How I Built This with Guy Raz

Advice Line with Todd Graves of Raising Cane's

December 25, 2025

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  • Consistency and doubling down on a core, craveable product, as exemplified by Raising Cane's simple menu, is often a superior strategy to chasing every new trend or product variation. 
  • Franchising introduces operational inefficiencies and potential quality dilution compared to corporate-owned stores, requiring founders to weigh control and brand standards against rapid capital access for growth. 
  • For early-stage founders seeking capital, creative financing options like subordinated debt from angel investors or strategic partners can provide necessary funds without immediately sacrificing controlling equity. 
  • Todd Graves advises entrepreneurs to prioritize progress over perfection, noting that striving for perfection can halt necessary business advancement. 
  • Losing focus by pursuing secondary ventures can lead to screwing up what is already working well, a common pitfall for successful businesses. 
  • The founding story of Raising Cane's involved naively attempting to secure bank financing with a business plan, highlighting early entrepreneurial struggles with securing capital. 

Segments

Raising Cane’s Growth and Model
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(00:02:23)
  • Key Takeaway: Raising Cane’s achieved third-largest US chicken QSR status by focusing on exceptionally high average unit volumes rather than mass unit count.
  • Summary: Raising Cane’s surpassed KFC as the third-largest US chicken QSR despite having fewer than 1,000 restaurants. This success is attributed to having the highest average unit volumes per restaurant. Todd Graves emphasizes enjoying this milestone before returning focus to growth.
Franchisee Quality Control
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(00:04:14)
  • Key Takeaway: Maintaining brand standards with franchisees hinges critically on selecting partners through rigorous vetting, including mutual mystery shopping and extended relationship building.
  • Summary: Selecting the right franchise partner is crucial as they license the brand’s know-how and product knowledge to run their own business. Graves detailed courting his Middle East partner for two years, involving mystery shopping each other’s brands. This deep vetting ensures integrity and adherence to brand standards over the long term.
Consistency Over Menu Expansion
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(00:05:39)
  • Key Takeaway: For a strong brand, consistency is critical, and doubling down on what is already done well, like In-N-Out’s simple menu, prevents quality degradation and speed loss associated with adding complexity.
  • Summary: Introducing new items like spicy chicken forces a shift from cook-to-order to holding food in warming bins, which compromises both quality and speed. Trying to be all things to all people results in serving no one well, making disciplined focus a key advantage in a world of infinite choice. Limited Time Offers (LTOs) distract management and crew, negatively impacting customer service.
Coffee Business Model Scaling
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(00:10:38)
  • Key Takeaway: Founders should prove the core business model through several corporate-owned units, instrumenting everything with data, before considering franchising to ensure repeatable unit economics.
  • Summary: Evan Sledge of Whiskey Morning Coffee is opening a drive-through concept combining espresso and tamales, costing $150,000 per unit. Graves and Raz advised against immediate franchising, stressing the need to first prove the model’s profitability and replicability across 3-5 corporate stores. Franchising introduces control challenges, as franchisees often operate at a lower performance level (e.g., 85 vs. 95 on a 100-point scale) than owner-operators.
Financing with Credit Issues
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(00:29:28)
  • Key Takeaway: Founders with damaged traditional credit, like David Burmeister of Midwest Pasta Company, can explore subordinated debt from local angel investors or strategic financing from large customers to fund expansion without giving up control.
  • Summary: David Burmeister needs $1.4 million to expand capacity but is blacklisted by the SBA due to a prior loan default. Graves suggested seeking subordinated debt from local angel investors who are passionate about St. Louis businesses, offering them high interest (15-20%) but no voting rights. Another option is strategic financing from large co-packing prospects who could prepay minimum volume contracts.
Brick-and-Mortar Distraction
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(00:41:33)
  • Key Takeaway: For a successful catering/wholesale model, opening a traditional brick-and-mortar location can be a significant distraction that pulls focus and capital away from the proven, high-margin core business.
  • Summary: Shane Lyons of Vesti Sandwiches, which operates on a scalable factory model supplying 45 retail partners, is debating opening a physical restaurant to handle on-demand orders. Graves advised against it, noting that a restaurant is a completely different business requiring substantial debt and distracting from the current successful wholesale growth. Shane should focus energy on doubling retail partners or exploring pop-ups as brand-building exercises instead of full brick-and-mortar commitment.
Focus vs. Diversification Risk
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(00:52:32)
  • Key Takeaway: Pursuing secondary business opportunities risks losing focus and damaging the core, successful concept.
  • Summary: Starting two different businesses can cause a founder to lose focus, potentially damaging something that is currently working well. This tendency to pursue ‘what else’ can mess up the established concept. The example of Stacey’s Pita Chips shows that sometimes a side product, like pita chips, can unexpectedly become the main business.
Advice to Young Todd Graves
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(00:53:10)
  • Key Takeaway: The most crucial advice for a starting entrepreneur is to concentrate on progress rather than striving for unattainable perfection.
  • Summary: Founders often delay releasing products or programs because they want them to be perfect, missing out on significant progress. Mentors taught Todd Graves that nothing is ever truly perfect, making progress far more important than perfection. Version one of a product or training program should be released to allow for iteration toward version 100.
Recalling Early Funding Efforts
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(00:54:43)
  • Key Takeaway: Early Raising Cane’s founders used theatrical props like cheap suits and briefcases with combination locks when naively pitching banks for funding.
  • Summary: The founders believed they could secure a $100,000 loan simply by presenting a business plan to a bank. They bought cheap suits and briefcases with brass combination locks to present their plan. They would sit across from bankers, open the combination lock, acting as if someone might steal their chicken finger business plan.
Closing Remarks and Calls to Action
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(00:55:27)
  • Key Takeaway: Listeners are encouraged to sign up for Guy Raz’s newsletter and submit their own business questions via voice memo or phone for future Advice Line episodes.
  • Summary: The newsletter is available for free sign-up at guyraz.com or on Substack. Founders seeking advice should send a one-minute voice memo detailing their business and current challenges to [email protected] or call 1-800-433-1298. Production credits and information on listening ad-free via Wondery Plus are also provided.