Tracie Lee and I met at an event hosted by Makeshift Society in Design*Sponge‘s offices – it was a panel discussion of different New York designers and entrepreneurs during the Brooklyn Beta conference. Tracie openly talked about what it was like trying to start up Lonestar Taco while at the same time working at her web design job. I wanted to hear more about her Chapter Be story, so we met over coffee a couple weeks later.
Tracie started Lonestar with her husband, Wayne Surber, who also has a great Chapter Be story of leaving the IT world to become a chef. He worked as the Executive Sous Chef at Bouchon Bakery with Chef Thomas Keller until 2010. It was shortly after that he and Tracie set out to make the “best damn tacos east of the Mississippi.” Lonestar Taco aims to bring the lively flavors of Mexico and Texas to New York, and they do it by sourcing their ingredients from local farmers and producers. They are known for their signature house made tortillas, which helped them create a loyal following at the New Amsterdam Market. Unfortunately, the New Amsterdam Market had to close this summer after a long fight with city officials and real estate developers – its last market was on June, 21st 2014. Lonestar Taco is now focusing on corporate catering while they continue to look for a space and raise the money for a brick-and-mortar.
Tracie grew up in New Jersey, but knew from a young age that she wanted to live in New York City. Owning a business in New York is more then just being a business owner for her – she sees it as a way to build community, as food can be such a connector for people. For example, when Hurricane Sandy hit the city in October 2012, Lonestar Taco handed out free tacos to those who were affected after raising the money in order to do so. People came looking for them after they heard they had hot rice!
You are a designer by training – how long have you been in that field and are you still doing any work within it?
A really long time! Since I’ve been out of school, actually, so 13 years. I do that 4 days a week. I work for Serious Eats, the food website, as their Designer. I do that and I do Lonestar Taco. The plan is that we are trying to find a permanent space for Lonestar, that can be open every day, but for now I am trying to balance the two.
I’m sure that having a design background compliments what you are doing with the restaurant but there is probably a lot that is completely new and different to you.
Totally. My background is more about looking at a problem and saying how can we make this better? I definitely think that process has helped us a lot. It’s how we can make service better, but I don’t have kitchen experience but my business partner, Wayne, who is also my husband, spent years in the kitchen. That is where his expertise comes in. There are so many pieces where I feel like we are both still learning – particularly the business stuff – but that is exciting to learn. It can be stressful sometimes, though.
When was the moment that you decided you wanted to create Lonestar Taco? Had you been talking about it for a long time or did you have an a-ha moment?
We both quit our jobs in 2010 because we both were burnt-out. We decided to take some time and visited a lot of sustainable agriculture projects. We went to Thailand, China, Turkey, and it was really inspiring to see what people were doing. They were unhappy with the way agriculture was going, for example with all of the chemicals that are being used, and they wanted to do something different. We came back from the trip we realized that we really wanted to do a project of our own – what could we contribute?
At first we were thinking about starting up a little grocery store in our neighborhood, but as we started researching it we realized we didn’t have any expertise in this field at all. I didn’t know anything about managing a grocery store or how to choose the products that went in it. But, we started looking at spaces and we saw a space and joked that it would be the perfect place for a breakfast taco joint. This had been a running joke of ours for years. Ha-ha, wouldn’t it be funny if we opened a breakfast taco joint? My husband is from Texas, and I hadn’t had a breakfast taco since I was in Texas. So we were like…wait…that’s a really good idea. We both love breakfast, and we love fresh tortillas. So, that is how it started. We thought it was something we could open really quickly. Um, no! But, the idea of it was something that we could both be really excited about, because we both love it. He can bring his expertise to it and I can bring mine.
So, why not start with a food truck?
We do not have a food truck, and that was something we were pretty adamant about. The challenge of the past two years was discovering how much it all was going to cost. Once we started doing all of the budgeting and included the way in which we wanted to do things, it was a lot. One of the things we were really dedicated to was doing whole beast tacos. That requires a lot of space, and you need a full kitchen. We also are doing tacos to order. We don’t want to do a Chipotle-like style layout, because there is a trade-off in quality. We found that the costs were adding up and it was a lot of money. So we have been trying to raise money, and that has been a challenge.
Can you talk about that challenge and some of the avenues you are exploring as far as raising money?
The Brooklyn Public Library has an annual business plan competition. We thought that was a perfect opportunity. We went to classes and did all of this research and it actually helped us get a business plan together and we spent a lot of time putting it together and realized every space we chose we would have to do like a whole business plan just for a particular space. We did that and then we went out and did the budgeting for all of the equipment. Then we were like, this is all theoretical. We need to get out and actually do this to see if it is a viable idea. Just because it was a lot of money to be investing and it hasn’t really been proven yet. A space fell through and we were kind of bummed out. A friend of ours, Peter, he owns Runner & Stone, a bakery and restaurant in Gowanus, had been doing New Amsterdam Market. He encouraged us to do it. So, we did that starting last year in the summer to see if people even liked our food. That was huge for us in terms of what the real costs were, and what do people like, and how do people respond to our food or want to order, and how we are taking orders, and how we can organize. I am so glad that we did all of that and were able to test things on a smaller scale. Now it’s only every month but last year it was every week. So, we did every week for almost the entire season.
That is impressive on top of working your other job. Wow!
Yeah, we had no days off! We got to the point where we now have someone working with us part time, which is really great, but in the beginning it was just us and we were asking for friends to volunteer to help us. So, that got us started. People were really excited about the food, and so we knew that we had a great idea. Then we still needed to find a space and to find the money cause our personal funds weren’t gonna cut it! So, in the spring of 2013 we talked to the New York Business Development Corporation. We were connected to them through Accion, the small business lender that is a micro-lender. We received a microloan from them two years ago. They said they could recommend us for a loan with the Small Business Administration (SBA) so we were talking to them and started to fill out the paperwork, but it just sounded like it was going to be a very long process.
We explored partnering with some investors that ultimately didn’t work out. It was a long process, but we figured out that we had differences in the way we wanted to run the business and what growth meant. Even though it was disappointing in the short run in terms of capital, it was more important for us to keep control of our vision. Otherwise what are we doing this for? I don’t regret the process at all, if anything it’s made our understanding of the financial aspects of our business much tighter and to remind ourselves to look at our decisions with less emotional attachment; if you can’t make the bottom line, it’s not good for anyone. So we’re rethinking our next steps in securing our first permanent location – we’ve gone back to our bank and we may actually qualify for a loan now that we’ve been in business for more than two years. (This has been a lesson in tenacity!) It’s slower growth, for sure, but it means we choose the direction 100%. But meeting these investors all happened through contacts that Wayne had through his last job and kept in touch with over the years.
That’s really speaks to how important it is to not just network, but to keep in touch with past networks and keep up your relationships.
It is really important because it ended up that one of the possible investors we are talking to was a regular at the restaurant where Wayne worked. He had never met him, but before meeting him, we had no one. We thought, “Well, how do we find investors?!” It ended up being a combination of us being out there doing what we love, building our reputation and having people hear about us, and it’s almost like they came to us.
You have to ask yourself, “Do I really want to take this huge jump without knowing if it is A) something that people really want and B) something that I really want to do day-in-and-day-out?” You can think about it, but really doing it gets you to a completely different place.
There were assumptions that we made in the beginning before we tested it out, for example the way we wanted the kitchen set up, that have evolved and been refined. I think if we had jumped in without that all would have been way harder. Once you build something, it’s done and you are not going to change it once you are that far in. You are stuck with it. So, it has also helped us be more certain about what we want.
Are you still looking for a restaurant space? What is that process like for you? I was just recently meeting with a friend who was looking for a space for something she is starting and she was very overwhelmed with knowing how to even start looking. She doesn’t know any developers and some of the landlords were really resistant.
Some people swear by realtors but we have been a little wary about it. We have just been contacting people out-right via Craigslist. Sometimes they were realtors and sometimes they were owners. It hasn’t been that successful, to be honest. It’s been useful for us because we could figure out what the going rates were for different neighborhoods. It was about getting a feel for spaces and having a better idea of what going rates are. I think doing a lot of that is just good education in general, but it takes a lot of time. Knowing what to do to find a good deal, and figuring out how to negotiate a lease – all important! For example, if a landlord doesn’t want to meet you in person, don’t do it! That is really sketchy. If someone doesn’t even want to meet with you before signing the lease then what is that relationship going to look like? We just heard a lot of horror stories of people taking on a lease and then never being able to get anything fixed. Making sure you have a good relationship with your landlord is so important. We passed up opportunities to move into spaces because the landlord seemed sketchy or wasn’t responsive. It’s really hard because there was one space that we fell in love with and really thought it was the one for us, but then we looked at the numbers and had to deal with it logically instead of emotionally.
At first we were super disappointed when we passed on the space. How could we do that? But, two weeks later we were so glad that we had not taken that space because it would have put so much financial pressure on us, and the landlord was so inflexible with so many things. He wanted the right to build a deck over our space. We were like, what? And you want us to pay how much money? It was crazy. So, just spending the time doing that sort of stuff to make sure that you know what you are getting yourself into is a good thing. I think maybe we would work with a realtor in the future, but right now we were just not ready to do that.
Yeah, that’s a very overwhelming process! What keeps you going when you have those moments of “What the hell?!”
That’s the thing! One of the things that keeps me going is just seeing the people when we do the market. We have this crowd of regulars who are very vocal about telling us they are so glad we are here. Just chatting with them and making people happy with our food. We were not doing it as regularly which makes that a little bit harder. Now, we are catering to fill in the gaps, and that helps, too. When I’m just working on a spreadsheet trying to figure out numbers then I’m like, “I can’t do this!” I think that when you actually talk to people, it keeps you going. Another reason why it is important to put yourself out there!
What is it like working with your husband?
It’s great because we know we can rely on each other to get stuff done. Setting the boundaries, too, because you can be at home and tired and go, “Oh, you know that thing…” It’s like, no, go to sleep. If we are going to talk about business then we will do that for like 1/2 hour and then we are going to transition out of that. Otherwise it becomes all consuming and stressful. It’s like midnight – why are we talking about this in bed?!
What do you get out of this process of starting a business that you don’t get out of designing?
I work as a web designer, so a lot of my work goes out there and I have no idea what people think of it. Getting feedback from users is hard because there is always this barrier because it is virtual. Whereas, doing the market and talking with people, you get immediate feedback – and I love that. I like talking with people and hearing what they like about it and how I could improve. It feels like there is more of a human connection there that I want and I don’t get from doing web design. This is why we wanted to start a food business – connecting with people and then having people connecting to each other through our food. Getting to see that happen is really exciting for me.
Do you envision that you will always keep doing web design or is it your hope that when you open up the restaurant that will be your full-time job?
Yeah, that will be my full time job once the restaurant is open every day. But I think I will still like doing some web design work. I think it is important to keep on doing multiple things that you are interested in doing – diversify your time. I’m really looking forward to the challenge of building up the space and working with architects and figuring out that full experience and really working it through so that we have a small resale component where we have products and also have fresh produce from some of our farmers and figure out what that looks like. It will be fun to see how people interact with that.
New York has so many people, do you see restaurants as an opportunity to build community? We live in our neighborhood in New York and if you find a favorite place you tend to go back to that place even though the city offers endless options. I’m wondering how you see restaurants and community working together.
That is something that we are really conscious about. We want to create that sense of community between the people who are going to work with us, the team that we build within restaurant and also with our customers – it all is really important. I think often times there is just a sense of being rushed in a lot of restaurants here and there is a strange idea of “service.” You don’t always feel welcome. Whether it is the person who is taking your order and getting a sense that they don’t really want to be there or just feeling like you are another number.
We want to turn that on its head. You should feel welcome and form a relationship with the person who is bringing you food. I think about my favorite coffee place. I know the barista’s name and we chat. I think that is something that I really want out of our restaurant is having that feeling. I want people to feel really comfortable. Especially if someone has kids, I want them to feel comfortable and not like we just want them to hurry and get out. Food is a whole social thing in New York, too. We want to make people feel welcome, and have the chance to have those social interactions.
I think when you are thinking about building a business that is not going to be just you doing something, but that it’s going to be a hand full of employees, then how do you make sure that you take your idea and the heart that you have put into it and transfer that to the people who will be working for/with you? It’s important to that you consciously think about how you transfer that to the people who are working for you because you can’t just expect that it will automatically happen.
I think finding the right people who get the vision is important. The other thing we have talked about is this whole thing that happens in restaurants where it is split between the front-of-house and back-of-house in terms of both pay and the way people are treated. The servers are walking away with a living wage and others are not. If you want everybody to work as a team then you have to create an even dynamic. We are looking at how we are going to deal with that. Do we just pay everyone a higher wage and then the tips are split across the entire team? And how do we work within the labor laws that are already set, etc.
I think it is so interesting thinking about how you could turn that structure on its head. It can change the experience for the customer, as well.
Exactly. I think that is part of the point of why we wanted to start a business. Why not do things differently? Why do we have to do things the same? It’s not really working, so we should try something different. I think that all comes out of Wayne’s frustration having worked in restaurants. Why somebody gets paid nothing in the kitchen – I mean the dishwasher works just as hard as the person on the floor. If we didn’t have a dishwasher the restaurant wouldn’t run.
The trick is to be sure to stick to this plan, because it can be much easier to go the pragmatic route. How do you ensure that you stick to your guns? It is up to us in the long run. We started working on this 3 years ago and we still don’t have a space, but I think doing it the way we have is working. Sticking to our principles because we don’t want to compromise. Once you make the compromises you can’t go back. If you are putting yourself out there and you are known for a certain thing and we compromise on that already then it can just be a slippery slope!
How do you approach competition? Let’s say tomorrow you walk by and another breakfast taco place has just opened – how do you deal with that?
That has already happened! I think, like with anything else, there is always room for another business, especially in the city. It’s a combination of finding the right place and your audience. I think every business has a unique thing that a certain group of people, who have a certain point of view, are going to be attracted to. I think that you just have to keep that in mind, find those people, and then make sure you are connecting with them. Tacos are like sandwiches. I mean, there are a million sandwich shops, there are a million taco places and there will always be more. But, what is it about your business that is unique that makes people come to you? There is a large amount of people who will appreciate that and support you. Also, is what you are doing simply trendy? I think what we are doing will fit people now and ten years from now. It’s not just something new, like a cronut, that people will talk about for six months and then think it’s an old idea. Part of it is definitely thinking about longevity, so that your audience will stick with you, and ten years from now you are still making those customers happy.
It is easy to feel like everybody else is so successful in his or her venture, but you have to almost ignore all of that because you know there is more to it than just what you hear or see. That can be frustrating. You have no idea what their story is. It’s really hard to not feel jealous and maybe a little jaded because here is someone else who is successful in opening a business. You just have to remain true to your path and what you are trying to do. We can’t compare ourselves. For example on Eater, you can get any piece of food industry gossip that you want – but I just try really hard not to read that stuff. On one hand it is good to know what others are doing and what is going on in general, but on the other hand you can get on this cycle of “Oh my god, we are not where we want to be!” But, I think everyone, even people who are perceived as really successful, say that to themselves.
Would you ever do a Kickstarter?
We decided we wanted to do a Kickstarter after we sign a lease and maybe like a month away from opening. We have seen so many Kickstarter campaigns that have stalled or not fulfilled their rewards or they don’t raise enough money because the plan isn’t as concrete as it should be. We really want to make sure we use it responsibly so that it shows the people where their contributions are going. Otherwise, it is like, “Oh, sorry, we can’t do it.” I don’t want that. For example, it might be a campaign for a bigger and better tortilla-making machine. People who have had our flour tortillas know that they are really good, but take a lot of time to make by hand, so they would have the opportunity to help us make many more and speed up that process.
A Kickstarter campaign is very time consuming. One of our friends did a Kickstarter and didn’t factor in postage – it ended up costing her more than what she had planned on – a lot more. Kickstarter also takes 5% of the total, and Amazon takes like 2.9% of each transaction. So with the rewards, postage, and what the companies take out, you have to budget at least 20% over what you are trying to raise. You have to be really strategic about it. There is a budget and then there is a cost to produce all of this. Am I doing it, am I paying someone to do it? Your video, are you paying someone to do that or can you a do it yourself? Plus, you have to make sure that for those 30 days you are basically sitting on all social media channels. You are tweeting, posting, doing everything you can do to make sure the word is getting out there!
How much does food play a part in your life? Did you grow up cooking a lot? I’m fascinated by the idea that we gravitate back to whatever it was that we loved when we were younger. So, is cooking something that you have always done or was it a big part of your family?
I think that food was always a big part of my life, even as a kid. My Grandfather owned Chinese restaurants in Harlem, but he retired when I was really little. But we came to New York every weekend to visit my grandparents, and he would make us lobster or chicken for dinner, and we would always get fresh vegetables. My mom liked to cook, too, and she loves going out for different cuisines and trying new things. When I was like twelve, I’d be like, “Really, Indian food?!” You know how kids are, but I think that just being exposed to that played into my interest in it. Then I carried that into college where I start seeing all of these different foods and trying different things. I lived in Italy for my junior year. For me, when I start going into my default mode – it would be Italian food! That’s where I really learned how to go to the market, because I lived down the street from the Central Market in Florence. It was amazing! I started to wonder why it wasn’t like that in the States.
Italy is such a good example – there you sit down for four hours and have a meal. It is an experience. I’ve been guilty of just grabbing a bagel and eating it on the subway – which is just about convenience. How do we slow down and actually enjoy food and share it to create a bigger experience?
Yes! At our stand at the market people are like, “Oh, this is taking so long.” We’re like, “Yeah, we are making your food to order and that’s why it takes a few minutes.” I don’t just slap something on a plate. Bring a friend and stand in line and chat. Take a few moments, slow down, and don’t expect that your food is going to be ready in 30 seconds. We have made this decision that our food is not going to come out in 30 seconds. We are going to do our damndest to get it out to you as soon as possible but you do have to wait a little bit to get a quality item.
If you knew someone who was where you were before, who is just now wanting to create something of their own, what would you say would be a first step for them to take in that venture?
I definitely think it’s getting out there, whether it is at a market or in another smaller scale environment. So, do that and also save up some money. That can be the most frustrating thing. If you don’t have the money saved up to actually be able to put in the time and then you run out of money then you might have to let go of what you are trying to do. Make sure you have that cushion and then start to do things on a small scale and see if this is really what you want to do. I think it is important to get that feedback as early as possible. Give yourself the experience of what this is really like. Then you can figure out pretty quickly if this is something that you really want to do or is it worth it. If you do it too much in your head and don’t have it out there for people to see then you can live within these romantic notions vs. doing it, which can kill those very quickly and help you figure out if you really want to do it.
You just have to get it out there. You don’t know where it is going to take you necessarily, but I think that is the exciting thing about it. If you share it and people respond to it, “Oh, wow. That really worked!” then you can see where it really leads you. If it’s just rolling around in your head then it doesn’t grow. Do the cheapest thing possible to get it out there. Ask what people think and see what sticks.
I love that for you it really is the human aspect – with everything you say, you always come back to your customers and the connections to people. I think that if that is what drives you, then you will have a successful business.
Yes, and it’s even the small things. Honestly, I’m terrible with remembering people’s names. I’m the cashier at the market, though, so I see people and try really hard to remember a customer so that when I see them next week I will remember their name. There was a woman who was kind of a regular last year and then she came to us in June and I said, “Hello Heidi!” She was like, “Oh my God, you remember my name!” She said, “Do you know how much that just made my day?” It is little things like that, because small things like that can make a huge difference. People really appreciate it, especially in a big city.
Thank you for being willing to share your process of how you are learning along the way and how you then make changes accordingly. It is important for people to know that when you start a business it doesn’t just happen. There are a lot of steps between A and Z!
It is the process that often gets glossed over. I know I’ve read a lot of stories about having an idea and then working really hard and then there you have it! I’m like, “Yeah – okay, right!” It’s a little different for everyone, but I think there is a huge learning process that is involved. We’re not going to just know everything (even if you do go to business school), there is so much that you have to learn. For example if you want to have a brick-and-mortar and you know nothing about real estate that could sink your business. But, we can’t be expected to just know this, so you have to spend a lot of time learning, reading, and doing research. It is not always a fun thing, but you have to be willing to educate yourself on the pieces you don’t know. And that’s the part that no one ever talks about! Like choosing which accounting software to use – that can really affect your business, and no one tells you that! QuickBooks is horrible. We spent hundreds of dollars on it and it was awful, so now we are using Xero and it’s actually kind of fun to reconcile the books.
Yes – it is the beauty and curse of owning your own business – it is all on you! There is no one else to blame, and you have to learn everything. In the beginning, at least, there is really no down time from it – you feel like you should be doing something every minute. What do you do to try and create some balance in your life?
Yeah, it’s true. You finally feel like you have a little time and then you notice there are 50 emails and requests to answer, quotes for catering to generate, and the kitchen schedule to set up…it’s endless! So, you are going to be doing it from 7:00 a.m. until you go to sleep. And you are always thinking about it!
I do karate, and I actually started running. I can train for a race and clear my mind in the process. Doing karate for me is a good release. It can be hard getting there, but it definitely helps. I have to do something physical to get that sort of nervous energy out so that I can focus. It is nice to have my own moment to do that. You just have to make it a non-negotiable and make it happen in your day. It’s important to take a break!
Notes of Reflection:
- Perseverance is the name of the game. Tracie and Wayne came up with the idea in 2010 and started it in 2011 – three years later and they are still working hard to make their dream of having Lonestar Taco be a brick-and-mortar a reality. What impressed me so much about their mission, though, is that they are very committed to staying true to the way in which they want to develop it – focusing on quality and community over quantity and big business. It would be very easy to fall down that whole when you are so anxiously looking for the capital to start-up, but the fact that they remain aware of why they started this venture in the first place is very admirable.
- Know your customers and work hard to develop a personal connection with them. At the end of the day all companies are about people – those that remember this will be all the more successful. The fact that Tracie makes it a personal goal to remember her customers names goes a LONG way. I know that if I had the option between two yummy taco stands – I would go to the one where the person there remembered me. After all, Cheers taught us that “You want to be where everybody knows your name.” This is a good rule to remember – The Cheers Factor.
- Lonestar Taco is another great example of starting small to get big. Originally Tracie and Wayne wanted to dive head-first into owning a brick-and-mortar restaurant. After taking the time to develop a business plan during a course offered at their local library, they realized that this would be a huge financial risk. So, they instead started by testing their product and the customer’s wants at a small local market. It allowed them the chance to gather important information and data at a very low cost – and as a result they made a lot of changes to their plan. So, look for local classes in your community that will give you the chance to work on a strategic plan and then find a way to test out your idea on a smaller scale, before investing a large amount of money and time.
- It is rare that the financial backing – whether it be a small business loan or finding an investor – will happen overnight. It takes time to build up enough business to show that you are a viable candidate for a loan, etc. Factor this into your decision making as you start exploring your idea. This should not halt you from moving forward with your idea, but it does allow you to plan accordingly.
I’m going to recommend books that I turn to regularly for motivation and inspiration. Business books are important to read, but it’s also important to remind yourself why you created the business in the first place, to keep yourself centered and grounded! -TL
- The Art of the Restaurateur by Nicholas Lander – It’s a series of interviews with successful restaurateurs from around the world. It was a motivating read and I liked the different approaches that each person had to their business and philosophy about how to run a successful restaurant – it’s not your typical “business” book.
- Canal House Cooks Every Day by Christopher Hirsheimer and Melissa Hamilton – Gorgeous and inspiring. I love their approach to food and the recipes are just begging to be made. It gets me excited about going to the market and seeing what’s in season.
- Plenty by Yotam Ottolenghi – Another great cookbook with beautiful photos. I love the way Ottolenghi approaches vegetables and combines flavors. I turn to this for a lot of the cooking I do at home.
- East Wind Melts the Ice: A Memoir through the Seasons by Liza Dalby – I actually picked this up as a remainder at St. Marks Bookshop. The seasonality of it makes it a great book to pick up throughout the year and read short passages. It helps me pause and notice the small things.
- Wanderlust: A History of Walking by Rebecca Solnit – Solnit is one of my favorite authors ever, and I’ve reread this a number of times. I give it to practically everyone who asks for a book recommendation.
- When Things Fall Apart: Heart Advice for Difficult Times by Pema Chödrön – Things to work on for a lifetime.
- Grapefruit: A Book of Instructions and Drawings by Yoko Ono – Cheeky yet profound. This book made me fall in love with Yoko Ono’s work and to stop and appreciate the things we do have.
*Images via Chapter Be and Lonestar Taco