YouSaid · the spoken record

Steve Ells

lines on the record: 65
first: 2017-10-30
most recent: 2017-10-30
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

“Everything in its place, and it's basically you could think about it before service, you have your musem plus, and that means that once service starts, everything you need for a successful service that night is laid out just so. And so I think about my overall mes and place that I've set myself up for success. And that seems to make sense for me.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“You know, my success in the early days I think I caused a lot of that success. But then you have to layer on being in the right place at the right time. I was lucky to have a father who could invest $85,000 in my first restaurant because I couldn't have raised that money myself. That McDonald's allowed me to basically run the company and tap into their resources. You know, it's a combination. But also a lot of it is if I go back to this concept that I learned in cooking school, it's this French term called Misemplace.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“So, again, I've always. So, when I, before I started the first restaurant, I used to tell people that I wanted to show that just because food is served fast doesn't mean it has to be a typical fast food experience. And that evolved to saying that I want to change the way Americans think about and eat fast food. And I remember when I started saying that we weren't very big. That sounded like a big, audacious goal. But the basic idea behind our purpose is that food that's raised right should be people's everyday food. And as I see others who have I'm very excited about that. That's what drives us.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“It doesn't really work that way. It's not big stair step sort of increases. It's relatively linear, you know, and sort of just it getting bigger, taking on more responsibility, the evaluation, all this sort of thing. It's been a relatively linear.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“21 billion dollars. I mean, for a burrito restaurant started in Denver in 1993, that's pretty insane. When you think about that, I don't know, do you sit back and say? Wow, how awesome is that? Or do you don't even think about that?”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, you know, I'm here now, so I got through it. But we weren't prepared as an organization for it, obviously. And since that incident, we're two years away from it now, we are a different company. We have a top-notch board of directors that are independent and very critical in a good way, in a challenging way. And we are prepared now for a lot of success ahead of us.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“You had this incredible run from the literally from the first story you opened that was profitable, and then you hit this crisis point in twenty fifteen and I can't imagine you ever dealt with anything even remotely close to that. So were you mentally prepared for it?”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“We cut millions and millions. And I'm not saying that the avocado was responsible for this particular incident, but we've looked at every single item we bring in and we've ensured that there are a number of interventions along the way. And so what we do with this avocado now is after we wash it, we plunge it into boiling water for five seconds. This is called blanching. And it's not long enough to cook the avocado, but just long enough to bring the temperature of the skin and the area under the skin just high enough so that it would kill any pathogen that might be there. We do this with lemons and limes and bell peppers and jalapeno peppers. It's a process that is very, very thorough. And the chance that a pathogen can survive through that is certainly near zero.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“You can never say 100%. You can get very close to zero. So I'll give you an example. Think about an avocado. Potentially pathogens on an avocado. But you wash the avocado, right? The avocado is washed after it's harvested. But what if that avocado could be infected somehow? Falls on the ground and hits a little rock or something. And just that little spot where the pathogen is pushed under the skin. And now you wash it, but you don't wash that little spot. And what if? As you put your knife into the avocado”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, I mean, I don't know if freaking out is the right way to describe it We were really, well, I mean, it was all encompassing. I mean, it was like, it was. Really intense, you wouldn't wish this on anybody. But if you back up and think about it, nobody was bringing in as much fresh food, as much fresh produce and meat as Chipotle. So, what we realized is that we needed to develop protocols to prevent any kind of pathogen from coming into the system.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Sure, well, that, you know, that anyone would get sick from the food that you serve them is really a tough thing. So immediately we try to figure out what could be causing this. And it was a very difficult thing to figure out. And there were a lot of experts. who we brought on immediately and you know the CDC and lots of investigations.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, you learn along the way, and there have been so many transformations along the way. And so over the last 24 years, it's about reinventing yourself, you know, learning new things. But I got good at finding really good people. I think that's probably what I'm best at.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“I imagine there was, and to me, that seems like a very healthy thing because I would not feel confident if you didn't have self-doubt. I mean, that's a thing. You're a chef and you are all of a sudden at the helm of this massive growing empire with tons of employees scaling quickly. How did you even know how to deal with personnel and management and all this stuff?”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Because the intention was to start one little Chipotle and then to be able to step away from it and use the funds from that restaurant to open and operate my full-scale restaurant. So I failed because I never stepped away from Chipotle. In fact, I don't think I took a day off in the first year. The only time I left was when I had to run out to take the money to the bank or go to a supplier or something like this. Certainly there was stress to it, but it was really exciting On the other hand, though, as it got bigger and the challenges got much larger, the challenges of operating a large business, I just always wondered if I was qualified so. It was like I never went to I didn't think of myself as a CEO. How on earth am I going to learn to do this? So there was a lot of doubt.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“The expansion of Chipotle was unbelievable. I mean, after that McDonald's investment, it was like a rocket, you know, I mean, and everybody and their brothers and sisters wanted to create the next Chipotle. How did that affect your personal life? I mean, were you just on top of the world so excited about this, or were you stressed out about this? Because you went from 13 stores to 500 stores very quickly. from 500 stores to thousands now. But did you enjoy that? Was it exciting or were you overwhelmed ever?”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“And that was perhaps the biggest point of contention. And McDonald's sort of had a duty to their franchisees to offer Chipotle as a growth vehicle. It just did, it wasn't going to be a fit. And we felt like we were ready to go our own way.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Right, well, so McDonald's has a very strong franchise. System and their franchisees obviously wanted a part of Chipotle. And certainly they would have been capable of operating Chipotle. There are a lot of good operators in the McDonald's system. But the economic model was so good that we wanted to own it.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“You know they would ask questions, not dissimilar from the questions you asked, but they would see the results. So, you know, I remember when I put Nyman Rangepork on the menu, I had to increase the price of the Carnitas burrito, and I think it increased by about a dollar or something. And so in the world of fast food, that was just not understood. I mean, gotta remember, this is the time when fast food had the 59, 79, 99 price point. I think that was at Taco Bell. The dollar value menu and things like this. Here I am raising the price of the Carnitas burrito by a dollar. And after we did that, we started selling more Carnitus burritos.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Right? I was reading a quarterly magazine called The Art of Eating, and this particular issue that I was reading was about Nyman Ranch and the pork farms in Thornton, Iowa. And at the time I was reading this, I was thinking about changing the recipe for our carnitas. And so as I was reading this article, I was learning about the way they raised their pigs, which I guess was much different than the typical way that pigs are raised in the United States. The vast majority of pork is raised in confinement. So if you contrast that with what I saw at Nyman Ranch, I mean, it's just such a stark contrast. So after sampling their pork, I decided that I wanted to switch all of my supply to Nyman Ranch. It took about a year to get there, but eventually. we did.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“They own the majority of the company toward the end of the seven-year period. But as we develop the relationship over the years, we realize that, you know, our way of doing things was more appropriate than what their system had to offer.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“There was no. I mean, I was very lucky in that I don't think there's anyone else who would have been able to invest that way and bet on the come. And what I mean by that is, you know, we open some markets, California's a great example, where sales were really soft and the restaurants weren't making money. But McDonald's was very patient, and they believed that the sales would come in some of the markets that were softer, and indeed they did.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“But that McDonald's investment, which may have been tiny for them because it's a multi-billion dollar company, that cash infusion for you guys was tens of millions of dollars. That was transformational.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, initially, I think they wanted to buy it outright. And I wasn't willing to sell. And so they made a very. Very small investment enough to open a few restaurants and then they annually they would put in more money. Over a seven-year period, I think they put in $360 million or so. But the majority of that was in the last couple of years.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“I did, so I started to go to institutions. And then one of my initial investors, Al Baldaki, suggested that I send a plan to McDonald's. And he had met someone in McDonald's that was thinking about new restaurant ideas. And so I thought, well, that's a really bad idea, Al. You know, Chipotle and McDonald's are so completely different. Well, just send them a plan, see what happens. And so I did. And within a few weeks, I got a call and a visit. And a couple of weeks later, I got another call. And they said, can we bring some more people? And that kept going on for about a year. It culminated in a visit from the CEO and their CFO”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Was very, very efficient, first of all, the investment cost was very low. And typical fast food at the time had to have room for a drive-through. They were usually freestanding. And so all of that required a sizable investment. With Chipotle, we were going into strip malls, often in the inexpensive center units, not the more desirable NCAPs. This was early on. So the investment was very, very modest. Our production system Really was an assembly line, and as volumes increased as we served more customers, you would get a higher and higher margin, a higher contribution margin. And so the resulting returns on investment were extraordinary. And again, nothing like this in the restaurant industry at the time.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“I didn't as we were contemplating. Business plan, but after having to pitch it, it was my MBA, really. That was my quick and dirty business school. And so during the time where I was pitching it, I met one of our early investors who turned out to be a board member. And he was really instrumental in helping me understand. How special the economic model was at Chipotle.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“And I remember I hired a college buddy who went off to get his MBA. So I hired him and said, well, we have to put this business plan together. And so as we put the business plan together, what emerged was this economic model, the investment, the sales, the resulting margin.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“As you know, my dad funded the first restaurant. And then I started signing up leases for restaurant four, five, six, seven. And then I went to my dad and said, you know, I'm signing up leases. I think I'm going to need a cash infusion. Would you like to invest? And luckily, he said, yes, we opened those restaurants and they were successful. And I said, well, I'm going to continue to open up some more. Would you like to invest again? And he said, you know, why don't you go raise the money yourself? And I said, well, how do you do that? He said, well, you need to write a business plan and you have to, you know, go pitch it to people who are qualified to invest. Wait, just to be...”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, the idea of expansion wasn't about building an empire. There wasn't a number I was going after. I never thought, oh my gosh, if I could only have, you know, 10 restaurants or 20 or 50 or 100 or 1,000, it was never like that.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, so that happened after I had a dozen restaurants or so, maybe less, maybe eight restaurants. Honestly, I forget. But I thought I would go to Kansas City. It seemed like a neat food town. People were really into barbecue. It was a really strong barbecue culture there. I like that, and I thought there could be a burrito culture too. And so, you know, it didn't open up super strong, but it did pretty well.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Actually, that was one of my dad's questions. He's like, Steve, do you think Denver can have two of these? I'm like, I think so, dad.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“And so I'm like, well, okay, maybe I'll open one more. And so I called my dad and I said, you know, everybody's pressuring me. I said, Dad, I think I'm going to do it. He's like, all right. So I think maybe he put in a little bit more money, but it was mostly cash flow that opened the second restaurant. And that opened about a year and a half later. And it opened up much busier than the first one. It was extraordinary. And so I said, all right, I'll open up one more.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Had never demonstrated an inability to, you know, balance my checkbook or be frugal about organizing my finances. So he said, well, you really ought to get a book. He probably said, well, I do have one. He goes, well, really, let me sit down with him next time I'm in town. And I'm like, all right. And so I remember we sat down with the bookkeeper and he was blown away. He's like, this thing is really efficient, making a lot of money. continued to get busier and busier and busier. And then everybody started asking me when I was going to open up the next Chipotleway.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“You know, at that point, I was living in the basement of a friend's house, a couch in the basement, and I slept on the couch. Was working from first thing in the morning until late at night and doing that well every day And I remember I paid my dad back and he said, Well, Steve, wait a minute, you can't be making that much money. And I said, well, Dad, I really, I think it's doing very well. And, you know, he knew that I hadn't taken any business classes.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Was crazy, crazy busy. And remember, this is 850 square feet total. And so a little less than half of that was the kitchen.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Mobbed and we ran out of food. First day, and so we got a bigger order the next day and ran out of food the second day and just could not keep up.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“And the restaurant reviewer for the Rocky Mountain News was named Bill St. John. And he came in a few times and then introduced himself and said, hey, I've been in a few times and I'm going to write a restaurant for you. I said, yeah, it's great. How's the review going to be? And he said, Well, I'm not going to tell you. I'm like, okay. And the next day, a review came out. And it was a really glowing review. And there was one particular sentence that stood out, and I'm paraphrasing, but it went something like this. Chipotle is unlike any fast food you've had. Everything has depth, character, nuance, and layers of flavor. That really struck me. I'm like, well, this guy has got it because when I think about cooking and seasoning food, And what happened next, though, we were completely unprepared for A line out the door that did not stop”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“So I remember opening a July 13 and I opened for dinner. It was mostly friends. And I think the sales the first day were probably $240 or something like that. And the next day, a little bit more. And the next day, a little bit more. And we sort of, we got faster and more efficient. And words spread pretty quickly. And students got back to campus in September. And so that helped business a little bit. But the turning point was in October.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Oh, no, no, there's nothing written down. I just made stuff. Guy, the menu was developed. The day before I opened. And it was interesting because when I trained the cooks how to make all the different ingredients, it was how I learned at stars. It was about technique and then about tasting as you go. And it just didn't occur to me to write down recipes. Because I wanted people to taste the food and really understand the techniques of cooking, not just think about adding a cup of this, a tablespoon of that, and be done with it. Probably when we opened, I can't imagine there was another fast food restaurant where the crew actually taste the food. I just don't think they did that, right?”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“I opened with really only a handful of people and I asked some of my friends if they wanted to help work the line and It was really sort of cobbled together.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“It was by design. I mean, you know, every time you have a dinner party, people are in the kitchen. People want to be in the kitchen. And so Chipotle was designed to invite people in to bring them close to where the action is.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“And then you had to walk up to the counter and actually sort of build your burrito. And this was confusing to a lot of people. They said, well, what do you have? And I said, well, we have all these things here. There's burritos in the burrito. I could put rice and beans and meats and salsas. I mean, you think about it now, and it just seems so obvious how you would use chipotle. But in the early days, it was a very novel experience. Was also a novel experience to have an open kitchen so close to the customer. I mean, the grill was just a few feet away from customers, and so they were really involved in the production that was, you know, the cooking and the service.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Chipotle was not an easy place. I remember customers coming in and have to say, well, what is that place? Chipodle, Chipotle, Chipotle. All kinds of pronunciations I've heard at all.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“So I knew always that I was going to use Chipotle peppers in the marinade and for the braise for the barbacoa, in the beans. And I wanted to use Chipotle because it really adds a depth. It's not about the heat necessarily, but a smoky character. That I think really adds complexity to the food. And I was introduced to Chipotle Peppers at Stars. Jeremiah was a big fan of Southwest cuisine. And it just occurred to me as I was looking at a can of Chipotle peppers. And I said, oh my God, that's the name. College Pole. And of course. Nobody knew what a Chipotle was. And everyone thought I was. Silly for choosing a name that people couldn't pronounce.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Yes, this was going to be one restaurant and this was going to be a cash cow that could. And help support a full scale restaurant. You know, I knew that full scale restaurants were a dicey proposition. I mean, they go out of business often. It's hard to make margins, very difficult to operate. And so I wanted Chipotle to be a backup. I deliberately made it very simple to operate. Only a few items and simple cooking techniques, not a lot of ingredients, and able to operate with just a handful of crew members.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“And I think this spoke to the food. So as you looked past the counter into the kitchen, you could see the basic ingredients. You could see chicken and steak and avocados and rice and beans and all the things and how it was simply put together. And so I think this connection to the built environment was something that made the brand special. And I don't think it was obvious to most people. I don't think it wasn't even obvious to me at the time.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, I would say that the design aesthetic came out of the necessity to be frugal. So the table bases were pipes, the service counter. Was faced with barn metal. Just materials that were inexplicable. Making the tabletops with the contractor, and we were applying the stainless steel to the top of the plywood. And then he wanted to put stainless steel on the edges also. And I said, no, no, no, no. You have to let people see the plywood. They have to see the striations of the plywood. They have to see how it's built. And so the aesthetic for Chipotle was very much about how it was put together.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, so I had an architect of record to get the permit. Found a contractor and then sort of designed and built as we go. I was there every day, and I was hands on helping him build the thing.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, I had to strip off the vinyl tiles on the floor to reveal the oak. Wood floor underneath which I refinished and painted the walls and built out a kitchen and tiled it and put up stainless steel on the walls of the kitchen.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT
“Well, you know, I described the food. I described the service format. I said, first of all, you know, it's going to be an open kitchen. We're going to be grilling meats and cooking whole beans and mashing avocados for guacamole and grating the cheese and dicing the tomatoes and jalapenos and onions and chopping fresh herbs like cilantro and oregano. And, you know, he seemed very excited about the prospect. He said, Well, give me about a week, I'll identify a few potential real estate sites, and we'll go on a tour. We saw a Dolly Madison ice cream store. This was the first site we saw near the University of Denver campus. It was 850 square feet. It was in terrible condition. It needed a lot of work. I think the rent was $800 a month, something like this. That's pretty cool.”
2017-10-30 · How I Built This with Guy Raz · Chipotle: Steve Ells · IDENTIFIED FROM THE TRANSCRIPT