WEBVTT 00:00:00.000 --> 00:00:01.639 Welcome back to the Deep Dive. I've been looking 00:00:01.639 --> 00:00:04.019 forward to this one because, frankly, looking 00:00:04.019 --> 00:00:06.019 at the stack of research you sent over, this 00:00:06.019 --> 00:00:08.560 one feels personal. We're tackling a topic today 00:00:08.560 --> 00:00:11.599 that is technically a business case study, a 00:00:11.599 --> 00:00:14.699 very grim one. But for a specific generation, 00:00:15.080 --> 00:00:17.359 this is a sensory memory. It's a smell. It's 00:00:17.359 --> 00:00:19.859 a specific taste. It really is. It is one of 00:00:19.859 --> 00:00:21.719 those rare business stories that you can actually 00:00:21.719 --> 00:00:23.579 smell the moment you start talking about it. 00:00:23.660 --> 00:00:28.179 Exactly. You walk in, say... 1996. You push open 00:00:28.179 --> 00:00:30.660 those heavy glass doors and you are immediately 00:00:30.660 --> 00:00:34.000 hit with that wall of savory roasted air. Oh, 00:00:34.020 --> 00:00:36.539 yeah. It's warm. It smells like herbs and poultry 00:00:36.539 --> 00:00:39.079 fat. You look behind the counter and you see 00:00:39.079 --> 00:00:41.939 rows and rows of golden chickens spinning on 00:00:41.939 --> 00:00:44.600 those spits. The rotisserie. The heartbeat of 00:00:44.600 --> 00:00:46.560 the operation. The rotisserie. And then you look 00:00:46.560 --> 00:00:49.210 at the sides. The mashed potatoes with that little 00:00:49.210 --> 00:00:51.829 indented pool of gravy in the middle. The mac 00:00:51.829 --> 00:00:54.310 and cheese that was always impossibly creamy 00:00:54.310 --> 00:00:56.390 -like, scientifically creamy. It had to be, yeah. 00:00:56.649 --> 00:00:59.390 The creamed spinach and, of course, the cornbread. 00:00:59.509 --> 00:01:01.549 Which was basically cake, let's be honest with 00:01:01.549 --> 00:01:03.909 ourselves here. It was absolutely cake and it 00:01:03.909 --> 00:01:06.269 was delicious. We are, of course, talking about 00:01:06.269 --> 00:01:08.870 Boston Market. Or, if your memory goes back just 00:01:08.870 --> 00:01:11.489 a little further, Boston Chicken. A brand that 00:01:11.489 --> 00:01:14.340 went from being the absolute... darling of Wall 00:01:14.340 --> 00:01:18.140 Street, the rocket ship of the 90s to a company 00:01:18.140 --> 00:01:22.500 that as of late 2024 has essentially ceased to 00:01:22.500 --> 00:01:25.040 exist in the physical world. It is a shocking 00:01:25.040 --> 00:01:27.959 decline. I mean, usually these big chains fade 00:01:27.959 --> 00:01:30.540 away slowly. They consolidate, they shrink, but 00:01:30.540 --> 00:01:32.219 they, you know, hang around. Right. There are 00:01:32.219 --> 00:01:35.450 still a few locations left here or there. Looking 00:01:35.450 --> 00:01:37.269 at the data here, this isn't just a story about 00:01:37.269 --> 00:01:39.430 a restaurant getting less popular. This is a 00:01:39.430 --> 00:01:42.549 story of a total species extinction. We're talking 00:01:42.549 --> 00:01:45.150 about a brand that had over 1 ,200 locations 00:01:45.150 --> 00:01:48.269 at its peak, and now. It's staggering. We're 00:01:48.269 --> 00:01:50.150 looking at fewer than 30 locations left in the 00:01:50.150 --> 00:01:52.469 entire United States. It is a statistical wipeout. 00:01:52.530 --> 00:01:54.790 And what makes this deep dive so interesting, 00:01:54.890 --> 00:01:57.549 and frankly a bit dark, is that the collapse 00:01:57.549 --> 00:02:00.129 happens in phases that are almost perfect lessons 00:02:00.129 --> 00:02:03.469 in what not to do in business. You have the Icarus 00:02:03.469 --> 00:02:06.049 phase in the 90s. flying too close to the sun 00:02:06.049 --> 00:02:08.409 with debt, and then you have the zombie phase, 00:02:08.689 --> 00:02:12.949 which ends in what I can only describe as total 00:02:12.949 --> 00:02:15.669 corporate anarchy. Anarchy is a strong word, 00:02:15.789 --> 00:02:18.330 but looking at these court documents, the Gossamer 00:02:18.330 --> 00:02:22.069 defense, the stop work orders, it fits. It really 00:02:22.069 --> 00:02:25.169 does. It does. So our mission today is to trace 00:02:25.169 --> 00:02:27.819 this arc. We need to understand the financial 00:02:27.819 --> 00:02:30.400 engineering that built the empire, the identity 00:02:30.400 --> 00:02:33.740 crisis that confused it, and the mismanagement. 00:02:40.919 --> 00:02:43.759 Newton, Massachusetts. Newton is a suburb just 00:02:43.759 --> 00:02:46.439 outside of Boston, a fairly affluent area. And 00:02:46.439 --> 00:02:48.719 to understand why Boston chicken, as it was called 00:02:48.719 --> 00:02:51.020 then, was such a big deal, you have to look at 00:02:51.020 --> 00:02:53.979 the landscape of American dining in 1985. Okay. 00:02:54.060 --> 00:02:56.259 It's hard to imagine now because we are just 00:02:56.259 --> 00:02:58.960 drowning in options. But back then, the dichotomy 00:02:58.960 --> 00:03:01.740 was very strict. Right. You had fast food, burgers, 00:03:02.159 --> 00:03:06.439 fries, grease, paper wrappers. Speed was the 00:03:06.439 --> 00:03:09.439 priority. Health was not even a consideration. 00:03:09.479 --> 00:03:12.509 Yeah. Exactly. And on the other side, you had 00:03:12.509 --> 00:03:15.349 sit -down restaurants, tablecloths, tipping, 00:03:15.590 --> 00:03:18.270 a 90 -minute commitment. A whole evening. Right. 00:03:18.389 --> 00:03:20.810 There was a massive gap in the middle. The term 00:03:20.810 --> 00:03:23.610 fast casual simply didn't exist. Panera didn't 00:03:23.610 --> 00:03:26.530 exist. Chipotle didn't exist. So Stephen Colo 00:03:26.530 --> 00:03:29.409 and Arthur Kors, the founders, they weren't just 00:03:29.409 --> 00:03:31.250 opening a chicken shack. They were stumbling 00:03:31.250 --> 00:03:34.110 onto a new category entirely. They identified 00:03:34.110 --> 00:03:36.250 what the industry now calls home meal replacement, 00:03:36.490 --> 00:03:40.009 or HMR. The sociological timing was perfect. 00:03:40.349 --> 00:03:42.370 You have to look at the demographics of the mid 00:03:42.370 --> 00:03:44.990 80s. Right. You had a massive increase in dual 00:03:44.990 --> 00:03:47.930 income households. Moms were entering the workforce 00:03:47.930 --> 00:03:50.389 in record numbers. So both parents are working. 00:03:50.530 --> 00:03:53.150 They come home at 6 p .m. They are exhausted. 00:03:53.449 --> 00:03:55.509 The kids are hungry. Precisely. They don't want 00:03:55.509 --> 00:03:57.569 to. I mean, who has the energy for a roast chicken 00:03:57.569 --> 00:04:00.629 on a Tuesday? But they also feel a tremendous 00:04:00.629 --> 00:04:02.849 amount of guilt about feeding their kids a bucket 00:04:02.849 --> 00:04:05.110 of deep fried chicken or a burger. Of course. 00:04:05.550 --> 00:04:07.189 They want something that looks and feels like 00:04:07.189 --> 00:04:09.310 a Sunday dinner, but with the speed of a drive 00:04:09.310 --> 00:04:11.810 -thru. So Boston chicken offers the absolution 00:04:11.810 --> 00:04:15.870 of guilt. It's rotisserie. It's healthy, or at 00:04:15.870 --> 00:04:17.850 least because it's not fried, we tell ourselves 00:04:17.850 --> 00:04:19.629 it's healthy. Right, it feels healthier. It's 00:04:19.629 --> 00:04:22.089 plated like a real meal with vegetables and cornbread. 00:04:22.430 --> 00:04:24.449 It was the perfect product for that specific 00:04:24.449 --> 00:04:27.649 moment in American culture. And the concept worked. 00:04:27.790 --> 00:04:30.029 It worked so well that when they decided to scale, 00:04:30.250 --> 00:04:33.470 they didn't just grow, they exploded. And this 00:04:33.470 --> 00:04:36.170 brings us to the first major technical insight 00:04:36.170 --> 00:04:38.949 of this case study, the financing of the expansion. 00:04:39.310 --> 00:04:40.910 I was reading through the financials and the 00:04:40.910 --> 00:04:45.089 notes, and it looks complicated. It feels like 00:04:45.089 --> 00:04:47.069 a house of cards. They weren't just selling chicken 00:04:47.069 --> 00:04:49.889 to make money. They were selling the idea of 00:04:49.889 --> 00:04:51.829 selling chicken. That's a great way to put it. 00:04:52.110 --> 00:04:54.389 In the early 90s, the company came under the 00:04:54.389 --> 00:04:56.930 leadership of George Nedaf, who, by the way, 00:04:56.949 --> 00:04:59.189 is a legend in this space. Okay. He's the guy 00:04:59.189 --> 00:05:01.350 who actually discovered the original Kentucky 00:05:01.350 --> 00:05:04.290 Fried Chicken concept and helped expand it. He 00:05:04.290 --> 00:05:06.529 saw Boston Chicken and thought, I can do it again. 00:05:06.769 --> 00:05:09.629 Okay, so they have the pedigree. But how do you 00:05:09.629 --> 00:05:12.949 fund opening a thousand stores in just a few 00:05:12.949 --> 00:05:15.829 years? That requires an enormous amount of capital. 00:05:16.029 --> 00:05:18.350 Well, they used a very aggressive franchising 00:05:18.350 --> 00:05:22.360 model. But it wasn't standard franchising. What 00:05:22.360 --> 00:05:24.199 do you mean? In a normal franchise agreement, 00:05:24.639 --> 00:05:27.939 you, the franchisee, go to a bank, take out a 00:05:27.939 --> 00:05:30.199 loan, build the store, and pay the parent company 00:05:30.199 --> 00:05:32.759 a royalty. Right. The parent company takes very 00:05:32.759 --> 00:05:34.360 little risk. They're just collecting a check. 00:05:34.540 --> 00:05:38.129 Exactly. But Boston Chicken wanted speed. They 00:05:38.129 --> 00:05:40.209 wanted to capture the market before anyone else 00:05:40.209 --> 00:05:42.889 could copy the rotisserie concept. So they set 00:05:42.889 --> 00:05:44.810 up a system where they would lend money to the 00:05:44.810 --> 00:05:47.189 franchisees to open the store. They would lend 00:05:47.189 --> 00:05:49.870 the money. They created a separate entity to 00:05:49.870 --> 00:05:51.769 finance these franchise partners. Wait, hold 00:05:51.769 --> 00:05:56.170 on. So Boston Chicken records revenue from development 00:05:56.170 --> 00:05:59.310 fees and royalties from the franchisees. But 00:05:59.310 --> 00:06:02.129 those fees are being paid for by loans that Boston 00:06:02.129 --> 00:06:04.649 Chicken effectively guaranteed or facilitated? 00:06:04.870 --> 00:06:07.870 That sounds like a circular revenue stream. They 00:06:07.870 --> 00:06:09.730 are lending money to people to pay themselves 00:06:09.730 --> 00:06:13.970 fees, which they then book as revenue, to show 00:06:13.970 --> 00:06:17.009 Wall Street growth, to raise more money, to lend 00:06:17.009 --> 00:06:19.410 to more franchisees. You've got it. It's a loop. 00:06:20.040 --> 00:06:22.600 And on a quarterly report, it looks fantastic 00:06:22.600 --> 00:06:25.379 because the revenue line is skyrocketing. Wow. 00:06:25.699 --> 00:06:29.279 They opened 500 stores in barely two years. The 00:06:29.279 --> 00:06:31.240 stock price was soaring. People called it the 00:06:31.240 --> 00:06:33.779 rocket ship. Right. But the fundamental cash 00:06:33.779 --> 00:06:36.920 flow, the actual profit from selling drumsticks 00:06:36.920 --> 00:06:39.600 and cream spinach, wasn't necessarily supporting 00:06:39.600 --> 00:06:41.819 that level of debt service. This reminds me a 00:06:41.819 --> 00:06:44.199 bit of the dot -com bubble or even the subprime 00:06:44.199 --> 00:06:46.899 mortgage crisis on a micro scale. If the underlying 00:06:46.899 --> 00:06:50.339 asset... The chicken sales slows down even a 00:06:50.339 --> 00:06:52.579 little bit. The whole debt structure collapses 00:06:52.579 --> 00:06:54.720 because the new loans stop coming in. And that's 00:06:54.720 --> 00:06:56.399 exactly what happened. But before the crash, 00:06:56.560 --> 00:06:58.199 they tried to innovate their way out of the corner 00:06:58.199 --> 00:07:00.519 they painted themselves into. Okay. They realized 00:07:00.519 --> 00:07:02.220 that while they had built a massive footprint, 00:07:02.459 --> 00:07:04.660 they had a problem with the product itself. The 00:07:04.660 --> 00:07:07.560 chicken problem. Yes. This is where we get the 00:07:07.560 --> 00:07:11.980 1995 pivot. The name change. From Boston Chicken 00:07:11.980 --> 00:07:15.670 to Boston Market. It seems subtle. But looking 00:07:15.670 --> 00:07:17.870 back, it feels like a desperate move to widen 00:07:17.870 --> 00:07:19.750 the net. Well, they hit what we call a usage 00:07:19.750 --> 00:07:22.589 barrier. A usage barrier. Yeah. If a family of 00:07:22.589 --> 00:07:24.790 four is deciding on dinner and three want chicken 00:07:24.790 --> 00:07:27.670 but one hates chicken, the Boston chicken name 00:07:27.670 --> 00:07:32.350 is a veto. You don't go. Ah, the veto vote. Veto 00:07:32.350 --> 00:07:35.170 vote. You go somewhere with a broader menu. So 00:07:35.170 --> 00:07:36.649 they had to become a market. They need to offer 00:07:36.649 --> 00:07:40.290 everything. Exactly. So February 1995, they decide 00:07:40.290 --> 00:07:43.050 to expand the menu significantly. They add turkey, 00:07:43.290 --> 00:07:47.259 meatloaf. And ham. The meatloaf. I forgot about 00:07:47.259 --> 00:07:48.600 the meatloaf. It was actually pretty good in 00:07:48.600 --> 00:07:50.759 a, you know, cafeteria kind of way. It was iconic 00:07:50.759 --> 00:07:52.319 for a while. But think about the operational 00:07:52.319 --> 00:07:55.180 complexity they just added. Yeah. Cooking a rotisserie 00:07:55.180 --> 00:07:57.920 chicken is one process. It spins, it cooks, you 00:07:57.920 --> 00:08:00.379 take it off. Now you are managing supply chains 00:08:00.379 --> 00:08:03.519 for turkey, ham, and meatloaf. You are managing 00:08:03.519 --> 00:08:05.740 prep for all these different proteins, plus the 00:08:05.740 --> 00:08:08.180 sides, all in a kitchen originally designed just 00:08:08.180 --> 00:08:10.839 for chicken. Sounds like a nightmare. And the 00:08:10.839 --> 00:08:13.800 branding followed the menu. In fall of 1995, 00:08:14.120 --> 00:08:17.639 they officially changed the signs to Boston Market. 00:08:17.819 --> 00:08:20.930 Right. The logic was. We are a market now. We 00:08:20.930 --> 00:08:23.970 have options. But here is a fun little detail 00:08:23.970 --> 00:08:26.370 from the corporate filings. Okay. Even though 00:08:26.370 --> 00:08:28.149 they changed the signs on the door to Boston 00:08:28.149 --> 00:08:31.209 Market in 95, the corporate entity was still 00:08:31.209 --> 00:08:35.230 called Boston Chicken Inc. until 1997. So the 00:08:35.230 --> 00:08:36.730 paperwork couldn't keep up with the marketing 00:08:36.730 --> 00:08:39.450 department. Not at all. And this era, the mid 00:08:39.450 --> 00:08:42.169 -90s, was really the peak of their throw -everything 00:08:42.169 --> 00:08:43.950 -at -the -wall strategy. They weren't just adding 00:08:43.950 --> 00:08:45.450 meats. They were trying to capture the lunch 00:08:45.450 --> 00:08:48.210 crowd, too. Because a half chicken with two sides 00:08:48.210 --> 00:08:50.519 is a heavy... lunch. It is. You need a nap after 00:08:50.519 --> 00:08:53.440 that. It's not a power lunch, no. So in 1996, 00:08:53.720 --> 00:08:57.700 they launched the Boston Carver sandwiches. Chicken, 00:08:57.919 --> 00:09:01.759 turkey, ham, meatloaf, all in sandwich form. 00:09:01.879 --> 00:09:03.519 I remember the ads for these. They were pushing 00:09:03.519 --> 00:09:05.200 them hard. And then because it was the 90s and 00:09:05.200 --> 00:09:07.519 everything had to be bigger and bolder. In 1997, 00:09:07.820 --> 00:09:10.919 the Extreme Carver sandwiches. Extreme. Nothing 00:09:10.919 --> 00:09:13.759 dates a product to the late 90s faster than the 00:09:13.759 --> 00:09:15.919 word extreme. Did it come with a Mountain Dew? 00:09:16.039 --> 00:09:19.100 It might as well have. It was... Larger portions 00:09:19.100 --> 00:09:20.980 of meat and cheese. Yeah. They were trying to 00:09:20.980 --> 00:09:22.840 compete with the sub shops and the delis. They 00:09:22.840 --> 00:09:25.100 wanted to be your dinner spot, your lunch spot. 00:09:25.240 --> 00:09:27.600 Yeah. And did you catch the bagel part in the 00:09:27.600 --> 00:09:30.799 notes? I did. This actually blew my mind. I had 00:09:30.799 --> 00:09:33.679 no idea. Boston Chicken was responsible for Einstein 00:09:33.679 --> 00:09:37.039 Bros. Bagels. Yeah. That feels like a glitch 00:09:37.039 --> 00:09:39.320 in the simulation. It's a forgotten chapter. 00:09:39.659 --> 00:09:43.519 In 1995, they acquired three smaller bagel chains. 00:09:44.420 --> 00:09:46.740 Noah's Bagel and Bagel and Brackman Brothers, 00:09:47.000 --> 00:09:49.659 and rolled them up into Einstein Bros. So they 00:09:49.659 --> 00:09:52.360 created the Einstein Bros brand. Essentially, 00:09:52.460 --> 00:09:55.379 yes. The strategy was share of stomach. They 00:09:55.379 --> 00:09:57.379 wanted you for breakfast with bagels, lunch with 00:09:57.379 --> 00:09:59.600 sandwiches, and dinner with chicken. It sounds 00:09:59.600 --> 00:10:02.120 ambitious, but looking at it now, it looks incredibly 00:10:02.120 --> 00:10:04.539 unfocused. That's a good way to put it. You are 00:10:04.539 --> 00:10:07.120 running a massive debt load. Your core business 00:10:07.120 --> 00:10:10.620 is facing saturation. And instead of perfecting 00:10:10.620 --> 00:10:13.120 the chicken operations, you were trying to learn 00:10:13.120 --> 00:10:17.080 the bagel business. From scratch. It was classic 00:10:17.080 --> 00:10:19.399 corporate hubris. They thought they had the magic 00:10:19.399 --> 00:10:23.039 touch. But gravity always wins. And math always 00:10:23.039 --> 00:10:26.269 wins. Right. By 1998, the debt bubble burst. 00:10:26.610 --> 00:10:29.210 The interest payments on all those loans exceeded 00:10:29.210 --> 00:10:32.269 the cash flow from operations. The circular financing 00:10:32.269 --> 00:10:34.210 stopped working because they couldn't open new 00:10:34.210 --> 00:10:36.610 stores fast enough to pay for the old ones. And 00:10:36.610 --> 00:10:39.169 that led to the first big crash. Chapter 11 bankruptcy 00:10:39.169 --> 00:10:43.289 filed in 1998. They closed many stores. The stock, 00:10:43.429 --> 00:10:46.129 which had been a darling of Wall Street, collapsed. 00:10:46.529 --> 00:10:49.429 It was a humiliating fall. OK, so let's pause 00:10:49.429 --> 00:10:52.259 on Chapter 11. For the listener, this doesn't 00:10:52.259 --> 00:10:54.019 mean the company dies immediately, right? It's 00:10:54.019 --> 00:10:57.299 not a funeral yet. Right. Chapter 11 is reorganization. 00:10:57.419 --> 00:10:59.980 It shields you from creditors while you try to 00:10:59.980 --> 00:11:02.220 restructure your debts. It's different from Chapter 00:11:02.220 --> 00:11:04.840 7, which is liquidation, selling everything and 00:11:04.840 --> 00:11:07.279 turning off the lights. Boston Market thought 00:11:07.279 --> 00:11:09.659 they could restructure, but they ended up getting 00:11:09.659 --> 00:11:11.879 bought. And the buyer is the most confusing part 00:11:11.879 --> 00:11:16.879 of this entire timeline for me. May 2000, McDonald's. 00:11:16.960 --> 00:11:19.840 The Golden Arches. Why? I mean, McDonald's is 00:11:19.840 --> 00:11:21.799 burgers and fries. It's assembly line speed. 00:11:22.340 --> 00:11:25.220 Boston Market is slow roasted home style food. 00:11:26.399 --> 00:11:29.440 Operationally, they are opposites. Was McDonald's 00:11:29.440 --> 00:11:31.759 trying to get into the rotisserie game? Not really. 00:11:31.860 --> 00:11:34.620 No. If you look at the acquisition analysis from 00:11:34.620 --> 00:11:37.799 that time, it wasn't about the food. What was 00:11:37.799 --> 00:11:41.120 it about? It was a real estate play. Ah. Location, 00:11:41.120 --> 00:11:43.500 location, location. Think back to that aggressive 00:11:43.500 --> 00:11:46.059 expansion in the early 90s. All those loans. 00:11:46.500 --> 00:11:49.340 Exactly. Because they had so much cash from the 00:11:49.340 --> 00:11:52.860 loans, Boston Market paid... top dollar for premium 00:11:52.860 --> 00:11:56.039 corner locations in high traffic suburbs. They 00:11:56.039 --> 00:11:58.500 owned the leases on some of the best dirt in 00:11:58.500 --> 00:12:00.500 America. So McDonald's looked at the map and 00:12:00.500 --> 00:12:04.240 saw 1 ,000 prime locations. Exactly. They figured 00:12:04.240 --> 00:12:07.039 we can buy the whole company, take the best locations 00:12:07.039 --> 00:12:08.840 and convert them into McDonald's restaurants 00:12:08.840 --> 00:12:10.740 and figure out what to do with the rest later. 00:12:10.840 --> 00:12:13.039 It was a land bank acquisition. But they didn't 00:12:13.039 --> 00:12:14.940 convert them all immediately. They kept the brand 00:12:14.940 --> 00:12:17.289 running. No. And this is where it gets interesting. 00:12:17.950 --> 00:12:20.870 McDonald's is a very disciplined operator. They 00:12:20.870 --> 00:12:23.370 are the masters of efficiency. They actually 00:12:23.370 --> 00:12:25.669 stabilized the Boston Market brand for a while. 00:12:25.769 --> 00:12:28.289 They cleaned up the operations. They streamlined 00:12:28.289 --> 00:12:30.529 the kitchens. They kept it running. They even 00:12:30.529 --> 00:12:32.269 tried to take it international. I saw on the 00:12:32.269 --> 00:12:34.629 notes they went to Australia. They did. Nine 00:12:34.629 --> 00:12:38.490 stores in Sydney between 2002 and 2004. I'm trying 00:12:38.490 --> 00:12:41.289 to picture a Boston Market in Sydney. Did they 00:12:41.289 --> 00:12:44.559 serve the cornbread? Did they? Have the meatloaf. 00:12:44.620 --> 00:12:46.440 They tried to replicate the menu, but it failed. 00:12:46.799 --> 00:12:48.740 Competitive pressures was the official reason. 00:12:49.039 --> 00:12:52.519 But the rumor is that the Australian palate just 00:12:52.519 --> 00:12:54.919 didn't resonate with the very American style 00:12:54.919 --> 00:12:57.720 of comfort sides. Too heavy. It was too heavy, 00:12:57.779 --> 00:13:00.200 perhaps. Yeah. And true to form, when they closed 00:13:00.200 --> 00:13:02.940 the Sydney -Boston markets, what did they become? 00:13:03.740 --> 00:13:06.399 McDonald's. The real estate strategy in action. 00:13:06.519 --> 00:13:08.559 Of course. So McDonald's holds them for seven 00:13:08.559 --> 00:13:11.000 years. They stabilize it, but they don't really 00:13:11.000 --> 00:13:14.190 grow it. Eventually, McDonald's decides we don't 00:13:14.190 --> 00:13:16.570 want to run a rotisserie chain anymore. So in 00:13:16.570 --> 00:13:19.610 2007, they sell to Sun Capital Partners. Enter 00:13:19.610 --> 00:13:22.149 the private equity era. Now, generally, when 00:13:22.149 --> 00:13:24.289 I hear private equity buys a restaurant chain, 00:13:24.590 --> 00:13:27.809 I assume two things are about to happen. Cost 00:13:27.809 --> 00:13:30.809 cutting and asset stripping. That's the playbook. 00:13:31.029 --> 00:13:33.889 What was the Sun Capital era like? It was surprisingly 00:13:33.889 --> 00:13:37.799 long. They held it from 2007 to 2020. That's 00:13:37.799 --> 00:13:40.519 an eternity in PE years. It really is. Usually 00:13:40.519 --> 00:13:44.139 it's a three to five year flip. Buy it, cut costs, 00:13:44.299 --> 00:13:46.940 make the numbers look good, sell it. Sun Capital 00:13:46.940 --> 00:13:49.159 tried to make it work, but they suffered from 00:13:49.159 --> 00:13:51.639 a massive identity crisis. They spent a decade 00:13:51.639 --> 00:13:53.700 trying to find a reason for people to come back. 00:13:53.940 --> 00:13:56.460 I remember seeing ads for ribs during this time. 00:13:56.639 --> 00:13:59.440 Yes. In 2013, they opened their first new location 00:13:59.440 --> 00:14:02.220 in seven years, trying to restart growth. By 00:14:02.220 --> 00:14:06.710 2015, they added ribs. In 2018, they tried rotisserie 00:14:06.710 --> 00:14:09.269 prime rib. Prime rib. At a drive -thru speed 00:14:09.269 --> 00:14:13.269 place, that feels ambitious and risky. It was 00:14:13.269 --> 00:14:15.129 desperate. They were throwing things at the wall 00:14:15.129 --> 00:14:17.129 to see what stuck. They even did baby back ribs 00:14:17.129 --> 00:14:20.269 with sweet baby ray sauce in 2020. Wow. But while 00:14:20.269 --> 00:14:22.190 they were tinkering with the menu inside the 00:14:22.190 --> 00:14:23.870 restaurant, something else was happening that 00:14:23.870 --> 00:14:25.610 would eventually hurt the restaurant significantly. 00:14:26.149 --> 00:14:28.690 The grocery store pivot. This is a crucial distinction 00:14:28.690 --> 00:14:31.470 for the listener. If you see a Boston Market 00:14:31.470 --> 00:14:34.389 frozen lasagna or chicken pot pie in the supermarket 00:14:34.389 --> 00:14:37.350 today, that has nothing to do with the failing 00:14:37.350 --> 00:14:39.909 restaurants. Wait, really? Because the logo is 00:14:39.909 --> 00:14:42.470 exactly the same? The font is the same? The branding 00:14:42.470 --> 00:14:45.549 is identical, but the rights to the frozen food 00:14:45.549 --> 00:14:48.230 brand were sold off. They are now owned by a 00:14:48.230 --> 00:14:51.570 company called Belizio Foods. They are a massive 00:14:51.570 --> 00:14:54.610 conglomerate that makes frozen foods for lots 00:14:54.610 --> 00:14:57.769 of brands. So the brand Boston Market has bifurcated. 00:14:58.039 --> 00:14:59.740 You have the zombie restaurant chain and you 00:14:59.740 --> 00:15:01.980 have the thriving frozen food brand. Exactly. 00:15:02.059 --> 00:15:04.700 And in a cruel twist of irony, the success of 00:15:04.700 --> 00:15:06.820 the frozen food actually helped kill the restaurant. 00:15:06.980 --> 00:15:08.960 It tells a substitution. Yeah. If you want the 00:15:08.960 --> 00:15:11.220 taste, you can just get it at home. Think about 00:15:11.220 --> 00:15:13.700 it. If you have a craving for the taste of Boston 00:15:13.700 --> 00:15:16.580 Market, that specific spice blend, that gravy. 00:15:17.179 --> 00:15:19.720 You can get it for $3 .50 in the freezer aisle 00:15:19.720 --> 00:15:22.419 at Kroger. Right. Or you can drive to the restaurant, 00:15:22.639 --> 00:15:26.240 park, wait in line, and pay $12. Plus, the grocery 00:15:26.240 --> 00:15:29.000 stores themselves changed. Costco, Whole Foods, 00:15:29.220 --> 00:15:31.600 Kroger, they all started installing their own 00:15:31.600 --> 00:15:35.240 massive rotisserie ovens. The famous $4 .99 set 00:15:35.240 --> 00:15:39.059 Costco chicken. Ah, the death knell. That is 00:15:39.059 --> 00:15:42.159 a loss leader. Costco loses money on every chicken 00:15:42.159 --> 00:15:45.559 just to get you in the door to buy a TV. Boston 00:15:45.559 --> 00:15:47.899 Market, whose entire business model was selling 00:15:47.899 --> 00:15:50.580 chicken for a profit, couldn't compete with someone 00:15:50.580 --> 00:15:52.720 selling it for a loss. So they were getting squeezed 00:15:52.720 --> 00:15:55.139 from the freezer aisle by their own brand name 00:15:55.139 --> 00:15:59.279 and from the deli counter by cheaper, more convenient 00:15:59.279 --> 00:16:03.080 options. By 2019, Sun Capital closed 45 locations. 00:16:03.899 --> 00:16:06.340 And in their press release, they explicitly blamed 00:16:06.340 --> 00:16:09.159 grocery store competition. They admitted the 00:16:09.159 --> 00:16:12.080 supermarket had beaten them. Before we move to 00:16:12.080 --> 00:16:13.820 the final collapse, I want to take a detour into 00:16:13.820 --> 00:16:17.200 the legal weeds. The outline mentions a trademark 00:16:17.200 --> 00:16:20.000 war With Boston Pizza. Yes. This feels like a 00:16:20.000 --> 00:16:22.000 subplot from a sitcom, but it apparently had 00:16:22.000 --> 00:16:24.519 real consequences. It's a fascinating case study 00:16:24.519 --> 00:16:27.240 in international IP law. So you have Boston Market 00:16:27.240 --> 00:16:30.139 in the U .S., and in Canada, there is a massive 00:16:30.139 --> 00:16:32.480 casual dining chain called Boston Pizza. Which 00:16:32.480 --> 00:16:34.539 I assume has nothing to do with the city of Boston. 00:16:34.799 --> 00:16:37.600 Very little. It was founded in Edmonton by a 00:16:37.600 --> 00:16:41.120 Greek immigrant. But in 2002, when Boston Market 00:16:41.120 --> 00:16:44.399 tried to expand into Canada, Boston Pizza sued 00:16:44.399 --> 00:16:47.440 them. Because they used the word Boston. Essentially. 00:16:47.559 --> 00:16:50.320 They claimed their trademark on Boston pizza 00:16:50.320 --> 00:16:52.860 gave them rights to the word Boston in the context 00:16:52.860 --> 00:16:56.039 of restaurants in Canada. That seems wild. It's 00:16:56.039 --> 00:16:58.580 a major American city. Can you trademark a city? 00:16:58.779 --> 00:17:00.639 Well, no, not usually. Can I open a restaurant 00:17:00.639 --> 00:17:02.899 called New York Tacos and sue anyone else who 00:17:02.899 --> 00:17:05.700 uses New York? Generally, no. And that was Boston 00:17:05.700 --> 00:17:08.339 Market's defense. They argued the term was descriptive, 00:17:08.660 --> 00:17:11.740 not distinctive. They said, look, Boston pizza 00:17:11.740 --> 00:17:14.559 just describes the style of pizza. It's not a 00:17:14.559 --> 00:17:17.240 unique brand identifier. But is Boston style 00:17:17.240 --> 00:17:19.539 pizza a thing? I'm from the East Coast and I've 00:17:19.539 --> 00:17:22.039 never heard of it. I know New York style, Chicago 00:17:22.039 --> 00:17:24.940 style, Detroit style. Legally, it didn't matter. 00:17:25.140 --> 00:17:27.660 Boston Pizza had the market dominance in Canada. 00:17:27.700 --> 00:17:31.039 They fought for years. And in 2008, they settled. 00:17:31.200 --> 00:17:34.019 And the terms were humiliating for Boston Market. 00:17:34.200 --> 00:17:36.240 What were the terms? Boston Market agreed not 00:17:36.240 --> 00:17:38.880 to use the words Boston or Boston Market for 00:17:38.880 --> 00:17:41.200 any restaurants in Canada for five years. So 00:17:41.200 --> 00:17:42.720 if they wanted to open a store, they'd have to 00:17:42.720 --> 00:17:46.259 call it... Newton Market. Or just the Marchet. 00:17:46.279 --> 00:17:48.539 Or Chicken Market. It effectively killed their 00:17:48.539 --> 00:17:51.099 ability to expand north of the border. Wow. It's 00:17:51.099 --> 00:17:53.500 a reminder that a brand is only as strong as 00:17:53.500 --> 00:17:55.660 its legal protection in the specific jurisdiction 00:17:55.660 --> 00:17:58.960 you are operating in. You might be a giant in 00:17:58.960 --> 00:18:01.539 the U .S., but in Canada, you might be infringing 00:18:01.539 --> 00:18:04.579 on a pizza place from Edmonton. That is wild. 00:18:05.079 --> 00:18:08.000 Okay, let's fast forward. We move past the trademark 00:18:08.000 --> 00:18:11.779 wars. We are in 2020. The world is changing. 00:18:12.240 --> 00:18:15.519 The pandemic hits and Boston Market changes hands 00:18:15.519 --> 00:18:17.720 again. This is the turning point. This is where 00:18:17.720 --> 00:18:21.059 the story shifts from struggling brand to disaster. 00:18:21.480 --> 00:18:24.480 April 2020, Sun Capital finally offloads the 00:18:24.480 --> 00:18:27.740 brand. They sell it to Engage Brands, LLC. Which 00:18:27.740 --> 00:18:29.799 is part of the Rohan Group, owned by a businessman 00:18:29.799 --> 00:18:32.839 named Jignish J. Pandya. Now, usually when a 00:18:32.839 --> 00:18:34.839 new owner comes in, there is a honeymoon period, 00:18:35.039 --> 00:18:37.859 maybe some investment, a new coat of paint. What 00:18:37.859 --> 00:18:40.930 happened here? The exact opposite. Buying a buffet 00:18:40.930 --> 00:18:42.890 -style restaurant chain at the start of a respiratory 00:18:42.890 --> 00:18:45.529 pandemic seems like a contrarian bet, sure. A 00:18:45.529 --> 00:18:47.890 bit, yeah. But the issue wasn't the pandemic. 00:18:48.049 --> 00:18:51.049 The issue was the operating strategy. Almost 00:18:51.049 --> 00:18:53.130 immediately, the reports started coming in that 00:18:53.130 --> 00:18:55.329 Boston Market simply stopped paying its bills. 00:18:55.609 --> 00:18:57.049 And when you say stopped paying, do you mean 00:18:57.049 --> 00:19:00.079 they were late? Net 90 instead of net 30? No. 00:19:00.160 --> 00:19:02.000 I mean, they just stopped paying almost everyone. 00:19:02.180 --> 00:19:04.720 Total nonpayment. Who is everyone? Suppliers, 00:19:04.880 --> 00:19:07.779 landlords, employees. It was a complete financial 00:19:07.779 --> 00:19:10.599 tailspin. Let's start with the suppliers. You 00:19:10.599 --> 00:19:12.319 can't run a chicken restaurant without chicken. 00:19:12.599 --> 00:19:15.460 Correct. And U .S. Foods, one of the biggest 00:19:15.460 --> 00:19:17.440 food distributors in the country, sued them. 00:19:17.539 --> 00:19:20.900 This was the big lawsuit. July 2023. U .S. Foods 00:19:20.900 --> 00:19:23.240 filed a suit claiming Boston Market owed them 00:19:23.240 --> 00:19:27.619 $11 .3 million in unpaid food bills. $11 million. 00:19:27.920 --> 00:19:30.660 That is a mountain of mashed potatoes. How do 00:19:30.660 --> 00:19:33.160 you rack up an $11 million tab without someone 00:19:33.160 --> 00:19:35.539 cutting you off sooner? That is a valid question. 00:19:35.740 --> 00:19:38.079 But what's incredible is the legal defense or 00:19:38.079 --> 00:19:40.980 the lack thereof. Okay. When this went to court, 00:19:41.059 --> 00:19:44.460 the judge, Judge Manish Shah, had a very specific 00:19:44.460 --> 00:19:46.859 word for Boston Market's defense. I have it right 00:19:46.859 --> 00:19:50.940 here. He called their defenses gossamer. It's 00:19:50.940 --> 00:19:53.019 a beautiful word. It is. It refers to something 00:19:53.019 --> 00:19:56.799 very light, thin, and insubstantial, like a spider 00:19:56.799 --> 00:20:00.000 web or a fine fabric. But not a word you want 00:20:00.000 --> 00:20:02.460 to hear from a federal judge regarding your legal 00:20:02.460 --> 00:20:05.539 argument. No. He was basically saying their defense 00:20:05.539 --> 00:20:08.220 was made of thin air. They didn't dispute that 00:20:08.220 --> 00:20:09.960 they received the food. They didn't dispute the 00:20:09.960 --> 00:20:12.480 price. They just hadn't paid. So they lost that 00:20:12.480 --> 00:20:16.339 lawsuit in February 2024. U .S. Foods won the 00:20:16.339 --> 00:20:19.910 $11 .3 million judgment. Yes. But by then, the 00:20:19.910 --> 00:20:21.930 damage was done. And it wasn't just the food. 00:20:21.950 --> 00:20:23.630 It was the roofs over their heads. The landlords. 00:20:23.910 --> 00:20:26.430 We saw evictions popping up all over the country. 00:20:26.789 --> 00:20:29.809 In Danbury, Connecticut, the landlords sued for 00:20:29.809 --> 00:20:34.109 over $61 ,000 in unpaid rent. Evicted. In Detroit. 00:20:34.309 --> 00:20:37.150 In November 2023, all Detroit area locations 00:20:37.150 --> 00:20:40.140 were permanently shuttered. Evicted. In Connecticut 00:20:40.140 --> 00:20:42.559 again. The whole state. All eight remaining locations 00:20:42.559 --> 00:20:44.980 in the entire state of Connecticut closed and 00:20:44.980 --> 00:20:47.799 evicted in November 2023. It's like a domino 00:20:47.799 --> 00:20:50.039 effect. But the part that really gets me, the 00:20:50.039 --> 00:20:51.500 part that makes this more than just a business 00:20:51.500 --> 00:20:54.079 story, is the labor crisis. This is where it 00:20:54.079 --> 00:20:57.380 gets tragic. It's one thing to stiff a giant 00:20:57.380 --> 00:20:59.839 corporation like U .S. Foods. They have insurance. 00:21:00.000 --> 00:21:02.160 They have lawyers. Right. It's another thing 00:21:02.160 --> 00:21:04.299 to stiff the person serving the mac and cheese 00:21:04.299 --> 00:21:06.680 who is making minimum wage. In New Jersey, the 00:21:06.680 --> 00:21:08.799 Department of Labor actually stepped in. August 00:21:08.799 --> 00:21:12.359 2023, the NJ Department of Labor issued stop 00:21:12.359 --> 00:21:15.640 work orders at 27 of the 31 Boston Market locations 00:21:15.640 --> 00:21:17.819 in the state. Wait, explain the stop work order 00:21:17.819 --> 00:21:19.799 to me. That sounds intense. That sounds like 00:21:19.799 --> 00:21:21.380 something you do to a construction site that's 00:21:21.380 --> 00:21:23.859 about to collapse. It is the nuclear option for 00:21:23.859 --> 00:21:26.259 a regulator. Usually, if a business violates 00:21:26.259 --> 00:21:28.400 labor laws, they get fined. They get a warning. 00:21:28.660 --> 00:21:31.819 But a stop work order means the state sends agents 00:21:31.819 --> 00:21:34.480 or police to physically shut the business down. 00:21:34.559 --> 00:21:36.839 They lock the doors. You cannot operate. And 00:21:36.839 --> 00:21:38.640 why did they do this? Because the violations 00:21:38.640 --> 00:21:41.420 were so severe. They found Boston Market owed 00:21:41.420 --> 00:21:47.279 back pay of up to $607 ,471 to 314 employees. 00:21:47.900 --> 00:21:51.700 $600 ,000 in unpaid wages. Yes. That is people's 00:21:51.700 --> 00:21:53.759 rent. That's groceries. That's car payments. 00:21:54.200 --> 00:21:56.740 Exactly. An employee in Mercer County had filed 00:21:56.740 --> 00:21:59.099 a complaint back in November 2022 saying they 00:21:59.099 --> 00:22:01.329 hadn't been paid. That triggered the investigation. 00:22:01.849 --> 00:22:04.650 They found a pattern of failure to pay workers 00:22:04.650 --> 00:22:07.650 across the entire state. And it wasn't just New 00:22:07.650 --> 00:22:11.829 Jersey. No. Massachusetts in November 2023. Same 00:22:11.829 --> 00:22:14.670 story. Failure to pay workers. The state fined 00:22:14.670 --> 00:22:17.369 them heavily. So picture this. You have no food 00:22:17.369 --> 00:22:19.349 coming in because you aren't paying U .S. foods. 00:22:19.589 --> 00:22:21.509 You have no buildings because you aren't paying 00:22:21.509 --> 00:22:24.170 the landlords. And you have no staff because 00:22:24.170 --> 00:22:26.170 you aren't paying the workers and the state has 00:22:26.170 --> 00:22:28.940 shut you down. It is the definition of a collapse, 00:22:29.079 --> 00:22:31.720 a total systemic failure. And the numbers reflect 00:22:31.720 --> 00:22:33.880 that velocity. Let's look at the store count 00:22:33.880 --> 00:22:37.359 freefall. Start of 2023. About 300 locations. 00:22:37.859 --> 00:22:40.859 End of 2023. About 79 locations. And end of 2024. 00:22:41.240 --> 00:22:45.480 16. 16. From over 1 ,000 in the 90s to 16. That 00:22:45.480 --> 00:22:47.480 is basically a rounding error compared to where 00:22:47.480 --> 00:22:50.059 they were. It is stunning. And amidst this collapse, 00:22:50.299 --> 00:22:52.400 the leadership was trying some bizarre maneuvers. 00:22:52.599 --> 00:22:56.190 The franchise for free, Hail Mary. Yes. On January 00:22:56.190 --> 00:22:59.349 10th, 2024, the company announced that anyone, 00:22:59.569 --> 00:23:02.690 literally anyone, could open a franchise without 00:23:02.690 --> 00:23:05.430 the usual fees or buy -in requirements. It sounds 00:23:05.430 --> 00:23:08.009 like a desperation move, like a late -night infomercial. 00:23:08.109 --> 00:23:10.869 Call now and get your own Boston Market. It was. 00:23:11.009 --> 00:23:13.210 They were basically giving the brand away to 00:23:13.210 --> 00:23:15.309 try and keep the name alive. But think about 00:23:15.309 --> 00:23:17.650 it from a business perspective. Who would sign 00:23:17.650 --> 00:23:19.930 up for that? No one. Who would sign a contract 00:23:19.930 --> 00:23:21.890 with a parent company that is currently being 00:23:21.890 --> 00:23:24.210 sued by every major vendor in the country and 00:23:24.210 --> 00:23:27.009 has been evicted from entire states? It's a liability, 00:23:27.150 --> 00:23:30.190 not an asset. Exactly. And speaking of liabilities, 00:23:30.410 --> 00:23:33.190 the bankruptcy saga is confusing. They filed. 00:23:33.609 --> 00:23:35.210 Then they didn't. It was a merry -go -round. 00:23:35.369 --> 00:23:39.089 In December 2023, Pangea and Boston Market filed 00:23:39.089 --> 00:23:41.490 for Chapter 11. Okay, standard procedure for 00:23:41.490 --> 00:23:44.490 a failing company. But in January 2024, the court 00:23:44.490 --> 00:23:47.329 dismissed it. Why? Because the company was unresponsive 00:23:47.329 --> 00:23:49.769 to the court. They just didn't reply to requests 00:23:49.769 --> 00:23:52.509 for documents and information. They ghosted the 00:23:52.509 --> 00:23:54.940 bankruptcy court. Essentially. Then, in February 00:23:54.940 --> 00:23:58.039 2024, right after losing the U .S. Foods lawsuit, 00:23:58.319 --> 00:24:00.900 they filed for bankruptcy again. Third time's 00:24:00.900 --> 00:24:03.240 the charm. Apparently not. In September 2024, 00:24:03.759 --> 00:24:06.220 a judge dismissed their appeal regarding the 00:24:06.220 --> 00:24:08.980 U .S. Foods judgment, and the language the judge 00:24:08.980 --> 00:24:14.000 used was scathing. Quote, bad faith, delay tactics, 00:24:14.240 --> 00:24:17.589 and willful disregard. When a federal judge says 00:24:17.589 --> 00:24:19.869 you are acting in bad faith, you are in deep 00:24:19.869 --> 00:24:22.150 trouble. It means they believe you are abusing 00:24:22.150 --> 00:24:24.470 the legal system to delay the inevitable. And 00:24:24.470 --> 00:24:28.210 yet, and this is the wildest part to me, amidst 00:24:28.210 --> 00:24:30.390 all this domestic destruction, there's a dot 00:24:30.390 --> 00:24:32.369 on the map on the other side of the world. The 00:24:32.369 --> 00:24:35.170 India paradox. While the U .S. chain is collapsing 00:24:35.170 --> 00:24:38.039 to fewer than 20 stores. They reportedly opened 00:24:38.039 --> 00:24:41.819 a new location in India in early 2024. It defies 00:24:41.819 --> 00:24:44.400 logic. You cannot pay your workers in New Jersey, 00:24:44.500 --> 00:24:46.539 but you are cutting ribbons in New Delhi. What 00:24:46.539 --> 00:24:48.740 does that even mean? It speaks to the chaotic 00:24:48.740 --> 00:24:50.539 nature of the management during this period. 00:24:50.720 --> 00:24:53.119 It implies that maybe the brand asset still has 00:24:53.119 --> 00:24:55.460 value somewhere, even if the operational reality 00:24:55.460 --> 00:24:58.140 in the U .S. is utter ruin. So what does this 00:24:58.140 --> 00:25:00.819 all mean? We have gone from the sensory joy of 00:25:00.819 --> 00:25:02.680 rotisserie chicken in Newton, Massachusetts, 00:25:02.920 --> 00:25:05.980 to gossamer legal defenses and stop work orders. 00:25:06.410 --> 00:25:08.410 I think the lesson here is about the fragility 00:25:08.410 --> 00:25:11.829 of legacy. We assume brands like a Boston Market 00:25:11.829 --> 00:25:14.960 are permanent fixtures they feel like part of 00:25:14.960 --> 00:25:17.200 the landscape they're just there but they are 00:25:17.200 --> 00:25:20.160 just collections of contracts cash flows and 00:25:20.160 --> 00:25:23.799 trust trust seems to be the key word it is if 00:25:23.799 --> 00:25:26.839 you leverage the company too high with debt like 00:25:26.839 --> 00:25:29.279 they did in the 90s you break trust with the 00:25:29.279 --> 00:25:32.380 future if you strip the assets like in the private 00:25:32.380 --> 00:25:34.660 equity era you break trust with the customer 00:25:34.660 --> 00:25:37.460 and if you simply stop paying your bills like 00:25:37.460 --> 00:25:39.960 in the final era you break trust with everyone 00:25:39.960 --> 00:25:42.980 your lenders your landlords and your Once you 00:25:42.980 --> 00:25:45.380 break that trust, no amount of cornbread can 00:25:45.380 --> 00:25:48.019 fix it. Well said. So here is our final thought 00:25:48.019 --> 00:25:51.720 for you to chew on. Next time you're in the frozen 00:25:51.720 --> 00:25:54.819 food aisle and you see that red and white Boston 00:25:54.819 --> 00:25:57.500 Market box. Which is owned by Belizio Foods, 00:25:57.660 --> 00:26:00.019 remember. Right. When you see that box, would 00:26:00.019 --> 00:26:02.519 you just see a quick dinner? Or would you see 00:26:02.519 --> 00:26:05.200 the ghost of an empire? An empire that once had 00:26:05.200 --> 00:26:08.539 1 ,200 restaurants, convinced McDonald's to buy 00:26:08.539 --> 00:26:10.960 it, and tried to trademark the name of a major 00:26:10.960 --> 00:26:14.279 city. only to vanish into the ether of unpaid 00:26:14.279 --> 00:26:16.599 bills and bad faith. It makes you wonder which 00:26:16.599 --> 00:26:19.079 other permanent brands are just one bad ownership 00:26:19.079 --> 00:26:21.799 change away from disappearing. A scary thought. 00:26:21.980 --> 00:26:23.599 Yeah. Thanks for diving in with us. We'll see 00:26:23.599 --> 00:26:24.099 you on the next one.