You never forget your first… interview.
That’s why asking Farmers Restaurant Group founder and co-owner Dan Simons to be my guinea pig was a no brainer. I’m inspired not only by the group’s mission of serving responsibly sourced, made-from-scratch dishes, but also Dan’s commitment to helping others. Dan’s version of paying it forward takes many forms – he mentors the next generation as a lecturer at The George Washington University; co-founded VSAG, a consultancy to help aspiring restaurateurs; and founded Our Last Straw .which led the effort to eliminate single-use plastic straws in the D.C. metropolitan region. Thanks to Dan, countless people have taken the pledge to #StopSucking and skip the straw.
Farmers Restaurant Group opened their first location, Founding Farmers, in Washington D.C. in 2008 under Dan and Michael Vucurevich’s leadership. Today, more than 47,000 family farmers own the group of 7 restaurants, providing the ingredients for cooking and baking dishes from scratch, in house, every day.
Dan suggested we meet over lunch at Founding Farmers. He must know someone there (probably helps to be the owner) because we snagged a reservation even though Founding Farmers has been one of the most booked restaurants on OpenTable in recent years.
Now onto the interview. I’m confident you’ll find his words of wisdom don’t suck.
Lessons from The Family Table
Winston: So obviously I’ve read your LinkedIn profile and I know you, so I know a bit about your path from Cheesecake Factory and Eatzi’s. But what’s not on the resume that led you to hospitality?
Dan: I think for me it’s really about the family that I was raised in. Going out to eat was a huge treat – maybe once or twice a year. We mostly cooked at home. My mom’s a good cook, and food was important.
My parents were immigrants, and they grew up in London, so they were young during World War II. Family mealtimes really mattered, times were tough, and while some foods were rationed, there was still comfort in being together. Portions were specific and to this day, my mom is like, “okay if there’s six of us, three potatoes each, 18 potatoes,” and she cooks 18 potatoes. She puts on heaping piles of butter, because butter was rationed during the war, and I think even to this day she enjoys the extravagance of extra butter. Family time mattered, food mattered, being around the table mattered, noticing the food mattered.
I’m lucky – I grew up in a really awesome family, and my mom still lives in the same house I was raised in. We still say, “let’s round table it,” and sit around that same kitchen table to talk things through. I think some of the most important decisions in any of our lives – the biggest moments and the biggest tears and all of that – happen around the table.
So I think that drew me to restaurants because I love the food, I like the drinks, but it is really all about what happens around the table. Because to me, hospitality is the background that allows the foreground, and the foreground is the people around the table.
Getting Started in Hospitality
Winston: Let’s fast forward. Tell me about your experience as a hospitality leader and how you determined the right partner to work with.
Dan: Not everybody wants to be a boss, right? Doing what you love is incredibly individual. From a young age, I clearly liked leadership and partnership. I look back now, and I see that is what I loved about sports. I loved leadership through collaboration, and if I look at my career, I’ve focused on that every step of the way.
It’s all about having someone to cry with and someone to celebrate with. I think picking a partner is like the Venn diagram approach. I put shared principles and some shared worldview in the overlap of that Venn diagram – the principles should be really aligned, and priorities of what matters at a deep level, as that’s what is really important. I say some shared worldview is valuable because so much communication has to happen, spoken and unspoken. Your business partner needs to be able to understand and be understood. Then, I think, the Venn diagram where you’re not overlapping is where the magic happens.
When searching for a partner – a life partner, a business partner – it’s knowing the common ground, also being really different, and then deciding if you admire that difference. Mike and I joke that we are one plus one equals one – we fill in each other’s gaps, and we make one really good whole.
Winston: Advice for a solo chef that wants to start his or her first restaurant. Would you recommend they find a partner in that way, or are you okay with a chef trying on his own?
Dan: I think that answer has to be asked to the mirror. If you have a track record of leading independently, whether it’s in sports or band or book club or anywhere else, then look for the people that are going to be junior to you and form a team around yourself that aren’t necessarily partners. If you excel by collaborating with your equals, then having a partner is the right recipe. In the end, you have to figure out what works best for you and then understand what is going to be additive to your recipe.
Winston: You call your first restaurant the “million dollar business degree.” What happened, and how did you take this lesson in stride?
Dan: We confused passion, commitment, work ethic, and courage for wisdom, experience, and ability. We used those first ingredients, and we made the recipe and it just, frankly, wasn’t good enough. And the hundreds or thousands of forks in the road that you’re not wise enough to know you’re taking – you can end up really far away from where you wanted to be.
Up to that point, I had never really failed at anything. I’d lost, of course, and not accomplished certain things. But never a comprehensive, fundamental failure. So I didn’t know what it looked like. I didn’t know what it smelled like. We were already dead, long dead, before we acknowledged it.
We got the restaurant break-even after about four months, and then we couldn’t continue building sales, we slipped backwards, and went cash-flow negative. Right then, we should have studied the business model and said, “Look, there is no marketing tactic that’s going to get us a 25 percent sales boost. We’ve already captured all the low-hanging sales.”
Now I would look at that situation and I would say, “It’s not going to happen and it doesn’t matter how much passion, hard work, creative marketing, guerrilla marketing… It’s not happening.” We had a profit architecture problem and yeah, if we had another half a million dollars to burn, maybe we could’ve gotten there. But, another 25 percent sales growth just wasn’t there. And then the economy crashed and we just had no ability, at that point, to grow sales anymore.
As you know, only the strong survive. So we also didn’t acknowledge how weak we were. There’s this giant army out there of competition with better weapons, better guns, and more soldiers. Then there was us with our bow and arrow, and thinking, “Let’s stay in the fight.”
Now when people sit down with me for mentoring, and I say, “You need to close your restaurant,” they’re just stunned or they refuse to accept it. I’m like, “That’s fine, but your refusal to accept it isn’t actually relevant to the outcome.” All you’re going to do is lose more money. I’ve seen this movie. I know how it ends. There’s no changing it and in business, that’s just sometimes the truth.
Winston: What would you have done if you could do it again?
Dan: We should’ve put the restaurant up for sale immediately upon determining no amount of hard work could solve the problems, and then used the remaining cash we had to continue to operate the restaurant, because it’s much more valuable to sell an open, operating restaurant. A closed restaurant is most often worthless.
First of all, you default on your lease. And then, there’s a clause in almost every lease that accelerates the rent, once you default. I didn’t know about that. We defaulted in year two on a ten year deal. We got sued by the landlord, which is standard practice, and we owed a million dollars. There’s no selling a restaurant at that point!
We should have thrown in the towel sooner, and said, “we can’t win – what are our exits?” And put all our energy and money into selling that restaurant while it was open. Because had I sold that restaurant for even just one dollar while it was open, I would’ve saved myself a million dollars in liability.
I wish I had a mentor at the time who could’ve sat me down and explained that to me: “Listen, your restaurant is not worth what you think it’s worth. It’s worth what someone will pay.”
Dan gave us so many words of wisdom, we couldn’t fit it all in one post. Stay tuned for part 2 of our interview with Dan Simons, where he shares some of his most important learnings from building Farmers Restaurant Group.