Kat Cole: Leading A $5 Billion Company Through International Growth + Partnerships | Creator Lab

The business surprise that I got was when we were in Turkey launching Auntie Anne's. And I thought it would be wildly successful. Like, I don't know why I thought it would be wild. I just thought it was gonna be amazing. The product's so good, it's so simple, it's so affordable, or at least here it is. And I get there and it's this gorgeous Auntie Anne's in Istanbul in a very popular shopping center.

Wow.

And there's nobody. No one's going to the counter. Very few. It's slow. The franchisee's disappointed. And it took— it's a bit like this Argentina story where it took a few days for us to talk and for me to say, when are we saying no? What's confusing? What are people telling us? Because this is unusual. It makes no sense. And what we figured out through a series of Questions and conversations is that in this country, there is a product that is sold on every street corner called simit. Simit is like this little tight looks like a skinny bagel twisted like a pretzel with little sesame dots on it that look like the dots of a pretzel sold for one lira, and we are selling a twisted bread product for. 400 times the amount.

Wow.

Kat, welcome to the show.

Thanks for having me.

Um, so I've been following your work for some time and we've been, we've kind of like, we've tweeted each other. We've spoken in the DMs. We've even been in Clubhouse rooms together, which is a whole different, uh, conversation. We could probably talk for 2 hours just about that whole emerging world and how you've been kind of the queen of, queen of, um, Clubhouse, it seems like. Um, but, you know, I'd love for people just to get a sense of your background in a nutshell. We're going to talk a little bit about your story today, but really dive into how you help grow brands through partnerships, international expansion. Um, but yeah, just would be great for you if you could just introduce Yeah.

So today I run a company called Focus Brands. I'm the COO and president of the company. And the brands that we have include Cinnabon and Auntie Anne's, which are well known around the world in 60 countries, as well as more domestic or North America brands like Schlotzsky's, Moe's, McAllister's, Carvel Ice Cream, and our most recently acquired Jamba, formerly known as Jamba Juice, the world's largest smoothie and bowl chain. So global businesses, food franchises run through franchisees as the core legacy business, but then we build these brands and have additional routes to market through strategic alliances and partnerships, what we call licensing, sort of co-creating products that end up in channels other than our own restaurant business. So grocery stores, hotel chains, convenience stores, even on other restaurants' menu sometimes. Product that lives in other places. Sometimes it's very close to the core product format, other times it's, it's really cool extensions of the core brand. I know we'll talk about that a little bit. Been with the company for almost 10 years, started out as president of Cinnabon when I was 31 years old, helped take over the company right at the tail end of the Great Recession, helped put a plan in place and got to work with a great team that turned that business around in almost like a business school case study. Of transforming both a business and building a brand around the world in multiple channels. A very cool success story. And as the company grew and added brands, I continued to grow. Prior to that, I was an executive at Hooters Restaurants. I was actually with that company for 15 years, starting as a waitress and a hostess when I was in high school. So I've been in and out of brands, franchising, international operations, and retail for, for a minute.

Love it, love it. And that's the kind of— when I first saw your story, I actually didn't know your full story until I started doing more research. I'd like just seen you on the scene. I think you're in those, those fancy lists like Fortune 40 Under 40, wherever it was, and you've probably spoken at events I've been to and stuff like that. But I didn't actually know your full background. So that really stood out to me. Just, there aren't many people that go from being a waitress, I think, at like 17, 18 years old, And then at 26 years old, you were vice president. So I'd love to go back to that time a little bit.

It was super fun. I mean, I, I got into it because I was the child of a single parent. My dad was an alcoholic. And so my mom and my sisters and I left when I was 9. So from the early days, I had leadership responsibility. I had to help take care of my sisters. My mom was working 3 jobs. She fed us on a food budget of $10 a week for 3 years. So just super scrappy, very resourceful. And basically, if I wanted anything, I had to work to make money to pay for it. So I started working very early in malls selling clothes. And then when I was old enough, I became a hostess at 17 at Hooters. And that was a normal gig. You know, when you're in high school in the US, 1 out of 2 people's first job is in restaurants. And so I was a hostess and then I became a waitress and I was the first person in my family to get into college. So I started college, was an electrical engineering and computer sciences major, and just was being a waitress to pay my way through school. Pretty simple. And, but what was unusual about it is that it was Hooters. So that always makes people intrigued. And what was also unusual is that the company was growing rapidly around the world. And so I just happened to join a restaurant company that had a lot of opportunities for people who were good fits for those opportunities. And at the age of 19, I was offered the opportunity to go open the first of Hooters franchises in Australia. I'd never been on a plane. I did not have a passport. I'd only been out of Florida a couple times in my life on a school bus for cheerleading competitions. So I bought my first plane ticket to Miami, stood in line with my paperwork to get my passport, and a few weeks later left to be a part of the opening training team to go help open and launch the franchise. I would never have that opportunity again, made up the classes I missed from college. And then a few months later, the company called and said, can you go to Central America and do the same thing? And then a few months later, South America, and launched the first of the brand there. And before I knew it, I was very good at launching businesses around the world. I had gone from being a member of the teams to leading the teams by the time I was 20, so in just a year. And I was failing college. Because I was never there. So I dropped out of college at the age of 20 to continue this unknown path with no guarantees, no contract, no salary. I was still an hourly employee to open businesses around the world. And at the age of 20, shortly thereafter, I was offered a corporate job to move to Atlanta from Jacksonville, Florida, take my first-ever corporate role overseeing all employee training for the franchise and corporate business. And then as the company grew, I grew. And by the time I was 26, I was vice president of the company and we were doing between $700 and $800 million in revenue at that point. And so it was not small and it was wild. I mean, it was a ton of fun. I was just happy to be there, truly, to just learn and grow and be a part of what really did feel like that decade's version of a rocket ship, not tech style, but definitely restaurant style. And I had incredible opportunities as a result. When a company's growing that fast, a disproportionate amount of opportunities are afforded to those who are already there, typically. Um, and I was the beneficiary of that for sure.

That's amazing. That's amazing. Yeah, I guess, um, even just anyone rising up the ranks is, you know, there are stories of people doing that, but it is becoming increasingly rare, I think, in, in today's age. Especially in a kind of more traditional business versus let's say high-growth tech startups. It's a little bit different because everyone's like super young anyway. But, but I guess a question that comes to mind is you mentioned it there. What was unique wasn't that you were one of 2 people in America that had a restaurant job, but the fact that it was Hooters, right? Also the way I say it with my accent sounds hilarious, but—

I'm used to it, opening it around the world.

It was always funny. Um, but just, I, I guess that brings up the question of, you know, when you're a young leader, there's already quite a lot to manage. Like, I've, I've been in that situation where, not exactly the same as you, but I went into a team to manage a team and I was younger than a lot of the people that I managed. And that is already a difficult challenge. But then if you add to that the, the types of people that might be in a more traditional organization like that, and then, um, the fact that you were a Hooters girl Like, what were some of the things that you had to navigate that we might not even know about?

Part of it was, first, I'll group it into different stakeholder groups. So when I would travel to other countries, the team that I would lead would be a team of cooks and Hooters girls from other restaurants from around the world. So I had never met them. And essentially, when we were done with this job, we would all go back to our stores and be equals, right? Like, they're a waitress, I'm a waitress. They're a cook, I'm a cook. And so going to this special event of a new opening in a new country, all of a sudden I'm the leader. When everybody knows back in our stores, we don't know each other, but we know we all do the same thing. And so that was very interesting. Learning to earn trust and build relationships, yet still have a very clear line between I'm friendly, but I'm not your friend.

Yeah.

I'm the leader of this group, but I'm not a boss. You know, that it was a nuance that I learned that was really just underpinned by building trust and letting people know I was there to support them, to help them know what to do and when to do it, to listen to them as they had ideas, because every country there were so many unknowns and unpredictable things that we ran into from a supply chain, technology, equipment, customer culture, you know, it was just different everywhere. And so I had to build this muscle of two-way respect, two-way communication. I'm here to support you. If you can't do your job, we don't get our job done. But also making it very clear that it's— I'm not looking for consensus necessarily. We've got to make very quick decisions in unfamiliar environments. Your input is valued. You have a voice, not a vote. And that took time, you know, to navigate that, to figure out how to do that and then to be able to articulate it as simply as I just did. It wasn't that simple in the early days. Over time, I looked back and I'm like, ah, voice, not a vote. That's what we're doing here.

Yeah.

I care what you have to say, but ultimately, it's not your decision. And so, that was one stakeholder group. Another, as I moved up in the company, were my peers that were executives who had been in business longer than I had been alive. Literally. So people, working professionals for 30 years, and here I am, 26 years old. And so they're in their 60s, 50s or 60s. And so that was a very— it had similar attributes, of course. The foundation of relationships is trust and respect. So it was similar in that regard. But when I would go to a country to open a store, It's a, I'm showing up, we have a job to do, and we leave. So there's this energy around a temporary shared mission. When I go back to manage peers that are— or work with peers that are much more my senior, and then yes, manage people on my team who are older than me, that's different because those are long-lasting corporate relationships where what we do intersects with each other over time. And that was different. And people who are that much older and have had that much more corporate experience, as opposed to 5 or maybe 7 years difference between me and the people I led in the restaurants, you know, it was 30 years difference. And so some of them, not all, some were very supportive and amazing, but some led with criticism, right? They led with doubt of why are you here and you can't possibly know these things. And so it was a mixed bag of learning where do I lean into my strengths? And in what occasions do I need to recognize that there's still a lot I have to learn that is evidenced by what some of these other executives are saying or doing? And how do I navigate that in a way that allows me to continue to maintain parity, equality, and respect without kind of going into a corner and saying, oh, I'm just— I'm lucky to be here. What can I learn from you? Please help me. do my job, but rather, I have a right to be here, I have work to do, um, I have a question for you, I want your input, but we need to make a decision together. So it was— they had different frequencies, like a different tone to them, but very similar building blocks of trust and respect and relationships.

I love that. Yeah, that's super useful. I think even for me, if I was ever to go back to a full-time job in the future of leading— right now I'm self-employed, I don't have a ton of employees, just more contractors. Um, but I think one of the things, just to go into that a little bit more, um, I love that what you said, be friendly but not your friend. I think you said something along those lines. And you have a voice, not a vote. Like, that's definitely going to stick with me.

Thank you.

And if I just am being honest with myself, I think I've probably had, and many people listening to this have this tendency from being an individual contributor where you're working alongside people And then you kind of rise up the ranks in whatever way that is, and you're used to being friends with everyone, right? And, and that's just— people who've worked with me know that was like my thing. Like, I was friends with everyone. And I think when I've gone into other roles, naturally I want to be like that. And if this was a therapy session, you'd say, hey, Bilal, you probably have this problem of wanting to be liked, right? And most people do, so I can say that about myself. Um, have you struggled with that yourself before, especially in the early days? And how did you navigate that feeling of saying, okay, it's okay if they don't like me, but I need to be the— do the right thing here?

Yeah, one of my favorite early examples of this, and, and there have been iterations of it all throughout my life and career, so I love that you're kind of pausing on this dynamic, was when I was a waitress And I was 18 and the manager came to me. And this is super normal in restaurants. You go to a waitress that seems to do a pretty good job. And you say, I need you to be what— at the time, I don't know if it's still called this— what was called head wait or shift leader, which means I'm still a waitress, I'm still serving my tables, but I'm going to work the whole shift. And as other servers wrap up their shift, it's my job to make sure They clean their section. They do what's called side work. They refill their salt and pepper shakers, and they restock the station. Everybody's got to do a job before they leave. The manager's busy ordering food and filling the freezers or whatever. And so they rely on an existing employee to be a temporary supervisor of their peers. And so I will never forget it. The manager said, hey, can you be headwait today? And I was like, sure, you don't get paid more. You basically just get to pick the best section. You get to— since you're going to be there the longest, that's your benefit. The busiest section, you get to have it. And so I remember the first time the first server came to me from that shift and said, all right, I'm ready to go. And the way it worked is they would bring you their little paper, their receipt of all their transactions, and you just had to sign it. And that was proof that they did their side work. And she goes, can you sign it for me? And I said, oh, I have to check your tables. And she said, well, just sign it. And, and I said, no, I need to go check your tables. So she rolled her eyes. She got very frustrated, even though this is totally the norm of how business runs. And her tables weren't properly cleaned up. So I said, hey, you need to refill your salt shakers. And there was something else she hadn't done in the wait station. And she looked at me and she said, But you don't do it that well. who are you to tell me to do that when you're just like me and you skate out of here all the time?

Hmm.

And it was one of these forks in the road. When any of us are repeatedly put in positions of measuring our peers, we never have a perfect past. We are easily called out on things that we're now trying to lead and hold everyone accountable for that we ourselves did not do well. And it was— I remember, I remember the brain Freeze of what am I going to do? Am I just going to be like, you're right, it's cool, girl, I got you, you know, go ahead. Or no, this is my job and I need you to go do it. So it was almost a blend of those 2. I paused and I just looked at her and said, you're right, I have not done that as well as I typically should. My bad. I'm going to going forward. I need you to. Right. It's like this blend of humility and acknowledging the criticism, which is often in part true, making a commitment to being better going forward, and not forgetting that I currently have a responsibility that requires me to ask someone else to do these things. And I'm not going to not fill that responsibility. I mean, every year, many times a year, this exact situation of the waitress and the salt shakers, metaphorically speaking, comes up for me. When I was a president of Cinnabon, I had other peers that were running other brands. And then I was promoted to be the president over the presidents. And there were things I needed to ask them to do differently that were not the way we behaved when we were led by someone else. Some were totally cool with it. Others reluctantly complied. Others criticized. And pushed back, and I had to navigate that as a leader. So I think finding a way to blend humility and confidence, where yep, I deserve to be criticized, I'm going to do better, you should too, let's move on. That blend, so many people don't find their way to that. They feel like they either have to fight the criticism and be the boss and be just beyond reproach or get completely rolled over by people who define them by their past behavior. And it's one of my favorite quotes, which is like a version of what my mom writes on my birthday cards. Don't forget where you came from. Your truth is in your roots, but don't you dare ever let it solely define you. Like, I'm not defined by my past, not my history with my family, not my behavior last week. Right? It's true. And I have to acknowledge that, but I am not only allowed, in many cases I am obligated to evolve beyond it.

That's, that's brilliant. I think another thing you just touched on there was once you've actually said, hey, look, I acknowledge that this is the past, it wasn't perfect, but going forward, this is how it needs to be, and we're going to do this together. I think the key thing there is also you need to follow through, and to change behavior is is really important because if you went back to saying, actually, hey, I've been asking this person to be on time for the last 5 weeks, but I'm late, then that's not going to work either. So—

Exactly.

Um, that's, that's great. Um, so that, that's really great for your background. I think we're going to touch on different parts of your background again throughout the conversation. Um, but just to paint a picture of where you are today, you already kind of said you're the head of this, this parent company that has these major brands. Could we paint a picture of the kind of size of the company in terms of locations and revenue? I think I saw it was like $5, $6 billion in sales, but I don't know if that's public or if that was speculation. But whatever you're able to share there would be helpful.

Yeah. So, um, 7,000 units, just under 7,000 units, 60 countries, 7 brands, well over 100,000 employees of the franchisees, right? It's their employees, but a lot of touchpoints. Millions and all kinds of cool stats of different products, gallons of ice cream, cinnamon rolls, depending on the year, $4 to $5 billion in total branded product sales. So that's our company's sales from a franchise perspective, as well as our retail and CPG partnership business. So it's between $4 and $5 billion of total branded product sales.

Awesome. Now that's super helpful. And I think for regular listeners of the show, you'll know You know, your world is within the world of private equity technically, right? Like you're owned by a private— and a part of your growth is growth through acquisition.

That's right.

And in the last few episodes, we've had 2 people working in similar fields but different scales. So if you're interested in this world, I'm hoping this will be useful. The first one was Ryan, number one, Ryan Culp, who has bought 7, um, SaaS businesses on a smaller scale individually. And then we had Ryan Beagleman from Summit Series, and he's come from a private equity background, but he is looking at companies up to $3 million, and yours is now in the billions. So I'm hoping there's some commonalities but other things we can borrow from each different world. So let's fast forward a little bit to Cinnabon, because I think this is an interesting case study, like you said, and this could literally be a case study if it isn't already in an MBA program or a business course. Um, you took over Cinnabon at the height of the Atkins craze. I've heard you describe it, and also during a recession, right?

Yeah.

And if you fast forward now to 2020, we're also in a world of paleo, keto, veganism, and emerging trends. So I'd love to come to that in a second, but just take me back to that moment. And on day one, what were you looking at and what were you trying to analyze to say, these are the assets, these are the pros, And these are the areas we can improve.

You know, day one, I didn't put too much pressure on myself to have the answers or have a point of view. It was just a learner's mindset. What I knew is the brand was beloved. What I also knew is that the business, the economics were in trouble. And so that was obvious. I didn't need an hour on the job to know that. That was obvious in my diligence. And to the company's credit, they were very clear with me Both the challenges and the upsides of the business in the interview process, so I knew what I was walking into mostly. Some things were a little worse than I thought they'd be, but some things were a little better than I thought they would be. And so it was just about learning, which meant being in the stores, rolling cinnamon rolls, taking out trash, talking to employees for weeks and weeks on end—not like a couple days shaking hands, kissing babies, saying I've been there and taking. Some pictures, but like actually crowdsourcing insights by having many, many touchpoints in a compressed period of time. I asked the same 3 questions. I always ask the same 3 questions when I take over a team or am evaluating a business, especially a mature one, or one that is early high growth but needs to pivot. And so, one question is, what do we throw away? Said another way, what are things that we're doing that aren't adding value? Because if I need to pivot or I need to make an investment, I probably need to find money. And in the world of restaurants, in the world of private equity, it's not like venture where you just go do a raise, right? It's like you need to go find money if you need money, and so you've got to figure out where there are inefficiencies or any activities going on that maybe at one time added value, but the activities have continued and the value has diminished. And you find that out by asking people, what are we doing that doesn't make sense? What do we throw away? What do we make that we throw away? What do we make that the customer throws away if it's a product business? What do we do that the employee doesn't value? You're just looking for pennies. And if you get lucky, you find a dime. You rarely find a dollar. And so that's one question. That's about finding the funds that can later be redeployed or the resources. The second question is the opposite, which is when do we say no? What are the signs that the marketplace is giving us that there are things we could be doing that the customer would value? And the way you find that out is you talk to your sales team, your frontline employees. When do we say no? If we're saying no, people think we should be doing something. And I'm not looking for one-offs. I'm looking for patterns. of answers that are probably actionable in a scaled way to provide a scaled benefit across the organization. So, that's the second question. And I use those 2, obviously, together. What can we stop doing? What can we start doing? And then the third question is a bit of a validator for sequencing and sorting between the answers of the first 2, which is, if you were me, what's one thing you would do differently? To positively impact the business? Or what's one thing you would do differently to allow us to be a better bakery for the customer? It depends on the stakeholder how I word the question. But the point is, I'm asking for one thing to do differently that makes something materially better. Those answers vary more broadly, as you can imagine, if I'm asking a janitor versus a baker versus a manager versus a franchisee. Owner, but there are themes that then help me sequence the patterns that I found in the first 2. And that becomes my to-do list as a leader, especially when I don't otherwise have access to deep data insights, which we didn't at the time, and other types of guiding lights that would typically inform strategic decisions. This was my dataset. And the truth is always there with employees, with customers. I always say the people who are closest to the action know what the right thing to do is long before the leader does. The issue is that the leader has powers or capabilities that frontline workers often don't. People who are closest to the customer often lack the language to fully articulate the scaled problem or opportunity and the solution, and they lack the authority to do something about it. So, it's the leader's job to go in and try to pick those pieces out, identify the patterns, and then rank them into a few things that make the most impact in the business, and then put resources around those things to go drive the business forward. And then when you do that, when I did that, it just makes a lot of sense, right? People are like, yeah, that is the right thing to do. And it is because they told me, because I asked them, and I found the patterns. And so, you also— I also didn't have a lot of friction. or resistance for some of the changes needed in the company, things to stop doing, things to start doing, in part because I sourced the guidance from those doing the work. Also, it's the recession, and it is easier to change culture, company, and a business when things are bad.

Hmm.

And so, that environment made it not easy, but a bit easier to drive change because it was obvious what we were doing wasn't working. It is much harder to transform a relatively successful organization. I've had to do that as well.

That makes— yeah, I'm thinking of obviously in the good times everyone's like, look, don't broke what's not— uh, don't fix what's not broken. And, and there's a lot more questioning, I guess. Um, that's, that's really helpful to hear how you think about it. Are there specific examples you can think of with Cinnabon specifically Let's say in the first 90 days or 6 months that after those conversations with people on the front lines, you said, actually, okay, these are a few patterns I'm seeing and now here's a few things we're actually going to change.

Yeah. One of the answers to the question, when do we say no, was to when customers would ask for smaller portions. And it's easy for any of us on the outside to go, well, yeah, obviously. Right? But there are many reasons as a business why you would not want to offer smaller portions.

Mm-hmm.

Trade-down, right? Why would I give somebody a little thing that they only paid $2 for when I'm getting them to buy a big thing for $4? The fear of trade-down is very real. So without the insights, without the marketing expertise to say, mm, I get it, you're scared of that, but actually what's gonna happen is You're going to attract more people that you can't get today, both because it's physically smaller in terms of indulgence and calories, and it's half the price or a little over half the price. And oh, by the way, it's more profitable per ounce. And oh, by the way, people often buy 2 smaller things instead of one because they want to share or they add a drink. So your check, your basket size isn't actually going to be compressed. There wasn't that leadership to guide them through that thinking. So when they were afraid afraid of smaller portions, they just didn't consistently offer them. So when I went into the company, realized this was a universal circumstance where we were saying no to customers, then I realized there were several franchisees who actually were doing it because they had learned it was the right thing to do. But because it wasn't an approved menu item, they would hide it when corporate would come in. And so the answer existed already in the And so, you know, to tie all of that together, asking the question, getting the answer, understanding that one of those ideas was smaller portions, realizing there were people who were already doing it so we didn't have to work super hard to do it right, then making the business case so that people weren't afraid of trade-down when their sales are already in the toilet. Remember, it's the recession, so anything that sounded like letting customers spend less was really scary.

Right.

When, in fact, the very thing you need to do when times are tough is provide more opportunities for entry, which is typically lower price points.

Mm-hmm.

And so, it took that leadership and that encouragement and finding the coalition of the willing, some of the franchisees willing to test it, assuring them that if it hurt their business, I would protect them in the test financially. I would pay for waste or whatever happened. And then once it started working, which it did, shining the light on those franchisees doing the work and letting them tell the story so that others— it was more of a pull. People were wanting to put it on the menu instead of me having to force it. We didn't have to force it and make it mandatory until we got down to that last 20% that were still the resistors. And then for the good of the brand and the business, we had to offer it consistently so we could market it in a big way. And then we also ended up launching that small product called the Mini Bon in Burger King to get major distribution, tons of marketing we could never afford. That really helped the company take off into the stratosphere at that time. So all from that insight of when we say no, and then having the creativity to figure out a cost-effective, brand-aligned way to deliver on that request.

Yeah, I love that example. I think I remember reading you mentioned something like this before, and maybe it went from like $4 to $2 or if we were rounding, rounding up or down. Um, and I guess, yeah, there would definitely be someone in the team that says, hey, look, this is half the cost, so that means we're gonna have to, we're gonna have to sell twice as much, roughly, maybe a little bit less because the margins are probably a little bit better on the smaller ones, I assume. Um, so you mentioned that test. So like, how would you actually— would you test in like 10 stores Because you obviously can't like do this across the board straight away, right?

Yeah. Yeah. Just a handful of stores, right? Pick enough environments that are different because you also don't want to assume outcomes for a very diverse system based on a test in a not diverse environment. And so put it in an airport, put it in a low-volume store, put it in a high-volume store, put it in a low-income market, put it in a high-income— you know, you're just trying to solve for as many variables as you can. Put it in a location with not as strong of operations, put it in a location that's super high volume and has really strong operations. In a food production environment, all of those variables matter as to whether or not it is scalable. So, you know, you just try to solve for as much as you can in the test group that is more predictive of sustained success and outcomes. So, there's ops test, which is just, can we do it? Right. And then there's layering on marketing. What happens when we tell people about it? And how does it affect other things on the menu? Do people buy more or less of something else because this is here? How do they think about it? How do they react? You know, it's all 101 kind of product testing stuff. But if anyone's new to it, that's not intuitive. But that's the way you try to get at it. And then you build from there with a progressive rollout. Try to have a lot of feedback systems, so as it rolls out, any little thing that you start to notice a pattern, you can address it for the next region or the next market that gets it. Similar to shipping a tech product, right? You try to ship it to kind of a small group of people, and there's probably— you probably ship some bugs, and then you tweak, and you try to QA as much as you can in advance, but you never know what's going to happen in the wild. And you progressively roll out and have just like, you know, engineers at the ready to tweak, tweak, tweak before it really gets out. It's, it's the same in a physical product environment.

Now, I touched on this before. You mentioned Atkins back in the day, and now I guess the equivalent of that is keto, paleo, low carb. And then there's vegan, non-dairy, which are— and in different markets, there's different penetration and awareness of these or number of people who are following that lifestyle. So I'd love for us to kind of look forward-looking now versus just the past. So in, you know, you've got a portfolio of brands. Jamba Juice is obviously very different from Cinnabon. Very right. But like, how are you thinking about this going forward? Because the healthy eating trend, if we want to call it that, doesn't seem to be slowing down. And that doesn't mean people aren't having ice cream and sweet treats and, and stuff like that too. But I'm just curious how you guys think of that on a macro level when, let's say, Cinnabon, one of your major brands, is the opposite of what a lot more people are doing.

You know, the reality is it's, it's not the opposite of what a lot of people are doing. It's still one of our best performing brands in the portfolio. A lot of people People are still indulging, to your point. But what's changing is people, we all want it to be more worth it. If we're going to be bad, it needs to be so worth it. And Cinnabon is effing delicious. It's mind-blowing. And so as long as we're honest about it is absolutely being bad, and then we give you lots of ways to be a little bit bad or a medium-sized bad or big bad. It's worth it because it's so delicious and it's made from scratch right there in the stores, rolled, mixed, frosting, you know, proofed, baked on site. So what people have changed as it relates to indulgence, yes, there is absolutely a growing market for plant-based indulgence, lower sugar, and that continues to grow. But the thing that is shrinking is not extreme indulgence. Right. Like fresh-made cinnamon roll indulgence. It's that middle. It's the death of the middle. People are snacking on average stuff less because they'd either be really bad or really healthy. And Cinnabon is still very far in the really bad, really delicious end, so it's not experiencing occasion attrition or customer attrition in terms of its product positioning. Mall traffic obviously is an evolving thing that we've dealt with for all kinds of reasons. But the product's positioning, it has still been the highest year-over-year comp sales growth brand since I took it over, since we started this return. And that's with 2 other presidents succeeding me. They've done a fantastic job continuing the growth of the business. And so that's interesting, right? It's not only is it sugar and fat and carbs, but it's in malls and airports, and it has been the highest year-over-year grower in terms of same-store sales. I'm not even talking about net unit growth, even though it's really strong in that area as well. So there's something about if you're going to be an indulgence, you got to really be it to win and maintain share and protect relevance and differentiation in this marketplace where, to your point, there are other trends that are drawing consumers. And then we have Jamba, which is a far more interesting example, because Cinnabon's pretty obvious, right? I don't go there for a diet. I want to be bad. It is made with sugar and flour and dairy. And we've played around with gluten-free. We can't safely offer gluten-free in that environment because there's flour everywhere. We've played around with dairy-free, low-sugar, vegan, it either dramatically affects the quality or we don't sell enough to make it worth carrying additional inventory. But the brand keeps playing and experimenting and trying. CPG grocery is far more the place we can experiment with those things, right? It's a completely different environment. We can take something inspired by our product and turn it into coffee creamer, gluten-free baking kits. We've done all that. It's a much smarter way to experiment. Jamba is really interesting because it is famous for these sweeter juices and smoothies— orange, carrot, apple, pear. Razzmatazz and Mango-A-Go-Go are its most famous smoothies that are all natural but really high in natural sugar content. And the world has moved beyond that for smoothies and bowls to less sweet, more functional. And so when we bought Jamba, We had to really figure out a way. Like we're not going to go all the way to juice press or press juicery, right? Where it's like a $15 juice or smoothie, and it's like all these different, maybe more fringe herbs and plants and things that are in it. But we are going to launch. We did. We bought it. We launched plant-based protein. Believe it or not, it had soy. Soy was its plant alternative, and we're like, God, that is so 1990s. You know, you need. You need hemp. You need these other types of plant proteins that are available. We're even exploring more fringe plant proteins. So we introduced plant proteins as a protein alternative. Then Jamba was the first national chain to carry Oatly out of like the first major one. They partnered with a couple of little ones, but we were the first national chain to bring a plant milk alternative to the marketplace. You could still order a Mango A Go Go. But we started to introduce these alternatives in a way that allowed us to appeal to an evolving palate and set of need states and preferences without violating our past, without being confusing. It was still delicious and creamy and amazing. And we launched a blue spirulina drink, but it was called Vanilla Blue Sky. And it was with almond milk and different— all plant-based. But it was still bright and beautiful, but all natural. So, it still looked like Jamba, but way less sugar, all plant, healthier-er by a lot of measures. And so, I say healthier-er because some people debate healthy of anything that's still got all kinds of yummy-tasting ingredients in it. And so, Jamba is squarely in the middle of those trends you're talking about. It kind of doesn't affect Cinnabon.

Right.

Or Carvel, for that matter, although dairy-free is very big in the ice cream world, and Carvel has continued down that journey with dairy-free alternatives. But Jamba straddles this world of mass commercial, more affordable smoothies and bowls, always clean and natural ingredients, but is skewed more sweet, and the world has moved on.

Mm-hmm.

And so adding plant-based, lower sweet alternatives to that menu without making the menu too big or without confusing people is is quite the strategic challenge.

No, that's, that's really useful to, to think about. I, I'm thinking of, um, the adoption curve, which you've probably seen before with innovators, early adopters, early majority, late majority, laggards, right? And if you're watching on YouTube, we'll put this on the screen so people can see. Um, I guess someone like yourself who's working on a brand that is mass, right? Like there are thousands and thousands of stores versus a liquid teriyaki in New York or the corner smoothie store, which is just one, one owner, they can obviously probably be a little bit more nimble in just deciding today we want to start doing pea protein and that, and that is a new thing. Whereas you guys have a lot of process, obviously, even though it seems like you move fairly quickly. So I'm curious, like, how you will decide around is this the right time?

Yeah, I think the trick is, one, understanding what innovation— which innovations have high friction versus low friction to implement. Because if it's low friction, there's not a lot of risk in having something available. You might not market it really heavily. It's just there, right? So pea protein is a great example. When we introduced pea protein as one of our many innovations in plant protein. We did not expect nor require it to be a big mover for lots of reasons. It was, but it was low risk because of its shelf life to introduce it and have it available. So the question is, what are the things that you say at any given point, which we have to evaluate real time really, but at least monthly, What are the things that are table stakes that you really should have available, even if it's simply a veto vote eliminator? Dairy alternative is an is a version of that, right? At first, it was very small, but we started to see a veto vote. People saying, "I can't have dairy. My kid has an allergy. I can't." You know, so what you don't want is to lose a customer simply because you don't have. what might be small as a percentage of sales, but an important offering. In the product business, we call that a veto vote eliminator. Salad at McDonald's, right? So, what's the veto vote eliminator so that the whole group or the whole family can come and find a solution? And if it's low friction, why would you not, right? High reward because you're, you're not losing occasions or customers you don't want to. Low lift operationally or organizationally. Now, Eventually, you could get too many of those and have SKU proliferation and inventory problems, and therefore efficiency and cash management problems. But typically, it doesn't get to that point. So, what are veto, vote eliminators? Then, what are the things we put in place that are about beginning to highlight to our existing fans that we are on a journey with them? Right? We don't want them to be on the journey too much faster than us. Some will be, right? People like me or you are going to go to Juice Press and we're going to get cricket protein and we're wearing the monitor. We are on a bullet train past Jamba Juice. But the average person is not. You know, the average person's moving. We just have to decide, are we moving with the average person? Or are we moving a little faster to be a leader? Or are we moving a little slower? Because remember, there's people who are doing this, but there's a lot coming behind them. You know, there are people who are like, I don't want this Milkshake anymore. I don't want this more bodybuilder, synthetic-heavy smoothie. I want to go to more plant and fruit. And so, just as people leave you, there are always people coming to where you are. And understanding that outflow and inflow so you don't try to solve for everyone, because if you try to be for everyone, you really won't stand there for anyone. So, there's got to be a target. There's got to be a positioning, but allowing the brand to to move back to this phrase, don't forget where we came from, but it does not solely define us. And so the introduction of plant proteins, of dairy, you know, introducing dairy alternatives was a veto vote eliminator at first. Introducing pea protein was a relevance builder. Slow, just letting people know we had it available and getting used to it. At some point though, we have to decide to start marketing it because it's taking up a space on our shelves. We added in spirulina as an ingredient. That was probably the bigger fringe ingredient that Jamba brought on board that wasn't available in most even regional smoothie chains. It was only in the juice presses and the places that had algae, E3, all of that stuff. It was only in the juice, like the juice places, not smoothies and bowls. So for Jamba to do that, it was one that we felt there were enough cues of wellness, and we could make it really playful and enough really beautiful visual benefits that Jamba is known for, these bright, colorful smoothies, that it didn't feel foreign. There was a way to make it commercial and mainstream while still protecting its more fringe benefits and appreciation and fan base. Jamba's carried turmeric shots for, I don't know, a decade, well before some of the juice chains even popped up. So in some ways it was a leader, in some ways it was a laggard, but the point is to have your finger on the pulse of why are you introducing an innovation. Who are you targeting? Who are you capturing? And is there a way to do that efficiently and effectively for the business so you meet your customers where they are today and don't lose the ones you don't want to lose as they move on, as we all do. At the same time, you got to be planting a seed in order for it to sprout into the new tree that is part of your future brand positioning. If it gets to the point where all your competition has a full orchard, it is too late to plant the seed.

So it sounds like more like, you know, knowing who your customer is, but also deciding where you're positioning and how you— it's not just positioning in terms of marketing, but actually like your product development, your, your recipe development, all that sort of stuff comes from are we going to be slightly ahead of the curve or are we going to be more in the majority? That's, that's useful. I think a lot of brands really struggle with that. I think a lot of brands will, like you said, try to be for everyone. And especially when you're a mass brand and your expectations are to grow 20, 30% or whatever the number is at billions of dollars in revenue, it's not an easy task. Um, you mentioned something earlier about foot traffic and malls and airports. Um, just so we can quickly touch on it, we're obviously in a crazy situation right now. Uh, people are traveling less, and, um, from what I can see, obviously more traffic is down as well in, in most places, um, though it might be picking up in, in some areas in some countries because you're an international brand. So I'm curious, whatever you're able to share of course, but like, what are the What has the impact been of the current situation for you guys, and how are you planning to navigate that in the next six to twelve months?

Yeah, it's interesting. So in the U.S., of course, just the growth of e-commerce over time has slowly reduced mall traffic, but it's been happening for ten years, seven to ten years. It's not new. What's going on now is just an accelerating event, as many people have said. It's absolutely true. And so. But it would surprise people how well some of these businesses are doing for maybe some unexpected reasons. One, at any given point right now, 80 to 90% of the locations are open. Obviously, if a mall is closed, so too is the Auntie Anne's. But if it's open, we're open. You have small business owners that are franchisees that have their life savings invested in these businesses. And if there's any way for them to be open, they will get open. They're also running on one shift instead of 2 because of modified mall hours. So it actually allows them to be a little bit more profitable if you think about it. Sales are lower, not as much as people would think, but they are lower on a year-over-year basis. But part of the reason they're not as dramatically affected as people would think is not all the food purveyors have opened back up. So we're getting a larger share of a smaller customer pool. The math makes sense, right? So you can kind of do the math in your head of some of these levers. Good chunk of them are open. They're able to run on one shift, so a little bit more profitable, doing decent in year-over-year comparative sales, and some really surprisingly so, some low, but a nice number in the middle. And so it is much better than people would think right now around the world. The numbers are identical in every country. They are identical. The number, the percentage open, the percentage of sales, it is identical. The consumer behavior, the psychology has normalized around the world around just feeling of safety, the way malls run their businesses, percentage of food vendors. So it's like it wasn't this way in the last few months and then like It's just literally identical numbers, bizarrely, in the 60 countries where we do business. But it doesn't mean it's not still very scary for these small business owners. So it's better than people would think right now, but the future is uncertain for some of the malls. Airports are going to come back faster, and everyone is speculating that leisure travel, maybe not as much international crossing oceans, but still leisure travel getting into the holidays is going to come back faster than business travel. And I think that's logical. I agree with that prediction. So that still means more traffic coming back in airports, especially as airlines and airports learn to operate in a way that really focuses on psychological safety, physical safety, giving people comfort to travel and move around. And so the businesses will come back as the airports come back. And even it represents some nice growth opportunities for us because some businesses were not able to survive this period in airports. And now the airports need a solution. And we've got many brands that we'd be happy to put in those locations. So it actually is on the other side creating some very interesting opportunities. So there's a little bit of dark and there's a little bit of silver lining around it. Nice real estate opportunities, unexpected expected new unit opportunities. A lot of franchisees are looking at this as a chance to consolidate and acquire other businesses that might have been struggling a little before, and this has just accelerated it. So it is a rightsizing of retail and an oversupply in many industries, and there will be some real pain. There is some real pain with independent small business owners, casual dining, some of these malls. But there's also some some really interesting bright spots that people might not see.

Last night I was looking at keyword data, like search data for your some of your brands, and one of the breakout queries for Cinnabon specifically was Cinnabon near me and then Cinnabon delivery. So and then I dug into that a little bit more, and I'll share it on for you so you can see and. For people on YouTube, you'll see. I don't know if you can see that huge spike, but that was essentially people were looking for Cinnabon delivery in the last few months, and that shot up. And I don't know if this correlates with your actual data and how people actually transact. Close. It's probably close. Okay, that's good to know. And then there was the Cinnabon near me, and the reason I look at this one because I'd like to geek out over it, and it's. a little bit of my background. But also, if you just think the way you talked about earlier, asking your people on the front line, like, what's happening, what do people give away, etc., and what are they always asking for— this to me is a way of doing that with millions of people in a focus group, so to speak, with Google search data. So I'm curious, like, as something like Cinnabon delivery has skyrocketed in the last few months, um, you've obviously got these partners like Postmates or Uber Eats, DoorDash, etc., that you already probably were working with. How do you think about that sort of relationship now? And either leaning into it with all the pros and cons of that, whether that's the take, the percentage they take, or being reliant on a third party versus the short-term need of cash flow?

Yeah, one, it's important to lean into it because they have the infrastructure to get product the customer in a way that would be inefficient and ineffective to build over and over with individual brands. We love our partnerships with them. We wish it was more profitable, to your point. But we also have our own apps for most of the brands, not all. We will complete the building the app journey so people can order directly more easily from the brands. But Moe's, Jamba, McAllister's, Schlotzsky's, Auntie Anne's, All have their own app, their own loyalty programs. You can order directly through them and have it delivered directly through them. Just Cinnabon and Carvel are the 2 right now that need to be ordered only through these third parties. But all the other brands, yes, you can order through the third parties. We've had partnerships with them for 7 years.

I mean, we were an early adopter.

But we also have more first-party ways to transact. It's better for the franchisee if people order directly. from the brand. It's more profitable, of course, than we have a direct relationship with the customer. So, we love that. Certainly, if they want to join the loyalty programs and get rewarded for their relationship with us and they're giving us their business, then that's great for them and for us. But we still love the third-party transactions. It's just, you know, it's farther away, and so it's less profitable. It's farther away. We don't have that direct relationship, so we don't get to know— exactly what that customer loves and how to delight them more with more of that, where that's very easy to do when they order through our website and our apps. So, still leaning into delivery, curbside. Cinnabon, 18 months ago, built a DTC business of being able to just order and have Cinnabon shipped to you. And so, that is also part of that. The outcome of those searches is not only Cinnabon getting delivered, because a lot of these malls are open, and so they're able to bake and deliver. But it's also our shipping business has gone through the roof.

I can imagine. Yeah. And I was just— well, I had this visual of people at home like me, and we haven't left for ages, and we need an indulgence. And like, that would be a great indulgence to get delivered to your door. And that'd be actually interesting in the winter months if that changes too, because in colder markets like New York where I am, Yeah, it goes up. It probably goes up because people don't want to go outside for that treat. Yeah. Um, I speak to a lot of people who have grown companies, but what really stood out to me for you was your international experience. Um, so I'd love to dig into some of those factors and kind of strategies you've employed. But before we even get to that, I'd love to just kind of paint a picture of what that, what that time was like for you. Like if I said to you, A time on your travels for work, is there like a story or something that comes to mind?

Oh, so many. Um, both the early days and the, the later days. The early days were just awe-inspiring. You know, I'm 19, 20 years old opening the first Tutors in Australia, the first one in Central America in Mexico, the first one in South America in Argentina. Um, Just wild, right? Just the exposure to the world, learning all the things we were screwing up as a business. I remember we opened up Hooters in Buenos Aires. And for anyone who doesn't— isn't familiar with Argentina outside of where it is on a map, it is the beef capital of the world.

Yeah.

Like, they eat a lot of meat. And it is cooked over open flame. I mean, it's just the way meat is prepared. And when we launched our brand, at the time, Hooters had— it was an American restaurant with chicken wings and burgers and fries and more casual dining, nicer salads, crab legs, shrimp, and we had a steak sandwich. And so we go down with all our recipes, our specifications for equipment that the franchisee had to buy. And I remember that first training session. Where we are taking a thin, plain ribeye, because it was a ribeye sandwich, and cooking it on a flat top. And that was sacrilegious to them. I mean, the cooks refused. The franchisee was furious because that— even McDonald's offered steak cooked on a flame broiler. And so here we are bringing what's supposed to be a more mid to upscale casual dining restaurant cooking meat in a way that is offensive, that wouldn't even be done in a gas station. And we didn't know that, right? We didn't understand that. And so we— I learned real time, and there were many other things like that that happened at several openings, but in particular that one where real time I had to approve getting a flame broiler, an open flame piece of equipment, replacing what was there, getting in new cuts of meat from a local purveyor, figuring out what that should look like. I'm 20 years old. 20 years old. This was my second time leading an opening. And so just being confronted with the lack of preparation of cultural nuance that was important to protect not the consistency of the product, but the consistency of the positioning of the brand, where it would sit relative to its competition, actually required different choices in product and equipment and process. And we did not I did not know that going into it. And I have learned so many lessons around the world of bringing businesses and really believing I never know the answer, but I do know what questions to ask over and over and over in advance of going to market so that then we can be thoughtful together about what modifications feel right and which ones might be experimental and which ones are still going too far to help the brand or the business have a chance.

Yeah.

That's hilarious.

Yeah, I actually spent 2 months in, in Buenos Aires, well, in Argentina last year, so I was semi-living there. Um, and it's kind of— you can tell, uh, if to do that there is kind of like offensive, you know.

Um, big time.

So, uh, what about like other countries? Are there other countries that really surprised you that you went into it thinking it would be one thing and it ended up being something else?

Not the countries itself, it's just, it's not my mindset. I'm very— I have no expectations, you know, it's just like open mind, open heart. I, I go in with a default of loving people and culture, and then we'll let it prove me wrong if I need to be proven wrong. Um, but the, the business surprise that I got was when we were in Turkey launching Auntie Anne's, and I thought it would be wildly successful. Like, I don't know why I thought it would be wild. I just thought it was going to be amazing. The product's so good. It's so simple. It's so affordable, or at least here it is. And I get there and it's this gorgeous Auntie Anne's in Istanbul in a very popular shopping center. And there's nobody. No one's going to the counter. Very few. It's slow. The franchisee's disappointed. And it took— it's a bit like this Argentina story where it took a few days for us to talk and for me to say, when are we saying no? What's confusing? What are people telling us? Because this is unusual. It makes no sense. And what we figured out through a series of questions and conversations is that in this country, there is a product that is sold on every street corner called simit. Simit is like this little tight— looks like a skinny bagel twisted like a pretzel with little sesame dots on it that look like the dots of a pretzel sold for 1 lira. And we are selling a twisted bread product for 400 times the amount in a mall because it's a fresh-baked pretzel, not understanding that those 2 things look alike, are confusing, and why the big price difference. So you've got this thing that's been sold for I don't know, centuries in Turkey, literally like part of core sustenance of the Turkish culture, for 1 lira. It's street food. And then we've got pretzels, where pretzels are street food too in the US, but there's an elevated market for warm, hand-twisted, fresh-baked pretzels. So that was literally, it just took us talking, talking, talking, and we figured out people were confused of why this was such expensive simit. And so, we finally got a marketing piece put up, not even fancy, just very literal, that said, like simit, but different. Not better, because that would've been offensive, right? Even though it was better, because it's like warm and fresh-baked and not sitting on the street all day. Like simit, but different. That helped people bridge what they were seeing to the rationale for it to be special and more expensive and a bit of a social occasion. And that did it. And there's always a reason, and it always has to do with not understanding the intersection of the brand and its offering with the local competitive environment and the reference set that a consumer has.

Yeah, it's one of those things you can't really know until you're there. Like, you can ask people who work there, and you might have employees that land there and try to figure stuff out, but it's really difficult until you're actually there doing it.

So yeah, I, I— But I would say I've learned that there are ways. Yeah, how would you actually do that even, even without being there? It's, it's that you— I have to— I have learned that we have to ask the right questions. So the questions would be showing them the product in advance, just pictures, and asking, what does this make you think of? Right? Just asking, what does this make you think of? What is this like? That's it. Not putting our beliefs, not asking, how much would you pay for this? Right? Just, what does this remind you of? And understanding someone's intuitive reaction To a product. And you do it for product, you do it with the logo, like Hooters, right? Hooters does not translate into any language, and there's an owl, and we serve bird wings, and people are like, is that owl wings? Like, what's the connection? It's really important to show people things and ask, what does this make you think? What is this like? What does this make you wonder? And some of that may be exactly what you want. Other of the responses might indicate, wow, there's a very literal set of messages that we need to communicate around what this is or what this isn't. Or heavier lift, we need to change something because it is too much like X, or it's not enough like Y, or in this language this means this word which is bad. Um, you know, there's so— so you can get at it without being boots on the ground, but it takes a very open questioning approach that has to do with identifying points of reference as opposed to, um, other types of questions that tend to be self-fulfilling approaches and self-validating approaches.

Yeah, I'm curious what you would say if you had a brand that you just acquired. We don't have to use one of your existing ones because there's all stuff going on already, but let's say Kat's Kat's Juice or Kat's Pretzels or whatever, and let's say it's domestically working in the US and you're saying, okay, I think it's time to expand internationally. How do you think about that process in defining and prioritizing which markets you should be going into? Are there data points you look at? Are there people you speak to? I'm just curious how you would attack that problem.

Well, we just throw a dart. Just kidding, just kidding. Um, yes, a lot of And more process as we've gotten more mature. You know, in the early days of any brand, you honestly typically are saying yes to people who just want to bring this thing that they love to their country. That's how it starts almost always. And then you go, oh man, this is inefficient. Maybe we should be a bit more strategic, and then put processes in place. So, the right approach, the best approach in my experience, is first having a really strong decomposition of what makes the brand work in its origin country. Like, break that into its parts. What type of density? What type of flavor palette? What competitive environment? What price point? You know, what size building? Like, you really have to break it down and then say, okay, If these are the variables in the success equation of this brand, what happens when any of these variables are changed? And which environments, countries, or markets have the most like conditions or have different conditions, but that this product and why it wins have a probable likelihood of winning there. So a perfect example is Cinnabon in the US was immediately wildly successful in the Gulf, in Saudi, in Egypt, in Jordan, in UAE. Not because the countries are similar, not even because retail is similar. It's very different. The malls there are like palaces of escape with ski ramps. And like, it's just, it's amazing. The countries couldn't be more different. The cultures couldn't be more different. What is common is a love of sweets and a love of indulgence. And in fact, in the Gulf, sweets and indulgence is not a snack in a mall. It is a sit-down social experience. So it was very clear that the product, which overindexes on sweet and indulgent, would be a winner. in the market. And then you've got to evaluate, do you have any ingredients, right, that need to be locally sourced versus imported? And are there any things, like if you go to India, where things absolutely need to be vegan or vegetarian first and foremost? And so you've got to think about those types of things. But in the, in the Gulf, more of our locations are sit-down cafes as opposed to a corner counter in a mall or an airport. And so it's understanding, are the need states, are the desires for product, where are they most similar? And then what else do I need to understand about the use case, that need state, that occasion, that might alter how I go to market, what I look like, my portion size? Is it lots of little ones because it's a bunch of families and it's very social? Is it one giant one because they love extreme and indulgence? Right? It's understanding how to deconstruct a brand, figure out markets that have similar need states or occasions. Said another way, where is it going to be lowest friction to port the concept? Not no friction, just lowest friction. You've got to make some changes always, 20-25%, right, of brand, of menu, of messaging. Not much more than that, otherwise you confuse the brand. And then where are the markets where there might be potential, but it's a much heavier lift? And those just become a different sequence. Of market entry. But it starts with brand. It starts with understanding the brand and what makes it beloved. And then what about that is relevant for certain markets? Which markets is that the most relevant for? Have very similar appreciations for product or occasion? And then what still do we need to tweak? And then out of that, which markets are the easiest to go in? And then it's about finding the right partner that respects that, but that knows the local market is going to help you see your blind spots as a brand and really lean into giving it its chance, which is the beauty of franchising.

That's awesome. That's a— I love that UAE example as well because my, my family's originally from Pakistan, so it's not exactly the same, but we have a Muslim background. And even I'm just thinking, I don't know if this is true, but from my experience in the Islamic cultures of the world, there is this thing about, well, first of all Most of the Islamic world doesn't drink, so the way you socialize mostly is leaning into food. And one of the things— I was in Kuwait actually last year for a business thing as well, and one thing we found crazy was there were like rooftop coffee bars. Like the way in New York you'll go to the Standard Hotel and have a cocktail on the roof, there you're going at nighttime in this Japanese-imported, uh, beautiful coffee space and everyone's there hanging out. And I think the sweet food with that for sure is something that happens too. Um, that's right, that's, that's a great example. Um, you, you just brought up a great point there about, okay, you've decided, you've done the research, you've figured out, asked those hard questions, then you need to figure out what that partnership— or I guess it's not always a partnership, but that mechanism of growing is— is that you going and setting up your own shops, um, with your own operated brands the way kind of Apple does in most cases? Or are you finding— or are you launching franchises? Or are you doing these kind of co-venture deals? Joint ventures. Joint ventures. Sorry, that's the— you obviously know more than I do. Um, so those are the 3 buckets I thought of. Are there others I, I left out there?

I'm sure there are, but they're hybrids, right? It's all hybrids. There's master franchise where someone owns the rights to a country and then they have the right to go find other franchisees versus the franchisor. So, there's iterations and hybrids, but those are the big sort of levers that you pull in deal structure and route to market.

So, I'd be curious to understand, like, why have you guys chosen to do the licensing approach with some people and say franchises with others? Is there— what are the things you're trying to figure out which one will work better?

Well, there's a big difference between the two. I mean, it's a bit nuanced in terms of contract, but franchising Franchising is the licensed— it's still a license, but it's called franchising because they're actually operating brick-and-mortar units that have to adhere to a set of standards that we support with training, operations, and marketing resources. Licensing is co-creating a— in the food world, is co-creating a product format. But then that would say International Delight coffee creamer. We co-create a Cinnabon coffee creamer.

Right.

They have the license to use the mark and our cinnamon, and we co-create that recipe together to make sure it lives up to the Cinnabon aromatics and reputation. But then they, International Delight, sell it anywhere they sell International Delight, right? So that there isn't ongoing— there isn't as much ongoing deep, deep engagement because it's a thing in a box, right?

Mm-hmm.

It's done. A franchise business is just alive, real time. It's people, it's innovation, it's new products every month, it's new unit growth, it's approving real estate. We have to be involved at every step of the way because that is the legacy business. But licensing into CPG and into other markets is a very different type of relationship. Still a branded partnership, but a much lighter way we interact over time because once we make it, it's done. And then it's collaborative marketing activity as it scales into many points of distribution.

Um, and one follow-up question to that is how you control your brand in that process, because I've heard you talk about you were at a conference at one point and an Under Armour exec was sitting near you and said, that's silly, I would never do that, I want to own all my experience. Which, which I get that, I think people already get that. But what are those people missing out on? You know, like, what are they— uh, sorry, said another way, how are you able to still control your brand That they are essentially scared of losing in that scenario.

Yeah. It's not easy, but the key is to understand the brand deeply and go through the always, sometimes, never exercise. Like, you just learn what must always be true with your brand, what is debatable, negotiable, sometimes, and then never. And you make mistakes along the way. We made mistakes along the way. But the The benefits, once I understand my brand, are that I can deconstruct it, figure out what partners I add value to and they add value to me, understanding what we both bring to the table, coming up with contract terms that rightly honor what we both bring to the table. And we radically accelerate interaction with customers because I have a brand that they don't. I have expertise in baking or whatever the menu segment is that they don't. I have credibility with my brand and indulgence and premium baking that they don't, but they have manufacturing. They have retail sales teams. They have distribution, right? They have giant marketing budgets. And so, we need each other. We might give up a little bit of the pie, but the pie gets huge. Like, our slice gets a little thinner because we're sharing with other hands in the pot, other people that are a part of the value chain. But the Burger King example, right? We have a cinnamon roll, that we found a way to get made so it could be baked in their environment. And all of a sudden, almost overnight, it's in 7,000 locations when it took us 25 years to open 1,000 locations. But we had to work to make sure that their ability to bake was there to deliver the quality of the product. And we had to structure the product and the ingredients in such a way that it could be resilient in their environment. And we had to negotiate packaging. How much is Cinnabon forward? How much is Burger King forward? You know, those are all— it's just about being brand obsessed, but not so brand obsessed that you miss the fact that there are some things your brands can't do, and there are things that other brands and partners can bring to the table. So it's this combination, again, of humility and confidence. It's the humility to believe that there is something greater to be achieved with others, but the confidence to hold firm on the things you know your fans and and your customers are going to want from your brand at all times. So it's both art and science.

So Kat, look, this has been amazing. I know we're running out of time, so I want to be respectful and make sure you get to your next meeting on time. But I'd love to do this again. I think we could talk for another 2 hours just about partnerships and your background. So thanks again for being on the show, and I hope people enjoy this. It's stuff you don't normally get to talk about, so I appreciate the time. Yeah, thanks for having me.