[00:00:00] Seth Berkowitz: I lived in a college house with eight of my very close friends, chaos and parties, and it was really a fun place to live for three years. So one night there's a knock at the door. 

[00:00:09] Michael Oved: Why did you start Insomnia Cookies in college?

[00:00:10] Seth Berkowitz:  So a warm cookie was comforting, it was nostalgic, it felt like home, but I was delivering it till two or two o'clock in the morning, right?

[00:00:18] Seth Berkowitz: So there was this like incredible late night party vibe in my mind, like. Insomnia when it started. There was very little success in the cookie retail industry, like insomnia set out to recreate the category.

[00:00:30] Michael Oved: Now, based on all your experiences, all your successes, all of your failures, if you're speaking to a high school or college student right now, what would you tell them to best prepare them to be a successful entrepreneur?

[00:00:41] Seth Berkowitz: I just –

[00:00:42] Michael Oved: welcome back to 30 years in 30 minutes. I'm your host, Michael Ovid, and we've got a great episode for you today. With that, it is my pleasure to introduce to you today's guest. Seth Berkowitz is the founder and CEO of Insomnia Cookies, a chain of bakeries in the United States that specializes in delivering warm [00:01:00] cookies, baked goods, and ice cream, beloved by college students across the country and true to its name by staying open until 3:00 AM Insomnia Cookies was founded in 2003 when Seth was a junior at the University of Pennsylvania.

[00:01:12] Michael Oved: Since then, he has scaled the company to over 250 locations with annual revenue over $300 million. Seth is also the founder of Beacon, a consumer and tech focused investment firm, as well as financial lease, a bookkeeping and financial management firm. Seth, thank you again for joining us today.

[00:01:29] Seth Berkowitz: It's my pleasure.

[00:01:29] Seth Berkowitz: Thanks so much for having me.

[00:01:30] Michael Oved: Of course. Let's, let's start from the beginning with your childhood. What experiences in your childhood and I. What about your upbringing peaked your interest in entrepreneurship?

[00:01:40] Seth Berkowitz: Uh, that's a good question. So I grew up in Rockland County, New York, about 45 minutes outside of Manhattan.

[00:01:47] Seth Berkowitz: My dad was a CFO of a textile firm for a while, textile and, uh, garment industry firm for a while. And I remember when I was little, I went to his warehouse. He used to, I used to work with him, [00:02:00] uh, every summer in between, you know, whatever. I think even like second grade, third grade, early, early on in my life.

[00:02:05] Seth Berkowitz: And he ran the warehouse. He was the CFO, he ran the warehouse. And I just remember feeling like something about this seems pretty special. Um, having the opportunity to work so closely with people in a leadership capacity, uh, definitely was intrigued by that. But then my parents also, like, they really just, they just pushed me to craft my own path.

[00:02:23] Seth Berkowitz: That was like a big. A big push for them as, as parents and role models for me. And when I was young I used to sell baseball cards and I used to like write a sports magazine, very big sports guy. Always trying to find a way to be enterprising.

[00:02:36] Michael Oved: And, and what skills did you develop, uh, in your child, either through selling baseball cards or otherwise that helped guide you when you started Insomnia Cookies at such a young age?

[00:02:45] Seth Berkowitz: Uh, I, I don't know if I developed many skills that early on that contributed to insomnia's success, but I'll, I'll tell you. The insomnia journey is a lot about passion and it's a lot about perseverance. And I think elements of my childhood push me. And [00:03:00] by the way, it's just one thing to add. I'm the youngest of three, I'm six years younger than my, uh, my brother and not eight years younger than my oldest brother.

[00:03:08] Seth Berkowitz: And there's something about being the youngest, it was almost the point where my parents. We're kind of done being parents and they had this, this, this younger, younger kid and they left me quite a bit on my own and created a lot of independence and autonomy. But I'll say like there was, there was definitely for me growing up, this sense of being really passionate, getting pushed to be really passionate about things and really trying to fight through challenges.

[00:03:27] Seth Berkowitz: It's just what I was taught. Uh, and I think that really set me up for a lot of success in business.

[00:03:32] Michael Oved: So what is the key to pushing through the challenges and persevering?

[00:03:36] Seth Berkowitz: You gotta kind of enjoy them, honestly, like. Look at them as more a puzzle than a challenge. Something to solve. Sometimes there's things that you can't get through, you can't crack the code.

[00:03:45] Seth Berkowitz: I mean, for sure, but it doesn't mean you can't pivot. It doesn't mean that you can't jump over it. You can't have somebody help you jump over it. And I, I typically look at, at, at a challenge as an opportunity. I think some of it is 20 year journey. Lots of struggles in the early days. I feel [00:04:00] like I was kind of forged from challenge, honestly, as a business leader.

[00:04:03] Seth Berkowitz: And so I revel in it. Like that's just the nature of, of, of how I behaved.

[00:04:08] Michael Oved: Does that come with experience experiencing all those failures? Or is there something you can do when you're younger to develop that resilience?

[00:04:16] Seth Berkowitz: I think most of my resilience came out of experience. I think just like kind of a general idea, resilience typically comes from not knowing what's right in front of you and it, and really surprising you trying to find a mentor, trying to find people who work with people who've seen what you haven't seen yet.

[00:04:31] Seth Berkowitz: Helping you avoid those pitfalls is way better than having to learn how to be overly resilient. But it's a mindset. I mean, it really is. Anyone can, anyone can shift their mindset away from. Not necessarily even victimization, but this notion that things that happen to me are, are insurmountable.

[00:04:47] Michael Oved: And how do you ship that mindset

[00:04:49] Seth Berkowitz: to some extent?

[00:04:50] Seth Berkowitz: I think it's pushing yourself and getting a win, pushing yourself and actually succeeding against the backdrop of challenge. Uh, and then once you've accomplished that, starting to use [00:05:00] that to build momentum towards building actually a capability, right? Like, uh. You can be really resilient 'cause you're delusional, which I think I was in the early days of insomnia.

[00:05:08] Seth Berkowitz: Um, I think you can think that you're a visionary even though you're not. And it's really gonna come down to rolling up your sleeves and fighting. Um, but then when you start to get some of those, those wins, I think it becomes a lot easier to establish that as part of your culture.

[00:05:21] Michael Oved: Because what a lot of people do is they put themselves in a box, they limit themselves in their mind, and the barriers are only there because they built them.

[00:05:30] Michael Oved: Their mind. So for people who put up those obstacles that don't exist, how do you overcome that?

[00:05:36] Seth Berkowitz: They're the ones who put them up, right? I mean, are you asking yourself tough questions? Are you really curious? Like, are you digging a level deeper? You have the box, okay, you put a box on and it's blocking you.

[00:05:47] Seth Berkowitz: But in your mind, can you think about why can you push yourself to really go, to be more curious, to go a level deeper, to look to others, to create a broader debate, to have a real conversation. And to help shape [00:06:00] your thoughts because a box is a moment in time, right? It's not a mindset, it's not permanent.

[00:06:06] Seth Berkowitz: It's a moment. And a lot of times in this world, you see it all around us. People get stuck in a moment and act like it's gospel, but it's not. It's a moment. It what changes. Changes thought process. What changes? The way that we move forward is others and conversation and debate, and then improvement and then growth and maybe even happiness.

[00:06:28] Michael Oved: Now moving on to Insomnia Cookies. Why did you start Insomnia Cookies in college?

[00:06:32] Seth Berkowitz: So I'll, I'll take you back to the timeframe, right? So it's 2002, 2003 timeframe, and at Penn there was a huge business culture. The Wharton School really drives a lot of. A lot of, lot of finance conversation, a lot of people going into finance just wasn't for me like I do.

[00:06:50] Seth Berkowitz: I knew it was something I didn't want to do. Um, and I had no idea what was next. Like I truly didn't. It's an amazing thing about college. I'm sure you're experiencing it now. It's such a crossroads in [00:07:00] such an amazing way. There's this feeling of I'm this adult, right? Like, I get to do what I want. I'm up all hours of the night.

[00:07:07] Seth Berkowitz: You know, it's so much independence, but then some level of, I just left home, maybe there's homesickness and, and generally I felt like this big crossroads and so insomnia for me actually pulled at that kind of moment, that kind of emotional feeling I was having, of kind of feeling like I'm still a kid, I'm trying to determine what my next steps are.

[00:07:27] Seth Berkowitz: And so a warm cookie was comforting. It was nostalgic, right? It felt like home. My mom used to bake. It kind of felt like home. But I was delivering it till two or two o'clock in the morning, right? So there was this like incredible, um, late night party vibe in my mind, like this, oh, we call it Own the night.

[00:07:44] Seth Berkowitz: Now it's this kind of a mantra that we, we live by and it hit at those crossroads. It was this, this kind of, this incredible late night atmosphere business, but it was also really comforting and nostalgic. And so it spoke to what I emotionally felt as a college student. So that kind of spoke to me [00:08:00] and it made it clear I wanted to start something that, that where I was, that was something that I could really get excited about.

[00:08:08] Michael Oved: I totally understand what you're saying about the crossroads because right now I'm in college. I actually feel like the world is at my fingertips. I feel like I ought to make the most at every opportunity. Very, very difficult feat. For you, you did that when you started in cellmate cookies, you took the road not taken.

[00:08:25] Michael Oved: How did you know? How do you know if the road not taken that you're traveling on is truly the right road?

[00:08:32] Seth Berkowitz: Uh, you don't. You do not know. And I use, I mean, I use the word like it's diluted. It is, it's kind of a big piece of the puzzle, right? You have to. Convince yourself it's the right path. And so I'm a very resolute person.

[00:08:44] Seth Berkowitz: Like I dated somebody in college. We're married, we have four children. I knew it within a, a week of us, of us getting together. I knew it, right? Like I'm incredibly passionate about everything that I do, and I'm very resolute to a fault. I always try to work on this to be a little bit [00:09:00] more methodical and ploting 'cause I can be a little bit stuck.

[00:09:02] Seth Berkowitz: It happens. The rigidity shows up. Like there is an element to it where you have to just believe and have resolve and just say like, I see something that others don't, and that's entrepreneurship rather. By the way, that's what it is. It's seeing something that other people didn't believe could exist and going after it and then trying to shape and mold society to agree with you.

[00:09:23] Seth Berkowitz: Not so easy.

[00:09:24] Michael Oved: I 100% agree with you. Obsession is a critical part of entrepreneurship. What did it take other than that obsessiveness in your mindset to get insomnia cookies off the ground and truly to, to grow it from you running around at 2:00 AM delivering cookies to the behemoth that is today?

[00:09:41] Seth Berkowitz: So I think there were two critical pieces.

[00:09:43] Seth Berkowitz: One is. I've, I've started other businesses. I've, some of 'em have struggled, some of 'em have worked. Insomnia's really been core for 20 years, and it's where still the CEO, um, have been since day one. So I focus on at 99% of my time. But I can get excited about a business when the consumer [00:10:00] expresses a certain amount of joy and love for what you're selling them, right?

[00:10:03] Seth Berkowitz: Like that's not so easy to spark. That cre, that connection and that emotion, insomnia had that right away. Like, I would go to the door and I deliver it to somebody. They would just smile and they'd be excited and there was, they'd be like, oh my God, I didn't know this was a thing. And that was enough for me to take the plunge.

[00:10:22] Seth Berkowitz: Now, what enabled me to take the plunge though, was being a college student, right, like having minimal amounts of expenses. At the time, my parents were still supporting me and helping me out very much, which was incredibly appreciated. My friends were splitting the electrical bill with me that they didn't even think too much about, went up a little bit when insomnia launched, right?

[00:10:42] Seth Berkowitz: So one, having this consumer reaction that was really authentic and organic, and also having a little bit of a less risky environment in which to launch it. Gave me a lot of confidence that it was worth a real and serious try.

[00:10:58] Michael Oved: And part of that was [00:11:00] because you chose a great niche where your target audience was college students.

[00:11:04] Michael Oved: How did you pick that niche?

[00:11:06] Seth Berkowitz: I lived in a college house with eight of my very close friends, and it was like ridiculous. Kind of a fraternity esque house. There's nine of us. It was chaos and parties and it was really a fun place to, it really was a fun place to, to live for three years on camp, uh, slightly off campus.

[00:11:21] Seth Berkowitz: And we would order food all hours of the night. We would order constantly. And there were like five options, by the way, for delivery. There was almost nothing. There was a couple of pizza concepts, Chinese restaurant, there's a hogie place, and then we'd all walk to Wawa, which was like three blocks away to just get whatever, whatever small indulgence we wanted.

[00:11:41] Seth Berkowitz: And so one night there's a knock at the door and we were playing a video game. We played Madden and Halo at the time, I don't, I don't remember which one it was. Inevitably I had lost, 'cause that was typically how it went. And I opened the door and it was the same delivery guy from one of the concepts that had been there like two or three times that evening.

[00:11:57] Seth Berkowitz: And I grabbed this pie of pizza and I slam it on the [00:12:00] table as my friends were playing Halo. And they're like, what? I said, listen, I keep answering this door. And the same guy is on the other side of the door, like there's gotta be something else, right? And they're like, you know what to do, like walk to Wawa.

[00:12:15] Seth Berkowitz: And I mean, he was like 20 degrees and I couldn't get myself to move. And I was like, you know, it would be amazing if something sweet and wonderful was delivered and something differentiated and unique. Um, and they're like, it's one o'clock in the morning in February of like 2002. Like. That's probably not happening.

[00:12:32] Seth Berkowitz: And I said, I'm gonna make it happen. They said, sure you are. And, but inevitably I did.

[00:12:36] Michael Oved: Like I said before, you picked a particular niche and everything you've done as a company has been geared, has been centered around that niche. How important do you think picking good niche is for the success of a company and the growth of brand?

[00:12:51] Seth Berkowitz: I mean, niche is really interesting because like you have, it's a captive group of insomniac. We call 'em insomniacs, right? It's a captive group. Late night. [00:13:00] Really committed to the community, loves the elements I described, right? The nostalgia, the comfort, and also the party elements of it. Like they love the convenience and the speed, and they're like plugged into social media and digital in a way that's very shareable and special, but it also has narrowness to it in some ways.

[00:13:15] Seth Berkowitz: So you gotta be great when you pick a narrow lane. You need to be great to that community and you can't deviate from it too much. Um, until you establish a bit, a bigger, uh, stronghold on it. So, you know, we were focused solely college, solely solely college really for many, many years. We opened up a New York store, but it went to NYU, right?

[00:13:34] Seth Berkowitz: We're delivering to NYU. It took until 2011 to open up really our first city store. And at that point we had many locations and the thought process was, well, people have graduated. They know our brand. They love our brand. They're in their twenties, so they're probably also out late at night. They're not so far removed from college.

[00:13:52] Seth Berkowitz: Let's try a city store. But it starts in college. It's always been rooted in college. 'cause that's where that emotional connection [00:14:00] stems from. Like it really goes back to that minute I was describing to you of. I feel like I'm still a kid to some extent, but I really am ready to be an adult. I'm kind of at this inflection point, and a warm cookie really hits the spot.

[00:14:12] Seth Berkowitz: And then if you can create that moment for the insomniac and hold that connection, it can be a lifelong connection. And so we then have to really foster that. We really need to engage with our insomniacs through their lifecycle. Uh, and that keeps going, right? I'm, I'm now 20 years past college, four kids.

[00:14:27] Seth Berkowitz: The suburbs are not such a big departure. I'm not. I'm, I live in New York City. I plan on continuing to do so, but many of my friends have moved outta town. That is kind of the next frontier for us to some extent, to try and make sure that we're maintaining that relationship with those that have, uh, allowed us to be successful.

[00:14:43] Michael Oved: And you guys did a really great job with that. Like I was telling before the interview, I have insomnia cookies every night and, and the workers there know my name.

[00:14:50] Seth Berkowitz: I appreciate, I really appreciate that. I mean, that's, uh. It's the college community. It's just, it's such a loyal and wonderful group. And, you know, our, our job is the har, the part that I, I [00:15:00] still find the hardest is you want to exceed expectations all the time, right?

[00:15:03] Seth Berkowitz: I appreciate you going every day, but like, I want you to be wowed. And the bigger you get right, the more you have to invest in that. You need to invest in the wow. And CO kind of changed people's expectations for a little bit, and I think those expectations are starting to rise again. And so we're pushing a lot into service.

[00:15:18] Seth Berkowitz: Making sure that your, your daily cookie is special.

[00:15:21] Michael Oved: Now I do wanna get to that wow factor in your ability to continue delivering. On that wow factor. But just to finish up the conversation about niche, because I think that's very important. How would you advise other people to identify specific niche markets in the untapped market like you did?

[00:15:36] Seth Berkowitz: My experience is a bit organic. Like I was a college student serving a college population, having access to college housing like it was, it was a very logical step for me and the time in my life. I think if somebody's trying to go after it that way, like that's great, right? If you can think through where are you in the world, where's a community that you can really tackle, uh, in a very specific way, and then push your brand around that [00:16:00] really focus your efforts on engaging that community.

[00:16:02] Seth Berkowitz: That could be superpower. I mean, some of the best brands are really focused. Harley-Davidson and Yeti, like they spend all of their time speaking to a very small group of people, but the passion and the connection is insane. It is so, so strong. And there are two exceptionally powerful brands, right? They do incredibly well because they make sure they are great, and whatever they do really well, connects very closely to that community.

[00:16:25] Seth Berkowitz: Don't deviate from it. So I think there's a lot of power in doing that. If you can find a community that is, that you can rally on behalf of, that they can rally with you. Um, but it's, it's really important that when you do pick that lane, you stay really tight and narrow to it. But, but how do you pick a lane?

[00:16:40] Michael Oved: Because there's so many untapped markets out there.

[00:16:44] Seth Berkowitz: We gotta bring a product to the market, right? There's a lot of untapped markets, but I mean, connecting product and market isn't so straightforward and so easy. I mean, I could have done not cookies. I could have done warm pre hot pretzels, right? There's a lot of different things.

[00:16:56] Seth Berkowitz: Trying to understand the target market and what you're going after and what [00:17:00] they care about. Maybe doing that research in that work. To recognize what the need state is and then determine what, what does expectation look like, and then exceed it and then exceed it again and again and again and again while continuing to bet on that community.

[00:17:14] Seth Berkowitz: Uh, I think that's probably the best way to go after that.

[00:17:16] Michael Oved: So, going back to what we were saying before. About the wow factor and still delivering on that 20 years after launching your company. How do you do that? How do you maintain the wow factor for all of your customers, whether it's their first time in your store, their hundredth time in the store, their thousandth times in the store?

[00:17:33] Seth Berkowitz: I think it comes down to knowing your. Insomniac, like we start from, do we understand what they care about? Well, like what's deeply important to them in the exp, right? Like, you can deliver lots of cool things to people slowly. You can deliver lots of cool things to people that are necessarily something that they're interested in at that moment.

[00:17:52] Seth Berkowitz: And so we try to stay very close understanding what the community's comprised of, what the, what the need states are like. There's. You can order cookies for lots of different reasons. Warm cookies [00:18:00] do make a lot of moments better. It's fun when you want a quick snack, right? You describe walking into the store or when you're with friends or in a gifting occasion, right, or a holiday.

[00:18:09] Seth Berkowitz: Like there's lots of different ways to use insomnia. For us, it's understanding how the community wants to use it, establishing a very clear baseline, and then pushing. Service and your internal teams to making sure that execution is above that line. Like basically like what is the line of wow, right? And are you above it?

[00:18:27] Seth Berkowitz: Every single time you deliver a cookie to someone's house, every single time they walk into the store and then measure it and then be obsessive with that.

[00:18:35] Michael Oved: And as the company grows, it becomes more and more difficult to do that. Now customer satisfaction doesn't entirely rest and end with you. It depends on the people you hire, the stores you've built.

[00:18:45] Michael Oved: How do you pick the right people to hire, build the right culture within the organization? How do you continue delivering on that wow factor when there's so many more elements of your company that are required to do that?

[00:18:57] Seth Berkowitz: And the nice thing about being a little bit narrow as a [00:19:00] brand, having like that kind of late night insomniac feel, is that the internal community of insomniacs are our employee base.

[00:19:07] Seth Berkowitz: It's pretty natural. Like, are you a late night type of a person? Right? Are you comfortable working late hours? Are you en energized by that? A lot of people are, by the way, a lot of people are just late night people, and so we try to focus our energy on finding those who are aligned to the hours, but also aligned to our values, right?

[00:19:23] Seth Berkowitz: Insomnia has six values. They're, you know, it's our internal verbiage, but, you know, effectively it comes down to are you super passionate about what we do? Are you incredibly creative? Are you flexible and nimble? Are you diligent? Are you authentic and original? And are you fun? And so we measure everything through those, those values or those are the behaviors behind the values.

[00:19:42] Seth Berkowitz: We measure everything through kind of that lens, and it allows us to understand are we, one, is the community one, and we try to make sure the external customer and the internal employee are not so different. And so that the community is all, we call everyone insomniacs. And so that we're trying to make sure that it feels as if everyone is one.

[00:19:59] Michael Oved: I really [00:20:00] do marvel at the fact that you started this company in college, literally 20 years old, not knowing much without having built anything tremendous before. How did you learn the business? How did you scale the business? What advice do you have for college students, for people looking to start a business with no work experience?

[00:20:17] Michael Oved: So

[00:20:18] Seth Berkowitz: I, I mean, I've learned a lot in the last 20 years. The single biggest thing I share with anyone is try to find a mentor early. Like really, I mean, I, I fought through eight years of losses and turmoil and financial crises and all sorts of different moments in time that I think about a lot because it helped move the business along, but were really painful and I didn't know how to get through 'em.

[00:20:46] Seth Berkowitz: I just. Used as much energy as I had and I pushed through. I mean, there were things I did that were ridiculous. I used to like build stores myself and deliver cookies five hours at a, you know, five hours to stores in upstate New York and in Maryland and Champ [00:21:00] Illinois. Like I just traveled the country fighting through it.

[00:21:02] Seth Berkowitz: You learn a lot from experience, but there is it that one, there's a cheat code, right? Others have done this before. You don't have to figure things out on your own. It's super critical that you find those mentors. I found them along the way slowly and kind of the biggest evolution I've had as a business leader has been since we partnered with Krispy Kreme back in 2018.

[00:21:23] Seth Berkowitz: Their leadership team really gave me a lot of room to run, but also truly showed me the way they really were very helpful in that regard.

[00:21:31] Michael Oved: So for someone without work experience, the best advice you'd give them is find mentors.

[00:21:35] Seth Berkowitz: I mean, to do is important also, but I think if, if you're gonna run something, really run something from scratch and build a business.

[00:21:42] Seth Berkowitz: Alongside others. You can bring in great talent if you have the capacity to do so, and that's gonna really help you. Like your talent can raise you up. I mean, that's really a critical piece. I didn't have that early on. I just didn't have the capital to do it. I was just bringing, I brought in some great people, but just not a lot of them.

[00:21:56] Seth Berkowitz: And we all were wearing a million hats at once in that [00:22:00] situation. And like the real early days of a startup, having somebody to guide you and be shoulder to shoulder is very helpful piece of the puzzle if you can get it. How

[00:22:08] Michael Oved: do you find those mentors?

[00:22:10] Seth Berkowitz: Seek them out. People will ping me and ask for a time all the time.

[00:22:13] Seth Berkowitz: Like they really, I just, I'll get emails daily, like, I just, I'm interested in entrepreneurship. Can we chat? And I try to say yes as much as I can. I think that's the way to do it. You know, find somebody that potentially inspires you, somebody who, uh, does something that you find it interesting and try to reach out, try to reach out to others who could, who might know them.

[00:22:30] Seth Berkowitz: Like I, I think that is the best possible way.

[00:22:33] Michael Oved: And how do you turn that informal conversation into a formal mentorship?

[00:22:37] Seth Berkowitz: I think you ask them, say, I'm looking for mentorship. How do you feel about us chatting every month? 20, gimme 20 minutes, gimme a half hour. And yeah, make sure you're walking away from that first meeting with the second meeting on the calendar.

[00:22:48] Seth Berkowitz: That's pretty important. That's by something I've learned in business over the last couple of the last 20 years or so, is that a lot of meetings end without a next steps. A lot of people walk. That was great. And then everybody goes off to their next thing. [00:23:00] Really important to walk away in the last three minutes.

[00:23:01] Seth Berkowitz: Be like, what do we, what did we just all say? And what are we doing next? So we're clear on, on the path forward. A lot of people. That it's really, it's an interesting dynamic to watch.

[00:23:11] Michael Oved: You mentioned that when you were first starting off, you didn't have access to a lot of capital. How did you build, how'd you scale?

[00:23:17] Michael Oved: How'd you market the company? Which inevitably required a tremendous investment without access to that type of capital.

[00:23:23] Seth Berkowitz: So I did raise some capital, but you know, you see fundraising now, at least in the last five years, right? Companies that are just an idea or have developed some level of revenue or raising money at, I don't know, valuations that are just.

[00:23:37] Seth Berkowitz: Excessive and don't make a ton of sense to me. But back in 2000, 2003, that's just not the way, that's just not the way it worked. And people did invest in food on a venture basis. The food businesses were not something that you'd find venture capital going into. 'cause typically cost money to build a store and, and venture capital likes going into asset life businesses.

[00:23:55] Seth Berkowitz: So I raised through, uh, angels and some family offices, [00:24:00] raised a modest amount of money by today's standards and that helped me. Help keep us in business. But my focus, and I think it came out of doing the first baking, the first mixing of the product for the first delivery was always operation focused.

[00:24:15] Seth Berkowitz: That's service focused. To make sure that delivering the warm product was gonna create brand advocacy. That if we did something really as spectacular, people would talk about it and they would tell others. And then the retail stores created even further brand engagement, and that was the virtuous cycle we needed to get the business really off the ground.

[00:24:33] Michael Oved: And what was the marketing strategy?

[00:24:36] Seth Berkowitz: It's funny 'cause we used to use these words, warm, delicious, delivered. We'd write it on the wall, which is not a marketing strategy. It's kind of, we call it a brand essence. Right? The key, the keys of insomnia. The pillars are insomnia are the warm, amazing product. The deliciousness of the cookies and just the delivery component, right?

[00:24:52] Seth Berkowitz: That is a convenient experience, but that's how we would talk about it way back when, right? It was just. This is new. We need to educate [00:25:00] you on warm cookies till two o'clock in the morning. For the first couple years. Everyone said like, I don't, does anyone need this? Like, does anyone need it? And I said, I'm telling you, if you try it and it's warm, it's going to blow your mind.

[00:25:10] Seth Berkowitz: Like, I don't know, I just dunno if anyone needs it. And it took many years to convince people that cookies are better warm. Sometimes they're better late at night. But generally it, for us, it was the educational component. We were, we were talking about. What the brand was built on that those, those pillars, uh, and we put them in front of our customers as much as possible.

[00:25:29] Seth Berkowitz: Now, it was kind of early days social media, so there wasn't tons of social media marketing. So there was a lot of product mar like we would do a lot of gorilla style marketing back in the day. We'd hand out lots of cookies. We would hand out a flyer, we'd hand out menus, we put something in people's hands and that kind of got, those were the touch points we needed to at least.

[00:25:47] Seth Berkowitz: Generate enough demands to keep the business afloat.

[00:25:50] Michael Oved: Do you think that even today in the era of social media that undergoing that gorilla type marketing is still beneficial?

[00:25:57] Seth Berkowitz: It's hard to scale up until probably [00:26:00] five years ago, it's still a big piece of the puzzle. We had about 150 ish stores. We talked about gorilla marketing quite a bit, and we had, like now we have college athletes.

[00:26:09] Seth Berkowitz: We, we sponsor athletes and. They serve as, you know, they're like our, our spokespeople to some extent on college campuses, and that's an amazing, amazing benefit to have. But it's a little bit different than literally going street to street, handing out cookies and handing out menus. But we did that as recently as five years ago.

[00:26:25] Seth Berkowitz: I. It was just, it, it felt like it was hard to measure the impact. Once we reached a certain level of scale, it, it started to feel like maybe we're putting the dollars to the wrong spot and we should focus our energies on putting more into social media where, you know, this is getting in front of people.

[00:26:39] Michael Oved: Now you're the CEO. A company generating revenues upwards of $300 million with over 250 locations. You're also the founder of Beacon, a consumer and tech focused investment firm in financial Lease, a bookkeeping and financial management firm. What lessons did you learn running insomnia that you took to your later ventures?

[00:26:58] Seth Berkowitz: Love growth in general, right? Like [00:27:00] love building things. It's always been a passion of mine goes, kind of goes without saying, being an entrepreneur, but. I felt like at certain points in insomnia, there's like these plateau moments. I think I've gotten that outta my head, but over the years I felt like there were these plateauing moments and every time there was one, I'd start a business.

[00:27:16] Seth Berkowitz: It's like 2013. We like kind of plateau. Our business is doing really well. I started this company called Fly Cleaners. It was this big laundry delivery logistics business in New York. That was crazy growth story to start. That was awesome. And out of that I started getting very excited about the idea of being more involved in early days startup.

[00:27:34] Seth Berkowitz: And I think some of that goes back to throwing the word nostalgia around quite a bit today. I, I really liked the idea of the beginning stages. Like I felt like there was something about that that was nostalgic for me. I wanted to be involved in things from the beginning. So I started investing in early stage, like really early stage businesses.

[00:27:52] Seth Berkowitz: And while working with early stage businesses, I recognize that they have. A very critical need for chief financial officers [00:28:00] and outsourced financial support that I struggled with when fly cleaners, when it was in its early days. And I certainly saw my portfolio company struggling with, so I helped. I worked with a friend of mine and we founded.

[00:28:11] Seth Berkowitz: This business, financial needs to support, to support early stage. It was. It was kind of, kind of, it was a way to take me back. I think that's, these founding businesses were functionally like a time machine for me.

[00:28:21] Michael Oved: Now, based on all your experiences, all your successes, all of your failures, if you're speaking to a high school or college student right now, what would you tell them to best prepare them to be a successful entrepreneur?

[00:28:32] Seth Berkowitz: Trying, like just go for it. Right? I mean, I think there's nothing, there's not much more to it like you can. So you can take some accounting classes. I think that's very helpful. I found my accounting classes to be incredibly helpful in college. I think speaking as we, we talked a little bit about today, right?

[00:28:45] Seth Berkowitz: Speaking to others who've done to get a feel for their experience and preparing you for what is gonna be pretty challenging in all likelihood. But I don't think anything really prepares you for it. I think it's, uh, it has to be an obsession. It has to be a passion. If you [00:29:00] want it, go get it.

[00:29:01] Michael Oved: Is there anything that aspiring entrepreneurs in college can do during the semester other than take accounting classes to best prepare them for success?

[00:29:11] Seth Berkowitz: I think reading and gaining knowledge about business is a pretty important thing to do. I think there's a lot to learn from others that have done, I've read countless business books and continue to do so. Other people's stories could be a blueprint for your own. Highly recommend being research oriented, but it's gotta balance with.

[00:29:29] Seth Berkowitz: I'm thoughtful and I'm really making sure I get all these pieces right, but also this willingness to just take the leap.

[00:29:35] Michael Oved: Now onto the rapid fire questions. What is your favorite flavor cookie?

[00:29:40] Seth Berkowitz: So I've been eating our double chocolate on cookie since 2004. I. I ever once deviated from that. I try, by the way, I try every cookie that we make and every limited tide offering product, I give it a shot.

[00:29:53] Seth Berkowitz: But if you put a box in front of me of our classic deluxe mini cookies cake, I will always go to Double Chocolate. That happened [00:30:00] exactly one hour and five minutes ago.

[00:30:02] Michael Oved: What book do you recommend?

[00:30:04] Seth Berkowitz: I mean, for managerial purposes, there's a book called Five Dysfunctions of A Team by Patrick Lencioni. That is, for me, it's like it's about how to design a trusted.

[00:30:13] Seth Berkowitz: Focused accountable team. It's really eye-opening. Um, especially for my seat. Somebody gave that to me about seven or eight years ago and it totally reshaped the way I thought about a leadership team. It was really, really, really powerful fiction. I've been reading this, uh, book by Hernan Diaz called Trust that I just absolutely love.

[00:30:33] Seth Berkowitz: It's a very different. Type of, uh, writing style than I'm used to. And it's, it's, it's great. His other books are also really good.

[00:30:42] Michael Oved: And what is your biggest regret?

[00:30:43] Seth Berkowitz: Uh, I, I try to say I don't have any regrets, but that's, you know, that's not true. So let's, let's, uh, let's give you one. So Insomnia, when it started in 2002, 2003 ish time, right?

[00:30:54] Seth Berkowitz: We had. There was very little success in the cookie retail industry, right? [00:31:00] Like insomnia set out to recreate the category, right? We wanted to do late night cookies and it was a way that people hadn't consumed cookies before and warm was a different kind of form factor. But those who were still in newer business, this is Fields great American cookie, they were not doing well.

[00:31:15] Seth Berkowitz: And so they, um, and actually I think two of them went bankrupt within 18 months of insomnia starting. I'm looking around saying to myself, I can't do a retail business, right? Like retail doesn't work. We're gonna do kind of like a ghost kitchen style. It's gonna be delivery only and it's gonna be in the back of other businesses and, and I ended up licensing a frozen yogurt shop at one point.

[00:31:39] Seth Berkowitz: Like there was elements to it where there was a fear of being a retailer when in reality. Retail has been a huge piece of our puzzle for a very, very long time. It creates incredible engagement. The late night hours are so important, and it took until five years later to recognize that those are five unfortunate lost years.

[00:31:58] Seth Berkowitz: And had we opened up retail stores in [00:32:00] college campuses on the main streets, it would've been great 'cause it, it proved that out very, very soon thereafter. Um, so I really do regret that fear. What is a quote that you live by? Uh, so this is like a company mantra, so I'll give you this one as I mentioned over the night.

[00:32:13] Seth Berkowitz: But like one thing that we talk about, we talk about our category creating. Spirit, that insomnia has shaped the way cookies could be eaten late night. And what we were intending to do was just be innovative, right? Be an innovative version of how everyone else was eating cookies. Um, and so we used the term imagine what's possible.

[00:32:29] Seth Berkowitz: And so like we just opened our headquarters in Philly. Imagine what's possible is the na Imagine was possible center. And the push really is can we iterate, can we innovate? Can we reinvent everything that we do? To exceed those expectations. Right? To be more than the wow yesterday. Right? Be a bigger one today.

[00:32:46] Seth Berkowitz: Um, and so for me, like I say, imagine as possible many times a day, probably to the point where my team is frustrated. But, um, those are words that I, I hold, you know, it's deep in my heart.

[00:32:56] Michael Oved: In the last question is, what has been the key to your [00:33:00] success?

[00:33:01] Seth Berkowitz: I'm not sure. I mean, I think there's been a lot of luck.

[00:33:04] Seth Berkowitz: Uh, there's been a lot, I mean, there's been a lot of perseverance. We've talked about that quite a bit today. But, you know, in 2000 10, 11, 12, I can't even remember exactly when, like the iPhone was a huge, huge springboard for success, right? We were an on demand late night business when on demand late night was meaningless for a very, very long time.

[00:33:22] Seth Berkowitz: And then the app infrastructure was built and convenience changed overnight. We were perfectly positioned for success, and that's the next 12 years has been wonderful. So, you know, there's a lot of luck in that. That was really great. But I think at the end of the day, and I, the passion for insomnia, I really believed in what I was trying to build.

[00:33:43] Seth Berkowitz: I really loved the community. I really loved the, the way the business was differentiated from the rest of the industry. And I think that ultimately was why we ended up where we're today.

[00:33:53] Michael Oved: That sounds amazing. This was a wonderful interview. Thank you so much, Seth, for joining us today. It's been a pleasure.

[00:33:57] Seth Berkowitz: It has been my absolute pleasure. Thanks for having me.

[00:33:59] Michael Oved: [00:34:00] Thank you for listening to 30 years and 30 minutes. Don't forget to like and subscribe and let us know in the comments if there's anyone else you want to hear from.