Recently, Dos Toros, an assembly-line fast-casual burrito restaurant, hit $50 million in revenue according to Forbes and—with the company still under private ownership—we wanted to ask brothers Leo and Oliver Kremer what exactly the secret sauce (hint: Ask for the "double dragon" when you go) is in their recipe for growing a successful franchise. If Chipotle was your go-to spot, perhaps after you read this Dos Toros will definitely have you rethinking that choice.
The Two Bros Behind Dos Toros
Co-founders and CEOs Leo and Oliver Kremer explain the rise of their millennial taqueria
I want to start off by saying congratulations. It's been 10-years since you guys started, right?
Oliver Kremer: Thank you very much. Yes, we are now in our tenth year. October 30th will be our official 10 year anniversary.
Leo Kremer: They say every 10 years your body's skeleton completely rebuilds itself. So it's like for the 10 years that we've been in business—and in New York City—Dos Toros is a part of the city landscape, the fabric of the city.
What's it like working as brothers, being two CEOs in this business?
Oliver: At first, we were just mixing family with burritos. The business at that time was just us trying to recreate our favorite neighborhood taqueria from Berkeley, Calif. Now obviously, this is a larger enterprise, but it always has been and always will be about the burritos.
Leo: It's wonderful working together. I might just be speaking for myself, but… [laughs] We really enjoy it. There’s a lot of humor, a lot of laughter. We disagree quickly and don't have to be so critical of each other. Invariably, having grown up in the same family, in the same neighborhood, in the same part of the world, we used to have a similar worldview and so there's a lot of alignment on core stuff—the vision for the company and how to do that.
Oliver: Totally. We grew up eating at the same place every day in the Bay. We both got the same North Star, and I think you need to have that when you are working with a sibling or a family member, but it's great. We're very close.
Why Mexican food?
Leo: We're from Berkeley, in Northern California where everyone in the San Francisco Bay area is fully addicted to burritos. We are no exception to that; we just got really passionate about the cuisine. We ate a lot of burritos.
Oliver: Burritos are perfect. It's got everything going on in it, right? There are so many different recipes and flavors and food groups coming together in this one delicious tortilla. It's not like, you know, a piece of steak, like a filet. That can turn out to be delicious. But then a burrito—it's like a symphony, and there are so many flavors and ingredients playing their part, and when it all comes together as it should, it's a harmony.
What was the first big break for you guys?
Oliver: I think the first big break that we got for the business was finding our first location. It was just beautiful. The first location was on 137 Fourth Avenue, between 13th and 14th street just off Union Square. It's this little tiny intimate amazingly located storefront, something clicked. We looked at each other instantly when we first saw it.
Leo: We'd seen, you know, 50 other locations, all of which were various degrees of terrible. A part of our luck was that this was late 2008, early 2009. Right after the financial crisis. There was a real softening of demand for commercial space. In a tighter market, it would have either been snapped up or the landlord wouldn't have chosen a kind of a business with no credibility or track record at that time. It was like, “Hey, great, you want to rent it? You got it.” So that was lucky.
What's the plan going forward? Do you want to open up more stores?
Oliver: It always will be one burrito at a time. We've got 16 locations here in New York and we opened in Chicago in late 2017, so we're super excited to be spreading and bringing burritos to the Midwest now. We're always looking to find great locations. We always want to create more opportunities for our team members, and the best way to do that is to continue to grow more in order to build more taquerias, and that's also how we spread our love for burritos to more people. But you know, we're not going to be a company that's opening 15, 20 locations in a year. I can't see that.
Leo: I can see it. Just not soon. You want to grow something like 20 percent a year, and that sounds like a lot. If you've got 20 locations, that's just four the next year, and five or six the year after that.
Oliver: Which is a lot.
Leo: Which is a lot, but that is kind of hockey-stick growth—growth for growth's sake. But we're excited because we think that is something special to us—for our team and for our guests, you know, to have the opportunity to grow.
Leo, you used to be a part of the band Third Eye Blind Do you see any similarities within the music industry and becoming a restaurateur?
Leo: Yeah, absolutely. You can always find parallels. I was the bassist, and bassists are often overlooked in the band. But the reason you're dancing or not is the rhythm section. It's actually why very often you do or don’t like the experience, especially live, and I compare that to the rice and beans in the burrito.
You know, everyone talks about the meat and guacamole and those are the stars of the show. But if the rice and the beans are on point, it is pretty great. And if they're overlooked, because they are often overlooked, if the rice is going into a rice cooker, and your bringing in precooked beans, people think it is no big deal. If you get those things right, you’re off to a great start—so the rice and beans, bass and drums comparison is a thing. There is teamwork in a musical setting, and you gotta just work as a team, and that's how it is in the restaurant. You can't do it by yourself and run a taqueria.
Got It. So Third Eye Blind to Dos Toros. Is there any coincidence there with numbers?
Oliver: The next thing is going to be Uni Toro. [laughs]
You never know!
Oliver: It’s our new concept.
Leo: Sea urchin. I love sea urchin!
Oliver: I'm joking!
Leo: I don’t know. Maybe? They are both passion projects. That’s the common thread. Whether it is music or burritos and then northern California cuisine—it’s when you're animated by a passion that it gives you so much energy to just go above and beyond and to hustle every day and to have that level of insight, that's going to excite/ignite your gas because you're connecting to that passion. I think that's the common thread.
Oliver, sources say you used to dabble in apps before apps were a thing. You guys did have Burrito Time where customers could win a food burrito for a limited time. How hands-on were you on the Burrito Time app that came out a little while back, and can we expect another app to come from you?
Oliver: You know I’m glad you asked. I think I was a four out of 10 in terms of how hands-on I was with the Burrito Time app. The first time that we kicked the idea around, I thought it was amazing. The actual traditional app that a lot of restaurants have, whether it’s location based or whatever it might be, didn't really appeal to us and The Burrito Time app made that much sense for us given our service style, and the way we position ourselves. We actually are about to release a new mobile app. Well, it’s not really an app. It's a mobile-enabled program for our website basically, So that kind of solves that issue. In terms of the future apps for Dos Toros, I think 100 percent we're going to do—have you ever heard of or played a game called Rollercoaster Tycoon?
Oh, of course.
Oliver: I personally would love to see a burrito-maker type app.
Leo: Still working on the title...
Oliver: You know, it is still in the nest in the tree, but once we're ready to share...
So if someone wants to start a business, what are a few of the challenges you feel they might face?
Leo: Everything's a challenge at first. The fear, the unknown, how to organize yourself and learn all these disciplines. You know, when you're an entrepreneur, there are many different disciplines you're kind of having to deal with, whether it's your marketing or design or product development or team building or training or hiring or sales—just all these different aspects. And I just think it's sometimes hard to imagine how you ever get to that end goal of realizing it. And I think you've just got to take one step at a time, and I'd just bite off little pieces, just start getting some of those steps of accountability and they'll lead to the next steps. You don't have to have it all figured it all out.
Oliver: Right. I agree with that totally. A little piece of advice is that if you are not completely passionate, animated and in love with the thing that you are making, then it is probably not the best thing to start a business. You have to be so, so into your product and so excited about it to get other people to feel that too.
Leo: Yeah, the product focus is a big thing. As we think about big-picture vision, not just strategies, but the mission statement and why are we doing this. It does not matter what you do, it's why you do it.
I think that it's Simon Sinek starting with Why—I thought it was real and powerful—but at the same time, as you think about lofty goals about the animating principle and the why and how to get everyone kind of pulling in the same direction—the product is it. If you just nailed the product and never lose sight of the potential of how great it can possibly be, I think you're going to win. I think if you overlook or skip steps, that's when you're going get into trouble and your product…you start with that.
There's a debate that's been going on here in the office, right? Say you have the perfect product. What comes next? Is it the logo or the website?
Oliver: The location.
Leo: For a restaurant, it is the location. When you're a convenience product like that, you just have to be convenient for your guests. But you're right to bring up design, you have to think of the design. I think the design is the hidden multiplier that, you know, beautifully considered design for every brand touch point, for the logo, for the website, the menu boards or whatever that relates to your product design. People just react to good design, they don't even know it. When they're interacting with good design, it just feels good.
Oliver: I mean the goal is that when interacting with your product, especially when it comes to your brand, is that it's fun. If it's fun and exciting, they are interacting with your brand. When you interact with someone else's brand, that didn't just happen. There was so much effort and energy put into creating these moments of life.
Leo: I would love copywriting in design. I think language choice—because ultimately it's so different from the writing that you got in school where you write a five-page essay or whatever. For copywriting, it's a sentence or three words, and sculpting those words and language is so powerful.
Oliver: He's really good at that. That's all. It doesn't just happen.
Final question. We've made it to the home stretch. I have to ask: Quesadilla love, 99 Tacos, Guac it out. What's the next music video we can expect?
Leo: I think that's a good question and that’s the right question.
Oliver: So we have a secret menu item that we are—I guess not-so-secret-anymore—but we're really excited about releasing nachos to the public and not necessarily having that on the menu board. I thought it would be an animal-style thing: a tasty, exciting treat that really worked wonderfully with our service style. We haven't gotten so much further than that it will be a nacho deep dive song.
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