The Business Plan Is: Stay In Business | Tiffany Chen & Leon Chen | TEDxUTAustin
Summary
TLDRThe founders of Tiff's Treats recount their journey from a small university-based cookie delivery service to a successful company employing nearly two thousand people. They emphasize the importance of luck in their success, but stress that luck favors the persistent. They share their early struggles, including financial losses, kitchen space issues, and legal battles over their brand name. Despite these challenges, they persevered, and their luck turned when they secured a new location and an investment that propelled their growth. The story serves as a testament to the power of perseverance and seizing opportunities.
Takeaways
- 😀 The founders attribute their company's success to a combination of perseverance and luck, emphasizing that luck favors those who persevere.
- 🏢 The company started small, with just two founders, and has since grown to employ nearly two thousand people, demonstrating significant scaling.
- 💰 The company is now worth over five hundred million dollars, showcasing substantial financial growth.
- 💵 They have raised over one hundred million dollars in funding, highlighting their ability to attract investment.
- 🎓 The founders began their entrepreneurial journey as 19-year-old college students, delivering cookies from an apartment.
- 🍪 They faced numerous hardships, including financial losses and the loss of their kitchen space, yet continued to operate.
- 💧 A literal flood in their kitchen, caused by faulty plumbing, was one of the many challenges they had to overcome.
- 🚫 Legal issues with the name 'Tiffany's Treats' due to trademark infringement by Tiffany & Co. forced them to rebrand to 'Tiff's Treats'.
- 🏠 They faced the challenge of finding a new location when their landlord gave them a 45-day notice to vacate, which was a critical moment for the business.
- ✅ A stroke of luck with the city permitting department allowed them to quickly secure a permit and renovate a house into a commercial kitchen.
- 🤝 A critical investment of 1.2 million dollars from a chance meeting helped them secure a new location and continue their growth.
Q & A
What was the initial size of the company when it started?
-The company started as a small operation between two people.
How many employees does the company have now?
-The company now employs almost two thousand people.
What is the current worth of the company?
-The company is worth over five hundred million dollars.
How much funding has the company raised from investors?
-The company has raised over one hundred million dollars in funding from investors.
What does the founder attribute the success of the company to?
-The founder attributes the success of the company to luck, but also emphasizes the importance of perseverance to be in business when those lucky breaks come.
What was the age of the founders when they started the company?
-The founders were 19-year-old sophomores when they started the company.
What was the nature of the business when it first started?
-The business initially involved delivering warm cookies at night out of a Hyde Park apartment.
What was the financial situation of the company after the first year post-graduation?
-After the first year post-graduation, the company had lost thirteen thousand dollars.
What was the impact of the tornado on the company's kitchen?
-A tornado caused a flood in the kitchen, leading to a fountain of water and sewage spewing from every floor drain, which required extensive cleaning and sanitization.
Why did the company have to change its name?
-The company had to change its name due to legal pressure from Tiffany & Company, who claimed trademark dilution.
How much did the legal fees cost the company to settle the trademark issue?
-The legal fees to settle the trademark issue cost the company about twenty thousand dollars.
What was the role of Mike Joyce in helping the company secure a new location?
-Mike Joyce, one of the company's first mentors, helped them lease a 1940s home near campus, which they renovated into a kitchen and storefront.
How did the company manage to get a building permit so quickly?
-The city of Austin permitting department staff took pity on the founder and walked them through every department to get approval, resulting in a building permit in one day.
What was the turning point that led to the company's growth?
-An investment of 1.2 million dollars from a person the company's accountant knew, which served as a springboard to their growth.
Outlines
🍪 Founding Tiff's Treats: A Journey of Perseverance and Luck
The speaker recounts the humble beginnings of Tiff's Treats, starting from a small-scale cookie delivery service between two university students to a successful company employing nearly two thousand people. Despite the company's current value of over five hundred million dollars and substantial funding, the speaker attributes much of the success to luck, emphasizing the importance of being in business when fortunate opportunities arise. The early years were marked by hardships such as working hundred-hour weeks, incurring significant losses, and facing eviction from shared kitchen spaces. However, the founders' perseverance through these challenges allowed them to eventually capitalize on their luck.
🚨 Overcoming Obstacles: Legal Battles and Location Changes
The narrative continues with the challenges faced by Tiff's Treats, including a legal dispute with Tiffany & Company over the use of the name 'Tiffany's Treats'. The speaker describes the stress of rebranding to 'Tiff's Treats' and the financial burden of legal fees. Additionally, the company faced the loss of their kitchen space due to the landlord's decision to reclaim the property. Despite these setbacks, the founders managed to secure a new location and, with the help of a line of credit, transform a 1940s home into a commercial kitchen and storefront. The speaker highlights the role of luck in these events, such as the city permitting department's unusually swift approval of their building plans.
🌊 Riding the Waves of Luck: Growth and Investment
The final paragraph details the company's continued growth and the role of serendipity in securing a crucial investment. The founders, facing the prospect of not being able to afford a new lease, were fortunate to meet an investor who provided a significant capital injection after a single meeting. This investment was pivotal for the company's expansion and success. The speaker concludes by reflecting on the importance of perseverance, suggesting that while luck plays a part in success, it is the ability to endure hardships and remain committed to one's vision that ultimately determines whether one can seize those lucky moments.
Mindmap
Keywords
💡Luck
💡Perseverance
💡Hardship
💡Misfortune
💡On-Demand
💡Trademark
💡Investment
💡Lease
💡Growth
💡Failure
Highlights
The company started as a small venture between two individuals and has now grown into a large enterprise with almost two thousand employees.
The company is valued at over five hundred million dollars and has raised over one hundred million dollars in funding.
The founders attribute much of their success to luck, emphasizing the importance of being in business when opportunities arise.
The founders had to persevere through hardships, including financial struggles and the loss of their initial kitchen space.
They initially operated out of a shared kitchen space with a struggling baked potato shop.
The founders were just 19-year-old sophomores when they started the business, delivering warm cookies at night.
They lost thirteen thousand dollars in their first year after graduation, working hundred-hour weeks without pay.
The founders had to convince their landlords to rent them the entire kitchen space on a month-to-month basis.
A mild tornado caused a flood in their kitchen, forcing them to clean and sanitize the entire space.
They faced a legal battle with Tiffany & Company over their original business name, Tiffany's Treats.
The company had to change its name to Tiff's Treats after spending twenty thousand dollars on legal fees.
The founders were given a 45-day notice to vacate their kitchen space by their landlords.
They found a 1940s home to renovate into a kitchen and storefront with the help of a mentor.
The city of Austin permitted department granted them a building permit in a single day, a process that usually takes months.
The new location turned out to be more beneficial for the business, bringing them closer to downtown and increasing visibility.
The founders signed a lease for a new location without having the funds to pay for it, risking the business's survival.
An investment of 1.2 million dollars from a new acquaintance allowed the company to continue growing.
The founders emphasize that luck is a significant factor in success, but perseverance is necessary to capitalize on it.
The analogy of surfing is used to describe the need to stay afloat and be ready to catch the wave of opportunity.
Transcripts
[Music]
thank you
so what started here at this great
university between just the two of us
has now become a company that employs
almost two thousand people
is worth over five hundred million
dollars and we have raised over 100
million dollars in funding from
investors
we're going to share with you all today
what we feel is most responsible for the
success of the tif treats brand
and that is
luck
pure luck
that's right if it weren't for some
lucky breaks we wouldn't be standing on
this stage right now
but the trick is you have to still be in
business when those lucky breaks come
along
you have to survive wave after wave of
hardship misfortune and loss
you have to persevere long enough to get
lucky
when we first started we are just 19
year old sophomores going to school
during the day delivering warm cookies
at night out of my hyde park apartment
by the time we graduated we were sharing
kitchen space with a struggling baked
potato shop right here on the drag in
the old scientology building
when we first graduated we weren't
making anywhere near enough money to pay
ourselves or to grow the business but we
knew we felt there was something special
about to happen with the brand and we
wanted to be a part of that we also of
course knew that on demand bake to order
warm cookie delivery it didn't exist
when we first started we'll share some
of our early hardships and and and go
over with you all that in that we'll go
over with you all in the beginning
there's just a lot of hardships and a
lot of loss
that's right a lot of loss
so we lost money
the first year after we graduated we
were working hundred hour weeks and at
the end of the year we had our books
done and we had lost thirteen thousand
dollars
we used to dream of ways that we could
have spent thirteen thirteen thousand
dollars and maybe had a little more fun
like driving down the road with the
window down and just throwing dollar
bills out as we went
but instead we had spent it working the
most grueling year of our lives not
paying ourselves a dime and owing
thirteen thousand dollars at the end of
it we had no business staying open my
personal checking account was regularly
under 50 and i had no savings
but still we kept going with nothing
more than a feeling that this was going
to work
we lost our shared kitchen space just as
we felt like we were maybe getting our
feet under us the owners of the baked
potato shop they sat us down to tell us
that they're going out of business they
literally moved out overnight
so the next day tiff and i we went to
the landlords to see if maybe they would
rent out the entire space out to just us
after much pleading they agreed to do so
but only on a month-to-month basis they
said at some point they're going to want
to have the entire space back for
themselves we did however convince them
to give us 45 day notice before they
wanted their space back so we didn't
know if we were going to be able to stay
for six months a year or longer but at
that point we were just ecstatic that
the business was going to survive
another 45 days at least
not having the security of a long-term
lease definitely kept me up at night as
did the stress of not knowing the
viability of the business if and when
that 45-day notice would come
we lost our
so now that the kitchen space was all
ours we went about making it our own we
painted a hand painted sign with our
name on it and we installed a walk-up
window so customers could come up and
order cookies
and then came the flood
on this particular day it was actually a
mild tornado and what we didn't know was
that the plumbing in the building was
installed incorrectly and when the water
rose too high outside the sewage system
started working in reverse and coming up
the floor drains inside
imagine a fountain of water spewing out
of every floor drain in the kitchen and
when i say water it also means sewage
it was so intense that at a certain
point i turned a bucket over sat on it
and it whisked me away
we ran around the kitchen trying to turn
off the ovens before the water reached
the outlets and we called all the
customers to let them know your cookies
are not coming
finally the storm passed and we spent
the rest of the day just mopping the
water out of the space and we even had a
customer come up and try to order
cookies as we were mopping water out
and then we spent the next few weeks
just cleaning and sanitizing and tossing
everything that got wet and dirty
we lost our name
so one day i checked the mail come back
to the store
we registered a trademark apparently for
our name at the time which was tiffany's
treats
and that caught the attention of the
legal team over at tiffany and company
the famous jewelry brand
they wanted us to stop using our name
tiffany's treats or any form of it they
were claiming trademark dilution which
basically just meant that they felt
their brand was so famous that it didn't
matter what industry we were in it did
as long as
you know there's another brand using a
name that was similar they didn't want
to have anything to do with it so
we knew that we had to do something
about that every law firm wanted to
fight this case because at that time in
order to win a trademark delusion case
tiffany and company would have had to
prove actual monetary damages which
would have been next to impossible
it was a dilemma for us
we could have decided we had to decide
whether to fight for what we thought was
legally all right or just figure out a
way to keep the business going another
day
so we hired a law firm it was a
trademark law firm downtown and we knew
about them because they ordered cookies
from us non-stop
and in that law firm was an attorney who
wasn't out there just to make a name for
herself
by taking this case directly to court
but even settling with tiffany and
company was really stressful because it
was going to cost us time and money that
we didn't have but still we fought to
shorten the name to tiff's treats and
eventually came to an agreement with
them that we could do just that after
spending about twenty thousand dollars
of borrowed money on legal fees
but ultimately we like the name better
it was shorter and easier to say and a
funny aside about this the whole legal
situation actually changed my name so
before this almost everybody called me
tiffany and just a handful of very close
friends would refer to me as tiff and
these days i still introduce myself as
tiffany but almost nobody calls me that
anymore
we lost our location
just when we were finalizing all the
legal issues literally changing the name
on our sign
the landlords they said they gave us our
45-day notice to vacate
the scientologists they wanted their
space back and they needed us out
we knew this was coming we knew this was
coming so the year before we hired a
real estate agent we went everywhere
looking for a space that might be
suitable for us to move into
we quickly realized there weren't very
many suitable and even if we found a
place
the chances that a landlord would rent
to two struggling kids in the financial
situation we were in well it wasn't good
and so this was really time to panic
even if we had options 45-day notice to
just to be able to find a location to
permit it to build a commercial kitchen
that was nearly impossible that process
would take us today nine months to a
year
at this point we thought the business
was probably going to fail
but then we started getting lucky
we stumbled upon a 1940s home near
campus and thought maybe we could
renovate this into a kitchen and a
storefront we knew we would need help
leasing the space and we were introduced
to one of our first mentors named mike
joyce through the landlord of a failed
sixth street walk-up location we had had
he eventually got this landlord to agree
to rent to us even though our financial
state did not support that at all
and in another weird lucky break we had
just signed a hundred thousand dollar
line of credit from the bank which in
those days they were giving out with
nothing more than a signature backing it
so with that money we had what we needed
to be able to turn this into a store
so our next challenge was to actually
turn a house into a commercial kitchen
which meant that we would need to go
through permitting so we sat down and
drew out by hand what we wanted to do
with the space and then we rolled up our
little elementary school style project
drawings and marched down to the city of
austin to get ourselves a permit
another stroke of unbelievable luck
for whatever reason that day the people
working in the city of austin permitting
department
they took this drawing this is the
actual drawing that we submitted for
permits and they took me and they walked
me through every single department
stamping it for approval basically
giving us a building permit in one day
this process would take four to eight
months today i don't know why to this
day they took pity on me they probably
saw the desperation in my eyes
or they took one look at me and thought
there's no way he's gonna pull this off
so they're gonna do it anyway but for
whatever reason they did and those
people changed everything for us they
made something that was impossible
possible because of this we were able to
build so quickly we just had to close
down for one day in between moving and
moving to this new location being forced
to move this new location actually ended
up being the best thing for us this
location was closer to downtown while
still being within walking distance to
campus and by being closer to downtown
that enabled us to be closer to the
corporate clientele that was growing for
us this location had much better
visibility and it had a parking lot
within a year we really started things
started to turn and the brand really
started to grow
and then a few years later we got
ourselves into a little pickle
we signed a lease for a north austin
location with absolutely no way to pay
for it we had assumed that the banks
would continue to loan us money because
that's what we had done in the past but
things were different now and banks were
no longer lending money for things like
this
without money for the lease and
construction that we were already on the
hook for once again we were at risk of
going out of business
but then we got lucky our accountant
knew somebody who was looking to make
investments in business and she
encouraged us to sit down and have lunch
with him
after one lunch meeting he agreed to
invest 1.2 million dollars into our
business without ever even going to look
at a store
we learned later that this is not how
investment meetings usually go
but we lucked out meeting just the right
person just when we needed him most
and that investment was a springboard to
our growth and is largely responsible
for where we are today
but we wouldn't have had any of this
luck if we hadn't fought and clawed to
stay in business along the way
so while the secret to success may be
luck the only way to get lucky is to
persevere
it will be hard
and it will be daunting and you will
fail and you will fail again but fight
for what you want and if you think
you're on to something keep it going
until that next lucky moment
i think of it like surfing you're out
there you're treading water you're
waiting for that wave to come you have
to be patient because the wave will come
it always does your job is to stay
afloat long enough until it arrives and
when it does you gotta catch it you see
it's not just those lucky moments that
determine whether or not you're a
success it's what you're willing and
able to do
in between those moments while you're
waiting to catch your lucky breaks
thank you so much for having us
[Applause]
you
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