Untitled episode

There is very little in this world that is more prized than ownership. Owners have power. They have say, they have rights, and they tend to use the things they already own to end up with even more. Nobody wants to be owned. If a young person looks at you and points and says, owned, you know something just like absolutely awful has happened. I read this thing in

fighting for and why do so many people end up owning nothing? It's a problem. We're gonna take ownership of it together, tonight. It's The Businessweek Show Welcome to the Businessweek Show. Tonight... Ownership. In 2016, a small restaurant in Harlem burned down and its owner who is sitting with me at this table did not have fire insurance. She ended up getting evicted and she lost her car

and she was even hit with a tax bill. In 2018 she had an idea, Slutty Vegan. Five years after that, Pinky Cole is the owner of a plant-based restaurant chain with 13 locations and famed burgers like the One Night Stand and a reported valuation of $100 million. Pinky Cole is here to tell us about ownership and a lot more, and I'm really glad she is. Pinky

Cole, welcome. Thanks for having me. I love that intro, it was good. Thank you so much. The people who succeed in business, they sometimes have a really hard time owning up to a lot of things, and especially I think at the top of the list is failure. But your new memoir, I Hope You Fail, is based on the idea that failing isn't like the enemy of

ownership or its opposite, but a key part of it. Why? You know, it's interesting when we think about failure, for me anyway, I've been through a lot. My father served 22 years in prison. I grew up in a single parent household, car got repoed, lost my business, almost lost my mind, had enough bad relationships that I can't even count, right? But I needed all those things

to happen for me so that I can realize what was on the other side. And what was on the other side was building a multimillion dollar business, creating Slutty Vegan when I had no idea what I was doing as an entrepreneur, becoming a wife, and becoming a mother when a doctor told me that I couldn't even have kids. So when we think about failure, it really

is just re-engineering a negative mindset. And that's why I wrote the book. I wanted people to know that okay, it's inevitable. Life is going to happen, but it's what you do with what happens in life is what makes the difference. And I know that it's going to bless a lot of people. When Americans walk into a McDonald's, when Americans walk into a Shake Shack, I mean,

they know what they're gonna expect. The corporation is banking on that, that kind of consistency. What should Americans expect like from the vibe, from the food, maybe from the wait when they walk into one of your places? You're gonna be called a slut. You're gonna be met with agape energy. You are going to hear music booming through the speakers. You're gonna have employees dancing with you.

And then I have four promises, right? We're gonna give you great energy, customer service, our form of training, and cleanliness. That is my promise and my guarantee to the people who walk through the door. And it's not about the food, it's about the experience. I like this idea that the food is like kind of the, is almost off to the side. It's almost an extra, but

let's talk about though, 'cause selling food is like, it's a complicated thing. Very hard. Is there something about food that you wanna get better at? It's really about food and about eating. No, but what I have learned, it's funny, I just recently talked to the executive chef at Shake Shack, right? 'Cause you know, Danny Meyer's team, they're my investors. One part half of my investors and

the other is New Voices. So I called him and I just wanted some advice on like LTOs, right? And that's limited time offerings. So when you go to a restaurant and like, you know how for six weeks they have like a certain burger. I'm like, I need to be able to make the relationship spicy. So I've been working on new menu items, new ways to excite

the customer all over again. Especially during the economy when restaurants are at an all time low. But it's been a journey, but it's been a beautiful one nonetheless. You no longer own the business outright. You've got, you've got these two big investors. Danny Meyer's one of the big restaurateurs in the country and he started Shake Shack. What have you learned about sharing something that you own?

You know, you're no longer the sole stakeholder. Nobody ever asked me that. But can I be totally transparent? I cried. When it first happened I cried, and where the camera at? my investors, y'all watch this. I love y'all, but I cried, right? But I'm gonna tell you why I cried. Because I have never had anything that belonged to me that amassed this level of success. So

when it amassed a certain level of success, and I did it on my own, I'm like it's me, it's mine, I'm not sharing like blood, sweat, and tears. I bust my ass to get here. So then when I'm like, okay, alright, we're gonna take the investment, but that mean that you gotta give up some equity. I'm like, well what's that? You gotta give up a percentage

of your business. What do you mean I gotta give up a percentage of my business and they ain't gotta come in here and work physically? No. It was hard for me because my ego was in the way, right? But that's that trauma, that growing up trauma that tells you that like if you have something, like you don't share it, you keep it to yourself. But you

go farther together. You wanna go far, you gotta go with a team. And I knew that in order to get where I wanted to be in my life, I needed to get me a team. And I'm glad that I chose the people to do business with because they got my back and I got the two Michael Jordans on my team. So as long as I got

them, I'm gonna win. If there's anything that could possibly be more intense and important for an owner than her relationship with, with her partners, it's her relationship with her employees. We are having like a real moment in this country with labor in general as our magazine has documented in the automotive industry, Hollywood. You've had to navigate lawsuits brought by employees. What have you learned about being

an owner that you didn't know when you started? That when I show up in the news, they don't just say Slutty Vegan, they say Pinky Cole is getting sued. Can I tell you a funny story? So I got a nine pager in the New Yorker one day, the next day Jet Magazine I'm on the cover. They hadn't printed in eight years. So we're in Target, like

I'm all over the internet. It's just beautiful. And then the next day I'm on the New York Post getting sued for unpaid wages. And how I found out is I was watching Golden Globes and then after the Golden Globes like I'm plastered all over the TV and I'm like, that happened, what's going on? Like, I'm trying to find out the information, just like they're finding out

the information, right? So that was my first experience of feeling defeated in my business, because there were a lot of things that I didn't know, obviously, because I don't run the day-to-day of the business anymore. I'm still the CEO, but I have a president and I have a really solid core team. So when that happened, it threw me for a loop. And to be honest, I

got a little bit defeated. I'm like this is not what I created my business for. I only operate in best practices. Like I only operate with the highest level of integrity. Anybody that knows me, I don't play with people money, I don't play, you know, like I don't play with people's opportunity. So like, when that happened, it really hurt me and I took it personal. And

my lawyers was like, don't respond, don't say nothing. I'm like F that. So I get on the internet and I'm like, I write this whole personal statement, didn't share it with anybody because at the end of the day I realized that my name is more important to me than anything else. Alright, let's talk about the Pinky Cole brand. So you're on the side, I mean, you're

a brand strategist in addition to everything you do. But Pinky, I mean, you're also a brand. What do you want your empire to look like in, you know, in 10 years from now? Slutty Vegan is a lifestyle brand, right? You know, depending on the day, Slutty Vegan is a marketing company that has restaurants as the storefronts. And when we talk about lifestyle brands, Pepsi is a

lifestyle brand. Coca-Cola is a lifestyle brand. Slutty Vegan is a lifestyle brand. I want people to be able to consume the brand, not just by way of food, which is why I did a shoe collab and a lipstick collab. I'm working on colognes, reality shows, producing movies. Because when you see this octopus right, the head is slutty vegan. The tentacles are all the things that are

connected to this head. This is the bread and butter. So it doesn't stop at restaurants. Restaurants was just the gateway to get in the door. But I'm going to world dominate with the brand in so many ways and show people that you do not have to be a one trick pony. You can have a multifaceted brand that is sustainable that will last throughout the years. I

think I'm gonna take the people that I've worked on on the show to Slutty Vegan for I think our wrap party when the season is over. Oh, that's awesome. Is there, is there like a sleeper? Is there a sleeper hit on the menu? Is there something that like we should absolutely, definitely get? The Chik'N Head. And the Chik'N Head is a chicken sandwich with coleslaw and

like a red, spicy sauce. It's so good. But beyond the food, I really want you to get the experience of a lifetime. All of this will not make sense until you walk into the doors of my church. It is really the premier restaurant chain that has the potential to change lives beyond just food. Even without going there. It's just a good time being in a room

with you and being able to talk to you. And I appreciate you being here. Well, thank you. I really enjoyed it. Really enjoyed it. Pinky Cole, thank you so much. The United States is the richest country in the world, and the competition is not close. And yet there are 38 million people here who cannot afford basic necessities. There are two million people here who don't have

access to running water or flushing toilets where they live. And there are one million kids in public schools who have no home. How could that be? The guest who's with me at this table has a theory. In Matthew Desmond's moving and convincing new book Poverty by America, he argues that poverty persists because the rest of us, the owners, want it to. He is a sociologist at

Princeton. He is the founder and the principal investigator at its Eviction Lab. He has a Pulitzer Prize in nonfiction and he is here to talk to us about what he's learned. Matthew Desmond, welcome. Ah, man, so good to be here. Really happy to have you. So you write in this book that complexity is the refuge of the powerful. Tell us with as much simplicity as possible,

why are there so many who own so little and are paid so poorly in a country that has so much? Because many of us benefit from that situation. You know, I read the novelist Tommy Orange's first book There There, and he has a line there that says, you know, kids are jumping outta the windows of burning buildings falling to their deaths. And we think the problem

is they're jumping, you know? And then when I read that, I was like, man, that sounds like the poverty debate. You know, we constantly focus on the poor. We should be focusing on the fire. You know, who lit it, who's warming their hands by it? And I think that's a sentence that cuts through the complexity arguments. You know, some lives are made small so that others

may grow. And that's just the plain truth of it. Matthew, you have a couple of quotes from Tolstoy in the book that are so lovely. My favorite one is this. I sit on a man's back choking him and making him carry me and yet assure myself and others that I'm very sorry for him. And I wish to ease his life by all possible means, except by

getting off his back. How do we create or exacerbate or perpetuate the poverty of other people in this country? So a lot of times when you think about the welfare state, what the government does for us, we think about things like food stamps, public housing, makes sense. But a lot of us actually get a lot of help from the government. You know, if we take means

tested programs, these are programs for the poorest Americans, and we add those up with social insurance programs like what a lot of us get, Social Security, but also tax breaks. We gotta count those too. And I know that's kind of weird, you know, sometimes, but you know, both a tax break and a check from the government, they both contribute to the deficit, cost the government something.

And they both put money in our pocket. And so when we do that, you learn that, you know, the average family in the bottom 20% of the income distribution, our poorest families, they get about $26,000 a year from the government. But our richest families, families in the top 20%, they get about $35,000 a year from the government. And so I think we do have to face

the fact that a lot of us receive help from the government and don't really recognize it until the government puts those programs on the chopping block and then we suddenly get up in arms. So this is like a way we contribute to poverty because, you know, if we did a lot more to fight poverty as a nation instead of guarding fortunes and instead of like, you

know, giving most to families that don't need it, we can make a ton of difference. But a lot of us protect those benefits, you know, we like them. I'm interested in the way that we tend to think about the working poor and the way we talk about the working poor. In the 1780s, Joseph Townsend, the writer, he said the poor lack pride, honor, and ambition. And

then 200 years later in the 1980s, the Smiths sang, although I think it was tongue in cheek, the poor and the needy are selfish and greedy. Why has that image lasted for so long? Yeah, I think that's like the propaganda of capitalism in a way. You know, the early capitalist had a problem, right? How to take folks that were, you know, living on their land, getting

by just fine, and move them into factories or into the coal mines or into mills. You know, that's a, that's a big problem. And the solution was hunger. You know, kind of enclose that land, take that away, make them have to work for their wages. And so when capitalism arose, you needed a big government, you know, you needed laws, you needed tariffs, you needed armies to

protect, you know, property. But a big government could also hand out bread. And so this is where this kind of language starts, this idea of like, you know, that bread's gonna make people lazy, which means that bread's gonna not allow folks to come work for me. And that kind of propaganda has been repeated over and over throughout the years. If we're gonna end poverty in America,

which is what I wanna do, I want to end it. Some folks are gonna have to take a little less from the government, you know? But I think what they get from that is they get a safer country, they get a more vibrant country, they get a freer country, right? They get a country where they don't have to worry that their kid might fall all the

way down the ladder into real, real hardship. So I think that, you know, this is not gonna come without sacrifice, but I think a lot of us, even those of us very secure in our money are pining for this. Like think of all like the engineers and scientists and computer whizzes that poverty has robbed from us and cost us. So I think, I think unlocking that

potential is a win for a lot of folks. Let's talk about some of those people. Let's talk about some poor people. The book has real people, people whose stories are complicated and whose money runs low. There's Crystal Mayberry. Yeah. There's your friend Wu. Yeah. There's your dad. He was a pastor. I think he could read ancient Greek, and then he loses his job. And the bank

I think took the home you grew up in. Yeah. How did losing something that your family owned, how did it shape you in the way you see the world? I think it made me confused, you know, about why this is how the country dealt with a family when they fall, fell on hard times. You know, my childhood home was $60,000, you know? And so I think

that when that happened, when we lost our home, I blamed my dad. Have you ever talked to your dad about that? Have you ever talked to him about the anger you felt? Yeah, I think so. You know, and I think that to be honest, it's hard to, to get completely over that. Even when you study it all day long. I think it's hard to really walk

away from that. You know, talking about poverty in the abstract, you know, that's one thing. But talking about poverty when it comes to someone with a name and a face who's fully human, which means they make mistakes, you know, that's something that's more challenging, yeah. I was really moved by something in the book that's really selfish of me. You cite the work that my colleagues and

I did on overdraft fees. It's a way that some of the biggest banks in the world make just billions of dollars from some of the poorest people. Overdraft fees are now declining, although they're definitely not going away entirely. What are other concrete changes you'd like to see from companies, from big companies in the finance industry and or beyond to help abolish poverty? I think we do

have to end the unrelenting exploitation of the poor in the financial sector. You know, overdraft fees are declining, but that's only because savings went up during covid, you know, because the enormous government relief packages. And as that money's drying up, I think it's, we're gonna see kind of a uptick again. Every year about $11 billion in overdraft fees in a normal, normal time. You know, most

of that is charged just 9% of bank customers, the poor made to pay for their poverty. We gotta stop that. And we have to also ask ourselves, like you, me, and a lot of folks, you know, like are we benefiting from this? Is my free checking account actually free? Or is it, you know, subsidized? But that's a concrete change though. I think $11 billion I think

might've been a couple years ago. I'm gonna have to check. But I wanna say off the top of my head, I think it fell to eight last year, might've been the year before that. And I think it's gonna keep falling. It's a rare example I think. You know, when I read your book, a lot of it can be disheartening and I think of overdraft fees as

like maybe a concrete reason to be optimistic that like change actually does sometimes happen in profound ways. Well, I would love for you to be right on that. Truly, truly. You know, we saw savings go up a lot during Covid. You know, in Covid we had two years where we were a different country. Like, you know, most people were more financially secure during the pandemic than

before it. And so I think that one of the trends you're seeing, I think in the overdraft fees might be a response to that. Savings went up, folks started businesses during the pandemic actually. A lot of bad indicators went down. And probably the most powerful thing for us is, you know, we cut child poverty in half, we cut child poverty in half in six months, and

then we just let those programs go away. Your book and exactly what you're talking about now, I mean, it did make me reconsider poverty as like kind of an existential threat that faces our country, you know? But the climate disaster is getting worse. The whole kind of experiment of American democracy seems kind of iffy sometimes. And then to consider poverty as, yeah, an existential threat to

our country is scary. Besides overdraft fees, what reasons do you have to feel a sense of yeah, a sense of optimism, a sense of hope? I think the American people are done with us. They're done with our old tired myths about poverty. I think on the ground level, neighbor to neighbor, there's a lot of folks that want more equity, less poverty. You know, the survey data

show that like most Americans think the minimum wage is too low. Most Americans think the rich aren't paying their fair share of taxes. They're right. Most democrats and most Republicans today think that poverty is a result of unfair circumstances, not a moral failing, not something that I did. That's a sea change. So there's something happening in the American public now, and I think translating that to

political action is the challenge. But what is happening on the ground level I think should give us hope. You know, before you go, on that note when you're writing or, or when you're talking, I'm betting that your audience is engaged in what you're saying and I bet that they really care about it. Are you learning to connect with people who aren't or people who don't? And

do you have, do you have ideas about how you wanna try? I think one of the, one of the challenges I'm facing out, you know, on the book tour is you'll get those sympathetic readers and they'll say, I read this book and yeah, I'm with you, but my uncle, my uncle would hate this. Or you know, or it's the, this political party, oh my god. Or

I'm just so hopeless. There's like a lot of like chic nihilism, you know, like pessimism's cool now, you know. And I think that, overcoming that is a challenge. You know, moving, moving past that and getting folks into action is a challenge. I think I'm trying to do everything I can to talk to audiences outside of the tent. This is something that I'm obsessed with. So I'll

go anywhere where with folks that disagree with me, that don't share my views and try to access that in any way I can. Well, you'll go to lots of tables, but I'm glad you're at this one. Matthew Desmond, thank you so much for being here. No, thanks for this conversation. Really enjoyed it. Yeah, me too. The problem with really trying to own the question of ownership

is that it would take longer than a half an hour to really think through the basic parts, money, politics, bankruptcy, theft, and more. But our guests tonight pointed the way to an answer. If you really wanna succeed as a business owner, not just running something successfully, but being a part of a community, it will mean thinking through who you are, where your ideas come from, who

your workers are, and how you fit into something bigger. And if you really wanna thrive, it will mean thinking through the reasons that things are working for you, and thinking through all the things that may have to change. Thank you so much for watching, we will see you next time. I am the most greedy when I really want to write something and everything else is preventing

that. Yeah, that's when I become a greedy writing monster. If my alter ego had a name for a sandwich, it would be happy ho.