Franchising Means Losing Your Brand - Steve Carse

[00:00:03] Speaker A: Foreign. [00:00:06] Speaker B: Welcome to another episode of the Worst Advice I Ever Got. I'm your host Sean Taylor, along with my producer, jb and today our guest is Steve Karse. Steve is a family man, entrepreneur, author, speaker, and proud Atlantan who co founded King of Pops with his brother nick back in 2010. Since then, they've gone on to start what they call their rainbow umbrella of companies, including Perfect 10 Distribution, King of Pops Bar, Rainbow Provisions, and King of Crops. In his new book, Work is Fun, which releases in April of 2025 from Matt Holt Books, he goes over those stories and shares how he has committed to making his work and the work of those around him more fun. [00:00:52] Speaker A: Hey, Steve, thanks so much for joining us today. [00:00:55] Speaker C: Hey, how's it going? [00:00:56] Speaker A: It's going great. It'll be going better when you tell us what the worst advice you ever got was. [00:01:01] Speaker C: Oh, sheesh. The worst advice I ever got was that franchising means losing your brand. [00:01:07] Speaker A: Okay. Franchising means losing your brand. Tell us a little bit more about you and about where this advice maybe came from. [00:01:14] Speaker C: Sure thing. Yeah. I've got a company that I started with my brother in 2010. We sell popsicles. Officially, Pops Unilever owns the word popsicle. Small carts with little rainbow umbrellas above us all over the region. [00:01:28] Speaker A: And for context, talk a little bit about how you birthed the company and some of the early days. [00:01:34] Speaker C: Basically, the idea came. My oldest brother's anthropologist. I was down in Latin America visiting him. It was the cheapest, best vacation option during college and right out of college, and we fell in love with the paleta, which is Spanish word for popsicle. The difference being it's made with fresh fruit, interesting flavor combinations, none of kind of the, you know, corn syrup, not so good for you. Things that are very processed foods tend to have. And I got laid off in 2009, kind of the Great Recession, and decided to give it a go at that point in time. [00:02:08] Speaker D: So obviously, you're. You're growing. So what's. What would you define, like, define franchising for our audience? [00:02:15] Speaker C: We always kind of had turned our nose up to franchising. Just the word seemed like something that was not necessary and. Or not cool. Certainly not cool. Um, and so we would get calls every now and then. Folks wanting to get a cart, inquire about getting a cart. Selling the Pops on their own. We always said, thanks, but no thanks. We're flattered, but things are kind of going just fine on our own. 2010. Great. 11, 12, 13, 14, 15, 16, 17, 18, 19, and then something happens in 2020 that's happens to impact a lot of businesses, but in particular if you're one that is selling to large groups. So Covid happens, you know, the Braves baseball season is up in the air. That's a lot of revenue. We know we're going to lose. Hospitals are big customers. They're not letting us anywhere near the hospitals to sell anything or come in or do catering or anything like that. So when you get a call in that environment and someone's like, hey, can I get a cart and go out in south and pops, you kind of cool. Doesn't matter so much to you anymore. And if someone's willing to write a check or pay some money, you're willing to try it. So that's how we landed into what was probably like not quite franchising, but directionally heading that way where other people were representing our brand. So in the beginning we called it the neighborhood partner program. It was about a half page agreement and very simple. Some entrepreneurs appreciated about that period where you kind of, it was just like, go do some stuff, you know, don't, let's not worry about it. But we immediately saw a, an unexpected trend. And I don't really know why it was so unexpected for us, but pretty obvious when you, when you think back about it. But the folks that were getting these carts were more connected to their communities than we were. So we had a pretty effective five or so person sales team. It was used to calling online Coke and Delta and Emory and all that. The people that had large budgets, but they didn't know about Billy Joe's barbecue at the end of the cul de sac that was happening during COVID And these folks are incredibly good at finding those events, showing up at them, being connected in the right ways, and really growing our business in a way that is very close to how Nick and I started the business, which was just us going out to anyone that would kind of allow us to set up. So it was kind of a back to our roots moment. That certainly a light bulb went off within a month or two. That this is certainly a better way. This is the future. [00:04:44] Speaker A: You, you were worried about the brand when you brought up the worst advice, right? It's like by franchising, you hurt your brand. Talk about your brand. [00:04:53] Speaker C: Yeah, brand is a lot of things. Obviously it's like a logo that I'm very well represented with right now. It's also, you know, how you talk and how people think about you. And I think we were really focused on the brand part that's super important. But, like, how are you going to be physically represented in the world? And you could just imagine things like that quickly changing. But the other part of brand is like, what people actually think about your company. And that's best represented by individuals that are caring about what they're doing. That's where franchising really can shine as a model, because the franchisees are at a different level when it comes to, like, making sure that a customer is taken care of, making sure that if a product isn't, isn't received just right, that it's not going to go out and touch anyone and kind of negatively impact the brand, because the brand is their brand, so they care about it in a different way. [00:05:48] Speaker A: When you got the advice, did you follow the advice and then ultimately, what was the result? [00:05:53] Speaker C: Brands that I admired, I would hear people say that in interviews. It wasn't directed at me, but people that I looked up to felt like there was a, a certain. I don't have. Stigma is the right word, but just a feeling that you, yeah, you're going to lose your brand if you do it. And then once I got serious about it, I, I went to kind of like the, you know, the peer groups that I'm in and started to get feedback from it. And I wouldn't say it was unanimous, but certainly the majority of folks felt like that was an unnecessary risk, like weather this storm and go at it again with kind of what you'd already proved out. [00:06:31] Speaker A: And this was during COVID This was like at the start of COVID So you had kind of heard this in the ethos and then you went to your peer group during COVID Yeah. [00:06:39] Speaker C: So I thought, I thought to myself, like, I can kind of just do this back of the napkin thing for a year or two and then go back to normal. Or I can go through kind of the full stack franchise organization, which is unfortunately quite a lot of paperwork. I mean, I think for good reason, but. And yeah, most people were saying, yeah, definitely don't go out of business, but don't, don't do anything rash because of this one setup, why do you think. [00:07:04] Speaker D: They think the franchising is rash? I mean, that's like the goal, right? If I was, if I'm starting a restaurant and it's like, hey, there can be a thousand of these restaurants, like, great, that means I made it. Look out. People much people love my stuff. Like, what is this bad, big, bad franchising thing? [00:07:17] Speaker C: I think we had proven it out already without it. I think there's like a, you know, you do one to three stores and then that's proof of concept and then you're selling it as much as you can. We had kind of gotten to where we wanted the brand to go. We weren't really trying to expand geographically anymore, just from like a what Nick and I wanted for the brand at that point in time. We'd never taken on investment or anything like that. And franchising was always seen as that. It's like it's a different way to access capital. The underlying piece of it always was it's going to take things in a negative direction brand wise. And I think that's proven to be not true. Like a well intentioned marketing director certainly could have a way worse impact. These folks, I mean, are just adamant about all the brand quality and brand standard stuff in a pretty impactful way. I mean it's like they care so much. [00:08:12] Speaker A: I think that people typically come to the conclusion that they got the worst advice that they ever got in one of two ways. It's either because they got killed by it, like it just, you know, crushed them, or they vetted it, they didn't take it and then they were glad they didn't take it because look at how well it went. And that sort of seems like your story. [00:08:32] Speaker C: I think so, yeah. I mean I think the, the program is growing. The folks that have bought territories are buying more territories, which I think is a great, you know, proof of proof point from their perspective, from our perspective, it's like we're able to focus on the product more, which is, which is a nice thing. [00:08:50] Speaker D: Did this cost you any opportunities? Like listening to the advice and you're like, man, if I had just not thought that franchising meant losing my brand. [00:09:00] Speaker C: This I wouldn't have wanted to like have that be the focus coming in. I don't think like I would have, I wish I would have just been like constantly monitoring it as an opportunity and maybe as people were coming along that were like fantastic adding them on, onesie twosy type thing. But I think there's a lot of value in not starting the business to franchise it. To be able to say like we've done exactly what we're asking you to do. We've been in a brand new market with nothing but one or two push carts and we've showed up for weekend week out to a park. People start to like the brand and they start to like you. Then they want you to come to your, their wedding and then once they come to the wedding they want to tell everyone that you came to the wedding. And it's. It's a pretty good cycle. But yeah, I don't think. I don't think we would have felt confident selling it. We might not have priced it right, all that type of stuff, if we hadn't first done it ourselves for a little bit of time. We probably did it a little bit too long. Maybe I would have four or five years sooner would have gone that way. [00:09:55] Speaker A: When you decided to go forward with the idea of franchising, did it lead you to approach actual framework franchising in a certain prescribed way? Was that part of your go to market on that? [00:10:07] Speaker C: I think so. You want the pieces of your culture to continue on. And we've had a very like, transparent, open culture from day one. So there's a part of a franchise doc called the item 19 that talks about, like, public disclosures of everyone's finances. And it's common for people in their first few years not to display that because it can look kind of not that great because someone's just getting started. They did, you know, 50,000 bucks or whatever, not very much. And it could make the investment look bad. But we always leaned towards transparency from the beginning on that. And it included a lot of info that is probably atypical. And then another part that I don't think I fully achieved. I tried my best. I remember telling the lawyer, like, I want this to be the shortest franchise agreement you've ever written. Like, I want someone to like, actually be able to read it. And, you know, she whittled me down. It's still like 94 pages or something ridiculous. But I did my. Did my best. I think we're at least shorter than some of them. [00:11:03] Speaker A: Come on, your lawyers got to eat too, and get private school tuition. I mean, let's go. You know, I really like what you. [00:11:10] Speaker D: Said about the fr. Like, I think the advice is still, don't open up a business with the goal to franchise, but don't be afraid of franchising. Don't. Don't let it limit your opportunity. So where. When did you find out? I'm not going to do that. I'm not going to limit my opportunity. Was it just Covid or was it. Did other things happen that you're like, this is good. [00:11:27] Speaker C: I mean, I think life was happening in that, like the business was, you know, singular focus, a hundred hour a week type of thing where it's all I was thinking about two married and then kids. And I think this seemed like the way to thoughtfully release some of the pressure from shoulders and I think there was a lot of that. I think there was also like I, I talked about it earlier, kind of like the idea of raising capital and it just felt so much more true to our brand than going out and getting it a, a family office or an investor of some sort to invest. And, and this is a way where we can kind of grow with people we get a chance to get to know and interview ahead of time and then decide if we want to go into business together with them kind of at a much smaller scale. I mean we have a very, I call it a micro franchise. It's a very small franchise compared to everything else. So it's a lot of people that are just, they might have a full time job and they've got some young, youngish kids maybe like in 12 to 18 that are going to go be their pop slingers. It's like a very familial like fun feeling culture. [00:12:34] Speaker D: Oh, there's a way to do it. That's what you're saying? [00:12:37] Speaker C: Yeah, yeah, yeah. I mean I think the, the people that we've sold to this point in time are brand fans. So that's like a nice filter when you're interviewing if the people that are interviewing, you know, loved your product prior to having this opportunity. So I think that's one very real part and we need to kind of grow beyond that. But that's, that's been helpful to kind of get us started pretty quickly. The other like very operational thing, we, we started a distribution company about 11 years ago now that distributes kind of best in class food items similar to King of Pops across the south. And those are the same trucks that are delivering to our franchisees. So Frozen Logistics is a expensive and challenging world. And if we were shipping all of this in UPS or if we were paying a third party to do all of the actual dropping off, first of all, they probably wouldn't pull into like a suburban neighborhood with an 18 wheeler and back down their driveway, which we will in our 26, in our 26 foot trucks. But, but yeah, I mean I think that's a very real thing that wasn't, didn't exist until six or seven years in. [00:13:44] Speaker A: It feels like maybe the fact that your franchising plan has gone well feels like maybe had a little bit to do with all the learnings you had. And like you said, the, the raving fans promoting, you know, your culture. [00:13:57] Speaker C: Yep. Yeah, I think, I don't. Yeah. I think if we would have started year two or three the, with the goal of like collecting an initial franchise fee. It would have just been the wrong motivation. Even if, even if you got the best intentions, you're seeing I can go sell this, you know, $4 popsicle or try to sell a $9,000 franchise, you'd be focused on that, which isn't maybe the right thing at that point in time. [00:14:21] Speaker D: Well, so far it sounded great, you know, like it's working, what you're doing. How so? Obviously, very big in the Southeast right now. To quote Tom Callahan from Tommy Boy, either growing or you're dying. So as you continue to grow and you expand into the rest of the country, how are you going to maintain this sort of franchising is still good and keeping your brand intact? [00:14:40] Speaker C: You know, I mean, it's, it's obvious, but people is the first part. You know, you, you hold yourself to a specific brand standard as far as people go, instead of like, oh, this person can write a check and buy the whole Houston area. Like, so making sure that you've got somebody that you feel like is going to check those boxes and that you ultimately kind of want to work with. And then I think beyond that following up and being consistent with stuff, it's not really any different than if you grew outside of franchising. I think you'd have the same problem. Like, if you're set up and again, just say like somewhere in Texas and you don't ever go see it, you're not really involved in it, it's not going to matter whether it's franchisee or an employee. It's going to, it's going to be different than at least you're hoping. If you lose focus, if you aren't thoughtful, you know, it's gonna, it's gonna damage your brand. It's not that the franchising is the part that's damaging your brand. [00:15:36] Speaker A: So what has franchising done for your brand? [00:15:39] Speaker C: I think it's opened us up for growth in a way that we ultimately couldn't have done otherwise. It's, it's introduced us to ideas that we wouldn't have come up with otherwise. Like I said before, we had about 300 frontlines, we call them pop slingers, where they're going out to events and, and selling. And a lot of them ended up making, making the leap and becoming full time kind of managerial type employees. But they just have a different investment level and having a group of at this point, well over 50 families or groups or entities, I guess they're all shapes and sizes that have a energy going towards improving kind of all aspects of the brand. Not just like getting more tips or meeting, meeting somebody of the opposite sex out on the cart. Like those are things that help big time. [00:16:26] Speaker A: So you, you describe yourself as a hundred hour a week. Everything into this business sounds like maybe you have 50 of those entities, 50 of those people that are spending a hundred hours a week driving this. That's what it sounds like to me. [00:16:39] Speaker C: Yeah, yeah, yeah. I think, and I think it's, I mean I believe in something kind of called work life blend, which is not balanced. You stop one and start the other. And I think that's the way it has to be, especially for entrepreneurs that are at the scale I'm at. And yeah, the thing about selling pops, like I took my 3 year old one to go to the beach. So there's this customer that was going to sign up to sell pops. I asked if I could do a demo at the pool. They gave us a free night. We kind of met more people down there than we would have anyway. She met a bunch of friends because she got to hand out free pops. It's just kind of like is that work? Yes. Is it not work? Yes. It's not, it's not one or the other. And that, that's when like that's what I want to teach to myself really. That's what I want to teach other people about. Because going to a concert, watching your favorite band and selling pops is probably just as much fun, if not more fun than just seeing the concert without it. [00:17:34] Speaker A: What would you say to someone about building brand presence, about building a brand recognition? Because that seems like a critical ingredient here. One of the reasons your franchising was so successful is you had a great brand. I've known about your brand for. [00:17:50] Speaker C: Yeah, Years. [00:17:51] Speaker A: Right. And right out of the shoot. It was unique. It was, you know, identifiable, very different. Yeah, you had to kind of create that. So what did you do? What do you recommend to people who are trying to have a brand be as recognizable as T pops? [00:18:09] Speaker C: I feel like the one to one in real life connections are so valuable and I feel like people are looking for the viral social media post so aggressively or some, something that is going to create hockey stick that isn't customer on the phone or customer in front of you. All of the best connections and the people that still talk about us and the people that are now signing up to be franchisees, we met at carts, at events and it's just a, it's just a different thing. And it's, it's, I understand why people don't want to go that route because it's, it's a lot of work. Like, it takes a lot of time. I mean, a lot of times I feel like people think we've grown fast and I don't know the frustrated the right word, but I always feel myself, like, defensive or reminding people that we've been at this for literally 15 years. It's not like an O. It's not an overnight success. [00:19:11] Speaker D: 15 year overnight success. [00:19:14] Speaker C: But I think because people see that online, that there are people that are building, you know, tens of millions of dollars brands in three or four months, they think that they're. They should be getting that, too. I think that does it a huge disservice. [00:19:27] Speaker A: Yeah. [00:19:29] Speaker D: So you're making a lot of money now. You're doing great. Everything's going fine. Why do you still care about brand? [00:19:36] Speaker C: Oh, man. I think, first of all, although I now am married and have two kids, it is still my baby, if you will. And when you work on something for 15 years, I feel like pride compounds. I don't think it. I don't think it diminishes. I think the more you invest into something, the more you're going to feel proud of it. You know, who knows what happened in 10 years from now? But I just can't really imagine doing anything else. I just. Yeah, I feel grateful to get to do it. So I guess that's. I don't know if that's an answer. [00:20:03] Speaker A: But that's why, you know, I think at the end of the day, whether you choose to franchise or not, I think it all boils down to what matters and not deviating from what matters. And you clearly have done that, created an incredible brand, and more people are enjoying it thanks to you not listening to the worst advice you ever got. So thank you for not doing that. But more so, thank you for being a guest today on our, on our, on our show. You really have been terrific, and I know our listeners are. Are thrilled that you came and we're a part of it today. So thanks very much. [00:20:33] Speaker C: Yeah, it's fun to think about it. Good. Good prompt. For sure. [00:20:37] Speaker B: JB When I think about Steve's story, think it demonstrates the impact that major events can ultimately have on us. [00:20:46] Speaker A: You know, if. [00:20:47] Speaker B: If he's not laid off in 2009 during the Great Recession, he never starts the business. And then if Covid doesn't hit it, doesn't force him to rethink his business model approach and thereby go into franchising, it's really really interesting to. To ponder. [00:21:02] Speaker E: Yeah. Similar to our Kurt Cowper episode in which he sort of had to pivot and it's that entrepreneurial leadership mindset that he was talking about that you got to be able to sort of move and ebb and with the times or if you want to be successful. [00:21:15] Speaker B: Yeah, yeah. It's almost like the universe speaks to us. Sometimes we wonder, should we go start this business? And then the universe kind of bumps you to do it, but then also just pivoting in a moment, which really, really speaks to just the incredible strength of the stories that, you know, Steve displayed and Kirk displayed to your point. One thing here that I thought was really interesting is he gets into this whole concept of franchising and why it's bad. I mean, jb, you work in this world, you're in the creative atmosphere, you see different companies with different brands. Why do people feel this way about the impact on their brand being negative if they franchise? [00:21:53] Speaker E: Yeah, it's interesting. I think the franchising, that word kind of feels like you're just going to water everything down. You know, you're almost selling out and you're just. All of a sudden, it's just about money. We're going to change the recipe. And I think what we learned through this is if you can maintain a certain amount of control as you franchise, that is not going to be a big problem for you. That's what Steve did. Steve was like, I'm just going to stay involved. I'm going to make sure I hire the right people. I'm going to make sure I do these things. And then the franchising can do what it is supposed to do, which is grow your brand and help other people be a part of what you've created and not get watered down. [00:22:27] Speaker B: Yeah, he definitely stayed very hands on through the whole process because I think generally he was just afraid of that might happen. But he had raving fans out there that really loved his product. And when they applied to be franchisees of his business, they ultimately promoted him and his product. They found new avenues for him, which is a really, really interesting point and a strength of franchising a great product and a great culture. [00:22:52] Speaker E: Yeah, start the community up. You know, I mean, that was what he said. You know, we know about the Braves game. We know about Delta having this big event. We don't know about Bob's, you know, barbecue in the cul de sac that. And they're like, oh, hey. And he's like. And that's where we sort of saw the most growth was these little tiny events that sort of just spread like fire. [00:23:12] Speaker B: Well, it's. It's great to have guests like Steve and these great companies like King of Pops and to hear their story. And if you're interested in hearing more great stories from more great entrepreneurs and great leaders in the community, be sure to give us suggestions for guests we might interview. You can do that in our LinkedIn page. You can do that on our Instagram page. Just reach out and contact us and let us know who would be great to hear the story about the worst advice they ever got.