Friends of Branded!
Happy Saturday and I hope you had a great week!
The theme of last week’s edition of the H^2 (Rethinking Labels) was about the need to rethink labels and reconsider whether putting people in boxes may accurately represent the value a business or person can offer. I used a number of examples including too many (maybe) sports-related references (a few from the National Basketball Association and one from Major League Baseball) and I also shared how people even tried to put a label on Branded Hospitality. (Oy, the agony! Ooh, the shame!) 😊
Based on the many comments I received (and please note, I love receiving feedback…good, bad or otherwise, it doesn’t matter, I appreciate the feedback & engagement), I decided to come back this week with a little bit of a follow-up (Part Deux) to this idea of rethinking labels.
I want to use this week’s Top of the Fold to share some information specifically on one of Branded Hospitality’s most important business verticals, our Media platform, and I feel the most interesting way to do that for readers of the H^2 is by putting it in the context of the industry event we’re heading to tomorrow (Sunday). This contribution of the H^2 isn’t just about Branded’s Media business or the conference, but wonderfully includes the many companies that we feel so fortunate to be working with at this event and in this vertical of our business. This single event represents a great example of the importance of the community we get to ride with and the village I mention as often as possible!
If you take away only one thing from this week’s Top of the Fold, you can refer to the Steve Jobs’ quote above the title or the OG version by the Chinese philosopher, Confucius who said, “choose a job that you love, and you will never have to work a day in your life.” This isn’t to say and doesn’t remotely mean that just b/c you love what you do that there aren’t hard days, frustrating experiences, difficult team members, demanding clients / customers / patients / guests / fans, and stress (lots of stress). But if you love what you do, you’ll get through all those things, b/c they’re all part of the professional journey you’re on and how lucky are you (if you love what you do) to have the privilege of going out to play this cerebral sport you’ve chosen every day.
As a young financial analyst at the investment banking firm, Kidder, Peabody, where I started my career, there was a Managing Director who loved to talk about “working hard and playing hard" (and this gentleman worked hard and smiled & laughed a lot). I remember a moment when one of the other analysts reversed the order of this MD’s favorite expression and boldly claimed his own love of “playing hard and working hard.” Hearing this transposition of his personal ethos, stopped him in his tracks. That simple inversion made by a member of the analyst class of 1990 needed to be called out and immediately corrected. He saw the reordering as something akin to the idea that success can come before work (and we all know that the only place that happens is in the dictionary).
Tomorrow, the Branded Team, along with a couple of thousands of our foodservice and hospitality brothers & sisters, will journey to Dallas, Texas, for the FSTEC 2024 conference. This is the event where restaurants and technology connect, and I’d argue is the leading foodservice technology conference as it brings together so many industry experts and the latest innovations in an environment that fosters the building of connections.
As an investor in early-stage and specifically emerging technology & innovation companies for the foodservice and hospitality industry, it’s understandable why the FSTEC conference is on the shortlist of our most important events to attend each and every year.
But this week’s Top of the Fold isn’t intended to be a puff piece on FSTEC or its organizers, Informa Connect, (besides, the attendee list is set, the sponsorships are done, and the hotel is oversubscribed). Writing about it today won’t drive more traffic or additional revenues for this event (Informa, was I supposed to write this piece a few months ago? Did I miss that memo?).
In fact, it wasn’t so long ago (before the pandemic) that Branded felt FSTEC, like so many of its peers, had a business model that was prohibitive to the very value-add they prided itself on and wanted to be – the place where restaurants and technology came together to discover the latest innovations. Traveling and attending conferences isn’t inexpensive and these are not charitable events or not-for-profit organizations. So, a challenge presented itself - how can Branded, in partnership with Winsight help make the leading FoodService TEChnology (“FSTEC”) conference more reflective and inclusive of the truly emerging technology companies?
Fantastic question and I’m glad you asked! 😊
FSTEC of course welcomed and had a pricing program for the youngest and most early-stage companies, but the real estate afforded to these companies was back by the loading docks or next to the restrooms. Despite what Woody Boyd (Harrelson) has to say about real estate professionals, the three rules of real estate are in fact location, location location!
To move this along (I no longer get paid by the word), Branded pitched an idea to our friends at Winsight, some discussions (debates, negotiations, disagreements and ultimately an agreement) ensued and the Branded Innovation Alley was born!
On Monday, September 16th, for the 4th year in a row, and thanks to our partners at Informa Connect (who acquired Winsight in May 2023) and our corporate partners, Adyen; Open Kitchen by Powerhouse Dynamics; and Comcast Smart Solutions, Branded will proudly raise the Innovation Alley banner high above the middle of the exhibition hall and present some of the very best and most innovative companies.
But wait, there’s more and this is where Branded Hospitality Media really raises its game and I dare say shines even brighter!
Conferences are about networking and the content presented usually in the form of general sessions and in a series of panels. Branded’s DNA is hospitality and as friend of Branded, Will Guidara, has defined, unreasonable hospitality, is “all about creating connections with your guests. It’s about going above and beyond to make them feel special and valued.” Yes, Branded is hosting a panel at FSTEC and we want to show respect to the attendees that elect to join us to hear us discuss, present and be informative. But a traditional panel format is off brand for us, so each year that we’ve hosted the Innovation Alley, we’ve embraced a gameshow theme and invited our corporate partners and industry experts the opportunity to share their views, and to do so in format that’s both joyous and fun.
Yes, these industry events and conferences are important, and I dare say in this world where remote work and video calls have become the norm, these in-person events are playing an even more heightened role. These events represent opportunities to have experiences and form relationships that can be both professionally and personally accretive. That’s why we take these industry events so seriously and by that, I mean our Media team works hard to be creative, innovative, and drive fun.
Work hard, play hard. Be serious about your work, but don’t take yourself so seriously. Share insights and intel that can help or at least offers others the opportunity to look at things differently.
Yes, I’m excited about FSTEC 2024, our return to Big D, Branded’s 4th year in a row leading the Innovation Alley, our 3 corporate partners, and the 21 emerging technology companies that have joined us this year in the alley.
If you’re in Dallas and participating, please come by our Innovation Forum on Tuesday, September 17th at 9:30am CST, or come by the Innovation Alley to see some of the best and most exciting emerging technology companies helping operators and brands win in this most competitive and challenging environment.
Finally, thank you for allowing me this opportunity to share some highlights on Branded’s Hospitality Media platform.
- This newsletter started out as a Saturday morning team e-mail.
- Our podcast was initially focused almost exclusively on our portfolio companies (and was sponsored by Chico’s Bail Bonds, “Let Freedom Ring”).
- We attended conferences to introduce ourselves and to identify emerging tech & innovation companies.
Collectively, all of the above started out as a marketing effort and has now become a media platform that not only stands on its own as a most important Branded business, but also contributes tremendous value to our investments and solutions platforms (and let’s face it, the risk of my hearing from my attorneys is so much lower when I write about media as opposed to investments). 😊
For information on how your company can engage with Branded Hospitality Media, please contact me directly or feel free to reach out to a member of our Media team.
It takes a village.
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This week two of Branded’s portfolio companies, Big Chicken and Bite, announced a most interesting and strategic collaboration.
Together, these companies are redefining what it means to place a digital order. Working with and featuring Shacquille O’Neal and his family, Big Chicken and Bite created a most engaging digital experience. This collaboration includes secret menu items, silly GIFs and interactive entertainment to enhance the dining and guest experience.
I’ve pasted an article by Fast Casual below on this collaboration, but I'll share here that it brings Branded great pride and joy to see our portfolio companies come together in order to create and capture value.
I’ve written about this before and I’m sorry (not sorry), that the job of a cashier at a quick-service restaurant is going to be replaced by kiosks and the human capital will be redeployed as guest ambassadors, guest success officers and guest enjoyment enhancers (or whatever naming convention a far more creative person can come up with).
This isn’t a matter of "if", it's simply a matter of "when". The data is clear and the kiosk from every meaningful metric delivers a superior performance over a human. This isn’t ripping humans out of the store, its redeploying them to a role that is more valuable to the business, the guests, and the employee.
Pulled from the article (in case you don’t want to click and read it for yourself, which is cool with me), in a 2023 call with investors, the CEO of Yum Brands reported that kiosks netted 10% higher checks than front counter sales. And, this year, Shake Shack’s kiosks drove higher year-over-year profits, becoming the store’s largest and most profitable ordering channel.
With the economic advantages of the kiosks no longer an argument, the next level is to integrate the kiosk into the ordering experience and create a branded and marketing experience. As Big Chicken’s CEO, Josh Halpern says, “there’s no reason why you can’t walk away from the kiosk smiling, and from a marketing standpoint, from a sales standpoint, from an executive standpoint, that’s exactly what you would hope every guest does on every experience.”
In the spirit of giving Bite’s CEO, Brandon Barton, equal time, “it would make sense to an outsider that anything you can do on the internet you should be able to do on a kiosk. And I can tell you that’s very far from the truth. One thing that I think people don’t really understand is that we are in the early innings of the kiosk user experience.”
Big Chicken and Bite have just raised the bar on the kiosk ordering experience and I can’t wait to see what restaurant brands engage next in an effort to raise their respective game. This is good for business and will prove good for the guests.
Again, pulled from the Fast Casual article, since 2017, Bite has been exploring AI integrations to improve its kiosks’ performance. Its patented Bite Lift AI tech, which is a part of all Big Chicken kiosks, can analyze past ordering data to suggest ideal cart add-ons based on what’s already in the cart, the season of the year, the region of the store, and even the time of day. Now, they’re starting to focus on the next frontier of kiosk ordering: making it fun.
Have a BIG day!
As I transition to the 2nd Shoutout this week, I recognize how difficult it will be to follow a shoutout about the above collaboration of two of Branded’s portfolio companies. Or will it?
In the spirit of this week’s “love what you do” theme, I present to you this bromance between two Branded’s portfolio companies and specifically the CEOs of Ovation and Lunchbox, Mr. Zack Oates and Mr. Nabeel Alamgir. This shoutout even has a little extra bonus by including one of Branded’s strategic partners, Toast.
Lunchbox and Toast are hosting a pickleball tournament at FSTEC on Monday morning and it appears that last year’s defending champion, Zack Oates, has thrown down the gauntlet and challenged Nabeel Alamgir to a little wager.
In the link above, you’ll see that Zack has wagered his limited edition and stylish Ovation baseball cap if Nabeel or anyone can take the title away from him.
This is obviously all in good fun and in the spirit of work hard and play hard, these two CEOs are among the hardest and most enthusiastic workers the Branded team is fortunate to know. Their passion for their work, their respective teams and for the industry has no limits and Branded is thrilled to be working and supporting both of these operator-centric companies.
I’m also particularly proud to share that I’m already an owner of this limited-edition Ovation baseball hat and that I don’t need to compete (and certainly not win, which I would never be capable of doing) this pickleball tournament to acquire one in order to show it off! 😊
And finally, yes, a 3rd Shoutout this week and it goes to Sterling Douglass, the CEO & Co-Founder at Chowly (a Branded portfolio company).
Mr. Douglass has become one of Branded’s favorite content creators and thought leadership writers on LinkedIn. I find his writing ‘real-talk’ (that's for you MR) and there’s a directness, honesty and humility that makes his LinkedIn posts incredibly interesting.
This week one, particular post by Sterling I not only enjoyed, but I found myself “called out” as Sterling and I have gone back and forth and maybe even debated the issues around the success or some restaurants while others are most challenged (and even failing).
At the end of the day, I don’t expect there is a single answer or magic bullet to success versus the failures, but the point Sterling and I have somewhat disagreed on is in the area of whether the saturation of the restaurant market is in fact a cause of the increased failure rate.
I’ve copied the link to Sterling’s post here: Sterling Douglass and a Single Restaurant Operator Up 20%
I believe the debate Sterling and I are having over whether saturation is in fact a cause of the increased failure rate of restaurant stems from his very good point that this saturation isn’t a new thing (Sterling, I agree with you).
In the spirit of finding a middle ground, I think my use of the word ‘saturation’ may be less than ideal here and instead, I’d like to offer up "increased optionality" and specifically, a meaningful increase in dining options that affords guests more dining options and flexibility than they've ever had before. The lines that have traditionally created clear delineation among restaurants, c-stores, meal kits, grocery stores and the like, have become far more blurred. This has resulted in an increase in competition from venues that weren’t competing or were at least less competitive only a few years ago.
In Sterling’s post, he writes about a “winning” restauranteur and what the operator used to drive impressive results (up 20% over last year) in an environment that is without question a most challenging one.
The factors that contributed to this operator winning reminds me of a story of two men hiking in the woods, and they see a bear. The bear is really angry, so they start running to get away. The first man says, ‘how are we going to outrun this bear?’ and the other guy goes ‘I don’t have to outrun the bear, I just have to outrun you.’
There are some amazing tools as well as strategies that can deliver value to your organization. As my brother from another mother, Mr. Wolf, always told me, “if you’re standing still, you’re falling behind.”
Branded invites readers of the H^2 that are interested in learning more about our portfolio companies, and investment strategies to become part of our Access Hospitality Network.
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New Release:
Join Michael Schatzberg, “The Restaurant Guy,” and Jimmy Frischling, “The Finance Guy,” as they chat with Doug Willmarth, President of MOOYAH Burgers, Fries, and Shakes, shares his unique journey from Navy pilot to leading major brands like Frito-Lay and Pizza Hut, before joining MOOYAH. He discusses the company's new franchise incentive program, offering royalty relief and marketing support for new owners, along with MOOYAH's tech-forward approach, including a relaunched app that enhances customer experience with an easy ordering system and free food rewards.
Tune into the episode and subscribe to our channel here: Hospitality Hangout Episode With Doug Willmarth
Re-Run of the Week:
Throwback to an exciting episode of Hospitality Hangout as Michael Schatzberg and Jimmy Frischling are joined by Noah Glass, founder and CEO of Olo. Noah shares how he's revolutionizing the restaurant industry through technology. From his early career to launching Olo, Noah's focus has been on streamlining digital ordering and delivery, while integrating traditional and modern payment systems. He emphasizes the power of data in driving personalized marketing, increasing restaurant sales, and enhancing customer experiences. Tune in to hear Noah, Jimmy, and Schatzy discuss the future of restaurant tech.
Tune into the episode and subscribe to our channel here: Hospitality Hangout With Noah Glass
You can tune in on:
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Apple Podcasts: Click Here
Watch on Youtube: Click Here
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MARKETING
Why is Shake Shack going after Chick-fil-A?!?!?
By: Rev Ciancio, Head of Revenue Marketing at Branded Hospitality Ventures
Why is Shake Shack going after Chick-fil-A?!?!? I have no idea, honestly .. but I want to know!
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That’s it for today!
See you next week, (about the) same bat-time, same bat-channel.
It takes a village!
Jimmy Frischling
Branded Hospitality Ventures
jimmy@brandedstrategic.com
235 Park Ave South, 4th Fl | New York, NY 10003
Branded Hospitality Ventures ("Branded") is an investment and advisory platform at the intersection of food service, technology, innovation and capital. As experienced hospitality owners and operators, Branded brings value to its portfolio companies through investment, strategic counsel, and its deep industry expertise and connections.
Learn more about Branded here: Branded At-A-Glance