Always Start A Food Business, Especially In A Pandemic

Good Advice

Here’s some good advice that I never heard:

1. Start a business. It’s easy!

2. Start a FOOD business, they’re the easiest!

3. Choose a food with a hard to pronounce name, that most people don’t know about.

4. Do it in a pandemic.

What We’re Doing - Kolaches

Well, Tom and I are starting a kolache business, in Chicago.

Odds are, you don’t even know what that word is, and aren’t completely confident about how to pronounce it (all the hallmarks of a fantastic good idea).

Here’s the big picture: we are starting a baked goods business. The primary product is a sweet bun, filled with savory fillings.

The best way to imagine it is what you would get if you crossed a sweet Hawaiian dinner roll with the filling of a breakfast taco.

They’re delicious. They’re very common in Texas (where I grew up), but they’re largely unknown outside of Texas.

Why It’s A Risky Idea

Well, the reasons above:

1. Food is hard

2. Unknown or confusing product in our geography

3. Pandemic

Why We’re Doing It Anyways

a. k. a. “What We’re Trying That We Think is Unique”

a. k. a. “Our Theory For Succeeding Despite The Challenges”

Cross Pollination

I believe there is a lot of “common knowledge” that accrues in some industries or fields that simply doesn’t transfer (or transfers very slowly) to other fields where it could be valuable.

Applying the widely known techniques from one field to your own can give you an unfair advantage over your competitors.

Examples:

• Obama’s campaign was the first to widely use A/B testing in their website and “modern” email marketing tactics to presidential elections, despite the fact that these techniques were widely used by tech startups.

• Trump’s (first) campaign activated Twitter and Facebook ad targeting in a way that no other candidates had before. This playbook was being run by Silicon Valley for a decade beforehand.

• Billy Beane (Moneyball) applied statistics to baseball to create amazing teams at a fraction of the price in ways that defied the standard practices of the time.

• The Black-Scholes options pricing model was a difficult and “unsolved” problem in finance until a chance encounter with a physicist, who looked at it and immediately recognized it as a solved problem in physics (gas diffusion).

All of these seem obvious in hindsight, but at the time gave someone an edge over their peers/competitors by applying a common practice in one field to another.

Our thesis is basically: “Do the things that startups do, but apply it to food.”

First Principles Thinking

Don’t be afraid to reconsider things from the ground up.

I don’t want to reinvent everything, but I definitely want to have a clear reason for why we do things other than “because that’s how it’s done.”

This is largely inspired by Nick Kokonas (Alinea, innovated on a bunch of stuff around restaurants) and Elon Musk (specifically talks about first principles, goal of reducing cost of rocket launches by factor of 10).

Many restaurants do things poorly, do things without understanding why, and make errors in the game of business (even if they are excellent in the game of food).

Our goal is simply to be open to reconsidering which things work and why and hope to improve our odds of success.

We might still fail, but hey, won’t it be fun to watch us blog about it while we crash and burn?

Some Theories For Things We Will Try

Our main meta hypothesis on all this is to treat food like a tech business. So a lot of these ideas will not seem particularly innovative to tech/ecomm/internet business folks.

1. No brick and mortar - In researching buildout costs, talking to other kolache store owners, exploring kolache franchises, it would cost a ton to build out a space and it would take a ton of time. Pandemic is also not a great time for this.

2. Move fast / launch quickly / “Minimum Viable Product” - Obviously the “don’t build out a space or a kitchen” is in this vein. Additionally, we’re trying to use an opinionated, minimal menu (only 4 kolache flavors) and get to market as quickly as possible lto validate kolache interest in Chicago as cheaply as possible

3. Build a launch list - Just like an unsplash / “coming soon” landing page for a SaaS business, our goal is to build interest before we have product available so that we can launch to pre-orders. SaaS businesses have been doing this for a long time.

4. Model after DTC e-comm companies - Casper, Allbirds, Everlane, Away etc - generate demand with the consumers directly and getting the product to them without the normal distribution channels. We want to try to do this. This is admittedly a bit weirder. Ghost kitchens, in a way, are kind of in this vein, but just moving their product through intermediaries like GrubHub, DoorDash, Caviar, etc. We want to advertise directly through Instagram and Facebook, have them buy our food for future delivery (not “on demand” food like delivery apps), and batch deliveries to compress costs.

5. Subscription Breakfast - KaaS? (Kolaches as a Service?) Who doesn’t want hot, amazing, delicious breakfast delivered to their door every Saturday morning in the cold, terrible, Chicago winter? OK, maybe nobody wants it, but why is this not even attempted? Maybe it’s a terrible idea. Maybe it’s brilliant. We’ll tell you after we try it!

6. Social Media Native - Building backwards from Instagrammability. I’ve always been inspired by the story of Grey Goose Vodka (tldr: Sidney Frank invented the brand first, designed it to be beautiful and eye catching, then made the Vodka. A story is as important as the product). Kolaches in Houston are DELICIOUS. But they aren’t INSTAGRAMMABLE. We're not the first people to think of prioritizing food or restaurants being “Instagrammable” (plenty of others, just Google it), but it seems to still be a less common practice, and we’re definitely the only kolache place in Chicago starting during a pandemic that’s at least trying to think about it this way.