Mark Bell's Power Project - Power Project EP. 54 - CEO of Philz Coffee Jacob Jaber

Episode Date: May 18, 2018

We hung out with friend of the show Jason Khalipa along with the CEO of Philz Coffee, Jacob Jaber. We met Jacob at Philz HQ in San Francisco to talk about how Philz Coffee got started, what it's all about, and where Jacob wants to take it. ➢SHOP NOW: https://markbellslingshot.com/ Enter Discount code, "POWERPROJECT" at checkout and receive 15% off all Sling Shots ➢Subscribe Rate & Review on iTunes at: https://itunes.apple.com/us/podcast/mark-bells-power-project/id1341346059?mt=2 ➢Listen on Stitcher Here: https://www.stitcher.com/podcast/mark-bells-power-project?refid=stpr ➢Listen on Google Play here: https://play.google.com/music/m/Izf6a3gudzyn66kf364qx34cctq?t=Mark_Bells_Power_Project ➢Listen on SoundCloud Here: https://soundcloud.com/markbellspowerproject ➢ Watch on YouTube: https://www.youtube.com/markbellspowerproject FOLLOW Mark Bell ➢ Instagram: https://www.instagram.com/marksmellybell ➢ Facebook: https://www.facebook.com/MarkBellSuperTraining ➢ Twitter: https://twitter.com/marksmellybell ➢ Snapchat: marksmellybell Follow The Power Project Podcast ➢ Instagram: https://www.instagram.com/MarkBellsPowerProject Podcast Produced by Andrew Zaragoza ➢ Instagram: https://www.instagram.com/iamandrewz

Just everybody grab a hold of their microphones there. Yeah, you know, one thing I think that's important, like, again, with – one thing I think that's really important with, you know – Put your pills cup here. That's right. Getting that – You don't need to convince me. I'm on the team.

Well, one cup is equivalent to four or five shots, and it's only $3.50, $4.50. Oh, that's great. So you are getting a lot of bang for your buck on quality beans. Yeah. Getting hyped up. Yeah, it's good for you. 350 450 oh that's so you were getting a lot of bang for your buck on quality beans yeah getting uh getting hyped up yeah it's good for you i was gonna say uh you know one thing that's important with fitness is to not ever view it as like i have to go to the gym to do abc because that'll prevent you from going yeah and if you're just if you just work out the way you are especially if you go for a walk yep you don't have to change you don't need a towel you don't need a gym

membership you don't need all these things if you invest in a bike, you don't have to change. You don't need a towel. You don't need a gym membership. You don't need all these things. If you invest in a bike that you just have in here, bam, done deal. You watch whatever, watch a show or whatever. It's more of an integrated mindset, integrated lifestyle versus, because it's hard to get out of bed and to go and do it. Yeah. That's one of the things I like to do. Go ahead and hold the mic.

Because we're rolling. Yeah, just, yeah. Oh, we're actually rolling already? Yeah, we just start going. You can edit oh if we mess up they'll take out yeah but like that's one of the no one will see this that's one of the things i like to do right is in the morning as soon as i wake up i'll get right on my spin bike actually jaime was there this morning i was doing a workout so i start off on the spin bike nice and casual might like read through a few make sure there's no like super critical emails on the bike but then once i'm done i put the phone away and i

get into my workout for the day but it's a nice way to kind of like be moving check make sure there's nothing crazy put it away and then get into the workout i like to start each day by doing some type of movement it just kind of kick starts the day and kind of sets my mindset like like kind of like the hustle you know like the hard the hard work. You're a, you're building a really impressive business. You know, this Phil's coffee is just, uh, it's unbelievable. And, you know, he's been a coffee connoisseur for a long time. I've been chugging down my fair share of coffee over the years, and we've both been very impressed. And that's why we're here today. So let's just start out with a very simple question. I go to Phil's coffee and I go to phil's coffee hq and i run

into jacob where's phil who's phil good question phil is a person and he's my dad and the z is actually uh when when uh we first started it was just phil's with an s but my sister wanted my dad to um uh make the way he spelled it more representative of the culture he's trying to create. So the Z is not supposed to be like gimmicky or it's not a marketing tactic. It's more about individuality and celebrating individuality, right?

Because Phil's is about people and community and respect. Was your sister young when she mentioned that? I think she was in school. Yeah. So my dad just says, sure, let's do it. But yeah, he grew up in the Middle East and moved to the States when he was about 15, but came up in an environment and a culture where community, social connection, like he thinks of the coffee table as the original social network not any online

channel so um every every night true yeah every night where are you middle east uh he's in uh he was in ramallah ramallah is how you'd say yeah so my mom's from yaf like near lebanon she's a little bit of lebanese little palestinian my dad's full palestinian palestinian okay yes my dad's from iran okay and so my dad's from Iran. Okay. And so my family's obviously from the Middle East. Yep. And when he moved here,

obviously his family moved here during the revolution. And to your point, right, it's tea for us. That's right. It's every meal, every time, it's just tea. And it's this specific kind of like thing that they cook the tea in, right? But it's just a way to kind of get around the table, create conversation.

And that's really interesting. Yeah. People are, you know, obsessed nowadays with branding and trying to be an entrepreneur and, uh, trying to figure out, you know, how do they, how do they get their brand to stick in people's heads? Uh, how have you guys been able to brand? There's so much coffee out there, you there. To try to start a coffee business this day and age sounds crazy. And you guys just started a couple of years ago, right?

Yeah. Well, we started 2003, but we actually only started really growing three, four, five years ago. At the multiple stores and stuff. Yeah. And I would say the intention that we had and my dad had was, this is not about the coffee business this is about the people's business and that the best cup of coffee is the one that comes to your taste so the concept of phil's is very unique and different and it's all about personalization so you'd walk into the barista and they'd help you decide what you want and there's a variety of options to meet every

person's individual individual any of this sound familiar to your business model yeah it sounds very similar but but on that note i just want to kind of share um so earlier today i was i was at phil's yeah obviously good choice basically everybody in our company drinks phil's that's it and so i i get back i'm like hey i'm gonna go you know meet ceo phil's really excited about it big fan and they go you know what's interesting is there's no condiment area at any phil's yep and i was like that's totally right and then i remember what every one of your baristas says me every single time i get a coffee if it's not perfect let me know and i'll remake it for you and i thought that that was just really indicative of what you're talking about right like be about the coffee be

about the person what do they want And specifically give it to them. Really cool. Totally. And it sounds like you do that with your business too in terms of an individualized approach for each person. Yeah, so we have three different classes. He's got a wide variety of people that come through his doors.

I mean, he's got, his team has, they're highly decorated, but then there's also all kinds of different ages and all kinds of different ages and all kinds of different uh people in there it doesn't matter their fitness level yep yep everybody loves most anybody who goes into your store loves coffee and they need to find the right way to give it to them right for example me maybe less cream someone else more cream whatever for us we're just trying to spread fitness in an inclusive way right if you don't want to snatch and do rope climbs that's

fine we have something else for you right we just want to make sure you're moving, doing something, right? I think that's key. And I think that's where the world is moving is more personalization. But I think that we need more connection with other people and the rise of technology has made it actually harder to do that and feel present. So I think that a lot of the big value that we get to offer is we are kind of a mechanism for presence. And that's pretty valuable. Yeah, the concept of charging more and making people wait longer is different, right? And when people first walk in, they're a little confused. I know you guys have an app and you can service people differently now.

I know you guys have an app and you can service people differently now. But with everybody having everything at their fingertips so quickly, what keeps people coming back when they have to wait a little while? Is it the quality? Are they like, man, this is a great product. I don't care if it takes a little longer. I don't care if it costs a little bit more. Well, I think our intention is not to make people wait long.

I think that every cup is handmade. The good news is that each barista can actually have multiple drinks going at once. And it doesn't actually take that long from the start of a drink to the end of the drink. It's actually only three, four minutes, more or less. Sometimes we might go over that depending on the complexity of the drink. But we really encourage and empower each team member to deliver an experience, not a transaction. And we have some guidelines, but they're a little bit soft. And my view is that if you want to have the experience, you go and you wait in line. And if you want convenience and you don't have time, you order through the app. So it's about having a multitude of experiences that best serve the

customer. Because on the weekdays, people might value the convenience because they have to go to work. And on the weekends, they might value the experience where they get to see people in line and touch them and be close to them and connect and find a table to sit down and grab something to eat. I would say that you guys have a unique way of reaching a different customer too. Because I don't know about your experience, but mine you know going to a lot of different coffee shops over the years the people that i'm seeing in your coffee shops are different than what i've seen before so maybe there's maybe there's just room for a lot of coffee companies to grow yeah well what are you seeing when you're in the stores what do you think are some of the differences it's interesting that

you say that main main difference i would would just say, is probably youth. Okay. I would say that that's probably number one. And I would say that I see a little bit older crowd in some other coffee shops and maybe a little bit more family might be the two things that I kind of recognize. In other coffees.

In Los Gatos in particular, if we're talking about that, it's more of a younger-ish demographic, kind of like the young entrepreneur, young working professional, kind of comes in. Sometimes they sit down for a little bit. They have a good conversation. Like today, I was there for two or three hours, used up one of your tables. I apologize. We had great meetings, great internet.

It was awesome. But that's kind of what I see. I see people coming in for a really great cup of coffee, almost like the way someone seeks out a really great beer yeah so you can go get a budweiser or quartz light that's fine and there's definitely people i love that yeah there's also people who seek out a phenomenal ipa something really unique and i think for you you're kind of like bridging the gap between the starbucks for lack of a better term and like you're hitting a demographic that's seeking a better cup of coffee and a cool environment to do it in which i think is awesome

yeah and one of the things i want to compliment you on is just the way that i've seen their business evolve over the last like four or five years specifically the app the app is really fascinating to me because you were using caviar and then you're using something else before head order ahead caviar and i was like when you change the caviar i then you were using something else before that. Order Ahead, Caviar. And I was like, when you changed to Caviar, I was like, oh man, I was like. We had to, because they bought them. They bought Order Ahead.

Oh, did they? Okay, I didn't know that. So we had no choice. It was no Order Ahead app or Caviar. But when you did that, and then now to see your new app, it's like, that's really cool to see you evolve. And I think sometimes, especially in our industry,

we came out with our own app and no one else is really doing it. And sometimes when you're spearheading some of these things, people start questioning what you're doing or whatever it may be. But as far as I'm concerned, you're being innovative, but keeping true to the roots of what Philz is all about, which is cool. That's right. I think the best way to scale and preserve the unique sauce is by creating frameworks

that help you make decisions that align with the values, right? So everything we think about is through the customer lens. We always start with the customer and work our way backwards. And when you do that, you just make better decisions. And I think that if you stick to your values and you have a long-term mindset, you create the highest likelihood of success over the long term. Working backwards is something I've done my whole life because I'm dyslexic. Well, that's a benefit then.

Yeah, it ends up being a benefit sometimes. I like what you just said, though, about the customer because the original question that I asked you a little bit ago was about branding. And you answered that perfectly with that answer right there, because that is what it's about. It's about the customer. If the customer has a good interaction, you don't have to worry about like branding because

they're going to come back and they're going to tell their friends. And I think there's branding intention that every business owner and entrepreneur has. And then there's the brand reality. Right. And I think you're, everybody's hope is that uh the the the brand that you want to create is what people are perceiving and feeling and i think it's uh important to make sure you think about what is what is actually happening versus i want what what do i want happening so one of the things that we care a lot about is creating like grandma's

house an environment where everybody feels warm and welcome. And every time I'm in stores, uh, maybe I'll have a conversation with a customer or two and I asked them, you know, how does, how does Phil's feel to you? You know, and what can we do better? What? And one of the things they always say is they feel like they're at, it feels at home. They feel like they're at home. And that's, that's always my way of checking. And it almost looks like a modern day office kind of thing yeah and on that note i just want to share one thing that you might not even pick up i'm sure you do actually but the music is obviously you know depending on who's the dj that day or the music guy it's always like lively feels good um but but i want to just touch base on one thing

like grandma's house i think what's really interesting i had to ask you about yeah is the fact you pay after you get your drink yeah from from somebody else. And they always say like, oh, what did you get today? I'm like, uh, because most of the time I just ask the barista just to make me something. And so sometimes I'll forget, but I'm just telling you, I forgot to pay like twice, but I promise I've gone back and paid for my drinks. We're watching you more than you know. I promise. Because I feel bad. I'll leave and be like, oh my God, I forgot to pay. And so I go back and I pay again the next day.

So my question to you is, if you want to make it like grandma's house, is part of that the payment process? Because I feel like you almost don't make a focus on payment, which is unique to me. Is that intentional or am I just… Think about how terrible the payment experience anywhere is a pretty bad experience and uh i think for us we didn't design our concept with payment in mind we designed it with personalization in mind and obviously we had to get paid so that's where the the the cashier comes in but there's no greater gift

to give someone than the gift of trust and i think that we we've done we've audited a lot of stores and you know out of the last study we did out of 420 customers who came in zero everybody paid zero zero walked out so you'd be surprised that it's actually not that big of a problem, even though an experienced operator would look at that and be like, are you guys crazy? It would also force you to be more attached to the brand, though, because they're like, what did you have? And then you have to repeat it.

And you're like, I don't know. And you've got to go look back over, and you're like, that's the one I like, and you've got to try to keep track of it. I mean, I would love to pay the process to get eliminated and for that not to be something anybody has to worry about. So that's what I'd like to move towards because I just don't think it's a... What would be something that would work for that, do you think?

Back in your brain with anything now? Yeah, no, I just think that coffee is habitual, right? It's something people enjoy every day. So how do we look at, I'm not going to buy a cup of coffee at Phil's. Phil's is just part of my day. So how do we build on the idea that Phil's is part of your day? It's part of the routine.

Yeah, and I think there's something cool we could be doing. We could be doing that a lot better because I just think it's a burden. Can you create the first coffee membership? I don't know you know 100 bucks a month you get uh you get one coffee a day every day 200 200 yeah let's start high maybe i mean i don't know what the answer is but i think that there's an opportunity the only reason you'd go to the cash i mean food is good because it kind of will be your first members yeah i will be i will be a member it distracts you from the payment because you're walking by the food you get to it's not all payment it's food and payment so that makes it a little bit better but what if it was

just coffee and then food and then bags to go for the house why do you think uh other coffee shops haven't had uh such different flavors like they'll have different kind of roasts. They got light, medium, and dark. They just don't have a lot of choices. They don't have a lot of flavors. You guys, I don't even know how many different flavors. There's probably 30 up there. 15, five dark, five medium, five light.

There's over four million ways to have your fill. That's the kicker, right? You can put cinnamon in the filter. You can do half- secret menu you can do half half you can do half cap anything's possible when i first came in i was looking at the board and i'm like that says chocolate and that says hazelnut and i had to ask him i'm like does it actually those are chocolate notes yeah yeah it's just people do get confused yeah i was like what i was asking some questions about some of that i didn't want extra sugar or whatever, right? Totally. How have you guys kind of come upon this style of coffee?

I think, again, it comes back to the idea that the best cup of coffee is the one that comes to your taste. And our concept allows us the flexibility to personalize it for you. And it's all handmade and it's fresh. So we've never thought of it as we have to be competitive and also incorporate lattes and espresso-based drinks into our... It's not about that. It's just about getting a great cup to someone. Do you guys even have that? No, we have no lattes, no espresso.

But we get a ton of people. Whether you are a cappuccino drinker, a latte drinker, an espresso drinker, a traditional drip drinker, all of those people convert to become fills drinkers once they find their fills. So one of the strengths we have, but also a weakness at times, is how good we are at helping customers find their fills. times is how good at we are helping customers find their fills. Because if you don't understand the concept and your first time experience maybe is not optimal, or maybe the barista was off that day for one reason or another, it could really shape your... You could be overwhelmed and then you're going to be like, well, I don't know if I've found the one I like. I'm going back to my cappuccino or whatever yeah and so to talk

about coffee purely coffee from my understanding and again i'm no coffee expert but i surely drink it a lot um looks like you grind the beans on site right you you get them roasted elsewhere bring them on site grind them do like a traditional pour over method if i'm not mistaken but you look like you use a different type of filter system. So can you run us through a little bit of, because I mean your coffee is without a doubt. I'm trying to duplicate it at home. No, no, no.

I'm trying to duplicate it at home. Your coffee is without a doubt more potent than a cup anywhere else. It is strong. So first we roast all of our coffee. We have a great coffee department who sources beans from around the world. So each

Phil's blend has a multitude, multiple varietals, single origin beans. And the idea is that the combination of the varietals create new flavors and enhance the ones that are really good in the single origin beans. So after we roast them, we blend them, and then we distribute them out to our stores. So we do all of that. And then the process is, like you said, every cup is ground fresh for each customer. We put it in a filter, we pour water over it, and we make it. So it's comparable to pour over, but there are a few things we do a little bit differently, both in terms of maybe temperature, the type of grounds, the way we stir it, the amount of beans that make it taste a little bit different. But I can't share with you all of the detailed secrets.

Yeah. A lot of people are trying to be successful. They're trying to kind of do their own thing. are trying to be successful. They're trying to kind of do their own thing. How have you kind of hit your stride with some of this? And I guess let's maybe just back it up a little bit. What were you doing before? I know your dad kind of introduced the coffee first in a liquor store slash grocery store, right? And that's how some of this got underway. But was there ever a point in your life where you were maybe just a little bit lost? There's a lot of people that listen to this show, and I interact with a lot of people that are maybe just getting out of college or just out of high school, and they're like, I don't know what.

They're like, what am I going to make of myself, and how am I going to get going? A hundred percent. So if it wasn't for my dad giving me the opportunity and empowering me. And this was just one store. So I'm not walking into a big business. I'm walking into one store and we're not very financially successful. And that was really important actually. But I hated school and I, I hate this is a strong word,

but I disliked it a lot because I was forced to learn stuff I wasn't really interested in from people who weren't that interested. Right. Let's talk about coffee. Yeah. And I think that I love education and learning, but I learned a little bit differently. I learned through doing, talking with people that I admired. So I had no idea what I wanted to do. I worked at, I remember because I was helping my dad since I was 10 years old when it was a grocery store. And then I would go to school and I'd hang out with friends and I'd help him a few days a week. At the time, did you not maybe like it that much because it was like your dad's thing?

I had a love-hate relationship with it. I liked it because I liked the business. I liked helping the customers. I liked working. And I disliked it because the last thing you want to do as a teenager is spend more time with your family when you already live with them. So I left school. I left college, I dropped out, and then I started helping him full time. And I only had one job before that, which was Abercrombie.

Oh, really? In the mall or what? In the mall. Oh, man. Yeah, Hillsdale Mall, Hillsdale Mall in Abercrombie. And I would sell jeans. And I did a pretty good job, but that was not, that was my only experience.

I thought I'd maybe get into real estate. that was not, that was my only experience. I thought I'd maybe get into real estate. I knew I loved people. I love business, but I worked at Marshall's. That's okay. Yeah. There you go. A little tidbit about me. But I think it's very hard to figure out what you want to do. Don't let school get in the way of it. And I think that sometimes it's, it's too much pressure to decide what your major is going to be. And it's too hard to change your direction after you've invested all that time in your major. So I think there's a fundamental flaw, there's a fatal flaw with school. And I think people need to be thinking about their future from within, and they have to not feel so pressured to have an answer and put their shoulders down,

not compare themselves with other people. Social media makes that really hard. I mean, the rise of stress and depression, I think, is only going to continue because we can't help but compare ourselves to others. Everybody's looking at the rock and no one can keep up with them. Oh, man, the rock. Yeah. Yeah. I mean, that's the key, I think. So those are some of my thoughts. But I didn't know. If it wasn't for Phil's, I don't know what I'd be doing. You mentioned some personal training or something like that you were doing. Yeah, so I'm hyper-competitive with myself. So I've been into a few things in my life.

One of them was basketball, Michael Jordan days. I used to play 10 hours a day. Awesome. And I became pretty good. And then I stopped after he left. And then I got into gaming. Oh! Like StarCraft and Diablo, computer games. And then I gained some weight.

You got really, really into it, right? I got really into it, and I became really good. Nowadays, that's a crazy business, actually. Yeah. Gaming? Oh, yeah. Oh, yeah, yeah. I mean, I still do.

You might have to go back to it. No, no. I'm going to get addicted pretty quick. Is that what's happening? Do you ever go on Twitch and watch that? Oh, my gosh. I don't want to have any visibility to it, because'll be addicting and I'll get back into it. Yeah, it's crazy.

And then after that, I gained some weight and I felt, you know, I wanted to date and go out with girls and I was insecure about how I looked and felt. So I decided to work out and watch my diet. So I lost 40 or 50 pounds. I gained muscle and I felt really good about myself. So I got really into that. And then I got less into it. Fortunately, I didn't gain a lot of weight back, but I'm softer than I used to be. So it was basketball, it was gaming, it was fitness, and now it's fills. And with fills, it's great because there's no ceiling, right? There's so much potential. And I only want to work on things that could be

meaningful that i can be like i could learn a lot from and uh it could make a good impact was there something that you maybe learned from basketball like i did professional wrestling for several years and uh i quickly learned who i'm not okay well i used to love steve austin and the rock i think you did an interview with steve austin absolutely yeah stone cold's the best yeah was there ever a moment where you just kind of looked at somebody almost in awe where you're like well you know i i am practicing 10 hours a day but yeah shit i ain't that guy and i probably never will be did was there anything that kind of led you to to be like almost uh i'm not six nine and yeah i should just maybe pick something else up the key is to no one to incorporate ignorance

in your mindset. Because sometimes when you think too much about something, you're going to talk yourself out of it. So you've got to know when to play dumb so that you don't mess up your psychology. So in those days, to me, I was like, I'll be better than Jordan.

And everybody, you look at that and like, obviously that's not going to happen. And whether i knew it was or wasn't wasn't the point right but that kind of mindset gave me the confidence to to be my best do you have a little bit of that mindset today going up against starbucks there's no other way of course i have zero doubt yeah a hundred percent so i have a you it's very hard, but we'll do it. I mean, you're talking about this mindset of just being, you're being, you know, you used a different analogy for it, but ultimately having, having confidence in, in your vision, right. This is essentially what you're talking about. Yep. And so from a Phil's perspective compared to Starbucks and Pete's and all these other competitors, how many stores you guys open?

How many stores do you have today? Yep. And what is the long-term vision? Where do you want to go with Phil? Because, you know, frankly, I think you've established yourself. You know, I think it's like you, Blue Bottle. There's a few other options that are similar-ish. But I think you guys are the industry leader at this time.

So how many stores do you have now and where do you want to go? So we have about 50 stores today. And the vision really is to – there's a couple of parts to the vision. If you quantify the vision for the next decade is like one store, 1000 times, right? So one store, 1000 times is we carry the personalization in cup to each store we designed for the community. So every store is fit to best serve the community. So it's not cookie cutter. It feels personal, right? So one store 1,000 times versus 1,000 stores. So we even call the stores by the store leader's name.

In Davis, it's not Phil's Davis 123. It's Amber's store. So it's personal. So I think the idea, that's really important to us. And then I'd say Phil's is more than the cup. It's the culture. And the community is not just the cup, it's the culture. And the community is not just the customer, it's the team. So we take great care in the type of people we hire.

It's very rigorous, actually. We hire baristas like Google would hire engineers. We take great care in making sure we choose not the resume, but the right character in the people, because we can train them on the coffee. So I think that we want to build a community, a workforce community that is different and that kind of closes the gap between who they are as an individual and who they are at work so that they can reach their full potential. And yeah, over time, the big idea is like make a positive dent in the culture of america and bring more community into it through the coffee through the people through the store do you get sidetracked sometimes from you know seeing like what some of the big other

other companies are doing do you sometimes get like uh almost like uh oh man oh we should go do that does that happen to you sometimes um no not not that much i think that uh there's always the question of like what is this gonna you know but it always starts with what's authentic to us right the framework that that that helps a lot well i think a good example of that correct me if i'm wrong yep is here we are at your hq sounds like it's like a test pilot location. You guys have the frittatas that might have been kind of created because you saw the success of the egg bites at Starbucks, perhaps. But maybe it just doesn't work for you at your location, right? Exactly.

And so you test it here in one store, and then you see what goes on next. Yep, that's right. That's pretty cool. I mean, these are just things that I think about all the time, right? As a business owner, I'm like, oh, I get what he's doing, right? But I really am. I'm really resonating on what you said. It's one store 1,000 times.

Yeah. I really like that analogy. Yeah. And I like the idea that you're saying, hey, it's Amber's store. Now, obviously, if Amber left, you had to change it to Amber's store. Yeah. But that's a pretty cool analogy. Yeah.

And I think when we first started, and it's hard building and growing your business because you can't just, it's not enough to have nice people and nice coffee. You have to have a nice business. And I think that when we first started, our only stakeholder in front of us was the customer. And then as we grew, we needed to hire people. So the second stakeholder is the team. And we're responsible to make sure we do a great job with both. And then now as we've grown, we have investors.

So there's three different stakeholders, and they all want different things. And how do you make that cohesive, and how do you make that work? And it's a very challenging dynamic for any business that wants to take, take, take it to the next step. But you very much have to stick with your values and also have a great business. Because if you don't have a great business,

nothing else matters. Just like the coffee. I bet you've, no matter how nice the people or the environment were, if the coffee wasn't good, you know, it won't matter. or the environment where if the coffee wasn't good, you know, it won't matter. As you guys have scaled out, how are you able to communicate the message to so many different people in so many different stores? And then, you know, not only does that, you know, that new store like in Davis or something starts up,

there's going to be turnover, you know, at some point. So how are you getting everybody educated? Is there constant learning, re-education going on? So it all starts in the selection process. And that is more important than training. Because it's a lot easier to train people on the mechanics than it is to train them to act a little different from a character, trait, personality standpoint. So spend a lot of time and make sure you hire for the individual. And then have a great training program, which we do. We spend a lot of time and make sure you hire for the individual and then have a great training program, which we do. We invest a lot in training and then have a great leader. So I think

that if you have a great leader and you hire the right people, it's 50, 60, 70% of the challenge. But retail at the end of the day is just difficult. It's a lot of people are transitioned. So there's only so much we could do to retain. There's always going to be a pool of people within each door, maybe 20% that we can develop and grow to be future leaders. But the other 80%, it's just hard to keep them. And people don't leave Philz because they dislike it. We have a very healthy culture.

People leave Philz because if people do leave, they leave because they're going to pursue a career in what they've been studying in school for. They're going to move to another city where there's not a Philz with their significant other. So it's the reasons you'd want if somebody were to leave. What are some of your own personal goals at the moment? I think I need to develop some more, but it's fills. It's all fills. It's not for

better or worse. I think people's biggest strength is also their biggest weakness, which is like, I'm very dedicated. I'm very focused, but so much so that I'm imbalanced. I'm not balanced. I'm working all the time. So obviously this is the first time we've met. Do you have a family? Fiancee. Fiancee. Congratulations. Thank you.

And yep, I have a great family. They're local. I don't have any kids, but two sisters. One of them's in LA. One of them's here. Mom and dad. So yeah, we're pretty close. When are you getting married?

No date yet. Oh, okay. That's okay. No date yet. Oh, okay. That's okay. No date yet. Hopefully at some point. Me and this guy married pretty young and we've been with our ladies ever since, right? Yeah, almost 18 years. How long?

18 years? Yeah, almost 18 years. How did you meet? At a bar in Los Angeles called Sharky's. Sharky's. Sharky's, yeah. Hermosa Beach, yeah. Nice. Yeah, and I have a son that's 14 and a daughter that's

10 he's got two kids that's four year old and seven year old and i met my wife in high school okay wow we've been married for nine years wow yeah so that's great all good congratulations yeah the last question are you ready to buy a phil's am i ready to buy i don't think you can actually buy one though right it's how about we to say. How about we make you one? Oh, you're talking about, I'll buy a cup of coffee. You guys can invest by being great customers and we're going to make sure you get a great cup of coffee. And when they roll out that membership plan, we're going to be their first members.

Yeah, that's right. The business model wise, you guys don't have like individual store owners, right? No, everything, you know, we believe in controlling the culture and making sure that we're working on one cohesive ecosystem. All working together. So, no, everything, we own all of our stores

and we don't plan to franchise or license or anything like that. Awesome. Yeah. That's all the time we got for today. I really appreciate you having us out here. This was awesome. Feel at home. All the time. Yeah, we's all the time we got for today. I really appreciate you having us out here. This was awesome.

Feel at home. All the time. Yeah, we will. All right. Strength is never a weakness. Weakness is never a strength. See you later.