Sweetgreen CEO Jonathan Neman on 18 years building healthy fast food: automation, seed oils, and the real estate game

of protein are in your protein bowl? We need to know. Uh, welcome to the stream. Please introduce yourself for those who might not be familiar.

Hello. My name is Jonathan Eman. I'm the co-founder and CEO of Sweet Green.

Get that overnight success button ready. When did you start this company?

2007. So, we've been at this for 18 years. 18 years. Wow. Uh t just let's talk about the the the very beginning. I mean, since uh this is your first time on the show, uh where did you grow up? How did you get into the business? What were you studying? And then uh let's go.

Yeah. You got to be somewhat of a masochist to get into the restaurant business. [laughter]

Yes, absolutely.

I mean, it's it's such a beautiful thing because it sounds so simple. It's like you get a box, you get a menu, you get some ingredients. Sounds it sounds super

and then you just copy and paste it and you scale to you know however many stores and then of course it's far harder in uh

so prior prior to launching the business what were you doing?

So I grew up here in Los Angeles I went to school in DC went to Georgetown and never thought I'd be in restaurants but

you studying government you thought

no I was studying business I always I knew I wanted to be an entrepreneur

and Sweet Green was almost almost an accident you know we it was the naivee we thought it would be easy.

Yeah we

And did you start it during school? Yeah, we started in we started while we were seniors in college. I started with two of my friends before that

was doing Yeah. I had a bunch of internships, you know, I was you know worked in media, I worked in tech. I you know I worked in real estate. Always knew I wanted to be an entrepreneur and create something. But senior year came around and it's exactly what you said. We thought it would be easy.

We're like how hard could this be? You go, you know, we'll go to farms.

It's like apparel. Like people [laughter] fall into the apparel trap because they're like I just wanted to make clothes that I wanted to wear and then you realize it's like the hardest business on apparel and restaurants probably the things that seem the most simple but are actually the hardest practice to actually do on a massive scale.

Yeah. So what was the was it was it build a business plan first? Assemble a team? Uh do a popup? Like what was the first thing where you were like okay let's

What was the first bowl? The first bowl was the guacamole greens we made in our dorm room. We brought a bunch of classmates to try it. My partner Nick actually made it. He was our first chef. No way. And the the the story was really simple. We had no we couldn't find a healthy place to eat.

We saw Chipotle taking off and we're like wow there's someone is going to create a

scaled healthy fast food chain.

And at first it was let's just open one. Our you know we wanted it for ourselves. We thought we'd go on with our lives. We opened we worked on it senior year. Wrote a business plan raised $300,000.

There we go. from 50 investors. So, [laughter]

so it was like five five grand, five grand average. Yeah. Party round.

So, they got equity in like what became the full company.

They got equity. Well, we actually it it was a little bit more complicated than that. At first, the first three restaurants we raised at the restaurant.

At the restaurant level.

Yeah. I was wondering if you were doing that.

And we actually paid the investors back every quarter and did the whole thing. And then after the after the third restaurant, we realized that the only way to scale this was to roll it up. So we rolled the whole thing up

and then we were able to continue to invest in it and we

it's notable when did the word wellness actually become mainstream or when did that become like a identif like 2015 years ago.

Yeah. Like early 2010s.

Yeah. So anyway, this is like any anyways at least 5 years before wellness is going like mainstream.

Yeah. When we were when we were starting you know the the thesis was healthy eating was not cool. Sure. and it was not delicious and it was not accessible. And

we're going to create a place that offers all of the benefits of fast food in terms of the convenience and the taste, but do it in a, you know, do it with healthy food and real real food that you can trust, where we're transparent about where the food comes from, where it's nutritious, and build a brand around it. And so we've been at it for about 18 years. We have almost 300 stores all around the country.

Yeah. It's almost hard to believe.

Yeah.

Yeah.

What was the first uh VC round? the first so we

or like or this transition from the you have a restaurant and what did it work immediately you set up one restaurant you you know you raised enough money to get that I imagine that you had to sign a lease so you weren't buying buildings but you might have to do some sort of renovation to actually get the first restaurant up and running you start making money enough to pay the employees enough to pay the rent uh you scale that to three and then at a certain point you say okay we're going we're going to turn this into like a corporation more than just a small mom and pop, right?

Yes. So, we we opened one in 2007, [clears throat] two in 2009, um with a food truck. You remember those?

Yeah.

U and then we opened like two or three a year and we were mostly uh built them from cash flow from the

profit. We were profitable, you know, we would just reinvest the cash flow and we would do a few party rounds.

Yeah.

Uh 2013 along the way, we started a big music festival called Sweet Life. 2010 it became a massive 25,000 person music festival. Where was that?

It was at Merryweather Post Pavilion. So, first year we had the Strokes. By the end we had Kendrick Lamar and little festival side quest.

Yeah. It was a, [laughter] you know, way to build the brand. And then in we focused on DC which was very, you know, it was almost an accident, but we opened the first 16 restaurants in DC.

Wow.

And then slowly went up to Philly and then restaurant 20 and 21 were Boston and New York. Okay.

And Boston and New York I really kind of proved the concept outside of DC

and took off and that's when we raised our first.

So now obviously all around LA there's sweet greens, but why given that you grew up here, why didn't you why why not start here? Was this because well like

there was did was there just more healthy food options in LA and there was less on the

honestly it was an an accident. We were in school and we're like let's just open one. We thought with the second one would open. gravity that you have around the center when there's more and more stores.

You know, when you have a restaurant company, the brand and all your economies of scale happen at the local level.

So for us especially given our supply chain is regional.

Um you have your overhead and your management like your team that runs it and then your brand you know restaurants the brands don't really travel across the country. Occasionally they do.

Um so it was really started in DC. We thought the second restaurant would be in LA. We went and looked.

This is true for even like In-N-Out is not a not a national brand still. It's like a west coast brand somehow. Uh and yeah, it's taken so long for that to actually like filter across. Uh what how capital intensive was it to launch like the second and third? Like you mentioned 300,000.

That's the hardest part of the No, it's way more than that now. Um the first one was tiny 500 ft and we did it really on the cheap.

500 ft.

500 ft.

Yeah. So that's like I imagine like one or two people like

Wow, that's tiny.

Yeah, we were working there. We doing the whole thing. So I mean we've had to raise a lot of money. Answer earlier question. uh revolution. Steve Casease was our first first VC investor

and it was part of the thesis was how technology can change the restaurant business. So we were we were the first company to you do mobile ordering where you can order on your app and pick up

and we started

most beautiful software for

that a restaurant had ever had probably [laughter] emit EMTT Shine

Emit Shine. Yeah. Yeah. Jin Lane Jin.

Yeah. This was like uh yeah this was like one of my favorite Jin Lane projects. That's awesome.

EMTT and his team were amazing. They they did they they did our app in the early days.

And you know, restaurants are today cost over a million dollars. So we're like $1.3 million, $1.3.4 million per restaurant. That's before you put the infinite kitchen in.

Mhm.

Our restaurants have very high return on capital.

Infinite Kitchen. What's that?

The infinite kitchen is our automation. Okay. Uh our automation platform that we that we've built. So today, most restaurants that we open, the assembly is automated. So we still make all the food from scratch. The sourcing is the same. We still cook the food fresh,

but it we load this beautiful machine that that makes your bowls. It makes them 500 bowls per hour, perfectly portioned, perfectly plated.

Um, and so that is kind of the future of where things are going.

How many different restaurant automation pitches have did you get across 18 years? Like cuz I imagine every single year there's a new like startup coming to you saying like we can automate this part of your kitchen and

clearly you got to the point where you had to build it yourself based on kind of domain knowledge but uh this just feels like something that's been promised for a long time and at this point I don't know like an individual startup that's done well in restaurant robotics.

Yeah. No one's no one's been able to create a platform that that works in multiple restaurants. And there's a few there's a few issues. Most restaurant workflows are very specific.

So they're super specific to that restaurant.

Two, most restaurants are franchises. And so they're not owned by the corporation. We are fully company owned. So if you're a franchise restaurant, you know, if you're McDonald's, you have to now go convince your franchises to buy whatever automation you have. And the other issue

they're looking at it and it's like this is coming off my bottom line. We're making money already. This feels like a risk. Like it the franchisee is saying like what like I'm happy with my IBIDA. I don't need to take a risk.

That's exactly right. And the other issue is you need automation that takes enough labor out or offers enough value to be worth it because the capex is still very heavy.

Yeah.

So when we went down this path, we tried to build it ourselves actually. We built a team to do it ourselves.

Yeah. realized how challenging it was. And then we found this startup that was doing it and doing a really good job. Yeah. It was called Spice. It was called Spice Kitchen. It was for MIT grads out of

four grads out of MIT. And they had the same issue. They realized they could build the automation, but no one was going to buy it.

Yeah.

So they ended up opening two restaurants. Um they were great at automation, not so great at the restaurant side. And then four years ago, we acquired them. Um and we began, we've commercialized the technology, we've scaled the technology um today. So most new restaurants feature the technology. And last week we actually just announced that we've now sold Spice.

Um so we sold out basically.

So we spun Spice out. Yeah. We spold spun Spice out. We announced about 10 days ago. We sold it to Wonder Mark Lure over there. Yeah. So So we sold it for about $186 million. Mark is Mark Mark uh uh I I don't I don't fully understand that that business, but talk about a guy that just like isn't even necessarily naive about the challenges of restaurants, which just like I'm going to go into the most competitive environment possible and compete with everyone.

It's amazing. It's a great It's a great vision and, you know, I'm a big fan of his and what they're doing. And so we we

it's a it's a really interesting deal. So we we sold the

the effectively the team and the IP, but have full access to it. So we will continue to scale with it and get the benefits as they get

they get to you know scale and build many more machines we'll get the benefits of those economies of scale as well.

Uh wait can you go a little bit deeper on the decision to uh franchise or not franchise uh the naive maybe steelman for franchising the franchise model is that uh it's somehow more capitalist in my mind. it like because it decentralizes the decision-m and it and it puts these financial incentives at the local level because each store lives and dies by its own P&L maybe uh versus even if I have a manager in one store and they have stock options like how what they do on the weekend if they come in on Thanksgiving or Christmas like that doesn't necessarily put more or less money in their pocket. Is is that real? What I'm what I'm feeling or is it irrelevant? what you're feeling is absolutely real and we actually try to design our comp structures and okay the you know I've always believed I my line that I say tell my team every single day is all the answers are in the restaurant and the closer we can push decision making to the edges to the customer the better we will be so we you know our general manager we call them the head coach they are the most important position in the company by far a great head coach will make or break you

and so we try to really incentivize them we empower them and we try to run as decentralized as an of an operation as we can. Okay.

The reason we decided not to franchise is

it's really hard to maintain quality.

Um if when you give up that when when you know when you really give that up to other people to run, you could sometimes scale too quickly. And we do a few things differently. We source differently. We're a very complex model because of the sourcing and the scratch cooking. The biggest difference between us and most of other companies is if you go into Sweet Green, you'd be shocked at how much we are making in the store.

It feels like you guys have taken such a principled approach in making food that I feel like stays true to the initial values of the company and kind of why you started it. And yet you're competing in an environment that says, "Okay, we're going to have these like factory kitchens offsite that we're going to be shipping in effectively almost finished product that gets reheated and we're going to be sourcing from all over with not a lot of values around how they're sourcing. They're just trying to get like they they want the food to taste good when it hits the plate, but maybe they don't care about uh a number of other factors. And so you're kind of in an environment where because of your principles, you're like fighting with your hands tied behind your back in against competitors like and I'm not talking about direct competitors, but more so like you're still competing with Burger King and McDonald's, right? Like people are going to have lunch somewhere and they're going to maybe decide between they have options, right?

Talk to us about land. Is McDonald's a land acquisition company? What like like why do people say that? Is that real? Have you ever looked they do they do own a lot of a lot of the real estate and lease it back to the franchise. So that is true and if you've watched the founder the last line in in that movie where he's like it's a real it's real estate. It speaks to more than the fact that they just own it.

Restaurants is highly a real estate game. Like great real estate mean is like if you look at like our portfolio where we have great real estate we do amazingly well. Location, location,

location, location, location. Really, it's it's people. Like people think restaurant business is a food business. It's really a real estate and a people business. And it's all about like you look at the great restaurants. So the Chick-fil-A's, the Raising Canes, the In-N-Out, it's so much about it's about that culture. How scient how scientific is you you hear stories of of companies like Starbucks and you can imagine like a team of data scientists with like you know 50 monitors and they're just

we need one Starbucks directly across the street from the other Starbucks.

Yeah. You know so like you can imagine a world where it's like hyper like hyper data driven and like down to a science and you just know when you're opening a new store you know that it's going to hit. But there has to be like some five days.

Yeah, we that is the process. We call it art and science. Okay. In pretty much everything we do, it's it's an art and science approach and real estate's exactly that. You know, the the science we have a very very intricate model that looks at psychoraphics, demographics, mobile data, drive, you know, people driving by.

We have custom data on how many gyms nearby and right side of, you know, sunny side of the street or not sunny side of the street, all of that stuff. But then you need a human to also walk it, feel it and understand does it tell our brand story. For us we especially when we were like early days growing where we went said a lot about who we were. So for example we went to New York. We didn't go to Midtown.

We went to Nolita, we went to Williamsburg. We wanted to kind of tell the story about who Sweet Green was.

You know today we're kind of everywhere.

But the real estate is is an art and science and tells a lot about you know says a lot about who you are.

Yeah. How do you think about uh if a new entrepreneur came to you and was asking for advice on uh where to start, is it is it worth it to go straight to Manhattan or straight to uh Beverly Hills and uh and try and like make it in the big leagues on day one or is it

or can you get negative indicators from that because there's a different type of customer there that's not necessarily representative of the rest of

I think that's more right especially when you're talking about New York. So when you when you're talking about New York, it is I mean the beauty of it is a massive market, you know, it's it's for us about a quarter of our business. It happens in New York. We have like you know in the New York region I think we have 50 something restaurants.

Wow.

Um what so it's great that it's massive, there's density, there's you know they have money etc.

But it's not really indicative of the rest of the country.

Yeah. So if you wanna, you know, if you want a scalable model that you can have thousands of locations, you're better off, you know, going into a more, you want to go to like the Iowa,

you know, like and to use the political uh analogy, you want you want to go to like something that, you know, is more representative of what the rest of the country looks like in restaurants. The place where everyone goes, the fast like the fast casuals is Columbus, Ohio.

That's where people go.

They say, you know, Columbus, if you can make it in Columbus, Ohio, you can make it anywhere. You can kind of make it everywhere.

Yeah. Yeah. Yeah. So, I mean, if you were a small restaurant, you're being evaluated by uh, you know, the the CEO of McDonald's or something, you might say, "Okay, how are you doing there?"

Yeah. The things that they look at for for a restaurant is they look at your unit economics, which is effectively your payback. So, how much does it cost to build and how quickly do you pay those stores back?

And they look at your TAM. So, they say, okay, like,

can you have a hundred of these, a thousand of these, 5,000 of these? And those are the two big kind of thing, you know, things you would look for in evaluating like the growth trajectory of a restaurant.

What's the story of the the the delivery market? Uh it feels like Door Dash has become massive business. Uber Eats has become a massive business. Uh more people are ordering delivery. There's the ghost kitchens trend. Is there a ghost kitchen where these businesses are like trying to effectively turn you into ghost kitchens? Is does that give them some sort of leverage? Is there some sort of tension there or is it pretty much just like, oh, it's just this trend. People are cooking less and less and so they're going to go to Sweet Green, but they're also going to order Sweet Green delivered more.

There's there's definitely a little tension there. You know, we're partners. A lot of our business comes through those marketplaces,

but it's not so dissimilar than, you know, a hotel chain and Expedia.

Sure.

Right. It's it's you're paying a fee on it. You do not control that data. you cannot market directly to those customers.

And so for us, we have to charge a higher premium. So people when you order on Door Dash, by the way, it's more expensive than you order on our app. So just a quick shout out, order, you know, download the sweet app. Things are about 20% cheaper there. Got it.

Um but at the same time, it's a great way to find new customers. Sure.

So you know, for example, Door Dash has been a great partner. They power our native what we call our native delivery delivery on our Sweet Green app, which is a big part of our business.

Yeah. So you so you're white labeling or something,

correct? Yeah. It's like a white label on on our app. And then we also, you know, we partner with

front store as their front end.

And as you know, they've become, you know, they're brilliant business models. They've become largely marketplaces.

So, you know, they you kind of have to buy your way to the top of the feed.

Yeah.

Yeah. Yeah.

And so

that's how they gain they I mean, if if uh like there's a reason the Door Dash app or any of these mobile ordering experiences are not they don't just put like the the restaurant that you've ordered the most from at the top. It's like, "Hey, why don't you try this new restaurant or this [laughter] new restaurant?" Yeah. They're all paid and it's how you maintain leverage over I mean they they do this on this is why the YouTube subscriber count doesn't mean anything because it's like they're going to constantly surface

anything. They've made money. I mean, the way they make money though, these businesses have been historically very challenging.

The way they made it work is batching orders

and and and then becoming an ad marketplace. And and that's what's made, you know, this amazing service an amazing business.

Explain batching orders really quickly.

So when you order, uh they they have a delivery driver pick up multiple orders.

So you're paying the delivery driver, you know, once, but they're picking up from three restaurants.

Uh I feel like you guys have done a really good job of listening to customers.

I would I would say like this 100 100 gram protein you guys are launching.

I was I was asking for 200. [laughter] Uh no, but that and then also the the the the [clears throat] seed oils. Is something about the business uh that

it feels like you're more agile.

Yeah. Is the business set up in a way that you guys can respond when when other companies like

you just caught a lucky break?

I would say like people would give a lot of the same feedback to Chipotle

and it feels like Chipotle is not set up in some way to like be like, "Oh, this is what customers want or even like some percentage of our customers really care about this. Let's deliver them uh let's deliver them a product here. And I think the results is that you know I've turned from Chipotle almost entirely

because of the seed oils.

Yeah. Because of the seed oils and just like a degradation of the quality of the food over like a decade. Like I watch it basically get worse and worse and worse and worse over

10 years. And so I just don't go there anymore. But I I joke about it. I'd almost rather when I'm on the road if I'm on a road trip I almost always rather just fast than eat at like the most common kind of like fast food market. Yeah.

Yeah. When we started the business, I had the saying this thing I would always say is, you know, there's there's businesses that as they get bigger get better. Yep.

And you can think of, you know, technology businesses, many of them do. Like your new iPhone is for the most part much better than the original iPhone.

These AI models are much better than the original AI models. Restaurants typically go the other way, right? Is scale kind of degrades quality. And that's because doing, you know, serving food at scale is really, really hard to do. So you have to fight that inertia so hard because all of those micro a one restaurant tour has an amazing restaurant they're like cool now I'm going to start a second restaurant and the second they start focusing their energy on the second restaurant the first restaurant gets worse it's like it even happens at like a micro scale

it's people and culture and so you need to really have a lot of systems in place

both like culturally how you how you keep the team engaged on your mission but also

other systems to make sure you're you're watching ing the quality of the food and listening to your customer. So like seed oil is an interesting one. When we first we we got rid of seed oils about exactly two years ago

and at the time it was not the national conversation. It was pre- RFK and all all of that stuff.

And so when we when we this is one of those examples we

but it was it was it was not a national conversation but it was incredibly online conversation

but a tiny at the time two years ago

there was like an there's the seed oil seed oil scout. Yeah. So, it was a tiny conversation. We surveyed our customers and this is why like surveys are [ __ ]

Yeah.

You really don't. Surveys can give you a general indication, but if you just follow surveys and the market research, you're going to hit the middle of the bell curve in everything you do.

And we're not trying to be a middle of the bell curve company. You got to find that like what are your top five or 10% of customers doing? And we heard from

it was honestly friends like wellness people in LA and New York that are like hey I I don't you know I can't go to Sweet anymore because I care about seed oils. And I remember we brought it to to broader, you know, I remember my CFO was like, "What are you talking about?" Like, "What even is this?"

And we're like, "No, trust me." It was one of those like gut decisions and it was expensive and we had to change a lot in order to do it.

But here's the thing. It's healthier

and it tastes better.

Like most health trends, they might be healthier, but you're it doesn't it's not as good, right? So I would I would argue like going from like dairy based, you know, traditional milk to like nutbased milk almost always is like somewhat of a downgrade. Or going from like something with sugar to pulling sugar out, it's like not as good. Or going from like sour like bread with gluten to gluten-free bread, it's not as good. And so when you think about these like what is like a durable health trend, it's like something that's better for you uh and tastes better. And so that that's why I was always super bullish on that trend. And I expected a number of restaurants to say like, "Hey, this costs slightly more, but the product's going to be better and it's going to be healthier for you." And that's what can create like real momentum around a trend versus some of these like flash in a pan health trends, which is like paleo or like, you know, which is like only eating stuff that was like super old, right? Um

what what's unfortunate about seed oils is it's become politicized a bit.

I know. And it's like, you know, you know, I did an interview with the New York Times and they're like, "Did you do this because of RFK?" I'm like, "No, I did this two years ago. Like, this had nothing to do with RFK. This is not a political statement. We don't make

We're making foods how your grandma probably made it.

Yeah. This is about olive oil. Like, this is not about This is just about olive oil. That's it. This is not a political statement at all.

Taste the difference. Yeah. Yeah. No. Uh is there is there anything happening upstream in terms of like automation or or technology on on the farming side that's like exciting?

Yeah, there's a lot of stuff happening on auto automation on the farming side. It's actually very exciting.

The both the better robotic arms and the vision I mean it's making some really hard grueling tasks around picking yeah

happen much much faster and easier. So, relatively early still, but and I think in the next 5 years, you're going to see that take off. I do think you're going to see a lot more restaurant automation as well.

Yeah.

Um, you know, between the availability of the labor, the cost of the labor, it's really just

when when you think about it, it's

it's just a hedge on labor. And here, like in West Hollywood, minimum wage is 22 bucks. So, we we pay like 24 $25 an hour here in LA in parts of LA. So with wages going up, availability going down, and then the ability, like all technologies, to just do things better, not just about the cost savings, like for us with the infinite kitchen, we can serve twice as many people per hour as we otherwise could.

Wow.

What about uh drone delivery? We've seen uh some four-w wheeled guy of protein out of

there's there's the air delivery.

Yeah, I saw you guys talking about Zipline. I love Keller and we I'm a big fan of Zipline. We're we're we're one of the early uh early partners that are going to be piloting that. I think his his way of delivering to the suburbs is super interesting.

Um we haven't done the the street delivery yet. Um Starship Starship Coco I've met with is working on one.

I think I think it's interesting. It see it's it's in the past year they've really taken off. You're seeing them more and more. They still kind of weird me out a little bit seeing them walk go down the street.

I saw one kind of stuck in the side of the street once. It was very sad. My kids love see love it when we see them on the street that a lot and I and I do I do just imagine that the AI is going to get way better and also some of the teleoperation uh just infrastructure to actually make sure that there's the ability for a human to jump into that little robot that's driving around. Um at a certain point you just need a lot of people set up with that all the software working make sure it's connected to the the cell phone towers effectively or Starlink or whatever it needs to stay connected. Uh but yeah, it's it's unclear when when that will really really take off because a lot of people have stairs, a lot of people have trees on their property. Like there's just a lot of there's a lot of places that will be somewhat inaccessible to those. And so, uh it just feels like it'll be sort of like a slow takeoff.

Cities and buildings cities and buildings will be really hard like dense areas, but you see what Zipline's doing. It's pretty amazing. Like they can have like, you know, you've seen like the promo videos, they can drop that thing

in the suburbs. It makes sense. You have backyards, you have a grassy area, you can drop it

sense. And and to be clear, that's probably like 50% of people in America or something. But uh but there will be this like long tail I think for for a long time. Uh just like we see with all the other AI tasks where um AI can do a lot of stuff and then there's just like these little sticky things. Yeah. You just don't.

By the way, even with our automation, it does not do the entire meal. And part of that is intentional. We want that human touch and for it not to feel so automated. But we have what we call a finishing station. So the things that are, you know, the the machine at the infinite kitchen makes the makes the bowl

or whatever the meal is and salmon herbs and then we have them hand mixed

just so you like have that you know chef crafted hand touch at the end to hand it. interesting that the that there's there's one version of automation which is like a AI or robotics in the back of house and then humans in the front of house and then there's also the opposite like I don't know if you knew it but

yeah we looked at it very

very Dave Freeber's company uh was like there were people in the back in the short term making stuff but then they would put it through like a little like like box that would open up so like you wouldn't interact with a human you would come in and on an app you would order and they had the cubbies

and it would be cubbies But there was a human back there. So it was like the opposite of like having the robot in the

back. It never fully got there.

Yeah. But but it's just funny that like you do have the choice to put the the robot in the front of house. I mean this is the same thing I think with the uh the the Tesla diner over there. Like there's the the Optimus robots there kind of serving popcorn, but I think when you order the burger, a human's cooking it in the back. [laughter] And so it's like do you want the robots in the front of house or back of house? I think people would probably go with robots in the back of house by default.

Yes. And we've tried I mean we have 30 restaurants featuring the infinite kitchen today and we tried out a bunch of different layouts.

The technology has been perfected for two years now. What we have not perfected is the experience. We're getting close. Today we actually la opened a very cool uh store. It's our first drive-thru featuring an infinite kitchen. Nice.

So bringing the two together. So now we can have true like fast food speed in a in a drive with featuring the infinite kitchen. driving through to get 100 g of healthy [laughter] protein is just undefeated. This is this needed to exist when I was this like specifically when I was like living off of QSRs as a as a as a college student and I'm and I'm really glad it does now. Uh what what what is like what does the market misunderstand the most or what what does like Wall Street misunderstand about and kind of retail investors misunderstand about uh c like kind of this like category of restaurant today because the entire like the entire category has had a had a rough year. Meanwhile, you guys are making steady progress on all the things that have been important since day one, right? uh greater efficiency uh actually responding to like customer demands and staying you know continuing to become more and more relevant.

Yeah, I think uh there's a few things. One is uh the consumer that we're all dealing with is really challenged and there's a question on how much they are actually financially challenged which they are but versus more psychologically challenged.

Yeah. So, if you've seen all of the consu, you know, consumer sentiment indexes and you're seeing, especially for the core demo for a lot of the fast casual concepts is that like 20 to 35, it's hit the lowest consumer sentiment that we've in recorded history that we've seen. So, there's a real like pullback there. On top of it, unfortunately, everyone's gotten more expensive. We all have. You know, I s you know, we've take we've sweet greens gotten about 25 or 30% more expensive since 2019. Chipotle is 40% more expensive since 2019.

So our price differential versus our competitors have actually gotten smaller. If you look at us versus McDonald's, for example, you know, the average sweet green bowl is about 15. It's almost

people people were like, "Wait, a Happy Meal is like $20 now."

Yeah, that was that was in fairness to them. It was like one location, but yeah, [laughter] you you can get out of McDonald's, you know, you spend you can easily, you know, for a a value meal, you'll spend like 12 bucks. Sweet you get a sweet green bowl for about 15 or $16. So I think a lot of it is this like overall narrative where people aren't feeling great, you know, great financially and starting to pull back on things like lunch. I do skip going out for lunch and they'll just have whatever is

but what I think the market doesn't get is the TAM

is you know Chipotle today is 4,000 restaurants on their way to 7500.

Yeah.

We believe we can have you know probably as many Chipotles as they have sweet as many sweet greens as they have Chipotas. You know there will be cycles like we are in right now. It's been a challenging year but if you kind of fast fast forward and think about you know just growing units at 10 or 15% a year growing same store sales just extrapolate out another 18 years.

Yeah. Just keep it rolling. just my eyes just keep going.

I always love when um uh when people like people on X are like the world's ending like geopolit you know they're like uh and then and then meanwhile it's like Chipotle is like in 2040 we plan to introduce 2,000 new Chipotle [laughter] they're just like thinking about like I got to just open more more more doors. So it's a good good mindset to be in.

Thank you so much for coming by.

Hey it's great great to be with you guys. Fantastic. Congrats on everything. It's been fun watching you guys. going to be daily driving this. I I the the power max protein bar it's actually breaking news. It's available today through December 15th. And I think I'm going to challenge myself to have one of these every day until it goes out.

Why not two a day?

Maybe two a day. Maybe two a day. We got to get them in the studio today for sure. We need them. Uh I need to tell you about fall. Build and deploy AI video and image models trusted by millions to power generate media at scale. I also need to tell you about Linear. Meet the system for modern software development. Linear is a