great. We're thrilled to be a part of your story. Do you see that being the future? Not just Dutch bros, but like, have you tapped into something that many leaders need to say,

hey, we better figure out our own version of what Dutch is doing. I'll tell you what, man, I just listen to our William Speak, and he's 77 years old, and he's leading. Yeah. And I don't care what generation you came from, man, you can be a leader. Yeah. And I don't care what generation you're trying to target or how you're trying to stereotype. People are people.

That's right. And at the end of the day, man, love rains. So if you're there for people and you have that servant mentality and you're really caring, man, they're on fire. That's what it's all about. I mean, people just want to be loved. the end of the day, you know, if you're a baby, you're brought in this world, you don't have love, you die. That's right. You know, so what are we doing about that? Yeah, I love that. Well,

you got to love people. That's really, really good. What are you excited about in the near future? I feel like we're just getting started. Yeah, I think you are. I'm just so fired up. I'm ecstatic about where we sit. We've got a couple new states on the horizon. I see us penetrating into New Mexico, potentially, maybe into Utah. Texas could be on the scene. But, you know, but you know, these opportunities that we've got for growth, I think we've got something pretty extraordinary and this mindset of being a model business for others to draw to and really some things that we can make an impact with

with influence on the social sector of our company and really promoting from within. We don't sell franchises. You know, we grow from within. And so, you know, you've got to earn it the old-fashioned way, man. And I just think that there's so much potential that lies ahead with our growth. can make major impact in people's lives.

You don't have to answer this, but I got to put it to you. We don't do gotcha questions on this program. This is as close to a gotcha question as I'm ever going to ask. Is Tennessee on the list? I'd say, you know what? Everywhere is on the list at some point. Well, I know that. But I mean, are we at least, are we getting a consideration in the near future?

Absolutely, man. I mean, you know, it's time, right? But it's all going to be predicated back to the people side. You know what I mean? The rate of growth has to be predicated by the people. There's three buckets. There's money that you need. There's people and there's sites.

And at the end of the day, if you don't have the people, you shouldn't be doing the sites and spending the money. That's right. So, you know, we want to invest in our people. And that's what we're going to look to with our growth pattern. Average age of a team member in a shop, in a coffee shop. Boy, probably 24. Love that. You know something like that?

Yeah. We've been talking about the people, the company, people. Let's talk about the customer because you've done something unique there. What have you found? Even now, I know you're constantly tweaking and looking at it, but what's worked so far? What are the customers telling you that has made you guys special? Well, you know what? It's family. I think that's the big draw for us is you've got people from, you know, being brought into this life as toddlers to, you know, elderly folks, right? grandma and grandpa. But at the end of the day, young energy is where it's at for us. So, you know, what's that look like? What's it feel like? I think authentically, we're really just kind of a punk rock

coffee culture. You know, I mean, that's where we really sit. And so I think alternative is probably that that term that you'd use for Gen X. Sure. I think punk rock is probably right before that. You know, where do we sit today, man? I think music is going to be a big different. differentiator for us. And what lies ahead with EDM and some of the things that's going on out there with some of the, what I would consider like disco, EDM kind of throwback stuff. Right. I have this pet peeve of mine and forgive me for the country fans out there.

But, you know, country music is trying to like bleed over into all the other genres of music, which I think there's a new movement that should be called contrarian. Right. You know, I think there's an opportunity there. for folks. Yeah, I think there is. So music is, the way you serve your customers and music, the whole environment. So you've got the way you love on customers, and that's the family thing that you're talking about. And then there's this unique vibe when you walk into an actual, it's music, it's different, and so you're attracting those kind of people. Yeah, I just

played golf with Alice Cooper two weeks ago. You got to be kidding me. And talk about a mind trip. Yeah, sure, of course. He has a foundation in Phoenix called Solid Rock, and it's all about art and music and recording studios and kick-ass instruments. And Jordan Sparks, who won American Idol, came through their facility and wears a little Alice Cooper bracelet. But man, he's 70 years old. He's out there with a 70-stop, US, not a US tour, a world tour, with two different bands, one of which is Hollywood vampires with Johnny Depp and Joe Perry on lead guitar.

And, I mean, these guys, they get after it. But I think with where we sit in music, There is so much creatively within our organization that we're going to do some dynamite things with. We've got five initiatives. It's really the rate of growth with shops. We want to open 800 shops in the next five years, new ones. Wow. And then embracing technology and making that our friend a frictionless transaction.

I think that's key. Using business data to make great decisions, you've got to have great factual information to make decisions. a disciplined brand strategy, man, and then bringing in key talent, experienced individuals that can help with our crusade. And I brought in a president who's a game changer, is a strategic planner. He's worn a few hats in his time, Mr. Joth, Ricky, and I couldn't be more ecstatic about that. I love it. And was there ever any, I don't want to say doubt, and I don't even want to say insecurity, but just uncertainty of you've got this company that's doing really great, and then you make a decision, I've got to go bring in some other talent. How has that challenged

you as a leader to step back and let them do some things that maybe they're better at doing than you. Was that a struggle or was it easy for you? Oh my gosh. It's a blessing for me. That's what I thought. You know, I know where I'm strong and I know where I'm weak. Boy, howdy, man, when you bring somebody in strong where you're weak, game changer. So I'm thrilled about the key guys, gals that we're bringing in and I couldn't be more ecstatic about where we sit with the scalability of the growth. I mean, like I said, I feel like we're just getting started. One question before we let you go, and this is really not a commercial, I just think it's really important for our tribe to understand that

if you've been listening to this program, you've never come to one of our live events, that what Dave has done works, obviously, and how we teach it works. And you have been coming. Your team has been coming. Just curious, what would you say to somebody who has maybe thought about coming to one of our events?

How is it valuable for you? And again, I'm not looking for the compliment. I'm looking for specifically content that maybe you've taken away from, whether it's Dave or Chris Hogan or one of the other guest speakers, why is this event valuable to you as the leader of Dutch? I'll tell you what, authenticity is the thing I think about.

You know, there's nothing like an authentic experience. It's like going to see a live sporting event or going to see a live concert. That's a difference maker in a big-time way. And when you come to a real live event with people that have heart and soul and they're pouring it out on stage and there's no editing, there's none of that. It's like it's on. And you've got like-minded people, the energy, the aura, the feel, the vibe.

Come on, man, it's a game changer. Yeah, the room's electric, isn't it? So great. I got to tell you, the first time I ever talked to you, I was like, man, I just dig this dude. I think when it comes to authenticity, I think you model the way. I think you're 100% the true blue dude. All you have to do is spend 25 to 30 seconds with anybody who works for Dutch. And you come away going, wow, there's something special in the water.

there and for you to take it from Oregon and it began to trickle down to other states, really is the real deal. And as you know, from Dave, myself, all of our team, we love Dutch. We love having you guys a part of this event. And we're so excited to see what you're going to do. So thanks for being with us. Hey, thanks for having us, man. It's been a blast. Big thanks to Travis and his team for truly setting the culture of what is an amazing and electric event at Andre Leadership Summit. I told him this. off the record after we were done talking. I said, I believe it is your team that has

created much of the excitement and the juice that exists at Entree Leadership Summit. There's no other event like it. And a lot of it is how the attendees are engaged. And I think they've had a lot to do with it. And again, just one more testimony to the leadership of Travis Borsman. So great stuff. Thanks, Travis, for hanging out with us. All right, let's go to Daniel Tarty, who is our executive vice president of business and leadership. He recently recorded some teaching content on how to get your team members to act like owners. I love this because this is true podcast style. Daniel got the thought.

He picks his phone up, hits the memo, and starts teaching, and that's what you're going to hear. Here is Daniel Tarty. Hey, folks, Daniel Tarty here. Hey, we get this question all the time from leaders around the country. How do I get my team to care the way that I care? How do I get them to think like an owner? I own the place. I care about everything. And it seems like my team just kind of phones it in sometimes. So, you know, this really can be done. First of all, let's talk about why we want to put some work into getting our team to think like an owner. You can delegate more to a team that thinks like owners. You know, there's less drama because people just make decisions and they figure out how to get along. No one says, hey, that's not my job. Someone else is going to do that. And things are just kind of magically take care of themselves. Like, no, people pick up the slack if they're thinking like an owner. This is a big one. Your customers are served better. You also don't need a bunch of policies. People can make decisions and use their judgment, use their critical thinking skills. You don't have to have a bunch of rules and regulations to manage everybody. Because if you think like an owner, you just do the right thing. You make better decisions. Also, you're advancing the decision-making to the front lines. You stop being the bottleneck for all the decisions because more people understand the mission of why we're here to think like an owner.

and they're doing the right stuff without you looking over their shoulders. So here's what I love, a team of, I don't know, three to five people that act like owners and think like owners and care deeply about the outcome, they can outwork a team of 20 people, 25 people that are just there to collect a check and just have a J-O-B. So this idea of getting our team to think and act like owners really, really matters. So how do you do it? Well, first of all, it starts with hiring. One of the biggest mistakes that we make in hiring is we hire skills over heart. We go, okay, it looks like they can do the job, and then we don't ask them why they care about working at this company,

why they care about the mission that this organization is about. So I love to spend a lot of time in the interview process, really digging in and asking what makes somebody tick, what motivates them. I want to hear them light up. I want to hear them get excited that serving people and taking care of people really, really is a passion for them. not just something that they're going to give lip service, but I'm looking for stories and indicators and their past experience where they've really gone above and beyond

to take care of customers and that they genuinely just get joy from doing that. That's super important. So in the hiring process, don't just look at their skills, look at do they have a heart? Do they care about people? Are they going to care about the team

that they're going to be working with here and they're going to care about our customers? The other thing is, the mission, if you're not clear on the mission of why your organization exists, this is the whole, you know, Simon Sinek talks about start with why. And unfortunately, a lot of times in work, we only talk about what. We talk about the job description. We talk about, hey, this is what you need to do to be winning.

And we don't ever stop and go, this is why it matters. Let's take for an example, somebody that works for a HVAC company. Well, if the mission of your HVAC company is to have happy, comfortable households for everyone, everything else falls into place. But if you're talking to one of your technicians and you only tell them, your job is to take duck work out and put it under the house and fix the AC unit,

and they don't ever understand that they're doing that so that everyone can have a happy, comfortable household, well, they're going to miss the things that an owner would miss. An owner comes up to the house and they realize, hey, the paper's in the driveway. I can bring that up to the front door on the way in. We got this company here in town

that every technician, understands the why. And they knock on the door and then they put on little booties before they come in the house. They're not tracking mud in the house. They're thinking about this stuff. They're not just there to do the job.

They're there to make a difference. But people don't know what difference they need to make unless as the leader, we take the time to sit down and say, this is why we exist. So first of all, it starts with hiring. Second of all, everyone has to know the mission and know the why.

And you have to model that and teach that all the time. Every week we're talking about why we exist, We're sharing stories of customers who are excited about the experience they've had with us. We're making sure that people have that in their hearts and that they're reminded all the time. We're not just here to do the work. We're here to make a difference. And then the third thing that we love to do is share the profits. Pay people like you get paid.

You want people to think about the bottom line. You want people to think about ways that we can keep expenses down and get revenues up and go the extra mile to take care of the customer and maybe ask for referrals, even though they're not technically the salesperson. We'll pay them like an owner and teach them how, profit works. And every time you pay out a profit sharing check, take that as a teachable moment where you go, hey, we're sharing the profits. Here's how profits are created. And we do this routine. It's almost, it's almost funny and laughable, but we've done it so much. Our CFO every

month with our staff meeting gets up and says, revenues are created when profits go up and we all say up and then expenses go down. And we all say down. And we're all self-employed. And that's why we have profit sharing. So it's a really good ritual to get your team to start thinking, I don't just get a salary to punch the clock and phone it in and collect a check. I actually am a part of the ownership team here. So do this with your team and you're going to be happier. You're going to be making more money. You're going to be having more fun. And the people that you work with, it's just going to be, it's going to be a lot better to be around them because you're all passionate about getting the bottom line to grow. And most of all, you're super passionate about taking really great care of your customers.

and make your customers have a much better experience. So I believe you can do this. I believe in you. Keep growing. And we'll talk to you again really soon. By the way, just a little nugget there, if you get a thought as a leader, and even if you think it may be great or it might be cheesy, maybe it's 50-50, you're not sure.

Grab the phone, hit the voice memo and let your heart sing a little bit. Now, if it's awful later, you can mitigate the damage by letting a couple people. People listen to it. If they think it's awful, you delete it. It goes on the ash heap of history. But I want to point out that what Daniel did there was so good, we wanted to share it. And he did it in the moment, which means he didn't think it, he felt it. One other little nugget. The proximity principle came to me on the way to work. And I took my phone out and said, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, blah, and I just recorded it. The first time I said it, it was exactly the way I wrote it and the way it came out. And so this idea of when you get a thought, it's a pure moment. You don't need to be. You don't need to

to worry about word smithing it, just blur it out and capture it. I love that from Daniel Tarty. Really good stuff. All right, let's move on to five fixes to get your team members to act like owners. Yes, this is on message with what you just heard Daniel Tarty teach about. This is an entree leadership webinar. So if you're wanting to dive deeper on learning how to get your team members to have that self-employed mentality, this webinar will do it for you. The five fixes to get your employees to act like owners. If turnover is costing you money, then and you can't afford not to be involved in this. Check out the webinar to register, text five fixes.

That's one phrase, no space. Five fixes. Spell it out. F-I-V-E-F-I-X-E-F-I-S. Five fixes. Text that phrase to 33-444-4. That's 33-44-4-4. Or click the link in this episode's show notes.

Well, big fun to have Travis and Daniel contributing to this program on behalf of the entire Entree leadership team. Thank you so much for listening. We'll talk with you again very soon. Hey, folks, I want to make sure that you're aware that we have other great podcasts from Ramsey Solutions. Here's a sample of the Chris Hogan Show. I am so excited to be able to talk to you all week in and week out. We're going to talk about your money, your life, your dreams, and your goals. You know why?

Because I'm your coach. Whether we're talking about building wealth, paying off your home early, investing, paying for college, and guess what? How to become an everyday millionaire. We're going to focus on taking your calls because you matter to me. Together, we can do this. This is the Chris Hogan Show. If you'd like to hear full episodes, just search the Chris Hogan Show in Apple Podcasts or go to chris Hogan 360.com.