Josh Sharkey: I mean it, so it was not. Soon after that that you guys opened? Was it the roasted garlic? Is that what it's called?
Fred Castellucci: Yeah, that was our original family restaurant. After a couple years of my dad working at supermarkets and hourly labor and my mom as a physical therapist, we, uh, we opened our first family restaurant with another family in our subdivision actually.
And they, it was like kind of this, um, two family immigrant style restaurant where everybody held [00:05:00] positions and super low budget. And that was kind of how we got back into the business as a family. Uh, in Atlanta, I think the, uh, the budget for the opening was 40 grand. Like, that's crazy. Like soup to nuts.
Everything was 40 grand, um, to reopen. It was, you know, a failed restaurant. So not much decor went into it. Went in there and did a real deep clean on the equipment and that was pretty much the end of it. My dad and I were the only line cooks when we opened, so we, we did all of the cooking as a, you know, nuts teenage boy.
Josh Sharkey: I mean, you've been in this since Yeah. Since, yeah. You were a little kid, man. Yeah, it's crazy. Yeah. Um, is your, is your dad still around? Yeah. Yeah. Yeah. He is, is he involved at all with the, with, with the company or,
Fred Castellucci: uh, you know, he, he and my mom, um, are in our original family restaurant out in John's Creek, Sugo.
Mm-hmm. Um, they kind of spend their nights there, even though we do have a general [00:06:00] manager and a full management team as well as a, uh, chef and a, and a full chef team there as well. Um, but that's their cheers, you know, that's where they, everyone knows their name and they know everybody's name, and it's just this amazing, um, restaurant that we built over now, 20 years.
Although it took a little while to get there, like that was a big part of like, I'm skipping over a lot of history, but the, the biggest challenge for us was, and for my dad was always really getting past that one unit, you know, like my dad and my mom. 'cause you know, as soon as we had the restaurant, my mom quit her physical therapy job and she became the front of house manager.
Um, and really the general manager, ultimately, she's really like the organization that. Makes the restaurant successful at the end of the day. And my dad has always been like the mind for food and creativity and, um, and the guest relationships and, and that kind of, uh, interaction with the, with the team and the guests.
And so I, [00:07:00] I saw firsthand how like a one unit successful restaurant was made growing up and they were able to consistently do that. Um, like the roasted garlic became very successful after, um, you know, a short period of buildup. And then the original sugo became successful after a short period of buildup.
But in both of those instances, when they went to the second unit or the third unit, there was failure and it was either quick failure, um, or kind of like whole. Business failure, meaning like the original store went outta business because the new stores were either taking market share away or just the quality decline because of multiple units being operated.
And so, um, that's kind of what I graduated college into. I, I went to Cornell and did the hospitality program there, and then got out and we were kind of at a really low point, like the, we had expanded through franchise agreements, which [00:08:00] obviously is, uh, a whole challenging business and a whole different business from restaurants altogether, really.
Mm-hmm. Um, and so we did that for a little while and we had some franchisees, but they, they had already, they all failed or were in the process of failing when I, um, got outta school in 2007. And so that was really my first project. I, yeah, I kind of had this, um, I. Moment where I was like, what am I gonna do with my life?
Am I gonna go back to Atlanta and try to salvage what's left of the family business? Or am I gonna try to go get a high paying job like all my friends and uh, do banking or consulting or something like that? And, you know, for me it was just like an obvious choice, what to do at that time because, you know, we're very family oriented.
I couldn't, couldn't leave my parents behind. And I also knew that I had a passion for food and beverage and, you know, and I thought that it was a real interesting opportunity to start and try my hand at like all these business concepts that [00:09:00] I, uh, wanted to kind of implement into kind of what was a, a bit of a blank slate.
But it was definitely tough 'cause we were, our sales were horrible. We were, I. Bouncing checks every week, year I took over, we had like 40 grand in overdraft fees and, you know, barely any, could barely keep staff. And the staff that we did have was not great. And, um, trying to, trying to build something on that foundation was really challenging.
And the location that I took over had already failed as a franchise and I reopened it with a 10 grand loan from a customer to get the liquor license. And so when we reopened, you know, everybody in that community already thought we were toast. So reopening with the same name, same kind of menu, um, there's, you know, not a lot of prospects for success Yeah.
Doing that. And so that was really, I think the, the hardest moment was, you know, kind of getting it from that to even break even or past that was, was the biggest [00:10:00] challenge.
Josh Sharkey: Yeah. And you know, it seems like I. You know, originally they were trying to whatever carbon copy the, the, the, the concepts they had.
And then you're, you sort of switched the model with creating a bunch of new concepts. What was the sort of driver or catalyst behind deciding, Hey, I'm not gonna, you know, create, you know, another one, another sugo, another, I'm gonna create a whole new brand altogether, or a whole new concept.
Fred Castellucci: Yeah. I think at its core it was about following ideas that I was passionate about and, and stuff that I wanted to see come to life.
So any, any new restaurant that we've done that has been successful, it's because I have like this, I. Deep desire to see something come to life and contribute meaningfully to the dining scene in a neighborhood or a city. And so when it, when it works, that's, that's the magic I think when I've gotten into trouble is when I've tried to, I.
Product market fit my way into a restaurant concept in a specific [00:11:00] location where you say, Hey, this is a great location. It just became available. It's gonna be, you know, not very expensive to build out 'cause it was already a restaurant or you know, any of the number of reasons that real estate people sell you on a location for a restaurant.
And I think when you have one successful restaurant, um, or even more than one successful restaurant, you start getting a lot of real estate people that are looking to bring you to their spaces. And so you can get very distracted Yeah. Easily by these offers and concepts. And so it's a lot of saying no, uh, to what is coming in front of you.
And when you're new to that game, you're like, oh, people want me. You know? Yep. And so everybody has this desire to be wanted. And so, um, you kind of run down these ideas that really you have no business running down and you should say no right away, but instead you kind of get down the road and then all of a sudden you're like.
Stein lease or doing, doing a concept or a joint venture, some hotel deal or some whatever, you know? And so I [00:12:00] think that it's something that you have to learn over time. Um, you know? Yeah, yeah. Most people are not able to like, have that knowledge ahead of time and, and exercise it. It's kind of something you have to learn on your own.
Josh Sharkey: I've been there, man, and made and, and, and, and probably made worse mistakes, so I dunno, you know, it does actually, it seems like I'm making an inference here just from looking at some of your background, but, you know, in addition to just really liking the idea that family plays a big part in, in, when you decide to do a new concept, I think when your sister, uh, graduated from Cornell, that's when you decided to open Iberian pig, right?
Right. And then your brother. That's right. When, when he, you know, when after he graduated from CIA, you know, you opened another concept, but is that like, um, how much is the family driving you deciding to build what you build?
Fred Castellucci: Well, I think in the very beginning, Stephanie, getting outta Cornell was like a critical juncture, um, convincing her to join me in the family business.
Um, was that hard? You know, was it like a lot of, I don't think it was, it wasn't that hard. She kind of like, I, we had [00:13:00] already had, had a little bit of momentum going at that time so she could kind of see that it wasn't a total lost cause. And so things were starting to turn around at that point, like 2009, like I had two years under my belt of like turning the business around and we were starting to see sales grow and profitable profitability grow.
And so, um, things were really improving at that time. But I also recognize that. We needed to do something new and a little bit bolder. Otherwise, we were gonna be, you know, stuck in the suburbs running these restaurants day to day on meager margins and slow growth over long periods of time, which is one, definitely one way to run a business.
Like you can get there applying the, you know, principles of, you know, guest service and quality execution and all that day in and day out. And that, that is a path to success, but it's a really long, arduous path. Uh, the best path to success obviously is opening something and it's a massive hit day [00:14:00] one, and people are just swarming the place and then you have to manage the, the operation from there.
But like, that's ultimately what we're trying to accomplish. And at that time, we hadn't ever done that before. And so, um, that's when I wanted to open Iberian Pig. Um, it gave me the opportunity to do it because Stephanie, um, was general managing the restaurant that I had been GM ing for the last two years.
Oh, gotcha. So she took over the restaurant you're running at Suga
Josh Sharkey: so that you could, so that you could open up a being pig catch Exactly. What's with the, and then
Fred Castellucci: John was similarly like he had gotten outta culinary school. He had done some really great STAs. He worked, um, for Wiley at WD 50 in New York and then he went to San Francisco with Michael Mina and he did, um, you know, some time in San Sebastian at ARS Sac.
And so he had really built this culinary, um, experience and that was really our biggest hold in the company thus far. 'cause like my sister and I are both kind of like more front of house driven, even though [00:15:00] we both worked in kitchens, Ben line cooks. Yeah. And, um, I love the creative aspect of it and building menus and, and all of that.
But we didn't have anybody in our corner that was really truly a chef. And so we were running the restaurants with kind of more or less kitchen managers at the time. And so I. We were, we, we had, we were starting to build that culinary ba bench, you know, but it really wasn't, uh, very deep at that point.
And so John came back from San Sebastian and we opened Cooks and Soldiers in 2014, and that was the first time that we kind of had put it all together. Like we had put the, the chef team together. Um, the dining room execution, the actual build out, like all the build outs we'd done before that were second generation piece together, really low budget.
That was the first one where we like hired architects and designers and built from new construction and made it beautiful and great. And that was also the first time that we had like any critical success, um, you know, with James Beer nominations, Atlanta, mass Magazine, best [00:16:00] New Restaurants, and all of this, um, eater Restaurant of the year.
Some of the stuff that we got back when we first opened, um, was like great. And the first time we'd ever gotten that kind of recognition.
Josh Sharkey: Yeah. So, just to re rewind for a second, you, you know, you, you sort of glazed over, there's this two years that you turned around Sugo. What, what, what happened? Like what, what was happening that was Well, I mean, what I, I know there's a million things I'm sure, but were the, the big takeaways of the things that you did that turned, turned the restaurant around?
I mean, there's a lot of restaurants, you know, that have a lot of problems, I imagine. Yeah, for sure.
Fred Castellucci: Um, I think for me it was first recognizing like with any problem in a business, like it's incredibly complex yet, uh, really simple. So like the simplicity is you have to increase sales and decrease costs if you want a business to succeed.
Okay. So like very simple concepts, right? But incredibly challenging to actually execute on those things. Um, the easiest being [00:17:00] cutting costs, you know, that's something you can kind of instantly do and find areas, um, to do. So like. My first goal was like, stop the bleeding as much as possible. And the bleeding was like, that was killing us, was bouncing checks.
So I was like, we have to stop bouncing checks. How do we do that? And so, reducing our spend, even our personal spend, like every dollar we spend on the personal side is theoretically $10 of sales, like on a 10% margin in a restaurant. Like for every dollar we spend per personally, it's gotta be $10 in sales.
And that wouldn't even be true because we weren't making money at the time. But if you apply that concept, you're like, okay, well going out to eat is a thousand bucks of sales. So like, are we, are we getting that a thousand bucks or not? And so, um, we had to go on the austerity plan, like, but
Josh Sharkey: how did you, like you, so you did that with your family, I'm assuming?
Yeah. Did, how did that, how did that work?
Fred Castellucci: Not great. I, there was, uh, there was some, some growing pains in the beginning, uh, when I'm like, guys, we gotta eat our meals at the restaurant. We can't be gonna Starbucks. We gotta be, you know, drinking [00:18:00] coffee that, you know, we're buying at wholesale and things like that.
So I was just trying to really. Control the things we could control in the very beginning and then trying to, you know, manage costs in the restaurant, but you can't cut your costs, you know, to a successful business. Like that's just one very small piece of, uh, the turnaround effort. And for me, it was like, as the owner gm, like I couldn't be the chef.
I couldn't be the bartender, I couldn't be the server. Like, I needed to oversee all of those things. And so if you're in a turnaround effort, you need to be overseeing the whole thing. Um, and so you can't just be like, I'm gonna be the chef and crush the menu, but like, what's happening out there? I'm not doing it.
I can't really see or know what's going on. So it's like I had, I knew that I had to be at that love, that position in order to, um, make the turnaround effort happen. And then from there it was really about this like, control what we can control every night, [00:19:00] which is, uh, how each guest. Experience is going.
And so I would personally make it my goal every single night to develop a relationship with each guest in each table that came through the dining room. So I would work the floor and make sure their experience was great. If it wasn't great, we'd fix problems. It, you know, if it was great, we'd like develop those relationships, get to know people by name.
Like that's where our mission statement of passionately pursuing the perfect dining experience, one guest at a time came from. It's like that one like micro unit of something you can control, um, that leads to ultimately a successful outcome on the aggregate. And so for us, like when we've got six covers, you know, like you better believe all six of those people are gonna be happy and then you gr you build on that.
Um, but it does take time and, you know, two years definitely seems like a short period of time, but like day in and day out, six days a week open to close. [00:20:00] You're have less money at the end of the day than you did when you started. That grinds on people. Most people aren't gonna make it through two years of that.
Yeah.
Fred Castellucci: And so it is about trying to put a smile on your face when things are not going well and grind through it and, you know, have this attitude of abundance with the guests. Um, so that, I think that was really like the, the bigger picture. So it's like control the, the cost and then control what we can in the guest experience and, and making sure those each individual guest lead happy and then we can build on that.
Josh Sharkey: Yeah. I love that, man. You know, I, I, I heard this, uh, you know, I guess it's a, it's, it's your core value or whatever that, you know, pursue the perfect dining experience one guess at a time. I never heard it through the lens of that, of the story you just told. It's amazing, man. It's, it, it's, it's also like, I, I mean, I, I'm sure your team does know that, but like hearing that story and then seeing that.
That value is so, is is such a strong sort of motivator for your, for your team. Thank [00:21:00] you. So you, you eventually, I'm gonna jump around a bit because I'm, I'm, I'm kind of curious about how this sushi thing happened because, you know, you went from, I mean, I understand that it's pretty linear. I could see Italian Okay.
And then go Spanish. There's, those are those makes sense.
Fred Castellucci: And then Bask,
Josh Sharkey: which is like Spanish and French, you know? Yeah, yeah. Bas yeah. Makes sense. Yeah. And then, I mean, you tapped an incredible chef. He came from Chuco, which by the way is one of the best, you know, if you don't, if you go to New York, you have to eat Chuco.
It's, oh yeah. It's incredible. And I think did Zumi as well, like, how did that happen? What was the genesis of, uh, the sushi spot also? I've never, I've never worked in a sushi restaurant. I have to imagine it's so different from, you know, like a standard sort of full service restaurant. Like what? Like what are the big differences?
Fred Castellucci: Yeah. Well, so like, any of our good ideas, it started with like, I. Uh, passion around this product and experience. And I had gone to Japan, I guess it was like 12 years ago now for the first time. It's like an eye-opening experience. Um, I think a lot of people talk about [00:22:00] Japan as like this incredible kind of paradigm shift experience, but I do think there is something to that, not just from a food perspective, but just like culturally, like I think every American should experience Japanese culture in Japan because it can exposes you to this concept that like two things that are different and opposite can be true and great at the same time.
Like American culture is, you know, undeniably great and successful, uh, in its own right and Japanese culture is undeniably great and successful in its own right. Yet they could not be more opposite like. On almost every regard, you know? And so going there and seeing that and, and, and getting to feel that culture and see it in restaurants and the hospitality that they deliver and the experience, um, was just like mind blowing.
And so I, I was able to eat at, um, Suki Bai. Giro, which is the Jira Dreams of Sushi movie. They made, documentary they made about him that kind of like popularized sushi [00:23:00] globally in a lot of ways and, and popularized that Omae experience. Um, you know, even in, in New York, it's kind of like the genesis of all of the spots in, in New York.
And so I left that kind of like, changed and also just wanting to experience fine dining like that elsewhere because to me, I had been burnt out on these 40 course meals, thousands of ingredients you eat and drink your way into like a. Coma, stupor, and at the end you just like don't feel that great and the next morning you feel even worse.
Um, and so after my experience in Japan, I just like felt great all the time and like that experience of the, you know, the sushi Oma cae with most of the meal being two ingredients, the beverage pairings and the way they play with like temperatures and, um, just was this amazing, euphoric kind of experience at the end that I had never Yeah.
Kind of gotten from fan di fine dining before. So that kinda led me on a path of just [00:24:00] my wife and I going to these places when we traveled. And that's how we got to this, the sushi counter at, um, Chuko and met Jordan and, uh, you know. And instantly I'm like, what is this guy doing at one of the best sushi restaurants, um, in New York, you know, a uh, a white guy from Kentucky.
And, uh, but you know, I quickly like realized like his depth of knowledge and his talent level and we just kind of became friends, like we hit it off. And so, um, had no real idea to ever open a restaurant like that. I really thought it was just outside of our abilities, honestly. It wasn't like I completely had written it off because we had talked about doing a popup in Atlanta and I was gonna, you know, kind of test the waters a little bit with it to see if there was demand.
And so we had scheduled a popup for April, 2020 and obviously March, 2020 hits. And we're like, oh man. And, but pretty quickly, our company, we, you know, because we had been through these tough times before and I [00:25:00] knew what it was like managing businesses with not a lot of sales, um, or, you know, in the red. I was like, well, you know, we can figure this out.
This is, we've, we've built, you know, six successful businesses and we're in a strong. You know, position financially so that we could weather a downturn. So I was like, you know, we will, uh, we'll kind of take this one day at a time. And, you know, we did the, the covid pivot instantly. We didn't like close for a single day at any of the restaurants.
Um, and, and pivoted to take out immediately. And so then that opened our eyes to the new business and the new reality of what was happening. That's when I was like, Hey, we should do the takeout popup. There's, there's still demand for the high end in the takeout experience and I think we could do something special.
And so he came down and stayed at a friend of mine's hotel for, cut us a deal for 20 bucks a night because he was living in a hotel for 20 bucks a night. For how, for five minutes outside the city for like seven months. What he like, so he came down and we did launch the popup in [00:26:00] May of 2020 and he never left.
Like, that's nuts. Literally stayed at this hotel for seven months, drove my mom's. Toyota Camry, uh, to work every day. And we launched the popup and then the demand was just overwhelming. And also the quality was incredible. Yeah. Like out of the Oma CAE box that, um, he created, like, I tasted it for the first time and it was truly world class, like amongst the best I'd experienced anywhere in the world in a to-go format.
So that's also when I knew that he was the real deal, because up until that point, you know, when you meet somebody at a restaurant or you mm-hmm. You know, it's a sous chef or a chef to cuisine or something like that, you never know if they're actually the person driving Yeah. What's happening in that business.
Uh, and so he definitely was at that level, and it was something that I, I was not prepared for. And so then when I knew that that quality level was there, I was like, we can build a business around this. And so that's when I signed the lease in, uh, July of 2020 [00:27:00] and, and got started on the, the build out, which was a total epic.
Fall, especially that time. During that time, getting anything done and built and open was just absolute misery. And we did finally open in, uh, February of 2022 and it was just like an avalanche of like guest kind of like demand for that concept in Atlanta. 'cause we were the first only Oma CAE restaurant like you see the sushi has in Japan and mm-hmm.
And New York and places like that. In Atlanta, of course there were other restaurants doing Oma cae inside a greater larger footprint where they also have a la carte. Um, but, you know, in order to do sushi at the highest level, it truly has to be in that, in that format of Oma cae for a variety of different reasons.
But that was kind of the, the first of its kind in Atlanta. And then we really saw, you know, just an incredible outpouring of support for the opening. Amazing. So it was, I mean, we were working friends and family and like the press releases went out, they all got picked up and it was like [00:28:00] within hours, we were booked out for three months.
It was nuts.
Josh Sharkey: It's crazy. Do you, do you, um, do you go back to Japan often or?
Fred Castellucci: I try to. I was there in uh, February, actually,
Josh Sharkey: by the way. Do you have four kids? I do have four kids. That's nuts. I all, none of this makes sense knowing that you have four kids. Did you like my, that my thought when I, when when you were telling me about gonna Japan, I was like, did you bring the kids with, because that we've been talking about taking our kids to Japan.
I'm like, I don't even know how that works.
Fred Castellucci: Yeah. I mean certainly no. When we're not taking poor kids to Japan, not until they're all old enough to like, you know, deal with their own bathroom situations mm-hmm. And pack their own bags and get dressed. Uh, otherwise no, there's no chance
Josh Sharkey: you leave 'em with, uh, with family and you go and,
Fred Castellucci: yeah.
That's nice. Yeah. Yeah. Um, but, you know, uh, my wife and I are, you know, same team and we both work in the business and we both work at home, so there's not a whole lot of rest going on Yeah. Uh, in our lives, but like, we [00:29:00] both are like supporting each other in these big efforts, you know? And so she's our director of marketing, which is like one of the most important roles because sales are the lifeblood of every business.
And so. She's, she and I are really focused on, on that and also just like big picture growth and what we're doing. And so we're intimately mm-hmm. Working together in that regard. And then on the family front, um, we're both tackling a lot of the big responsibilities there too. Um, where, you know, she's like the home, CEO on the work, CEO and then there we're both like the top lieutenant in both situations and kind of defer to the other person when it comes to the big decisions.
So that's kind of how we make, make it work for our life. But like, yeah, it's, it's certainly a challenging season of life.
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Yeah, how, how old are your kids?
Fred Castellucci: Uh, 8, 5, 3, and one. I'm,
Josh Sharkey: I'm trying to process that. We have, we have two and I'm, I'm done. Yeah. Um, two's enough.
Fred Castellucci: [00:31:00] Yeah. I mean, I like that. I do say that like, it doesn't matter how many kids you have, they're gonna fill every nook and cranny of your life mm-hmm. If you let that happen.
And so, you know, it is, uh, everyone, it doesn't matter, one kid, two kids, whatever it is. Yeah. It, it's gonna fill the whole box. So you have to be
Josh Sharkey: Yeah. Uh, aware of that. We have a similar story. I'm sure we have a bunch that you, I think one of the restaurants you opened, you uh, uh, you know, you started pay, you paint the GC and then you kind of walked with, with some cash mm-hmm.
And did the work. The original pig probably happened to a lot of us. When you're like in a. I'm sure it happens hopefully less often over time, but when you're feeling stuck, like you don't know what to do, like do, do you, do you have anything that you do to try to try to get centered or like, um, ground yourself when you're, when you're in a, you know, a tough situation?
Fred Castellucci: Uh, yeah, for sure. I mean, well I've, I discovered like a little over a decade ago yoga, and that's been like my primary working out activity that I've built into my schedule over many years. And when I've stopped doing [00:32:00] it, it's when my life kind of falls apart. And so that is like a core thing that I do, um, that I try to build in and schedule everything else around that.
Um, so it keeps my, kind of my head clear, but like I always, I, I do get into these like negative head spaces and kind of get really worked up on certain issues or things or, um, and what I've found is like action is the best antidote to any problem. Like I. Anxiety, like you can kill your anxiety really effectively with action.
And so, um, obviously the correct action is the best thing for it, you know, and so applying whatever that next best correct action is, I think is, is the way that I approach it. But like, if I'm really worked up about something, it's usually because I am stewing on it and I haven't really taken that step to correct this problem or do something positive in the direction that needs to be taken.
Josh Sharkey: You know what's so [00:33:00] funny? I I, by the way, I'm, I'm, I'm same exact way. And, um, I've had, I haven't had a personal therapist in a while, but we have a couple's therapists and she always says to me, she's like, you know. Are you sure that you just don't work all the time to like cure your anxiety and, um, like, yeah, maybe, maybe, maybe that's what it's Yeah, no, no, no.
Definitely indeed.
Josh Sharkey: And, and I think that's actually like part of what, uh, maybe the lifeblood of, of, of, of being entrepreneur is, is that it is so true. You know, if you, yes, action, like also just going and exercising, doing a workout, you always feel much better. But also just like, you know, doing a new initiative or improving something in your business or starting another business or each of these things like they, or the idea of it that you drive towards, it does, it helps so much in curing, you know, the comparison issues or anxieties and things like that.
I don't know if that's a good thing, but it definitely seems like a, a common theme with, you know, with, you know, entrepreneurs where we we're, we're always doing more. Mm-hmm. I have to imagine part of it's probably just like, you know, um, to, to quell a lot of that anxiety. [00:34:00] For sure. Is your wife also kind of, um, have that entrepreneurial drive or She for sure along the ride.
Fred Castellucci: Yeah. Yeah, she definitely does.
Josh Sharkey: Yeah, that's good. Big time. That's important, you know, for you, for you both to be aligned in kind of how you, how you think big time because, especially in the restaurant business, man, because you know, if you, if you don't see, if you don't at least understand, it's a very difficult, uh, way to sort of like live with someone.
If they're in the restaurant business, then you're not, you know? Yeah.
Fred Castellucci: I mean, it's, it's super challenging and I'm even starting to get it from my kids now where they're like upset when dad has to go to work at night and, you know, that kind of thing. So it definitely is a challenging business, but I will say, you know, every job has its challenges and so nothing that you pursue in life is going to be the perfect thing.
You know, there, I, I don't care what it is, what profession you think is the most glamorous, best or easiest, like, there are elements of it that are not gonna be [00:35:00] tasteful. Um, and so you just have to accept that. Then work to build a life around it that you're happy with. And you know, if there are elements of it that are not deal breakers, then of course, you know, um, but like we're in a season of life where family is a big part of what we do every day, you know, and I have to figure out how to make that mesh with the restaurant, you know, demands.
And so that's about like picking my spots. Where can I be most impactful? How can I create the most impact in the business, but also be there for the early years of my kids' lives that are fleeting. And then I know that the business will be there, um, when those years are over. I'll have even more time to dedicate towards that.
So for right now, it's about dialing in growth and making sure that growth fits within the broader picture of our family. And so that's, you know, how many restaurants do we want to open at what cadence? Um, the [00:36:00] cash that it requires and the, you know, financing that it requires to make a new restaurant happen.
And the team. And I think there's a right pace in which we do all of these activities such that it brings a lot of energy to the team where there's new opportunities for people to, for growth. 'cause you know, we are growing, but it also doesn't, um, tax the resources of the business too much financially and also our time so we can really focus on doing one new thing right.
And well at a time. And, uh, and also have time to do these other things that we wanna do with our lives.
Josh Sharkey: Yeah. Yeah. I also, I also find that, that my kids. Force way better prioritization for myself. You know, I have less time, you know, when you, you just have less time when you have kids. There's no way around that, and you're forced to decide, um, how you spend that time.
And I, I'm, I, I love the sort of premise of, um, Parkinson's law. You know, you fill the space that you have, it's surprising how much you can get done when you're forced to prioritize what not to do. [00:37:00] And I, I, I, I couldn't agree more, man. Especially, you know, you could look at it like, fuck man, I don't have enough time anymore.
Like, these people can do more. 'cause they have, they don't have kids or they have this, you know, everything is, is the way it's supposed to be. I, I believe, yeah. You know, I mean, I
Fred Castellucci: think especially in your business though, I mean tech startups, you know, you kind of have this unlimited amount of time out there, um, to do things.
'cause like in our business, we're gonna open and close the doors every day, like, and the lights come on and it's five o'clock, and then we're gonna close it, and then we're gonna do it the next day. But like in your world, you could theoretically like work 24 hours straight on a problem. Mm-hmm. And you know, and then eventually sleep at some time.
But there's no, there's no governor where it's like the last order hit the kitchen and we're done for the day. You know? And like obviously as you transition into knowledge work and restaurant business, like that can change and you could theoretically be working on these problems for extended periods of time.
But I. I also think what you do is so challenging because, you know, my competitive set is like whatever [00:38:00] neighborhood I'm in, you know, or city I'm in, depending on how you quantify the type of concept and the customer base and all of that. But like, you know, with a, with a tech startup, you're, I mean, it's global.
Like your competitors are global. Like somebody could come along and create a better version of what you're doing any day and make your entire business obsolete. Like that comes with a pressure and a stress, um, that is like almost unlike any other business. And then you also have investor expectations on top of that.
And the challenges of kind of growing a business, um, through all of those levels of investor expectations, like incredibly challenging.
Josh Sharkey: Yeah. It's, it's, it's, it's certainly a very different, well it's, it's a very different business approach altogether. I mean, running restaurants. Are very difficult, but it's also very quantifiable, right?
There's a p and l, there's opex and, and we're trying to
Fred Castellucci: have profit at the end of the day.
Josh Sharkey: Yeah, exactly. And when you're, when profit isn't the first thing, although, you know, it, it, it should ultimately [00:39:00] unit economics should, should be important for any business. But when, you know, growth is the, is the, you know, is the goal, it does make it hard to, to understand the guardrails and kind of, um, where you should spend your time, where you shouldn't.
And yeah, you have a very different dynamic with investors and customers and employees. I think for me, the biggest challenge I find is, you know, in the restaurants, I could always, to your point, I could always walk to a table and be like, how you doing? How's this and right away hear feedback and I knew no matter what, 'cause you could see them eating it, like whether they like it or not, or whether they, the, the service they're getting is whether they're happy, right?
Yeah. In, in tech it's very difficult, you know, 'cause one, um, you know, it's not a surface level. Sometimes people don't understand what they, what they, what, what, what problem they need to, to solve or how they need to solve it and or how to sort of express what, you know, what will help them. And it's also very hard to get, you know, in front of them because everything is remote or, or mm-hmm.
Asynchronous. Uh, that for me, I find is the biggest challenge with [00:40:00] tech is like, I wanna know so much about what my customers want, what, what pains they have, how they're feeling. And it's difficult. It's so difficult to do that at scale and especially once you get to, you know, thousands and thousands of, yeah, in our case, kitchens using this thing, you know, that it, it becomes harder and harder to become to, to stay personal.
Um, but I think in any business it doesn't matter what it is, you have to have some level of like human connectivity. For sure.
Fred Castellucci: And how do, and how do we measure that? Like guess. Satisfaction at the end of the day. Yeah. Is like, it's the most important driver of every business. And so how do we know if we're doing a good job or not?
Like that is? Well, I think every business should have a way to answer that or at least try to answer it. Yeah. With some degree of certainty.
Josh Sharkey: Yeah. If you were, if you were gonna double the size of your business tomorrow, what would you, what would you focus on most?
Fred Castellucci: Well, I definitely wouldn't do that because no interest in doubling the size of my business tomorrow.
Um, I think that. Restaurants [00:41:00] specifically are really hard businesses to scale, um, because we're dealing with like individual emotional connections that guests are making to our business and our staff is making with our guests and the, the kitchen and the food, and it is just a complex operation. And so, and, and it's also highly competitive.
So when you start slipping, like customers know right away and they go other places and other restaurants are constantly trying to be better and execute at a higher level. And so it's just one of those businesses, like you have to be on your a game in order to succeed long term and nothing will throw you off the a game more than adding a bunch of units where you're now pulling your managers and stretching them thinner.
And you're hiring people off the street that have never worked with you before and have no basis in your cultural values. And so they're bringing their own ex, you know. Expertise to your business that may be totally different than the way that you like to run things, or the values are completely different.
And so, and [00:42:00] there's no one there to make sure that that person, uh, knows that or is trained in that way because they're onto the, the fourth or fifth opening of the year. So I think the only way that I've seen at the high end, like nice restaurants is to do it gradually. And then there are great examples of companies that have done it really successfully pretty quickly.
And, but what they do is, is they gradually build up to that. Yeah. They gradually like build up to, okay, we can now, we feel great about doing one opening a year. Now we're gonna try to do two openings a year, and then that works. Now we're gonna try to do three openings. Okay, that didn't work. No. Now we might be doing just two.
And so, you know, there's just very few examples of really fast growth in our industry. I think that it also has to do with the con concept. Like whenever you've seen really fast growth. Be successful. It's usually a tremendously unique product. Something that really has a differentiating [00:43:00] factor that is changing the game in some way.
Like the last one that I can even really think of off the top of my head is like Starbucks. Like Starbucks changed the game on coffee, like in America. And so they had a very unique product and it was a status symbol to be like carrying around a Starbucks cup back in the day. And now they've reached a scale.
And now the business is on the other side of that where it's, it's declined because of just that tremendous amount of growth and it's now ubiquitous and not cool. And so I think every brand struggles with how to grow, even at the biggest scale, like a Starbucks or something like that. Yeah,
I think
Fred Castellucci: a good example is like Shake Shack, you know, like how did they grow and scale to where they're at?
And I, and I do think that they're also. A great brand outta New York that like had this zeitgeist and all that. But then, um, now as they've tried, tried to ramp up that growth even further and as a public company, um, what does that [00:44:00] experience look like? I've had really consistent meals actually, um, with them, but I can also just see the volume, maybe not quite where it used to be.
Um, and I think that also has to do with speed of growth. So we wanna keep that excitement around new concept and new, new brand openings and duplications. So we did Nashville and we created tremendous amount of buzz and energy around that opening and it was awesome. So now we're gonna try to do it in Charlotte next year.
So we open national in 2023. We're not gonna get Charlotte open until 2026. So that's like a good kind of window into. How quickly we wanna do things such that we can preserve that excitement around a brand entering a city or a new location or a new neighborhood. So yeah, that's really the way I think about it.
I mean,
Josh Sharkey: I mean, you already, you, you obviously already have a, you know, a a a lot of scale. You mojo cooks and soldiers, B pigs, suko, double zero. I, I'm curious, [00:45:00] um, I mean these are all fairly disparate concepts. Are there guardrails or parameters that you put, you put in place so that your team can have autonomy with creating menu items and, and things like that?
Fred Castellucci: Yeah, for sure. We definitely, I. Wanna create, I think like the best businesses operate in these environments where there's creative with creativity within a framework. So you kind of, as ownership leadership, you give the framework the guardrails of like, this is generally like the values that we wanna see kind of espoused in the business.
And then you have creativity around how to accomplish this goal. Even even setting goals with those values in mind. So we definitely do allow for that in, in the businesses, um, in a variety of different ways. You know, culinary obviously.
Josh Sharkey: What does that, what does that look like? Like let's, you are tasting today for double zero.
Yeah. Like what are, so from a culinary
Fred Castellucci: perspective, we try to identify like, what is, what's this brand? And like, what's the promise of that brand? Like for the, [00:46:00] from the guest perspective, like, what do we want to be like for double zero? It's, we wanna be a great neighborhood Italian restaurant. Like, we're not trying to be like the best.
Pasta restaurant in Atlanta, you know, where we're making all of our own pastas. We're not trying to be the best Neapolitan pizza restaurant in Atlanta. We're trying to be a great neighborhood Italian restaurant for that neighborhood that we're in. So what does that look like? And so then the chefs get to create around that.
And so what do dishes look like that are, what's a great version of a dish in a neighborhood, Italian restaurant for a seasonal summer vegetable dish or a seasonal summer salad or something like that, or those. So those are the. That's kind of how that plays out. And then we will give them kind of unlimited creativity on specials, like run specials and try stuff.
And then when it comes time for the menu, and we'll do a seasonal change, we all sit down and we do a round of tastings. Um, so we're even trying to fine tune that process now where there's a [00:47:00] tasting before the tasting that, that I'm at where John, who's the culinary director and my brother for all the European concepts.
And then Jordan does all the Japanese stuff. He's working with the chefs to like workshop and develop these ideas and then do one tasting, um mm-hmm. Where they can all sit and like kind of rip each other's ideas to shreds and then bring that, uh, to me and John, um, in a second tasting so that, you know, there's a, um.
There's kind of this creative safety in like a meeting where they can all critique each other and try to create the best ideas. Versus when the dishes come to me for tasting, there's like less of, you know, there there's just more of a desire for it to be good and, and when it's not, like, it feels like a personal critique.
And so finding that right balance there, um, so that we get at the end, the right product. And, you know, this is what I told my brother, is like the guests and the customer in any [00:48:00] business, like, really doesn't give a shit about our feelings. Like, and in these meetings, like, do we, we are making sure their work environment is good and positive and so we are tiptoeing around it a little bit.
'cause we don't want to just destroy someone's, you know, ego. But at the same time, guest doesn't care about that. So at the end of the day, we have to do the absolute best work that we can possibly put out. That's ultimately the challenge.
Josh Sharkey: Yeah. How do you guys collect feedback from, from guests?
Fred Castellucci: So we're trying to collect even more feedback.
So we have OpenTable or resi. So we're, we're, we wanna have the most verified feedback. So like we're kind of kicking out any review source that has nothing to do with the actual guest who sat in the bi in the business. Like anybody can write a Yelp review, almost anybody can ready to Google review. Um, but we wanna know this person verified was in the restaurant.
Um, so OpenTable and Resi have that, and then our mobile payments provider Sunday has that. [00:49:00] And so we are. Collecting all of this, um, review data. Um, and then we are bonusing on that review data across the whole company. Oh, that's cool. And so our top bonus metric is the, is the customer satisfaction score.
So we don't bonus people on sales anymore. The only bonus on guest satisfaction and cost management, because to me long term, I think that's how the business, um, is most healthy, um, is to say, Hey, we want the best possible guest experience and we also need to make money. So you have to control your costs.
So if we do those two things really, really well, I think long term we're always gonna be in a positive situation. And so that's kind of how we approach the, you know, incentivization of our management team. And specifically when it comes to the, um, the guest review score, we've even kind of roll rolled out.
Another element to this is we kind of did a benchmarking of all of the restaurants on OpenTable and Resi to see like what was the. You [00:50:00] know, kind of top scores. Mm-hmm. And where do kind of people, you know, um, on the, on the scale of very successful to about to go outta business, where, where do people, um, stand?
And so what we found is that like, you know, an average solid restaurant is like a 4.7, um, and that like. Great restaurants are typically 4.8, and then very few if, if none are like 4.9. And so we basically said we want our base standard to be 4.8. And so if you hit 4.8, we'll you get bonus. Um, if you hit 4.9 and you become like one of the top, like five places in a given city, we'll bonus even on that too.
So like, it's, it's a variable kind of on top of that. Um, and so it just kind of gets everybody focused on what I think is the most important thing at the end of the day, which is the guest satisfaction, the experience from a objective perspective. What is like the aggregate, like I don't care what one dude says on Yelp or Open Table.
If [00:51:00] somebody says nasty things about us somewhere, like I could care less. Um, what I wanna see is like. What's the aggregate say about us? What does over thousands of impressions, what are people saying? Is it overall at a level that's positive enough to enough to put us amongst the best in our city or neighborhood?
And that's what we're trying to achieve.
Josh Sharkey: It's really smart. It's, it's a great measure of success for, for the teams. What do you, uh, what do you love about the Atlanta food scene?
Fred Castellucci: Well, Atlanta has grown so much since, like, even we started doing this I think from 2009 until now. There's just been this tremendous growth of the, all these awesome places.
And, you know, Atlanta had pretty decent food scene before that, but like, there's just like been just this incredible growth and um, you know, Michelin guide coming to Atlanta two years ago also great, great for the city, great for fine dining. Um, great for the growth of that top level, but also for the tier below that too, that allows for.
You know, all these chefs to find homes in [00:52:00] different places, um, after getting training at some of the top spots. So I'm generally a big believer that the system is great on an overall basis and, uh, you know, I. Atlanta has, has just like continues to evolve and grow. I think right now, because of the, you know, Atlanta's also a very challenging market.
I think for a lot of people that come to Atlanta, they can be disappointed in sales and, and what they do here because they kind of misjudge it a little bit. So Atlanta is a big city, you know, it's, it's one of the largest MSAs in the country. It's like top 10. Um, but then if you actually do the nitty gritty work, it's like really a patchwork collection of a lot of different neighborhoods.
Mm-hmm. And so in order to be successful here, you first have to be a great neighborhood restaurant. Like that is what you are, have to be at the end of the day. And so a lot of people coming in thinking they're gonna, you know, dominate and do, you know, eight, 10 million a year in sales and that's just not the market.
The market is like create a great. Business in a neighborhood [00:53:00] on, you know, three to 5 million in sales, maybe a little bit more, and build your business model around that. Um, and so I think that's where people, uh, get, you know, into a tricky spot. It's also why like a lot of New York restaurants that try to go other places, there's so few places like New York and the country, like, okay, maybe you can open a Chicago store, maybe you can open la.
Like there's just not that many spots where, you know, I, I have a friend that works for one of the big restaurant groups out of New York and they're looking for new places to put restaurants, you know, and they're thinking about Nashville and, 'cause we're in Nashville and, but they're, you know, these glitzy eight to $12 million a year New York City restaurants.
And there's really nowhere to go in the United States where you can plop one of those things down and expect that to happen. Like maybe Miami, maybe Vegas, like I. Maybe la like we're talking a very, very short list of places. Um, so our model is like, I want to create a really sustainable [00:54:00] business for 30 years minimum.
And so that means taking a little bit less space, making sure we have just the right number of seats so that we can make a really good living when times are good. Maybe we leave some of the upside on the table in those early years when we're the hottest restaurant in town. But then as you get into that awkward teenager phase of being a restaurant years 6, 7, 8, 9 through 15, whatever that is, before you become a classic, those years can be tough.
And so I want just enough space that I can ride out those, those leaner years and be profitable and successful on just the right number of seats that I need in order to do that.
Josh Sharkey: Yeah, it makes, it makes a lot of sense. It was like a 15, 20 minute drive to get kind of anywhere in Atlanta I noticed. Yeah.
What hour was staying. Yeah. So that makes, it makes a ton of sense. These pockets of areas and then they're sort of condensed when you get into that, into that area. Alright, so if you were gonna, let's just say you breakfast, lunch, dinner in Atlanta and you were not gonna go [00:55:00] to one of your restaurants, but you're gonna eat dinner, eat breakfast at lunch, at dinner, where, where would you go?
Fred Castellucci: Oh, that's great. Um, all right, so Breakfast is Daily Chew. It's a excellent kind of South African Israeli food. The owner, Julia's fantastic and all their products are super clean and fresh and delicious. Um, you know, I probably would save them for lunch too, but I would say, I don't know, for a lunch, like sit down lunch is really hard to come by in Atlanta.
And, uh, I would, I, I probably say like. Sit down lunch. Roomies kitchen, um, is excellent. Just like good Mediterranean food, clean, great. Shareable. So that would be my lunch spot and dinner. This is, this is probably the tough one. So, I mean, I feel like I have a lot of, a lot of choices, uh, for dinner, but if I'm, you can pick
Josh Sharkey: two if you want, or you can see a little bang.
Bang. Yeah. Yeah. So
Fred Castellucci: like, [00:56:00] I think from a steak experience, if I wanna ball out, like Marcel, um, Ford Fry's, uh, steakhouse is killer. I feel like I find myself like with guy friends, like that's our kind of like go-to default Atlanta spot. Um, I think that. If I'm thinking Italian, my default is either like, um, if I want like more of a casual neighborhood spot, it's bocal lupo.
If I want something a little bit more elevated, um, from like a design and environment perspective and, and really great pasta. I think Lila, Lila is my, is my go-to on the Italian side of things as far as kind of cool little neighborhood type spots. Like I really, um, oh, what's the name of the little wine bar?
That is amazing. Lucian and uh, Buckhead is just like an amazing designed restaurant. Beautiful. The food's always consistent and the wine list is the best in Atlanta probably. [00:57:00] So anyway, those are probably alright. You got some good spots
Josh Sharkey: there.
Fred Castellucci: Yeah.
Josh Sharkey: Where did I eat last, last time I went there, I had dinner at, um.
Deer in the dove, is that what it's called? Oh,
Fred Castellucci: yeah, yeah. In Decatur Square. That's great. We're like four down, four doors down with that, from that, with the original Liberian. It's
Josh Sharkey: really good. Yeah,
Fred Castellucci: really good. Yeah. Yeah. I, I, you know, it's crazy. I haven't been, I need to go. It's, it's, uh, it's high on my list.
Yeah. But, you know, four kids, like, we don't get out often, so
Josh Sharkey: I get, I, I go out to dinner like once a year down. Mm-hmm. Not a year, but like, you know, maybe three, four times a year. Uh, I go in the city more
Fred Castellucci: in other cities, like when I'm traveling Yes. I'm able to dine out and see Yeah. What's going on in other cities.
But it's, um, it's challenging in my hometown. Me
Josh Sharkey: too. This is great, man. I'm so stoked. We gotta make some time for this. I
Fred Castellucci: know. I'm happy we did it.
Josh Sharkey: Yeah. Uh, I know you gotta busy. Congrats on all
Fred Castellucci: your success. What you guys have done is amazing. You've taken on like an incredibly hard, difficult, challenging piece of the business.
But I also think that's also where value is unlocked. Mm-hmm. Like when you take on these really hard challenging problems, there's a, [00:58:00] there's a reason no one's been successful doing it yet because it's, it's hard. And what you guys, the piece that you took on was very challenging, seeing a lot of startups in, in the graveyard of that space.
Um, yeah. And so congrats on you guys being the one to able to get out of that.
Josh Sharkey: I appreciate that. Yeah. You know, it's, it's funny that I think the thing that, that excited me the most about it, but also was the most daunting was specifically in like the recipe space. There was, uh, not a lot of people doing it.
A very challenging, uh, problem to solve and also not obvious to, uh, to anyone, including investors. Investors, yeah. That, that, that it is a problem because it seems so. Innocuous is the wrong word, but, you know, everybody thinks of recipes and they think of, you know, a food network, but it, but it, um, I think that's, that was the biggest challenge, but also makes it so fun, right?
Is that, yeah. You know,
Fred Castellucci: I remember one of the first projects I tried to tackle outta college was just like, how do we figure out what our theoretical food [00:59:00] cost is and how do we feel out, figure out like what our actual food cost is and we're running out of QuickBooks and manually writing checks, like Yep.
The amount of data and like individual transactions here is just like so vast. To try to marry those two things together is like nearly impossible.
Josh Sharkey: Yeah. The original idea for MES was just a, I just wanted a badass recipe tool. Like I come from the kitchen cook, I want this like, really cool dynamic like interactive thing.
And then before I launched Mees, I, I ran this large restaurant group. We had six or seven different brands, and I don't even think I knew what the word theoretical food cost meant at that time. Then I, I learned and I started interacting with all these other systems and having to roll them out and then looping in parts of what we were building with Meese.
And I remember the day we got all the theoretical costs of all of our menus in, in one place, and we built this tool that now is in me where you could, uh, you know, hypothetically [01:00:00] change, um, the, the cell price of something or the recipe or, and, um, we ended up saving like $600,000. I mean, this restaurant group, you know, is.
There's like a hundred something. Yeah. Huge. But it was like, what the, like, oh my god, okay, we need to build this into the app. That was that part of the app originally. It was really, um, we, we quickly built that in and was like, okay, we, we, we, we had to figure out how to make that, how to make that easy.
'cause it's insane how one, most people don't know what the theoretical food cost is. Two, once you do learn it, if you can actually get it, the delta between your theoretical and actual is way higher than you think and mm-hmm. And you might be excited because you have a 22% food cost, but it turns out you're actually, but you
Fred Castellucci: really could have 15.
Josh Sharkey: Yeah. Yeah. And it happens all the time. So, yeah. Anyways, this was great, man. I'm so stoked. And, uh, I'll be down in Atlanta again soon. We're gonna do a, an event there actually like a little, uh, party, uh, we're doing, we're going to a couple different cities and doing some parties, so I'll keep you posted on that.
But, um, that's awesome. Glad we found some time.
Fred Castellucci: Yeah, man, this was great. I really appreciate it. Yeah, thanks for your time.
Josh Sharkey: Yeah. Thanks for tuning into The [01:01:00] meez Podcast. The music from the show is a remix of the Song Art Mirror by an old friend, hip hop artist, fresh daily. For show notes and more, visit getmeez.com/podcast.
That's GETMEEZ.com/podcast. If you enjoyed the show, I'd love it if you can share it with fellow entrepreneurs and culinary pros and give us a five star rating wherever you listen to your podcasts. Keep innovating, don't settle. Make today a little bit better than yesterday. And remember, it's impossible for us to learn what we think we already know.
See you next time.
