The Pomp Podcast - 330: Kat Cole - The Best Business Leader In America?

Episode Date: July 8, 2020

Kat Cole is the President and Chief Operating Officer of Focus Brands, a company doing nearly $5 billion in annual revenue. She is the former president of Focus Brands' subsidiary Cinnabon. Prior to that, she was an Executive Vice President of Hooters. In this conversation, we discuss leading through hyper-growth, obsession with truth, why time is bad when dealing with problems, what the hotshot rule is, the importance of consumer-obsessed mindsets in business, and how Focus Brands is handling the COVID-19 pandemic and the related economic crisis. =============================== BlockFi allows you to keep your crypto, put it up as collateral, and receive a USD loan funded directly to your bank account. They do loans ranging from $2,000 to $10,000,000, and they're perfect for helping you reach your financial goals of all sizes. Visit BlockFi.com/Pomp to learn more about putting your crypto to work without having to sell it. https://www.blockfi.com/pomp  =============================== Our second sponsor is choice, a new self-directed IRA product that I'm really excited about. If you are listening to this, you are likely part of the 7.1 million bitcoin owners who have retirement accounts with dollars in them, but not bitcoin. I was in that situation too. Now you can actually buy real Bitcoin in your retirement account. I'm talking about owning your private keys and using tax-advantaged dollars to do it too. Absolute game changer. https://www.retirewithchoice.com/pomp =============================== Pomp writes a daily letter to over 50,000 investors about business, technology, and finance. He breaks down complex topics into easy to understand language, while sharing opinions on various aspects of each industry. You can subscribe at https://www.pompletter.com

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off. Kat Cole is the President and Chief Operating Officer of Focus Brands, a company doing nearly $5 billion in annual revenue. She's the former president of Focus Brands subsidiary Cinnabon. Prior to that, she was an executive vice president of Hooters. In this conversation, we discuss leading through hyper growth, obsession with truth, why time is bad when dealing with problems, what the hotshot rule is, the importance of consumer obsessed mindsets in business, and how Focus Brands is handling the COVID-19 pandemic and the related economic crisis.

I really, really enjoyed this conversation with Kat and I hope you do as well. Before we get into the episode though, I want to quickly talk about our sponsors. The first is BlockFi. I'm a big investor and user of the platform. And if you want to get more crypto, BlockFi is running one of the best promotions they've ever run. BlockFi already makes it easy to earn up to 8.6% APY on your crypto in their interest-bearing accounts. And right now, they're offering a massive increase in that interest. You can get a double interest bonus if you fund a BlockFi account by July 18th. That's right. They'll double up that interest if you fund the account by July 18th. That means for month of August, you're earning twice as much as normal. All you have to do is enter promo code 2X

when you're signing up again. Just enter the number 2 followed by the letter X. That's promo code 2X. Go to BlockFi.com slash POM and enter code 2X and you'll get double interest bonus if you fund your BlockFi account by July 18th. Our second sponsor is Choice, a new self-directed IRA product I'm really excited about. If you're listening to this, you're likely part of the 7.1 million Bitcoin owners who have retirement accounts with dollars in them, but not Bitcoin. I was in that situation too. Now you can actually buy real Bitcoin in your retirement account. I'm talking about owning your private keys and using tax advantage dollars to do it too. Absolute game changer. An IRA product that allows you to buy Bitcoin, hold your private keys and use tax

advantage dollars to do it. Go sign up. RetireWithChoice.com slash Pomp. Again, go to RetireWithChoice.com slash Pomp. Get your Bitcoin in the tax advantage dollars. Lastly, don't forget that I write a daily letter to over 50,000 investors about business technology and finance. I break down complex topics into easy to understand language while sharing opinions on various aspects of each industry. You can subscribe at pompletter.com, pompletter.com. All right, let's get into this episode with Kat. I hope you guys enjoyed this one. Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek

Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only. All right, guys. Bang, bang. I have a very special guest today. I think that she is incredibly well known in certain circles and then incredibly unknown in other circles, but she's got an incredible story. So Kat, thank you so much for doing this. Yeah, thanks for having me. All right. We're going to spend some time on your backstory because it is probably one of the best business stories that I've heard. Where did you grow up and kind of what did you do before, let's say, the age of 15 years old?

So grew up in Jacksonville, Florida. My family was pretty poor on both sides of the family, with the exception of of my family, my dad. So my dad's side of the family, all truckers, junkers, factory workers, mom's side of the family, same thing. And yet my dad had a white collar job. So we had a house, a car, had a playhouse. From the outside, everything looked pretty amazing, especially compared to the rest of our family. but by the age of nine, I'm the oldest of three girls, two younger sisters. So I was nine. They were six and three. My mom came to me and said, that's it. I'm done. We're leaving. And we were leaving my dad. He was an alcoholic and a good man, but a terrible husband and father. And so we left and my mom fed us on a food budget of $10 a week for three years. She worked three jobs and A lot of what transpired up to that point of being 15 was being a father figure at home, working all the local jobs that I could before I started like actual jobs at the age of 15.

So at some point, I think you were what, 17, 18 years old, you go and you get a job at Hooters. And when people hear that, I think probably a lot of people's reaction is like, why did you do that right and so that back context is an important piece of it but like why did you go to get the job at Hooters uh starting out as a waitress there yeah you know I it was my third job um I worked I cleaned gym equipment I worked in a mall and sold clothes and then as soon as I turned 17 I applied to be a hostess at Hooters and um you know I was in high school and people work one out of every two Americans I think their first job or one of their first jobs is in hospitality. So going to work in a restaurant as a hostess, as a high

school students, pretty typical. What's unique about it is that it's Hooters, but Hooters had been in Jacksonville for almost a decade at that point. Over a decade, it wasn't unique. It was just another restaurant and it looked like a ton of fun. And so I just applied to be a hostess. I was recruited at the place where I was selling clothes in the mall by some woman who had a a business card and she was a Hooters recruiter. And so she came and was like, you, you know, you have great customer service skills. You have the look that we look for. Um, we'd love for you to come and apply. And so I was like, Oh, dope. That sounds awesome. So I went and applied. I became a hostess. Uh, and then when I turned 18, I was able to rock the orange shorts. Cause you

have to be 18 to serve alcohol. And it's a restaurant that served alcohol about 20% of the sales at the time were alcohol so it was more of a restaurant than a bar but I was a waitress and that was all before I graduated high school. Okay and so when you graduate high school you basically go on this like wild ride from what I understand from being a waitress to eventually you're opening up lots of stores around the world at a young age for Hooters more in kind of an executive type role. How do we get from you working at one single Jacksonville restaurant to that? And that happened over what? I think it was like six, seven, eight years. It wasn't that long of a period of time. No, it was two years. It was two years from the time I started. I started

at 17. I started opening franchises at 19 around the world. How did that happen? Well, it was interesting. I was the first person in my family to get into college ever. So my plan was not to like run restaurants. My plan was to go to school, get a degree, an engineering degree. I was a chemical engineering or computer sciences and electrical engineering major with a desire to go on to chemical engineering. And then I wanted to go to law school after that. So I had this very weird, big, super fancy career path of, you know, electrical engineering and chemical engineering and then law. And what happened was I was working in a growing company. It just so happened that at that time Hooters was growing around the United States and around the world. And people who

haven't worked in retail might not know, but it's super common that when you open new units of a business, you take employees from the existing units and take them to go teach people how to do that job. Like that's super normal. What's unusual is that it was Hooters that the first time I ever went to go open a restaurant was in Sydney, Australia, because the company was growing there. I didn't even have a passport. I'd never been on a plane when they asked me to go open that franchise. But I said, yes. Then I bought my first ever plane ticket to Miami, stood in line, got my passport and came back and traveled and was a part of the team. It was a whole team of people from around the country that traveled to Sydney to go open that franchise. And I really

thought, you know, it would never happen again. Who would ask a girl like me, like child of a single parent, alcoholic, and to go do this? And the answer was Hooters because 60 days later, I helped launch the first ever of the franchise in Central America. A few months later, same in South America, eventually Canada, Asia. And before I knew it, within 12 months, I was opening franchises all around the world and I was failing college because I was never there. And I was really good in school when I was there. But once I started opening franchises, I would be gone for 30, 40 days at a time in these countries to launch the franchise, to help set up the supply chain, to train the employees, to help train the managers, to get it going, to do press and media

and help the franchise get started. And I'd come back, I'd make up my classes, but eventually that just wasn't sustainable. And by the time I was 20, so in that first year, I started leading the opening. So I was no longer a member of the team. I was now a 20-year-old launching franchises, bringing teams together and leading them.

And then I dropped out of college. So I'm a college dropout because I was never there. And Hooters offered me a corporate gig at the age of 20 to go to Atlanta to oversee all employee training. And then it just fast forwarded from there as the company grew. I grew by the time I was 26, I was vice president of the company. And then we were doing about 750, 800 million in revenue. All right. When you show up at 19, 20 years old with two years or less of experience, actually working at the restaurant that you're now helping open in foreign countries, what's the interaction with the people who are going to

work there? Like, are people just like, what do you know, you're 1920 years old? Or are they like, oh, the woman from America has come here to teach us how to do this. Like, how does that happen? In terms of just you being young, and having to interact with I'm assuming people who either are the same age as you at the time, or older, typically older, especially at that stage, since I was so young. It's a mixed bag, you know, the you think about the stakeholders are very different groups. So one is the actual franchise owner, which is typically a very wealthy business person from that country looking to diversify their portfolio by opening restaurants as a franchise. And so typically those people I had a working relationship with in advance, but just

over the phone, there wasn't Zoom, you know, back then. So I had some relationship, but they typically didn't know how old I was. I've always sounded a bit older. I've always looked a bit older. And while I had never been asked to lie about my age, nor would I, I was very well aware that the impression was that I was older than I actually was. In fact, when I was opening restaurants that first year, I couldn't even legally rent a car. I had to lie and say I was 21 or have somebody else sign for it just so I could get that piece done. But then the other trainers that I would bring, the team that I was leading, it was a mixed bag. Some would say, hey, who are you? You're younger than me. You haven't worked in this company as long as me. Others would make a

connection with me very quickly, which is why I had to learn on the fly how to build trust over and over again with people who I'd never met, who I would likely never see again. It was a different team in every country with individuals who really had never seen the brand or the concept before. And I'd say that's one of the benefits of that early demand of having to travel to a different country to do the same thing with a different team over and over is that it forced me to build the muscle of openness, vulnerability, humility, courage, you know, a lot of things that seem counterintuitive, but became my secret sauce of being able to go anywhere, no matter how young I was, build a team, achieve an outcome, and generally build trust across the stakeholder

group. And it feels like you're basically saying like, hey, I had a lot of practice, right? I got to do this over and over and over again. And the practice kind of makes perfect. One of the other things I'm really interested in is many of the most successful people that I talked to on the podcast, they've done a lot of traveling. And so maybe kind of like, how did that help you, especially at that age, being able to go into all these different cultures and meet so many different people? Like, is there things that you either learned or you kind of look back now on and you say, wow, that was a really valuable experience because of X? Yeah, for sure. One, I mean, literally Australia was my first trip. I mean, other than flying to Miami to get my

passport. And so, and yes, it's an English speaking culture, but different, right? Context is different. Words are different. And so from that first opening, I really learned the value of humility. At the same time, I learned that if you're only humble and curious, you're just a student and no one will follow you but if you're only courageous and confident you're you're a bull in a china shop possibly even perceived as an asshole and you can get things done short term but you'll never have a team that lasts and things won't get done when you're not in the room and so I learned this tension of I was confident but confidence didn't show up as I know what I'm doing always. It showed up as, I know I can figure it out because I know I'm humble and

curious enough to ask questions and to get people to help me. So the confidence oddly was fueled by this humility and curiosity. And I would go and every country, there was something we had done wrong, every country. And yeah, I was good at international operations over time because of practice but the first few openings they were a hot mess I mean there were things culturally we hadn't done our research there were certain aspects of the menu or the brand or even the basics of the training schedule that just didn't reflect the nuances of a social culture a brand and restaurant culture and employment structure I mean there's so much you don't understand if you aren't from a place. And it took two or three openings in two or three different countries

for me to realize that, wow, the only common denominator between these openings is me. So if it's consistently going wrong, it's pretty likely my fault. And that's a brutal leadership mirror, you know, to eventually be like, shit, it's not them. It's me. And what do I do about that and how do I figure it out? So I think because I was alone, there weren't a lot of other resources from the company. I was forced to deal with my own mess and I was forced to see where I was a common thread in a problem. And then my fourth opening was in Argentina, launching Hooters in Buenos Aires, first one ever in South America. I was 20 years old, might've just turned 21. And the franchisee, it was such a mess. There was so much we didn't

understand, uh, about the culture and the consumer there. I could go on and on about the specifics, but it was a mess. I mean, employees basically didn't want to come to work, even though they're contracted to come to work. And he sat me down and he said, um, I'll give you one piece of advice that I hope stays with you throughout your life, which is anytime you're criticized, assume first that it's correct. And he said, it's not your, it's not the natural, um, activity for your brain you instantly go into defense mode but assume first that criticism is accurate and then what will happen is is if you consider that and you reaffirm that it's actually not instead of debating the what you focus on the why but if you in fact realize that even a fraction of it might

be accurate it will keep your foot out of your mouth it will help you bridging whatever that gap is learning, unlearning, fixing, and create far more respect over time and progress. And so those were some little things, that balance of curiosity and humility on one side, courage and confidence on the other, that literally is the formula to going anywhere, doing anything in almost any culture. But also that piece of advice from that franchisee. And that allowed me to just iterate on the fly. Every time I would get an input, I'm going to assume it's correct. Is it? oh yeah, it kind of is, okay, let's change that instead of getting caught up in like ego battle, or we're the franchisor, you're the franchisee, or this is an American brand, do it our way. It

really helped me iterate and innovate and be fluid in ways that allowed without a lot of experience for me to seem as a more mature and experienced leader than I actually was. Yeah. And at some point you build the experience, right? Because eventually they ask you to step into kind of the vice president role. You kind of grow into that. And one of the things that I forget who said this, it might've been maybe the CEO of Wealthfront wrote a blog post and he basically was aiming advice at college graduates, right? And he was saying, Hey, look, there's basically three paths you have. Most of you are going to sit, you're going to evaluate two of them, which is go join a large tech company or go try to start your own business. And he goes, actually, those might not

be the right decisions because the best thing you should do is go find like a series B company. that's kind of not guaranteed to succeed, but it's definitely growing and get in there. It's really easy if you're a good performer to get more and more responsibility and kind of grow with it. And then the best part is if they're successful, whether you did something or not, like it's on your resume and you'll basically get the credit for being quote unquote early at this thing that grew. So I've always thought of that as like, that's a pretty prescient piece of advice for college graduates. You basically did that without even really knowing it in the sense of this thing went from, I think I've read that it was, you know, small hundreds of millions of

dollars in revenue to upwards close to a billion dollars when I left. And you basically literally go from a waitress to you're in charge of all employee training and development. Like talk a little bit about just like, what is that experience? Like kind of you growing and getting more and more responsibility as the business itself is growing. And like, what were some of the takeaways from that? One, it's what it, it felt it at the time. I think when I reflect, I remember far more of the positives than I do the pain. I think that's how we operate as humans. I know that as someone who's given birth to two children, it's sort of like in my memory now, but in the moment it was not fun. You know, I think one is when you're moving up really quickly, it is likely that you

continue to go from a position to being elevated. And now you're managing your peers. And then again, you're managing people who were your peers the day before. And there is something about that accountability, um, where they know you, right? You were all doing the same thing. You were the ones having coffee and lunch talking about what's going on in the business. And all of a sudden you're the person you were previously talking about. And when that happens over and over one, it really helps you sit up a lot straighter in whatever job you're in today because you you know it's pretty likely that you might actually be managing your peers and so it I think when you believe you're going to be under the bright light of scrutiny that you just do a better

job there's something really powerful for those who care about how they're perceived the other is there are a lot of these forks in the road given that same set of conditions where now I'm managing my peers. And some people can only improve incrementally in those situations because the way they believe they are viewed by their previous peers holds them back. You know, I can't be someone materially different in 24 hours after the promotion because I was just this other person yesterday. Yet some people will leave a company, go get crazy deep experiences, come back and be a completely different person. And I believe you can make just as much change inside of a company, but it takes a lot more courage because you do have to deal with

people saying, hey, wait a minute. That wasn't that important to you yesterday. And you have to be able to say, you're right. I was wrong about that. Now it is. Here's why. I'm going to do a better job to make sure people who were in the position that I was in yesterday understand that. So that's one learning of moving up quickly and being so young is I watched others have opportunities to move up, but then they got held back by trying to be a part of the crew instead of owning their full new responsibility in that role. And I like to think of it as a seat at the table. And if you're not using your voice and making an impact, you're taking up a seat, you know, get out if you're not going to do the job. And I observed that of others and I didn't

want to be that person. The other thing was that there were very literally many moments where my judgment or my mere being there was questioned either literally to my face, which I always appreciate more or behind my back. And then I would hear about it separately, far less because of gender, actually, because in that company, there were a lot of women leaders. Every person I worked for until I worked for the CEO was a woman actually. So I had many examples and mentors of how to show up as a woman. I was never trying to figure out how to like be an executive in a man's world, which was this really beautiful gift. But there were many people who, because of my age and how quickly I moved up, again, said directly or to other people, I don't understand why she's

here. She's too much of a cheerleader. There were definitely those sort of the presence of the patriarchy or the misogynistic beliefs because I was 26 and my peers were 60. And they had been in business longer than I'd been alive. And I had to realize that most of those people, I was not going to be able to change. You know, they're so set in their ways. I could only change me. So I learned to navigate that environment. I learned to turn my personality up a little and turn it down a little, but to never be someone I'm not, but to respect the experience, culture, and ways of other countries and other people. Those were hard lessons. They were emotional at times. There were times that I would go home in tears because it was just hard, right? The

normal politics that are at work and then add different gender, college dropout, not as sophisticated, former Hooters girl, half their age. There's a lot going on there that even if they didn't put it out there was in my head. And it's a symptom of being the only in a room, the only person of color, the only woman, the only young, the only college dropout. And so I respect that a lot now as a leader, when there are people who are the other or the only or the minority, I really think about the things that might hold back them giving their full selves, because there were times that I held myself back on that journey. Yeah, and I think it's a great piece of advice in terms of you learn that lesson the hard

way, right, of actually going through it, but it actually makes you a better leader now because you can almost spot, hey, that person is likely to be going through some of the things that I intimately understand and have personal experience with. You've told me before that as you were kind of going through this journey and growing within the company, it wasn't just people internally that realized, hey, she knows what she's doing. There was lots of people outside of the company or maybe a few people who would come to you and basically say, hey, do you want to go run this? Or do you want to join my company over here or do whatever? But you stayed for a while? Are you saying years? And kind of maybe talk a little bit about like, why did you turn

down some of those opportunities? And then like, what caused you or incentivized you to ultimately leave and go join Cinnabon? You know, part of it was the company was growing so fast and we were almost fully vertically integrated. So we owned our own supply chain. We owned our own merchandising company. It was like six companies. We had our own airline, Hooters Air. It was a thing. Look it up. it was a really bad idea, but nonetheless, it was another company. It was so rich with business education and leadership opportunities. And again, at such a young age and, and in the early days, and I stayed there for just under 15 years and, and in the early days, the first 10 years, I was like, man, who, again, who would ever give somebody my age opportunities like this?

I wouldn't get through their HR filter, for real, literally. They would never call me back if it was just on the piece of paper. So there was a part of me that felt I was getting such amazing experience that everything else seemed so boring. When other brands that were much bigger, less controversial, you know, less edgy, wanted me to come be the chief such and such, right? Chief HR officer, chief operations officer. There were these really president of a small company. There were these really interesting offers early on when I'd been a vice president for a few years. And I thought about them. I thought, oh, it'd sure be nice to just change the story, right? To like not be with the same company.

But then when I looked under the hood, it's like, oh, you mean I'm going to be pigeonholed in a functionality in a company that's already so set in its ways? No, thanks. My currency is learning. I turned down a lot of money, unfortunately, but my currency is learning. And I knew it early on. And anything that would try to get me to trade off learning for cash was not an acceptable trade off then. And it's not an acceptable trade off for me now. That's part of why I stayed. I mean, again, we're running an airline, we're buying hotels, we're navigating selling our manufacturing division. And I was in the middle of all of that, if not leading a good bit of it. And that was like glue, man. It was like gravitational pull, the growth, the diversity of business. And it's a little bit hard to leave when you've amassed so much relationship capital, right? I could do anything in that company up to a certain point. I enjoyed a great degree of flexibility and a great degree of impact. And the company was my family. I mean, I was there for, again, a little over 14 years. Um, so that was what kept me my last year and a half there. I went back to get my master's. So I have a master's without a bachelor's. I went to school nights and weekends, uh, an executive MBA program at Georgia state. And I did it because I wanted to round out my financial acumen. I mean, I knew I was a sure bet from a business perspective. I knew I could, um, brand and rebrand a company in any country around the world. I knew I could start and train operations. I knew

I could build teams and build franchises. I had confidence in myself, but I also knew I had limitations on the language I would speak with external stakeholders, lawyers, any type of private equity firms that might be looking at the business. And right as I was in the middle of getting my MBA, we had to sell the company. The owner and CEO had died. His son had taken over and to settle the estate. We had to put the company up for sale. And so I was literally going to class at night, learning about transactions and enterprise valuation, and going to meet with lawyers and private equity firms the next week and saying everything that I knew operationally, but able to communicate it in a language that garnered respect and allowed us to really optimize the

story of the company through that process, that sale process, and also through a lot of my volunteer work in the industry. I was the chair of the board of the Georgia Restaurant Association when I was like 25, 26 years old. So I did a lot of political advocacy for the industry. Those parallel lives, the management presentations for the company and the industry association work gave me a lot of visibility. And people in the industry, including private equity firms, started to see me as a leader with a crazy amount of potential, not just the executive at Hooters. If I had just been that executive at Hooters on paper, I wouldn't have been offered the opportunity to be the president of Cinnabon, which is what eventually got me to leave. I didn't think I'd get the job. They asked me to interview. I had been talking to the private equity firm for quite some time about working with them, Rourke Capital out of Atlanta, and they offered me a job to run one of the portfolio companies and turn it around in the middle of the recession. So that was, that was interesting enough to learn and to grow.

And I was excited for, you know, to change the, change the page, get another chapter going. So you glossed over an important thing here, which is you went and got an MBA without a bachelor's degree. How do you do that? It's still not common today, which is surprising considering the state of higher education and business schools. I here's how it went down and this is why having access to people with experience in business and

in life matters this woman who's always taken an interest in me who over time became a mentor I don't believe in really pushing mentoring and mentors on people it feels daunting it feels inaccessible to those who are like me who aren't like Wharton grads high potential right it's it feels, it just feels tough. And, but I do believe in mentoring moments. I do believe in mini mentoring. I believe in asking anyone, the assistant, the driver of the truck, the server, or an executive, I'm dealing with this. Have you dealt with it? Can you give me your perspective? I believe in amassing that. And I did that with various people. And sometimes you really love what you get when you have those exchanges. And this woman and I have a lot of these exchanges

and she took an interest in me. And she called me a couple of years into being an executive at Hooters. And she said, you know, if you want to get a job in this industry, you'll have no problem because you have such a strong reputation. But if you want to do anything outside of franchising and restaurants, you will not get past their HR gate. You have got to get a degree. And I'm like, oh, but I dropped out right before the, I got my second year degree, my two year degree. And I've tried to go back online and I'm just so busy. And it was just her telling me that it was possible. She said, you know, I know this CEO who's running an enormous corporation who had the same situation. And he went back and got his MBA through an executive

MBA program. And it's not common. You have to take your GMAT or your GRE very quickly and make a higher, typically a higher than is typically required score to get in because they've got to, you know, mitigate their risk. But it's possible. And that's all I needed to hear was that it was possible. I went, I applied to every business program with campuses in Atlanta, Georgia State, Georgia Tech, UGA, Emory, got into most of them and then chose Georgia State. So that's how it went down. It's amazing. And it's also a thing I think of, you took it as like, once I know something is possible, then I can go do it. But it's also an exposure, right? If you're never exposed to um somebody who did it right it's one thing to know hey it can happen but then when

somebody points and says that guy did it like well that guy did it then i could do it right and it changes the way people think about opportunities not just it could happen but it has happened that there's the person who did it uh makes it more believable yeah and i i think and i i love that you're double clicking on that because it also speaks to not keeping your access and what you've been exposed to in a little treasure box, right? It's not people who do that have a scarcity mindset, have a zero sum mindset. If I tell you, then it's less, you know, it's less special or I was the one, right? I was the one person. And I talk about this everywhere to everyone because I want everyone to know that it's possible. And I don't believe it devalues

the education or the merits of the experience because look what I've done since then, right? out it was a good bet on their part and it was a good risk on my part. And so I think there are many things like that, little things we are all exposed to that in any audience, whether it's on Twitter, in a clubhouse room, at a house with friends, just sharing those nuggets, that secret sauce, I mean, that helps democratize access to opportunity. Completely agree. You get in and you're the president of Cinnabon. You said you didn't think you were going to get the job, but you get it. What do you do like the first 30 days, right? Because you're what, you're like early 30s at this point? 31. Okay, so you're 31 years old. I'm assuming that you step in and

people are still like, what is that young lady here doing? Like she thinks she's in charge. And then you compound it with, as you said earlier, like the executive from Hooters, what does she know about Cinnabon or restaurants? You know, you can just imagine all of the kind of water cooler talk? Like what do you do? You know, I think what I did is so much a framework or a primer for doing a lot of things today, not just being new in a role or taking over a company, but I just went and worked in the restaurants and spent time with the franchisees. You know, all those questions are about the surface of me, the story of me. The minute we're having a discussion and talking about the business and I'm learning to roll cinnamon rolls. It's not about

that anymore, right? All you have to do is just go like an inch below and connect with people. And it just blows that up. And, um, and now if you sit in your ivory tower, you sit in your office behind your laptop. Yeah. I mean, that's a big wall. You have to break through your, your story, your resume, your reputation, whatever people want to decide, they think about you based on your age your gender or experience. I just left no, I gave that zero oxygen, right? Like just go straight in and do nothing but work in the business. And I didn't do that because I knew I was so strategic intellectually to think, oh, I'm going to dispel all the myths about me. I did it because I actually wanted to understand the business at a ground level. I did it because I, it wasn't that long

ago that I was working in restaurants in an hourly way. And I really respect that the answers are actually all right there. But what I've learned is people who are closest to the action, which is the transaction in business, so call center, drivers, service techs, servers, whatever, the people who are closest to the action know what the right thing to do is long before the leader does. But they lack two critical things. They lack the language to articulate the scaled problem or a scalable solution and they lack the authority to do something about it. It's the leader's job to like come in and ask a lot of questions, see the patterns emerge from that and go, ah, even though they're saying it in different ways, this is the common thread of the problem or

the opportunity. And this is actually what they're saying is the fix. And now I can do something about it. That's why all I did for the first 30, 60 days was work in the business. And in fact, I came out of that experience with a blueprint of what I believed had the highest likelihood to turn the business around in the middle of the recession. And it worked. So when you go in, you can roll cinnamon rolls. You can kind of do everything. Not well. I just ate that frosting. You can try. You could try to do all that, but you're still the president of the company, right? And so how do you kind of build the trust with somebody who is the cashier, who is the truck driver, who kind of, they're not used to every day, like you say, the language is one

piece, but the fact that like the president of the entire company's here, you can just imagine like, you know, the store's probably a little bit cleaner the day you show up, right? And everyone's kind of on their best behavior. How do you build the trust with them in a short period of time to actually be able to get the truth, right? So when you ask that question, it's not like, oh, the franchisees said that you know our biggest problem is we need x actually the biggest problem is that you know we don't have enough throughput on the tables or something like that and so like how do you build that trust to get that information yeah i love that you use the word truth um i am obsessed and i think there's such a thing as a true truth and then a created truth as you're

saying like the store is cleaner and that piece of equipment that's actually broken somehow isn't and then there's like tape all around it in the back. I'm obsessed with the truth. I'm obsessed with the truth and I believe I never know it fully. So the first way I build the trust is actually not with those crew members. It's with the layers of management that exists between me and them. Because if I don't do my best to create a warm entry where I at least have a conversation of what my intentions are, assuming they are not used to this type of leadership. If I don't do that, what will happen is before I arrive, they'll go tell everyone everything you said, be on your best behavior, don't mention this. And in one way, you can look

at that and say, well, that's a really low integrity management style. It's also human, right? It's also natural. And again, formed by whoever managed previously. And I respect that. So my first stakeholders are the group of people between me and them for me to say, I am not coming in here to play gotcha. If I hear something that would embarrass you or make you mad, just know I'm not going to flip out. I am not going to use what I hear or see as a weapon, unless it is illegal or immoral, right? If something bad's happening, everybody's going down. I'm going to be like that Elmo and fire meme. But in general, everything else, I grew up in this business, I get it. There are angry employees, there are bad employees, there are employees with good ideas, I get it all.

But I have to honor that I need to prime those layers of leadership so that I have optimal access without it. And still, they're going to do what you said. So that's step one that a lot of leaders overlook because they're not thinking about all the subconscious self-talk, the trauma, the personal and professional trauma that all humans bring to the table and the fear that that can put in their minds if a leader, leader, leader comes in all of a sudden. So that's step one. Step two is just coming in and working beside them. And literally, if I go in a business, let's talk restaurants. I advise a lot of consumer businesses and tech businesses, but let's just talk restaurants

as an example. I put my hair up. I wash my hands. I put gloves on, right? I'm showing respect. I'm leading by example. I'm saying, I'm assuming I'm going to get dirty back here. Even that step, some people don't do.

They keep their office persona when they enter a kitchen. And I won't ever criticize that because everyone's got their way. But for me, to answer your question of how, like how to get to the truth, those are my approaches. And it really does make people comfortable. I ask about them, how long they've been here. And then I have very specific questions that I ask. And I ask the same questions to everyone.

Because I'm also looking for patterns. And if you ask different questions, there's too much noise in that data. Even though it's qualitative, there's still a lot of noise. And I ask, when do we say no? So when do you have to say no? When does someone tell you no? That shows me a window of opportunity. If people are asking for something, employees or managers or customers consistently across locations over time, that is clearly saying there is an employee or a market opportunity. Then I ask, what do we throw away or what do we not use that we have? And that's about wasted resources. So I'm looking to find wasted resources so I can fund the thing that people are telling me is the opportunity. And then I ask, if you were me, what's one thing you would do differently to improve

the business? and, and not, if you were me, what's your advice? That's way too big. What's one thing you would do differently to improve the business? And there are always patterns. And honestly, the answer to that question often affirms or dispels the prioritization of the other things I've heard from the, from the first two. So that's how I do it. And it helps me get to the truth. It helps build a good culture around that. It helps model the behavior. So other leaders start to do that and don't um distance themselves from the engagement of the front lines yeah it's really interesting to hear you talk about uh specifically doing things like you go and you wash your hands

put your hair up like all that kind of stuff um i was in the military for a while and uh one of the things that they like thank you for your service it was uh best years of my life but one of the things that they harp over and over and over again in a lot of the leadership schools is never ask somebody who is you know one of your soldiers to do something that you're unwilling to do yourself, right? And so you can imagine in a military setting, there's all kinds of crazy stuff you could ask people to do. In a business setting, same thing, right? If you're not willing to go actually make the food or wash your hands or do whatever, then you're actually in some way telling them it's not important, right? So there's a element of reinforcement.

There's a flip side to that, which is also know when you're in the way. And some people are like, I'm here, you know, let me, it's getting busy. Let me, you know what happens when it gets busy? I take out the trash and I wash the dishes and I get out of the way of the people who are the experts because that's not the time, right? That's not the time. Like it's not the time to chat. It's not the time to try to be helpful in things in which I am not practiced. And so that also shows respect. Um, it's a, it's a removal of ego. I don't need to be, I need to serve you because what I ultimately get is your ability to do your job as best as possible drives the business. And if I am any way, I'm even distracting you or making you think you have to perform

for me and not do what it is that you need to do. It's, it's putting myself first instead of other people. So that's the flip side. I see some leaders who get it half, right. You know, they go in and they're visible and they shake hands and kiss babies. And then they stand right in front of a customer who's trying to order. And I'm like, no, you know, they don't, they're not really sensitive. And again, I don't criticize because maybe they didn't come from ops. So they're just not as attuned to it. But if you're a great leader of people running extensions of your business, you need to know that stuff. You need to understand how to get out of the way, literally and metaphorically, in any type of business. DTC, tech, retail, brick and mortar, construction services, doesn't matter. That's a really important spidey sense to develop. Yeah, that's awesome. What was the playbook that you implemented to turn Cinnabon around? uh three things so first through those conversations i diagnosed um that there

was a deficit of belief just the franchisees were tired um they're in malls this was like pre-e-commerce boom so there was another wave of this coming um but there was depressed discretionary income and when there's a recession a deep one like that one uh in 2010 there are two things people stopped doing shopping and traveling so just traffic right and top line sales were in the toilet for a couple of years and they were tired. Uh, the brand was beloved, but the business model was jacked. Like, you know, the, these small businesses, average unit volumes, half a million a year. They, you know, the, if you're close to break, even you're in a scary place, once you get past it, they, they can print money. But if you're in that danger zone and these are small business

owners in large part, um, it's really scary. So there was a lot of emotional fatigue around being involved in the business. And there was one large franchisee that was like, basically running a Ponzi scheme and was insolvent. And I was dealing with a potential bankruptcy of one guy that owned like, you know, over a third of the system. So that was interesting. And so the playbook was first diagnosing that that deficit of belief had to be healed. And I had to, without being able to fix the economy, I had to help seed a different dynamic where people would believe. Believe in the franchisor, believe in the potential of the business model, and be re-energized around the potential for the brand and the product. So that was first. And that meant me leading and literally

telling people how much I believed in the media and to franchisees. It meant me making some decisions in the company that subconsciously indicated I believed there was a positive future, like doing things for them that you wouldn't do if you believed that the business was headed to the bottom. So that was first was diagnose and address the deficit of belief. The second was to focus on the fundamental business model. And so from because it was so impacted by the recession, the actual unit level economics were crumbling because there were various things that worked pre the recession that

weren't during and probably weren't going to serve the business on the other side. So that meant answering out of the questions that I asked, what do we throw away and when do we say no, telling me what the opportunities were, using those insights to launch smaller products, streamlined SKUs, really basic blocking and tackling things, but that helped improve profitability and drive transactions. And then the third, so that was the, those were the two foundational pieces. And then the third was launched the multi-channel business that we've gotten so famous for, well over a billion dollars in multi-channel sales outside of the franchise business

across these licensed channels. So Pillsbury and Keurig and Green Mountain, there's Cinnabon Coffee, Cinnabon Coffee Creamer, Cinnabon Cereal. I mean, you name it, right? The brand and its flavors and its ingredients really represented a tremendous market opportunity if we could think outside of our franchise business model. And that is as big of a business today as the franchise business. And then we used that to build a multi-channel ecosystem to elevate the brand. So that third piece is really important because I think that people who've never looked at a franchise business, either as the operator to purchase from an investor or franchisee seat, or even worked at one, they think of everything inside

those four walls. And frankly, that's how most people kind of historically didn't think about it right was just like how do we drive more people into this store so that we can then sell them whatever the the food widget is that we have i think you were one of the first and as you said kind of pioneered this idea of like wait a second there's a sign outside that has a name on it that everyone recognizes and how do we take that brand with all the ingredients and things we do and we're known for all that kind of stuff and then get it out of these four walls right and that to me is not only one kind of creative thinking or thinking outside of the box, that I'm sure some people could come up with, but how did you actually execute that, right? Like what do you do from,

okay, we have Cinnabons, but how do I take this brand and actually drive a billion dollars in sales, right? Like what's the execution steps to that? The first piece is really understanding and cleaning up the brand architecture. A lot of people can innovate products from their core and go stick it in a bunch of channels doesn't mean it's going to be successful. So deeply understanding the essence of the brand, which means answering the questions, where does this brand have the permission to travel and in what product forms does it make sense in various channels? Like you got to get really honest about that.

And we got lucky. I didn't start the licensing business. we had the Pillsbury deal when I joined, but then we built everything on top of that because it was so obvious that there was permission for the brand to live in people's homes if we got the format right. And then we put the brand in other restaurants. We put mini bonds at Burger King and little Cinnabon delights at Taco Bell. And now there's a product at Pizza Hut that you can order little tiny, like mini, mini 80 calorie cinnamon rolls and many more. But it started with understanding, like where, how could we get this wrong? Because the reality was, and is we have

this legacy business. So think of any business, you have a legacy business that is still where a majority of the cash comes from. Even if it's waning in relevance, it's still the trunk of the tree. And if you go making this huge, heavy branch, not thoughtfully, it can pull the tree over. And so, and there's no shortage of brands that you could point to that you're like, why would they do that? And why would they go there? And a lot of restaurant brands over the years have had something in the freezer section or what, you know, or whatever, but it's a little side hustle. It's not an intentional brand building and highly profitable business division. And that's what we, that's what we built it. It wasn't a joke and it wasn't a way to just

market our brand. These are legitimate lines of business that are, again, now equally as large in revenue to the company and actually 75% of the consumer sales across the whole world. Out of the 100% of all things sold Cinnabon, about 70 to 75%, depends on the year, are sold outside of the franchise business. Even though the franchise business is still what we're famous for, right? So the first step is diagnose the brand. So you keep yourself out of the gutter that helps give the guardrails for where you should go in what formats with what partners in what sequence and even silly things like what do you call things? Is Cinnabon a brand? Is it a thing? Is it a place? You really have to understand that should it only be hot products

since we're known for being hot. We did just launch Cinnabon ice cream. It's delicious with Breyer. So, um, the answer was always should be hot unless it's a spice, uh, a cereal or an ice cream and because it had other attributes. So we broke down the attributes of the brand that were rooted in the attributes of the product. And then we used that as a framework to lay over any opportunity to ask, does this opportunity check enough of these brand boxes? And will it translate in this channel because in malls that's a very low frequency transaction one or two times a year that's it grocery is every week the same product that wins in malls is not going to win in grocery right something that indulgent that you would only buy twice a year you're you're only going

to buy it twice a year in grocery and that's missing the market so understanding the pieces that can translate that is i wouldn't even say that's step one that's like the foundation of the pyramid. You get that wrong in any place you take a brand or product format is likely to fail. The second is some type of framework for what partners you're going to work with. Blue chip partners, what do they have that we don't? What do we have that they don't? And how do we think about that in choosing partners and contract terms? That has to do with exclusivity, blackout windows, who owns the IP, right? Who pays for what? All that is the second tier. You figure out where your brand can go, and then who do you want to go there with?

And then I would say the top of that pyramid, which is maybe small in size, but it is the point of the spear, is understanding with the legacy business how to ensure that this is a collaborative ecosystem, not a new innovation channel that steals from the core, right? It's not like, I don't know if you remember that book, since I have a toddler, The Giving Tree, where you just keep giving up a piece, a piece, and all you're left with is a stump. It's got to be a creative ubiquity where I have to go to franchisees and say, even though this is a branded thing being sold somewhere other than you, it's not going to take away from you, And it's actually going to build the brand, create fans, draw interest, and create a revenue stream that will allow me to keep reinvesting in the legacy business.

So the pulling those things together with the legacy business as a ecosystem instead of a silo and silo and silo is literally the roadmap. It is the secret sauce. And there's a lot within there, obviously. And we made our share of mistakes because we moved fast with a lot of partners at once in new products. so I can share all the screw ups too. But that's a bit of the framework. So there's one mistake that you made that you've told the story before. We don't have to say who it was with, but there was a product that you created. And you basically did what you just said, right? You went to the franchisees and you basically said, hey, look, we're going to do this.

It's not going to hurt your sales. There's very specific kind of sandbox that is going to happen in and we're going to go put it in this other store. Like, trust me, don't worry. Uh, and I say all that because I think the first step is like, you pretty much did all the steps that like a good leader would do when potentially doing something that the franchisees and the core of the business, they could get upset. Right. And say like, Oh, you're going to take away sales from my store by driving people to go buy that the other stores that you're going to go do this with, uh, maybe tell us as much as you can, like what happened and like what the mistake was. And then really what i want to focus on is like how you were able to as a new leader of an organization

kind of use it as an opportunity to actually build trust and and a better relationship with franchisees even though there was a mistake made yeah most people ask the question when they hear the story how did the board not fire you did you avoid that um so i was 90 days into the job and had maybe, maybe 120 max. I don't remember exactly. And all the things that we've discussed that I did to build trust, to turn around the business were well underway. Franchisees were loving me. I was loving them. I built trust. We were still just coming out of the recession and their sales were growing. Their profitability was improving. And they were like, this lady knows what she's doing. And then I did what you said. I went to them and said, we're launching these

products in other channels. Here's what it is. It's different than what you sell, but similar. And it's going to be in this large club grocery chain. And they said, we don't like it because it's kind of like what we sell, but we hear you and we trust you. Okay. Let us know how it goes. And then a few days later, I get an email from one of the franchisees, the son of the founder. and I always joke, literally, it's like an email with three letters and font size 90. And it's whiskey, tango, foxtrot, question mark, question mark, question mark. And then he like leaned on the exclamation point for lines of text. It was a big WTF email. And he's a super kind and mild mannered man typically. So I get on the phone with him. I do what a lot of leaders don't do. I

didn't try to cover my tracks. I didn't try to, I just called him, right? Like time is bad. Time is bad when there are problems. You go like compressed time, go straight to the source, the person speaking out. And I said, what's up, Greg? And he sent me another email with a picture of a product in this grocery chain that was very different than what I told them it would be. It was the almost identical in form to the products that they sell in the franchises, six large ones and a rectangular, not 10 tiny ones in a round pan with drizzled frosting sold for basically half the price. And he's like, you can talk to our lawyer. Like they had already started emailing the pictures around everywhere. And it was just this feeling like, how did that happen?

This is under my watch, but there were other teams working on it when I joined. So I'm not really sure. So I said, I need you to give me 24 hours so I can figure this out and I'll call you back. So I did. And, and I mean, literally we could spend an hour diagnosing this. There's so many mistakes and leadership lessons, but essentially I had a really overzealous sales guy for this new innovation channel with a new retail partner. And the way we were delivering the product was different. It wasn't sending someone a fully formed manufactured food product, which takes well over a year to plan, commercialize, and sell in. We were sending them raw ingredients and recipes. So all you need is a different recipe to make a different thing. And this sales guy

sent them the recipe for the big thing, because they said, we want the real one. And there wasn't a gate or a process that was in place for me as the president to know and catch that. And some people hear the story and go, oh my God, what a low integrity sales guy. I bet he was fired. And he wasn't, well, not that time, you know, not then, but it truly, it wasn't, it was the fact that I did not have systems in place to catch what this new channel allowed to be a much faster process of change and innovation. All our stages and gates for innovation were built on old CPG models of 18-month, 24-month commercialization cycles. This was like 60 days. And then when I thought about it, I had walked around the building and saw different packaging. There were signs,

There were little signs that should have prompted me to poke. But then I had that typical young leader self-talk in my head. You know, who am I to question them? They've been here longer than me. They would never do anything to hurt the business. And I failed in my role as a leader. I had the humility to ask the question, who am I, you know, to question them. But in that moment, I failed to have the courage to answer it.

And the answer is, you are the effing president. And if you don't ask questions, no one will. and so I acknowledged that I called Greg back and said look we have the right to do this we had the right contractually and we were selling 70,000 units a week so it was like crushing it and we were making we were on track to make millions and millions from I mean it was huge I was going to take a big chunk of that money and plow it into the franchise business so we had some really good visions for how we would use this innovation revenue but just because we had the right to do something doesn't mean it was right. And we did not handle it properly. And I did not put the

systems in place to catch the variations in the commercialization process. So we killed the deal, walked away from millions. It took many months to unwind it. And ultimately, I was able to earn the respect of the franchisees, even though I was in tears every night. I had to go to the board and the CEO and say, we're walking away from millions. But the way I positioned it was, if you don't support me in doing this, which they did by the way, without hesitation. If you don't support me in doing this, I will never be able to manage this group. My employees will feel shame. The franchisees will always believe I'm out to make money off their backs. And I'm not being honest. If I don't fix this in a big way and learn from it and improve systems, I'll never have their

trust. I'll never be able to go get them to take a leap of faith for future endeavors. And as time went on, it became like the fish story. It's this famous fable in the company of how I am a high integrity leader and made a tough decision because we didn't do things right. And I made it clear to them, look, this doesn't mean when you whine, you get what you want. This is me acknowledging we didn't do this right. But a funny thing happened. We made up, I remember having a franchise advisory council meeting and sitting with those franchisees and getting teary because several of them hugged me, you know, like, thank you. This is their livelihoods that they're afraid of. But three months later, I came to them and said, I have an opportunity to put actual Cinnabon mini bonds in

7,000 Burger Kings, which is far more potentially threatening than that grocery business. And they said, because of how you handled this other situation, we support you. And that deal, that Burger King deal, single-handedly between doubled and tripled the EBITDA of the company for the following years. And had I not fixed the problem that I had allowed to happen, there's no way we would have been able to push that next innovation deal forward. And what I think it really just goes to is like, you did everything kind of by the book in terms of you told them, hey, this is what we're doing. This is why we're doing it. Trust me, which was kind of the important piece of it. And they did that. And when it went wrong, like you said,

It almost seems like you had no other choice other than either lose everybody or go and basically shoot yourself in the foot, but it was because you needed to do the right thing over a long period of time rather than just make money in the short term, and then who knows kind of how it plays out. Is that kind of fair to look at that trade-off? Yeah, but I do think that these are business people who have other business endeavors and have been around banks and financial sponsors who would have said, sorry, you're right, We didn't handle it properly. We'll do better next time. We're keeping it. Right. And then everybody would just have to lawyer up if they wanted to. Honestly, we had the legal rights, so it would have gone in our favor. And then eventually they would have been disgruntled, but we would have moved forward.

So a lesser leader, different leader, I should say, could have easily made the alternative decision and still found a way to move forward, but never with the speed and impact that we were able to move forward as a result. How do you go from president of Cinnabon to now president and COO of Focus Brands? Maybe tell us a little bit about what is Focus Brands? So Focus Brands is essentially the parent company. It started out as just a holding company where Focus would buy, you know, Focus bought Carvel. That was the beginning of Focus Brands and then bought Cinnabon and then Moe's and Schlotzky, you know, and just kept acquiring. And at four brands, five brands, we have seven now, we realized that we really needed to leverage the power of our scale and all the ways your listeners and viewers would imagine supply chain, investing in consumer insights, technological investments. We weren't doing any of that. When I was president of Cinnabon, I was the CEO of Cinnabon, right? My team, no real shared resources other than some lawyers and some parent company, HR, like that was it. It's a very different machine now. We have centers of excellence. It's a mini matrix structure where all the brand presidents, so there are nine presidents that report into me that run each of the brands and then the international business and the licensing business.

they have their teams but they also plug into a marketing center of excellence a digital center of excellence strategy consumer insights that allow us to pool the resources and get each of these brands to be able to punch above their weight far more than if they were freestanding businesses with just greater access to talent right we can afford more talent people are more interested in working in this bigger company in those centralized functions we can make smarter decisions that allow what they do in their businesses to be more successful. Um, so the journey has been, the company has grown and restructured as it's grown. And much like when I was at Hooters, every time we restructured, I took a different and larger role. So I went from

president of Cinnabon, turning that around for three and a half, four years, then grew the global channels division. I was president of that multi-channel business to do the things we've been talking about, like extend e-commerce manufacturing and licensing to more of the brands than just Cinnabon and Carvel and then put all those things together and manage all the businesses as president and COO now and it's been cool you know all the interaction with those various stages of hyper growth mergers and acquisitions evaluating companies turning some down getting some over the line integrating them diagnosing their brands and their fans and where they sit in the spectrum of brand love

and what's special about them and how to grow that in a franchise environment in now 58 countries around the world, 7,000 units and just under, between four and 5 billion in sales. And it's been interesting because it's actually helped me be a better advisor to founders and startups

because these are big brands, but they're actually quite small business. We're constantly going from zero to one or maybe never zero, but one to 10 with franchisees constantly having to help someone start from the very, very beginning while buying these businesses at various places in their maturation and working to reinvigorate them or accelerate their success if that's what they have. So it's been interesting. And the parent company basically owns the brands, owns the assets. We operate some of our own corporately owned units to have skin in the game in addition to franchising and we grow by acquisition

um i want to get into a number of challenges that i know you guys are facing uh just from an industry perspective but before i do that do you ever wake up in the morning or right before you go to sleep and just smile and say like holy shit i run a four to five billion dollar revenue business like does that ever hit you rather than oh i've got you know this franchise here this here You have a very kind of operational way of talking about it and execution and more of the micro piece. Would you ever just look at the macro picture and be like, damn, this is pretty cool? You know, I think it's, I do, but I don't wake up and think about it that way.

I think about the bigness of the brands when the responsibility feels heaviest. I feel about, I think about the bigness of the brands when the responsibility feels heaviest. So when there's a problem, when we've made a mistake, when there's a, you know, a big issue, either in our business or in the world, that's when I have the holy shit, this is big. day-to-day, not at all, right? I'm just in it. And I've got amazing leaders that work for me and with me. And my job is to help them be able to do everything that they can while harnessing the resources of the organization and working on the parent company's executive team to make the parent company better and better, both for the existing portfolio and to grow. So it just, it does it we're just in it right you're just doing it when there's something big a big problem

or a challenge that we face as an individual business or as a collective that's when it feels heavy but it's also when I love it the most because it our private equity founder Neil Aronson says you know we want to be a good partner in good times and a better partner in bad times. And I feel like that every day as a leader, I want to be a really good leader in good times. And I want to be like, unbelievably amazing during tough times. And so that's when it feels heavy, but in a, in a both, oh my gosh, way and in a really positive way, like, wow, we have an opportunity to do something really great in a big way, if we can figure out how to turn the Titanic. I love that. I'm going to go through each one of these challenges, and they're

all, like I said, kind of industry-based and more macro, but maybe just talk through how you guys have thought about it or reacted. The first is Cinnabon, for example, is not the first thing I think of when I think of healthy eating. It's not healthy. Yeah, there's this very large dietary type um uh dietary type um kind of trends that are going and so how do you think about whether it's Cinnabon or some of the other brands in terms of whether it's marketing it's actually the ingredients used the products you create like like how has that changed as the world has become more popular around various diets and kind of being healthier? You know, people, my assessment, which is pretty well informed from being in the industry,

but even just as a consumer, is that people still want to indulge. That's not, that has not changed. What has changed is what we consider worth it. And so if we're going to invest our discretionary calories or our discretionary dollars, it had better be so worth it. And that speaks to product quality, right? And is it so delicious that when I want to be bad and eating a Cinnabon is totally being bad. If I want to be bad, it's worth it, right? A bag of chips, a pretzel, what a waste, a dry cookie, not worth it for me anymore. Used to be when I was younger, not worth it anymore. I want to be like really bad because sugar is going to do what it's going to do, regardless of what form it's in. So it had better be so worth it in that moment and treat me emotionally.

Like I'm going to eat my feelings and feed my soul. It's bad for my butt, but it's good for my soul. So that's the underlying belief is that people want to indulge. There is a place for indulgent for that product segment, but what is required to be worth it and therefore get people to vote with their wallet is far more product quality, which has meant for that brand over time preserving the ingredient integrity, still making it, rolling it in store. You go to the mall, you go to the airport, you see them like rolling it by hand, baking it fresh. That matters because that's part of what makes it so good that it's worth it to be bad. On the other hand, it still has caused us the shift for all of us and wanting to be more responsible indulgers to lean into

smaller portions, like to make indulgence more accessible and to have less sweet things on the menu. But over the years, we've tested gluten-free and sugar-free. And of course, some people appreciate it truly, but not enough to make up for the waste. Um, it truly, most people are like, if I want to be bad, I'm going to go and I'm going to be bad. And we have raw, we have flour in our environment. We can't even do truly gluten-free safely. And because kids and families come to malls and airports, that's too risky of a proposition, uh, to market. Um, so that's the, that's the underlying belief is you, there's still a huge market for it, but man, it's gotta be, it's got to be worth it and then that drives all the decisions around product around marketing

I also believe it it was incumbent upon us to be really honest that the brand is an indulgence and it was one of the first things I did when I took over like I went on national television and said don't eat it every day like it's not a good idea there are people who do it but it's not a good idea um treat yourself and when you want to indulge this is definitely something that I would I would suggest is, is worth the indulgence, but being honest that it's a, um, a moment and an escape, it's not breakfast, lunch, or dinner. Yeah. And what about other brands, right? So Cinnabon is the, uh, the kind of the extreme example of like, I could probably look at that and say, okay, that's not healthy for me, but take Moe's or some of the other brands that

you guys have, like, how do you think about that health trend with those? Moe's Southwest Grill is so interesting because, you know, for those that don't know, it's a, it's a burrito chain and it's always had these like an amazing line of fresh ingredients. You can eat like genuinely healthy at Moe's, but you can also eat super not healthy. Like you can drink a bowl of queso and it's amazing. So, so what's changed for Moe's hasn't been necessarily the food itself has been the, the importance of articulating. You can be good or bad, right? You can eat for fun or you can eat for wellness. You can eat keto or paleo here because we've always had, you know, chicken and peppers and all of these things that are super clean. But again, you can also cover stuff and

cheese and queso and guac and tortillas and eat yourself into a carb coma. And so what's changed is the need to market that without trying to say we're something we're not, right? Without trying to say we are the healthiest place on the planet, but rather now with digital marketing, being able to segment and talk to people about the different ways you can engage with the brand, because there's actually been a possibility to be healthier or less healthy for quite a long time like that brand actually has the potential to be more healthy than for a consumer than most brands that we have but it has to do with how you put that food together yeah it's super fascinating uh the next two challenges i think kind of go together so i'll ask both at the same time which

is uh most of your locations are uh malls airports uh and then obviously you have standalone as well but the malls and airports are coming under pressure, right? Airports mainly from the COVID-19 and less travel. And then the malls, just because of the secular trend of like, everyone thinks malls are going away. How have you dealt with that? Or kind of what decisions have you guys made to kind of address that, mitigate it, or maybe capitalize on some opportunity there?

And then also a piece of that being like an entire delivery, you know, explosion during COVID-19. and I know you guys are doing some of that out of the malls as well so maybe talk just about like physical locations and delivery and kind of how you guys are navigating that yeah so much to unpack there so malls um Auntie Anne's is our only brand that's a majority exposed to malls Cinnabon's even only one-third in malls the other third are in Schlotzky's another third are in these like travel centers on interstate so Auntie Anne's is the brand that's the most exposed and that's one of seven brands so it's actually quite a small portion of our total portfolio

but it's a majority of this one enormous brand that we have. So the last, to your point, the last several years, the trends of mall traffic, e-commerce siphoning off mall traffic, mall, you know, questions around malls and their viability, that's not new. That's been going on for almost a decade. What is new is the acceleration of those trends from COVID and from just the increased adoption of e-commerce. So I'll touch on malls first and then go over to delivery because the rest of our business is street side. And so a couple of things are going on in malls. One, you have different malls, right? You've got A, B, C, D malls. They are what it sounds like they are. A, super premium. D, hyperlocal, like center of the community in a

regional, maybe even sleepier area. C and B malls have actually recovered faster from COVID because they are centers of the community. They're not just the place to shop. If a place is just a place to shop, it is equally, the demand shock is tremendous because you have alternatives with e-commerce. So leading up to COVID, one, as you said, was layering in delivery, even from our mall businesses. And that wasn't easy for a couple of years. The malls didn't give drivers their spaces. It wasn't easy to park and navigate these huge centers. So it was clunky at first, but it got better as it became very clear that this was an important way to drive revenue for the business. So it got better over the last 18 months, being able to deliver Annie Ann's pretzels via Uber Eats or DoorDash or Postmates, which I guess is now Uber Eats, or Easy Cater, catering businesses.

But that's still only a portion of incremental sales. The lion's share was still coming out of the business. So a few things. One is learn how to increase the capture rate of the people who are coming in. fewer people coming in, figure out a way to capture a larger fair share of the business. Second, of course, then was product development and other channels, meal kits, pretzel kits, other things that help drive revenue. So it's looking outside the mall for the additional revenue opportunities, including delivery and DTC, but then optimizing for what's in the mall

and then having a longer term view of which malls are going to survive, which ones are going to do well as a shopping and commerce center because they're just that good. Like the owners are going to keep plowing tens of hundreds of millions over time into them. And which ones are going to have to be meaningfully repurposed as an asset in order to keep bringing traffic. And some of them are turning old Sears into apartments. Some are turning it into hospital. And there's a lot of really cool things you can do with that real estate. And if those developers figure it out, then there is still life even in those malls for small food tenants like our franchises and then there will be some that are going to go away so we have food trucks pop-ups hub and spoke models there are many

options like you exhaust all these options before you just say lights out you know in a location and then remember the quickest way to get out of a hole is to stop digging so for the last three years we've been opening more and more street side businesses but co-branding and tri-branding So putting more brands, more day parts, more occasions together reduces the real estate investment risk and gives us access to more non-mall options. So that's the mall piece. Delivery, we were one of the first national chains to sign up with Postmates, actually. Postmates was the early mover in the food delivery space before Uber Eats and DoorDash really got traction. And we were one of the first when they were only in 17 cities.

And so delivery has been a growing part of our business for well over five years. But the last two years, it has become a material part of the brick and mortar business. Then add to the fact that we've been investing in our own apps, our loyalty programs, you know, all these things allow us to have a direct relationship with our customers, as well as a direct way to serve our customers that are something other than come in, order, sit down. Since we had that technology during COVID, we flipped on curbside in 48 hours. We were already testing it and had it set up in some locations, but because we had made these investments, we were able to turn on different functionality, not just on the technology side, but on the operating model side that allowed us to also launch meal kits and Moe's Market and other things that kept us in business, even when dining room business went away. some of our brands have not reopened dining rooms and are doing pre-COVID sales just through pickup windows, delivery, drive-thru. They're not all performing that way, but several are. So it's really interesting to think about how this accelerated innovation, in some cases, an improvement in profitability. In other cases, we're still figuring out how in one operation to have all of these revenue channels, you know, curbside and pickup and pickup window and drive through if they have a drive-through and app orders. And then the 10, 15% of people that

actually still want to come in. And that's a lot to manage with a small crew. So we're now navigating the operational impacts as all of that's converging. And you have the benefit, obviously, of having the seven different brands. How much of the infrastructure around the technology for, let's say, delivery and things like that is shared and you're just kind of white labeling it or relabeling it for each brand versus you're actually building a different technology stack for Auntie Anne's versus Cinnabon versus the others? It's a great question. One day, it will all be the same. But because we grow by acquisition, we get what we buy. And sometimes we get something super old that's at end of life,

and we need to upgrade it anyway. And when we do, we bring it onto our platform. Other times, it's not old, it's not optimal, but it doesn't make sense to tear it apart based on the financial equation and other things you're working on. So you just tweak it. And other things, when we bought Jamba, they were at the very beginning of a brand new technology contract, and it was just too unwieldy to unwind. And so we, you know, we had to work our way around that. But brand by brand, as the window represents itself, we bring them on to a common platform, whether that's web, general digital commerce, loyalty apps and frameworks. So it's a journey, but the utopia is common platform. So as we acquire brands, you just reskin, put it on, alter it for whatever

that business model is, different consumer frequency, different segment or pricing tier potentially, but otherwise keep building on the successes. So we're about halfway through that journey. So you just talked about, uh, as you acquire a new brand, re-skinning it, bringing it onto a platform, uh, that sounds a lot like what ghost kitchens are trying to do around being very iterative. Uh, any kind of thoughts around, um, either one using spaces you guys already have to, um, become ghost kitchens of some sort, or actually taking the brands going into other ones, or maybe even creating new brands, um, given all of the logistics and kind of, uh, food expertise that you have like what are the thoughts there yeah so we're um pretty well down the path of

um progressing toward external ghost kitchens while recognizing that during covid some of our businesses were ghost kitchens literally right nobody's coming in there's no walk-up business it is a kitchen and the only way you're getting it to people is through some form of delivery or off-premise transactions. So we think about it a few ways. One is we may have instances, not as a majority of our route to market, but infill opportunities where operating a dark business, non-customer facing storefront is a really smart way to fill in the geography because building a full-blown brick and mortar just doesn't make financial sense. So that's, I think that's a very real possibility, whether it's inside of someone else's owned and operated

ghost kitchen or how we decide to deploy our own real estate or our franchisees assets to operate a delivery only or digital only storefront. I think there's a real market for that, but it's not going to be the only path. You still optimize sales meaningfully when customers can walk up, even if it's just pre-order on the app and pick it up myself or curbside. That's a big chunk of business. And those behaviors aren't going away. I mean, even during COVID, while we stayed open, yes, we delivered more. Yes, more people wanted it delivered, but delivery is expensive. And it takes time that sometimes isn't what that app tells you it's going to be. And it frustrates people over time. They feel more control or it's just close to their house, right? So they just

are like, I'll go pick it up. It's fine. And so that behavior is not going away. There is a customer-facing revenue segment that if you are dark or ghost only, you're walking away from. And it might be super smart, especially in dense urban areas, but that's not the reality of most of this country. Most of the country isn't New York, isn't the Valley, isn't the Bay Area. It's not downtown LA. It's Nashville. It's widespread out Atlanta. And people still drive. They have cars. And so they're going to go, it's easy for them to go pick up food. And until the cost of delivery comes down and until the speed of delivery is faster and more consistent, and that is happening in dense areas, but in the rest of the country, it's not. Until that happens, the value

of customer facing is still so big that you're not going to see brands walk away from that. What you will see is them maybe building less dining room space and more kitchen. So then you can fulfill more digital demand more off-premise demand out of that and to your point if so inclined create other digital only concepts out of that back of house is that something you guys would do yeah have you created it's um you know when you're in a franchise system you got to be careful with spitting out a bunch of random brands with ip you've got to manage um but many concepts have done it we'll do it we'll play around with it to just understand the opportunity but fundamentally we are in the brand business and so if we're not growing the big bets we've made of these brands

we've paid hundreds of millions of dollars for and we're tinkering around with i don't know a talk trina's tacos out of the back of a mose then we're not building mose right so there there is a place for that experimentation. There's also an opportunity cost when you really want people making the most of that asset you've invested in. Yeah. And it also feels like you're thinking much bigger about the IEP as well, right? Because of all the other channels and things like that. So that makes sense. I want to finish up talking about one last topic, which is you are a mother, a wife, you run a four or $5 billion revenue business. And then you also have a bunch of non-business interest in terms of, I'll just call it pro-humanity work, right? And activism.

How the hell do you do all this? Like, what do you do from a productivity standpoint? And like, how do you structure your day and time in order to accomplish all this? Yeah, it's, it ebbs and flows. You know, it's first, my husband and I have a monthly check-in. So every month we ask each other a series of questions. I've got a whole post and highlights on my Instagram about it. It's actually really important to enabling successful business leaders where we keep each other in check. So if something feels like it's, you know, shifting the gravitational pull from where it should be, which is family, our, my health, our relationship, and then our family first, we call each other out on it. We'll do it real time, but we really talk about it

in these monthly check-ins. So that, that helps just making sure nothing gets off the rails. We'd like to say our relationship is like vines. You know, we do things that are independent, but they should never get too far apart and peel off. And sometimes they should come together really closely. And so we try to put structure like business structure in place to make sure that that happens. The next is I try to ask myself is what I'm doing the highest and best use of my time. And sometimes I end up speaking to a small graduate class or hanging out in a small room on a virtual app with people. And some people might be like, is that the highest and best use of your time. And in that moment, I believe it is either because I believe that group has a

disproportionate likelihood to then ripple impact or because I have a disproportionate opportunity to learn from them. I try to balance learning and mentoring and giving throughout the day. And that doesn't mean just learning from higher level, more successful people. It means learning from everyone, like super young people and people in different industries. I need to keep dipping my brain um into this like intellectual chocolate that is the internet um because it helps me it really does um and i i love it i love making connections virtually so i try to find easily an hour to an hour and a half a day where i can dip my brain into the intellectual chocolate that is you know virtual communities or the internet i just and that might be a podcast it might be

a social app, might be a virtual conversation, a Zoom conversation. Then I try to make sure that I've just prioritized my business responsibilities, like my day gig responsibilities, do the most uncomfortable, least pleasing things first. I've also learned for me that procrastination is a sign of stress. It's a sign that I've said yes to too many things. Rarely is it that I'm just actually a procrastinator. It's that in that moment, I've said no to too much in my brain or said yes to too much. And I need to say no to more. And my brain is like trying to protect, which is ironically making it worse because I'm not doing anything. So I've learned that about myself. I do a lot of reflection. I do a lot of asking like,

Why do I think that? And why do I feel that? Why am I spending time on this? And then making a change. So I use this practice called the hotshot rule. And the way I do ultimately what you're asking is on a regular basis. For me, it's weekly. It used to be quarterly and it was so effective. I started doing it more often. I practice the hotshot rule. I'll write a book on it sometime soon because it's so powerful and all the things that stem from this mindset. but I ask myself to think of a hotshot. Just whoever is a Mr. or Mrs. Potato Head of badassery like you, other people I've met, I think of you. And I think if you were in my job tomorrow or my life, depending on what role, am I thinking of my role as mother, my role as wife, my role as

president of a company? What is one thing, if you had my seat, what is one thing and the first thing you would do immediately because you're a badass and because you have fresh eyes and I can I can always think of that thing always as soon as I put myself in somebody else's like day one fresh eye mentality I know I know what the one thing is and then I ask myself why can't that be me and then I take action on it in 24 hours and I realized and so what I'm doing is I'm just improving every week by going through this exercise. It requires vulnerability and humility, but also courage and confidence because I'm having to disrupt something that I was already permitting to occur or actually doing. And this happened when I had been president of Cinnabon

for four years. And I've been using this practice for 10 years, but it really showed up as a benefit when I was president of Cinnabon because we did turn the business around. It was a wild success. It still is a wild success. And I remember about right before I took the next gig, some of my team members started nagging me about this franchisee that I needed to basically get out of the system. And I remember I kept thinking, but he's not that bad compared to how horrible the OG franchisees were. I was blinded by my own progress. The things my team saw as the biggest issues that were unacceptable to me were like, eh, it's not that bad. And I was failing them and failing the company because I didn't see it the way they saw it. And so I practiced the hot

shot rule. I sat in front of my team. I always talked to my team about it. I say, look, I was, I don't, sometimes I say the hot shot rule. Other times it's much more conversational. I say, I was thinking about it. I realized if any of you were in my job, you would take care of this. and I did not I'm thinking about it not I may I did right I took action and every time I tell people something I took action on as a result of the hotshot rule inevitably someone always says what took you so long because the people who are closest to the action know what the right thing to do is long before the leader does and so this process of asking answering and acting like over and over and over. Helps me not get blinded by my own progress personally or professionally.

It helps me prioritize the right things to get this stuff done. And it helps me make sure things are in harmony. There's no balance, but that exercise plus having a way to check in with someone who loves me, who cares, and I'm able to do the same, helps us make sure our time's not getting sucked by the bright, shiny light of some new interest. That's an awesome answer. I think that's super, super valuable. Before I end up, I asked everyone the same two questions. The first is, what is the most important book that you've ever read? I think the most important book I've ever read is probably give and take by Adam Grant. Why? You know, he, that book explains

a lot of what I've encountered in my life and codifies it. And I came to know it because he, as the author actually reached out to me because his first pass at the book, people called him out and said, there aren't enough women in the book. And he said, you're right. Fair critique, following the advice of my mentor, right? Somebody criticizes you, assume first they're right. Fair critique, point me in the direction of some women who should be in the book. And a few people recommended me and he reached out to me on Twitter and that's how I got to know him and that's how I got to know the book. And so I was in later iterations of his speeches and conversations around this, but talking to him is what got me to read the book.

and he talks about the value of like givers takers and then this group in the middle right these transactional maintainers like I'll give if you you give and the headline is there's a role in the world for all of them but givers as humans as long as givers put things in place boundaries protect themselves understand the healthy way to give there's unhealthy giving healthy givers always win in the long run um and i had called it destructive achievers and productive achievers that was my word for it but in such a simple way he's an organizational psychologist he's a professor at wharton an amazing human um it was something about codifying it in that way that was so simple that explained such a spectrum of behavior and didn't attack it

or make it personal. It just said, this is right. And there's a way to be aware of it. And there's a way to help people move to a more giving place. And there's also, again, a dark side of, of giving, if you don't understand how to do it healthily, it was the most in a very simple way, um, the most profound book about humanity and leaders. And there are so many others that I think you or I could talk about that are like really interesting and deeply intellectual and talk about like the evolution of humanity over eras um but that book is it's accessible it's simple yet profound and um i hope that when others read it they really think hard about where they are in those groups and whether or not they're where they want to be that's awesome uh second

one's a little bit more fun which is aliens believer or non-believer oh believer why super believer um because it's not a believer super believer super believer like they're out there dancing on some planet right now um i i believe for a few reasons one because i'm one of those people that believes in something or assumes the potential for it when it has not been disproven right like you can argue it hasn't been proven it hasn't been disproven therefore there is the potential for it and I just I just can't believe we're alone like this can't be the only time magic and evolution and all of these things like it just um it can't be like statistically it can't be um so and it it's fun to believe it's super fun to believe it so yeah that's why

A prior guest, Bruce Fenton, came on and he said, every human asks the same two questions at some point in their life. And the first is, what happens when I die? And the second is, are we here alone? And I think that pretty much sums it up, right? You wanted to believe positive things in both of those scenarios. For sure. For sure. I end with letting the guest ask me a question. So what question do you have for me? what do you wish people knew from your perspective if you just think about what you're seeing in the world things that run through your mind could be about you could be just your perspective on the world like what's crossed your mind where you're like if i had a way to convince people to know this or believe this what do you wish people knew really easy um and the context here is uh i obviously have the pleasure of talking to so many different types of people uh both in kind of the

day job stuff this on twitter all these different apps etc but uh the number one thing is just we have way more in common than we have different right i mean i think that like the world spends so much time word talking about focusing on and highlighting differences but at the end of the day like there's way more commonalities and there's differences and it feels like that's the one thing if people remembered that it would maybe not solve a lot of problems but it would at least drive us closer to solutions um because when you focus on the differences it creates all the tribalism and divisiveness and like all that but just we're all human we're all gonna live we're gonna remember that if they don't act but you know that because as you said you're talking

to so many people right you just it's constantly in your face that we are more alike and it requires connection to be reminded that we're more alike than we are different and it's crazy too because I can think back and like I'll have a conversation with you and you'll literally say something and I'll be like I've heard that four times before uh and when you're talking earlier about like oh I go and I talk to the different people that are actually the cashier or the truck driver or whatever and I'm looking for the patterns like you'll say something and I'll be like I've heard four other people say that and by the way they don't look alike they don't come from the same backgrounds they don't have the same jobs like no but they are literally good at something and

therefore here's the pattern yeah and you just start to think about like oh it's because we're all so similar rather than so different uh and so you know that's like the big takeaway for me it's just like we're not really that different yeah i think it's it's one of the reasons that my friend Kate Atwood, who founded Kate's Club. She's an expert in childhood grief. She always talks about belonging. And she talks about the fact that in our society, especially the Western world, we say, be confident in yourself. If you don't believe in yourself, how can anybody else believe in you? And if you don't love yourself, how can anybody love you? But what that unconsciously dismisses is the need for community and belonging. And maybe it is chicken or the egg. Maybe it's not

you love yourself and then I can find a way to love you. Maybe it's others around you love you and it's easier for you to love yourself. And that belonging, that role that like leaders play in creating an environment where people feel that they belong, wholly belong is part of the recipe of getting the most out of people.

I'll take it even a step further. I don't know if you, there's a New York Times article about an island that has the longest life expectancy anywhere in the world. And they credit it basically- Where the generations live together. Yeah. And they basically credit it with three things. They credit it with Mediterranean diet.

They drink red wine, you know, pretty consistently. And then it's the fact that every night, all the people on this island in Europe get together and they have like, not really a party, but just like they see each other and they go home they go to sleep they wake up and they do it again and it's the fact that like the community has an expectation every night we're going to see each other and it leads to happier life a longer life you know all this stuff so like you know it sounds kind of woo when you say it and people are just like oh yeah yeah whatever community you're like no no like actually there's science behind this like this is true uh and it's pretty hard to actually um you know to your point like disprove

it and so therefore like it works there's something to it think about what's going on with racism, classism. Fundamentally, it comes down to belonging. We call it equality. But if I'm not equal, I don't belong. And there's such an opportunity for more belonging. So it's been awesome to connect and talk about these things. And hopefully people who hear and watch will hear some things that resonate and that they connect with and help them feel like they belong or help others feel like they belong. For sure. Where can we send people to find you or find more about Focus? The usuals for me. So Twitter, Cat Cole, ATL, LinkedIn, Instagram. I'm super open and available on all the things, all the platforms. And Focus Brands, focusbrands.com, or you can

follow all of our brands, Jamba and Moe's and Cinnabon and Auntie Anne's and McAllister's and Schlotzky's and Carvel and more brands to come directly on any of their social channels. Awesome. Kat, thank you so much for your time and we'll have to do it again. Likewise. Thanks.