YouSaid · the spoken record

Seth Berkowitz

lines on the record: 115
first: 2024-08-26
most recent: 2024-08-26
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“I'm not 100% sure. Honestly, the demand of warm cookies wasn't really sufficient to keep going. But people seem to really love it. And so it's like, all right, there's an education element here. I haven't gotten the model right yet, but as we started to tweak it, I started to tweak it at this point. There wasn't really anyone else. And we had this Illinois location and the Penn location. They were starting to make money. And I was opening in Cornell and Binghamton and kind of a small co-op location in New York. They were doing okay. And so okay for me was enough to keep going. It wasn't clear that it was all going to add up to something that was great in the end.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I mean, sometimes less. You know, I think the champagne, Illinois location was 500. My first New York store in Greenwich Village, which opened in 2008, was like 250 square feet. I mean, We were able to shoehorn into almost anything.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“On cookies, we weren't. Like, I think at the store level, and I always looked at the store level because the intent was, can you replicate more of them? And if the stores are doing well and you can. Multiply that out, eventually, the math should work in your favor. When we isolated cookies from yogurt, there was some success at the store level. It started to happen in Syracuse as well. College Park ended up closing and working out a deal with the landlord because it was just a bad real estate choice. And I kind of right-sized the business and clarified the model. So I can do retail locations. They just have to be small.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Maybe six months after, you know, Jared and I parted ways on Insomnia, the Tasty Light stores started to close one by one.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“He was doing pretty well as a cookie only business. The cost of operating was cheaper, and it started to perform really well. It was our first profitable location.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Correct. So insomnia cookies was actually now had its logo on the signage, right? So, like the principal signage said Insomnia Cookies, and it was only the Insomnia Cookies brand being conveyed to the customer.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, but some of them start to convert. So at this point in kind of mid-2006, I convert Insomnia in Champaign, Illinois to a cookie-only store.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I said to Jared, and I don't remember who started it, but like we both recognize it was time to part ways on the Insomny business.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“We go up there, and it's a very long day shoot, and we finish it up and we drove back. And Jared was like really excited about the experience. And he had these like feelings like insomnia was going to be so grand and successful. And he was like, let's chat with everybody and have this meeting together. It was like one o'clock in the morning. I was like, Jared, you know, the business is not really there yet. Like this is a fun moment. But like we need to be successful as a business to really let this thing, really get excited about this. It was like a first fight. Like we got into like a real fight about it. He's like, I want to relish this. I want to really. And I was like, I'm just not there. And we were just in different places. And I think I was just really struggling with the present. And we didn't want, neither of us wanted to fail.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, it started happening because we'd been friends, but not for so long, right? We met 2000. It had only been a few years. And when you start working in a business as closely as we did, it was kind of like a marriage. And so I think when the business started to struggle and it was clear to us that we were going to be raising money or being raising money, and then the money stopped coming in, it started becoming more difficult to raise capital. I mean, there was real tension towards the end. I remember Jared and I, we drove up to Syracuse and we were on a show with Mark Summers from Nickelodeon. I cannot remember what it was called.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“After we opened up our second Atlanta location. And we bought these frozen yogurt machines that were like, they were like 10,000 a pop. I remember writing that check and being like, God, this really needs to be a six, $700,000 store to make some money. Like, you know, we got to do $2,000 a day And a month in, we were doing like $400 a day. And I remember saying to Jared, I think we're in trouble. And by the way, I'm watching in New York Tasty Delight, not flame out. It was still popular, but it was really being talked about all the time, and then you just stopped hearing about it. The fad was starting to play out.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I remember the rent in College Park at the space we rented was like 80,000 a year. So you're talking. 20 or 30 percent occupancy cost, which is not great in the restaurant business. Really a tough starting point. Yeah, layer and labor and cost of goods and shipping and distributing product. Especially with yogurt, you got to ship refrigerated gets very expensive. There was very little profit. And we had to, by the way, Jared and I needed to eat. So we also had to pay ourselves. And I just got married. You know, there was a lot of pressure financially for many years.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Think between the cookie and tasty light business, I think it peaked at four or five hundred thousand dollars at this point.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“So we tried two things. So, first we looked at cities. I mean, this was like to me the obvious answer is, all right, well, we're not succeeding exactly in a 12-month business. Let's look at a city. And I'm in New York, so this shouldn't be so difficult. I lived in the village. And so I walked around the market looking for locations, didn't really find one until maybe 2006 timeframe. We also doubled down on Tastylight. And we did it in a city environment. And so we licensed locations in Atlanta, which is where Jared was from. And the business had been struggling, so he kind of lost Say favor, but like he was starting to get impatient. He saw elements of tasty delight that seemed like maybe they had more legs than the cookies. And so we opened up three locations in Atlanta in early 2006.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Getting people to take that leap was really difficult and really costly in the beginning. So, but like the critical flaw was that frozen yogurt really does well in summers and college students are not there in summers So, just by nature, you're putting on the masthead this warm weather business in an effectively cold weather environment, especially in Syracuse, by the way, which is really cold and snows quite a bit. It was a mismatch to the college market. And even today, I don't really see a tremendous amount of frozen yogurt on college campuses”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I think it stems from the seasonality mostly. Would do well in September, October. But then November would roll around, and Thanksgiving would hit, and that week that the students left campus became a struggle. We'd have a great beginning of December when finals would be, and then everyone would leave for four weeks. And same thing would happen in the summer. So it just was really challenging to find success over the course of a year in a seasonal college business. And that's what we were. We didn't have a city store. We didn't have a 12-month business in New York and Chicago like we do today. And we didn't have the brand knowledge. There was still so much educating. So many people are like, Do I need a warm cookie late at night? You absolutely do. You just have to try it.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“No, we were not crushing it. We really weren't crushing it. There just wasn't a lot of profit. I think Syracuse made a few dollars. College Park lost a lot of money. Pence didn't make a ton of money when we stepped away.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I think we were trying to get to self sustaining. You know, I think even though we were raising small amounts of capital by today's standards, raising money is a full-time job. And I was clear from day one, like, I don't want to raise money every year for the rest of my life, which by the way, I did from 2003 to 2011. So it was every year for eight years. I was just raising capital, raising capital. I wanted to get away from that. So the premise in my mind was how does How do we get to profitable? How do we get to something that's not only profitable but allows us to build more locations out of those dollars? And I didn't see it right away in the cookie business. And so this to me was a bit of a cheat code.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Everything's about purple. It's Insomnia purple, and just not knowing what I was doing, I was literally giving away the brand in the absolutely wrong ways instead of building it, as you mentioned. Yeah, we certainly were not effectively conveying. Insomnia Cookies is here and growing and we mean it.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“You just were a clued in because there was a sign in the window. We actually was interesting. We customized the sign to the campus colors So, in Syracuse, it was orange, in Maryland. I think it was red. I think in Illinois it was also kind of an orange. But what's interesting now is like we don't deviate from purple, right? Insomnia's brand color is purple.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“At first, it was really strong at Syracuse, the Frozen Yogurt was very, very popular. I think some of that had to do with the fact that there's a lot of New Yorkers on the Syracuse campus and they just were aware of the brand. In Champaign, Illinois and in College Park, Maryland, you know, University of Illinois, University of Maryland, respectively, it never took off. But the cookie business did okay. We were selling, we were doing deliveries. We had the same kind of guerrilla marketing campaigns that I described.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“So my management style, even to this day, I love visibility into data. I wanted clarity of how the business was performing. So we put in fairly good systems, especially for 20 years ago. And we could see how the stories were doing on the hour, on the day. We were talking to management pretty consistently. I think the parts where I didn't have much expertise and wasn't investing enough was really in brand building and marketing and also in the delivery system”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I didn't. No, so I didn't. So I moved to Manhattan So I graduated, I got engaged, and so New York became our kind of our headquarters, and we had a small office in New York. But we were doing everything from that area. So we were driving up to Syracuse frequently. We were driving down to Philly frequently and then passed it to College Park, Maryland. We were flying out to Champaign, Illinois, which opened a little after the Syracuse location. But the center of operations was in Manhattan in 2004.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Was I kept separate books? You know, they each paid rent a portion of the rent like it was a completely separate business. It was just a co-op business. I look back on the big mistakes I've made in the last 20 years. To me, that was like the biggest one. Because if we had set the course differently and had just focused on retail with delivery together, the business that we have today, it would have accelerated things dramatically. But I just thought if we were retail centric or had retail as part of the business, it would be hard to differentiate. And I didn't know better. I honestly didn't know better. I mean, I was 21.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“You know, they've definitely declined quite a bit, but at their heyday, they like a lot of coverage on insects in the city at one point. They were featured in It was a bit of a fad.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“We purchased product directly from them, and it was similar to a franchise arrangement, but like a little bit nuanced from that.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“You could, but like what you basically walked into was a frozen yogurt chop. It had a cookie blade sign in the window, and there was a small little display of cookies, but it wasn't a cookie shop. It was a frozen yogurt chop.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Frozen yogurt chop that would be good for the summer and will open up a cookie shop that'll be good for the winter and we'll put them together into this one co-op space and so we opened up our circus location in December, late December 2004 that was both a frozen yogurt concept called Tasty Delight and Insomnia Cookies in the back of the house.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so that first location, there's a little bit of a, not to take us off track a little bit, but I was really nervous about cookies and how they related to the retail environment. Like there had been... Not tremendous amounts of success in cookies at that point in 10 years preceding it. Mrs. Fields had struggled, Great American Cookie had struggled, regional players were struggling. I believed in the delivery element because that's where kind of the essence of the business was, like warm delivery cookies. But I was scared of the retail. And so what we ended up doing, and it was really linear thinking, the idea was we're going to open up.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“College Park has very strong population, right? There was an opportunity to try to reach out and branch out beyond the college market, but it was still kind of in a college mindset. And so I didn't do that.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I don't think we had anything close to a comprehensive plan as we needed. I mean, honestly, the premise was let's stay close. We still have to distribute the product. We need to make sure that the ingredients get to the stores, that the cookies that you taste in the Philly store is going to be what you taste elsewhere. So we looked all around that area. We looked at Villanova. We went up to Boston. We went over to NYU. We headed down to Baltimore, like Penn State and State College area. And there just wasn't the right type of real estate available. Like we were trying to find kind of middle of the campus, clearly successful late night options. And there just weren't that many. And so we ended up picking University of Maryland, Syracuse University, and University of Illinois as the first three stories after Penn. And I didn't think about bringing in the broader community. I mean, Syracuse is in a small town.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“It felt pretty safe to shut it down with pretty minimal expenses and figure out how to relaunch in the fall of each year. But really that entire summer was about real estate trying to find locations.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“It was entirely friends and family. I mean, this is a. 2004, first of all, Venture wasn't touching food at that point, and so it was entirely friends and family we were looking for.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“We started looking for capital at that point. It wasn't just a matter of Two of us are going to muscle through this forever. We knew we were going to need to raise some funds to make sure that Insomnia could scale.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I was positive. Like generally, I'm pretty resolute. Like, I met my wife in college and I was very confident we were going to get married within a few months. I knew once that school newspaper article I was mentioning earlier, once that came out and the Daily Pennsylvanian had said like great college business potentially here in front of us, I was 100% sure that's what I wanted to do and really since that day what I want to do for the rest of my life.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, and we also started working with campus food at the time, which is kind of like an early grubhub seamless web Uber eats concept that was on college campuses.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so from that commissary space, it was kind of more central to the city. We were delivering to Pence campus and Drexel's campus, which are right next to each other, and to Temple's campus, as well as into the Ritten House area, which is kind of like the main area of Philly.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yes. Yeah, we started expanding outside of the Penn campus in the beginning of 2004. And then by the time 2004 rolled around, we moved the baking outside of the college house to a small commissary and we started hiring people.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“So Jared and I lived together on the same hall freshman year in the quad, and we were good friends through college. And he said, you know, it's interesting where you're doing an insomnia. You know me well enough to know I was dating Rebecca and was up in Boston every other weekend or so. He's like, this is a four-day business. I could be the other three days when you're out of town. And I was like, all right. I mean, I'm pretty bullish on what Insomnia's done so far and really excited to see what it looks like senior year. Let's give it a shot. And so he joined in September of 2003.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Basically, yes. You know, it was, I'd go to class, I'd run to the Costco and King of Prussia Mall like 30 minutes from campus. I'd pick up ingredients. I'd come back. I'd mix them often in advance. And then I'd refrigerate the dough. Sometimes I'd go back to class. Sometimes I'd study. Sometimes there were tests. I mean, it just depends on the demands of the day. But yeah, there were times where I'd stay up till 2 o'clock delivering. I'd come back and then I'd work on a project till five in the morning or study for a test. It was really hectic for many, many months there.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I didn't, so I think I executed 60 of them, maybe. I put cookies in the oven and then I went to deliver cookies that I had with the intent of getting back before they baked. It was so crazy that I couldn't sequence it effectively. It was such a change. I mean, whatever that percentage increases, it's pretty outrageous. And so I was trying to do everything. I was taking calls while driving on speakerphone, taking notes at the light. Obviously no one should ever do this. This is not recommended. dangerous, terrible idea. But like really insound cookies was born that evening. That's the moment where it became real.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“And the phone started ringing. I mean, it started ringing at a different pace, let's say. And from three to five orders to 80 orders that night.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“And then at the bottom third is a picture of me in this backwards baseball cap and a hand mixer. I honestly don't remember the words. It could have said like college idiots starts cookie business or something. I don't know.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“And I thought it would be buried, you know, so that's not a nothing news burden. I thought it would be buried. They put on the front page. And the top of the fold, Rudy Giuliani apparently was coming to the campus. So it said like America's mayor comes to campus.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“I love smart media. You did not know what that meant at 20. He's 43 now. I don't know. You know, there's just words that are burned into your brain. I said, wow, the school newspaper is interested. That's so cool. So they came over to my house. They took a bunch of photos.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“So, people were earning about $10 each. But this went really quickly. So it went from three to five orders a night for about a month in like September. And then one day the school newspaper, I had worked there, so it's possible that that connection helped, but the Daily Pennsylvanian reached out and like, you know, we want to run an article on Insomnia. And I was like, great. I'd love to earn media. Let's go.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so it was always delivered in a pizza box. They would say pizza on the top because I didn't have a custom box. But yeah, just kind of a simple approach, which is I'm going to bake them to order, make sure they're warm, put them in this pizza box, put them in a pizza bag to keep them warm.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“But I, you know, I mentioned to you previously it was really critical that the warm cookie that showed up at your door be the hallmark of the business. And the customization. Couldn't lead to that. And so I dropped the customization, I really focused more on the classics.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“People used to call and they thought there's like a code word to have cookies delivered with marijuana in them. So they would call and they'd say, can I have six cookies? I'll make them chocolate chunk, double chocolate. And then they'd say, anomalous. And we'd say anomalous. And they'd be like, yeah, yeah, yeah, anomalous. Like there's no code word. They're like, we totally get it. There's no code. We got it. Anomalous. Like, no, really, it's just cookies. So I think people... People made assumptions that were not accurate.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT
“So, the first semester, I was a little bit more ambitious, and I had this premise that any insomniac could customize any product that they wanted. And so people used to order gummy bears and Oreos and Andes mints were very popular at the time. But even till today, chocolate chunk, right, was number one. Everyone goes for that kind of classic cookie that they're used to.”
2024-08-26 · How I Built This with Guy Raz · Insomnia Cookies: Seth Berkowitz · IDENTIFIED FROM THE TRANSCRIPT