The REWORK podcast

A podcast about a better way to work and run your business. We bring you stories and unconventional wisdom from Basecamp’s co-founders and other business owners.

EPISODE 0025

The Bean Machine

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*taps mic* Is this thing on? We’re back from sabbatical! In our first post-hiatus episode, Shaun heads to Denver to visit his sister, who left a catering job at a big restaurant chain to run a coffee shop out of a Volkswagen Bus that she bought on impulse off Craigslist. Erika Hildner shares what she’s learned as a first-time business owner about risk-taking, customer service, and using common sense.


The Full Transcript:

[00:00:00] Broken By Design by Clip Art plays.

Shaun: [00:00:02] Wailin!

Wailin: [00:00:02] Hello.

Shaun: [00:00:03] Welcome back to Rework.

Wailin: [00:00:05] Where are we?

Shaun: [00:00:05] Exactly.

Wailin: [00:00:05] What are we doing?

Shaun: [00:00:07] Apparently this is a podcast by Basecamp about the better way to work and run your business.

Wailin: [00:00:11] I have no memory of how to do this. What we were doing before…

Shaun: [00:00:17] Well, we’re already off to a really good start.

Wailin: [00:00:18] Amazing.

[00:00:22] How has your sabbatical?

Shaun: [00:00:23] Would you like to introduce yourself first?

Wailin: [00:00:25] Oh, I’m Wailin Wong.

Shaun: [00:00:25] And I’m Shaun Hildner and my sabbatical was fine. I feel like I learned a lot about how to take a sabbatical and I’m not sure I did this one 100% correctly.

Wailin: [00:00:36] Oh really?

Shaun: [00:00:36] Mm-hmm.

Wailin: [00:00:36] Like what would you do differently?

Shaun: [00:00:38] I feel like a jam-packed it with too much stuff. Like I used that time, instead of to relax and center and reset myself. I used that time to get a bunch of stuff done or you know, go on this long vacation and none of it was super relaxing.

Wailin: [00:00:54] Right. In the way that international travel can often be a little bit draining.

Shaun: [00:00:57] Right.

Wailin: [00:00:58] Did you get that accent wall painted?

Shaun: [00:01:00] I did. I got a lot of walls painted.

Wailin: [00:01:03] Oh, you did more than one accent wall.

Shaun: [00:01:06] Mm-hmm.

Wailin: [00:01:05] Was all blue?

Shaun: [00:01:06] An entire hallway.

Wailin: [00:01:07] Oh, a hallway. You did the hallway in blue, too?

Shaun: [00:01:11] Uh-huh, now I’m ready to like redo all the trim.

Wailin: [00:01:13] Oh, look at you.

Shaun: [00:01:14] There’s a lot going on in my apartment right now.

Wailin: [00:01:16] Yeah, I’ll say.

Shaun: [00:01:17] Overall would… How did you find your sabbatical?

Wailin: [00:01:21] I found it to be really fun. Like, I truly disconnected from work the night before going on sabbatical. A bunch of us… Were you there? A bunch of us went out to a bar.

Shaun: [00:01:29] Yes.

Wailin: [00:01:30] Yes, you were there.

Shaun: [00:01:31] Yeah, we did some bowling.

Wailin: [00:01:32] I watched the bowling, well eating dessert and um…

Shaun: [00:01:35] Nothing is more exciting than watching bowling.

Wailin: [00:01:39] Well, you know, I’m bad at bowling so I’m not actually gonna do it. But I had a good time.

Shaun: [00:01:42] There’s only one way to get better, Wailin.

Wailin: [00:01:44] And our coworker Jonas took my phone and made me unlock it so that he could delete the Basecamp app off of my phone, which is very helpful because I’m not sure what have gotten around to doing it. And then I would have just been tempted to read notifications all during sabbatical because I am terrible like that. And I would have done it. So, I was really good at disconnecting from work.

Shaun: [00:01:44] Good.

Wailin: [00:02:06] I think sabbatical was still a little bit tiring and that we also packed a lot in. We took three different trips, but it’s a different kind of stress and being tired then like, work, or work burnout. So.

Shaun: [00:02:21] Yep.

Wailin: [00:02:22] So you know, I think it’s nice to have these, I don’t know. It’s kind of like alternating sources of stress and when you only have one to focus on at one time, then it seems much more manageable.

Shaun: [00:02:35] How do you feel about being back at work?

Wailin: [00:02:37] I feel okay.

Shaun: [00:02:38] Yeah?

Wailin: [00:02:38] I actually really like work and, you know, now that my kid’s back in school, it’s like, I think Jason talked about this in our last episode before going on sabbatical where he talked about work having seasons. And even though it’s still really hot right now, so still feels like summer, it doesn’t feel like fall… But, you know, now that my kid’s back in school and summer hours at Basecamp have ended, so now we’re back to five-day weeks instead of four-day weeks. I think it preps the body and mind for being like, now we’re back in a season of work, you know? And, I spent all this time traveling and reading novels and I didn’t really get anything done around the house. That’s okay. But, you know, it’s like, now I’m back and ready to work on stuff and… Oh! I got you a present.

Shaun: [00:03:28] Oh God. We just had a conversation at lunch, about how much I hate getting and receiving presents.

Wailin: [00:03:36] Oh, that’s right. But I love buying presents.

Shaun: [00:03:39] I know.

Wailin: [00:03:41] So, I got you a present. Now you have to open it on the air.

[00:03:45] [Wrapping paper rustles.]

Shaun: [00:03:44] I hope everyone can hear that. Oh my God, it’s amazing.

Wailin: [00:03:48] You have to describe it.

Shaun: [00:03:49] This is, dear listener, a gargoyle eating a… oh, I think it might be a cat. I don’t know. What do you think?

Wailin: [00:04:01] I couldn’t tell what it was. I thought I would buy and then I would let you figure out what it’s eating.

Shaun: [00:04:03] A horrific gargoyle eating some—maybe a rabbit. I would go rabbit, actually.

Wailin: [00:04:08] Well, it is from the French, medieval city of Carcassonne.

Shaun: [00:04:13] Oh, one of my favorite board games.

Wailin: [00:04:15] And it’s a real place and it’s absolutely beautiful.

Shaun: [00:04:17] How was the wall?

Wailin: [00:04:19] It was really cool.

Shaun: [00:04:19] I’ve heard it’s really beautiful.

Wailin: [00:04:21] Yeah, it is. I mean, we were there during a very busy tourist time. And so the line to get in to see the castle in the middle of the day was longer than even Disney World lines. So, we skipped it to just drink Aperol spritzes at a bar outside in a courtyard and it was beautiful. But we did go see this nighttime spectacular show in Carcassonne where the first part of it is they project these really cool images onto the wall of the castle and there’s music, and then you move into the courtyard and they have a dance show and a woman who is playing the viol de gamba, you know, which is a predecessor to the cello.

Shaun: [00:05:00] Sure.

Wailin: [00:05:01] And that was beautiful.

Shaun: [00:05:02] No, no, I don’t know.

Wailin: [00:05:06] So that was all really cool. Highly recommend going to Carcassonne.

Shaun: [00:05:12] Well, very cool.

Wailin: [00:05:12] And excellent souvenir shopping.

Shaun: [00:05:14] So, we’re back now and there’s some big news and I was assuming most of our listeners already know this. In the next month or so…

Wailin: [00:05:25] Early October, I believe it’s October 2nd.

Shaun: [00:05:28] We believe it’s October 2nd, a brand new book is coming out from the Basecamp cofounders, Jason Fried and David Heinemeier Hansson.

Wailin: [00:05:36] And it’s called, It Doesn’t Have to be Crazy at Work, and it’s all about having a calm workplace culture that isn’t about meetings and interruptions and getting every minute of your day scheduled. It’s about how to have an office culture where you have enough time to think and do your best work and where you’re not worshiping work for its own sake and just sacrificing everything on the altar of hustle.

Shaun: [00:06:03] You can find the link to preorder the book at Basecamp.com/books

Wailin: [00:06:08] We’re hard at work on episodes around some of the themes in the new book and you’ll start hearing those in October. In the meantime, we have just regular good old fashion Rework episodes for you as well. Starting with today’s.

Shaun: [00:06:22] This kind of ties into what we were talking about earlier on the show because it’s something I did while I was on a little mini vacation earlier this summer.

Wailin: [00:06:30] where you ended up doing work.

Shaun: [00:06:32] Mm-hmm.

Wailin: [00:06:32] Yeah.

Erika: [00:06:32] Hey, how are you doing?

Customer: [00:06:34] Good. How are you?

Erika: [00:06:35] Good, thanks.

Customer: [00:06:35] Can I just get a small iced coffee with room for cream?

Erika: [00:06:39] You betcha. Anything else for you?

Customer: [00:06:40] No, that’s it.

Erika: [00:06:40] All right, $2.50 please.

Erika: [00:06:47] I’m Erika Hildner and I’m making a smoothie.

[00:06:49] [Blender sounds.]

Erika: [00:06:52] I own and operate The Denver Bean Machine. It’s a mobile coffee shop out of a 1970 VW bus.

Shaun: [00:06:59] What is our relationship?

Erika: [00:07:00] Uh, you’re my younger brother.

Shaun: [00:07:01] Yup. That is my older sister, Erika, and a few months ago I was down in Denver to visit her and realized we’d never really talked about what it was like being a first time business owner. I had my microphone with me and asked her to show me the truck.

Erika: [00:07:15] It’s a 1970 VW Type 2 Transporter, which means it doesn’t have the top top and it does have the little silver detailing running around the side. That is the thing that distinguishes the Transporters from the Kombis. So, inside this thing I’ve got a refrigerator. It’s set underneath the counter facing the front of the vehicle. It’s basically one large countertop. The fridge is underneath it. It holds about 12 gallons of milk. And then set into the counter is an ice bin that holds 20 pounds of ice. To the left of that is my hand sink, which has both hot and cold water per to the health department. And then next to that is a BLENDTEC blender set into the counter. And then if I spin 90 degrees to my left, I’m looking at my drip brewer which will brew those larger pots of coffee.

[00:08:04] And then if I spin 180 degrees, so I’m facing the rear of the vehicle, I have my 2 Group Espresso machine, my grinder. And then, on the back of the vehicle. I have the back hatch open, and the whole drip brews station is back there. So, all your cream and sugars, all that jazz.

[00:08:21] Pretty much we can do anything that a larger scale coffee shop can do. I’ve got like the regular drip coffee, any espresso drink. We do a bunch of different flavorings. I can do mochas, caramels. And then I also offer smoothies and blended coffee drinks.

[00:08:37] Oh, I always say we because it’s—

Shaun: [00:08:37] It’s you and the van?

Erika: [00:08:37] —it’s me and the van. Because I feel like we’re in it together. I can’t do it without her.

Shaun: [00:08:45] Have you named her?

Erika: [00:08:46] Yeah, Laura. Because one of the key… it’s for no reason. Well, it is for a reason. One of the keys that was handed over to me to start the van had Laura stamped on it, like etched into the metal. I have no idea why. It wasn’t from the owner that I bought it from. It might’ve been from the original owner. So, I was like, yeah, it’s Laura’s key. It’s for Laura. So, I named the van Laura.

Shaun: [00:09:09] We’re at an outdoor food truck event in downtown Denver where Erika sells coffee every Thursday, and this being Denver. You may hear some folk music in the background.

Erika: [00:09:19] We’re at Civic Center EATS, right in between the court house and the Capitol building and they basically line this whole oval shape walkway with the food trucks. And they actually do it every Tuesday, Wednesday and Thursday from May to October. Monday through Friday I have a standing rotation of different corporate clients that I go to. Just like, different office parks that don’t have coffee nearby. And then Thursdays I’m here. And then on the weekends I pick up special events like sports tournaments, farmer’s markets, car shows, weddings, all that jazz.

Shaun: [00:09:53] Is there something about Denver that makes this truck work?

Erika: [00:09:54] Yeah, I think so. Definitely. We have really good weather all the time. This truck is a full nightmare to drive in the rain. The windshield wipers only have one speed. There is no power steering and the stick shift is as long as my leg and I can’t wear a seatbelt because I can’t reach the pedals if I do. Because the seatbelt has no elastic. It’s just a set, or like, no scroll or whatever seatbelts have to make them smaller or longer. It’s just one strap that goes in. Like a pilot.

Shaun: [00:10:29] What do you do in the winter?

Erika: [00:10:29] I take winters off. The last… yeah, I tried to operate the first couple of years I was in business. And, I really thought, you know, oh, hot drinks, winter’s going to be my busy season for sure. But, you know, I think what I’ve found is, you know, most people know where they’re getting their coffee every morning. And nobody’s really trying to go outside in the winter to go find a coffee truck somewhere. They’d rather just, you know, do a Starbucks drive-through or something, which I totally understand. In addition to that, I have teeny tiny pipes inside this espresso machine that are incredibly susceptible to freezing. So, it was a bit of a learning curve of actually, you don’t really want to be working in the winter because you know, you’re running into so many freezing issues with the equipment and then you also have way less in sales because nobody wants to be outside. So I decided two years ago that it wasn’t worth it. And so, I stripped all the equipment out of it, closed up the bus and went back home to Montana and skied my face off.

Shaun: [00:11:33] Erika started selling coffee out of the bean machine in 2013 when she bought the truck for about $50,000.

Erika: [00:11:41] So I actually never had dreams to be a coffee shop owner at all. I just wanted it to be a VW bus owner. I bought a 1984 VW pop-top and I was cruising around on craigslist looking for parts for it because you always need parts for VW buses and saw this for sale already retrofitted as a coffee shop. I was like, Oh man, that’s the coolest thing I’ve ever seen. So, I pretty much immediately quit my job, took out a loan and thought, why not this?

Shaun: [00:12:10] What was that process like? Were you scared? Were you, what where were you feeling when you decided to just jump in like that?

Erika: [00:12:15] You know, initially I was supposed to have a business partner, so I thought I was only taking out 25. And I sort of thought of it as like, well, I’m just gonna buy myself a pretty nice car. And then my business partner dropped out the day we were supposed to like pay the guy for the bus. He called me. I was sitting at the bank waiting to do the transfer and he called me and said that he hadn’t told his wife what his plans were, and that she was freaking out that he was taking out $25,000 out of their savings. Which I think is totally understandable. And I was like, oh man, who am I going into business with? This is not great at all. And so when he dropped out, I think that’s when I realized that I really wanted to do it.

[00:12:56] I mean, because I thought, sure, why not? But then I was like, well, another $25,000. That’s a pretty huge commitment. But like the amount of disappointment I felt at not being able to do it surprised me a lot. So, I decided to go for it and take out another 25 from a different bank.

Shaun: [00:13:13] What is it like being a business owner? Like what have you learned in the last five years?

Erika: [00:13:17] I think one of the biggest things I’ve learned is that it’s okay to sell out of things. I think when I first started out, I wanted, I was buying way too much product because I wanted to have everything that was on my menu available at all times for every single person, which is just crazy, especially in an operation this small, like I have such limited space. I can’t even, you know, reach everything. It’s, it’s crazy and that people were totally understandable or understanding. If you were like, I’m sold out of that, it’s fine. It’s fine to sell out. It’s a good thing to sell out. So yeah, product purchasing was, was a big lesson when I first started.

Shaun: [00:13:52] Do you think of yourself as a business owner?

Erika: [00:13:54] No, I don’t. I mostly think of myself as like a van owner and the coffee sales paid for the repairs on the buses. So it’s pretty much great.

Shaun: [00:14:03] Yesterday I overheard you complaining about you don’t know how to do pricing for catered events. Can you just walk me through your thought process?

Erika: [00:14:11] Yeah. Well I think what’s really confus—or, what I continue to struggle with is when do you charge people to have you someplace? When do you pay a vendor fee? How much of a vendor fee? Is it better to do a percentage of your sales or to do a flat fee? And it’s a little bit hard. I think the larger food trucks tend to prefer a flat vendor fee because they’re selling a more expensive single items. You know, they’re selling $10, $12, $15 entrees, so it’s a lot easier for them to make up 100, $200. But if I’m selling, you know, $3 or $4 coffee drinks, I have to sell three or four times as many drinks as they do to make up the same vendor fee. So, I tend to prefer percentages.

[00:14:56] And then if you’re doing like a larger event, like a wedding, it seems like if you want to offer like unlimited barista service, you know, like how do you factor in how many drinks, like you’re able to, to serve in that timeframe and then sort of round up. I mean that’s just what I’ve been doing. I don’t really know.

Shaun: [00:15:13] What are your plans for like next year?

Erika: [00:15:13] I mean, I think my ongoing plan is to just increase my weekly morning business because I really have like the sweet spot between seven and ten, which is when most coffee sales happen. Most people don’t want stuff after, you know, lunchtime, anyway. And then I do have a few evening things that are ongoing. But, so, basically trying to replace my, my underperforming corporate stops in the morning with better performing corporate stops, which in Denver right now has been super easy because we’ve had this huge influx of population and our job growth is out of control. And so is our housing, which sucks, but…

Shaun: [00:15:54] What were you doing before the coffee truck?

Erika: [00:15:56] So, I was working for Panera and doing their catering for a long time.

Shaun: [00:16:02] So, that’s kind of similar. Kind of similar industry.

Erika: [00:16:08] Similar industry, sure. Their coffee game is not really on point.

Shaun: [00:16:13] Is there anything you learned about catering, working for Panera that you’ve brought to The Bean Machine?

Erika: [00:16:18] When I was working for Panera, I think they’re… As far as their catering goes, their marketing department really wanted to do all sorts of crazy marketing schemes like all these free cookie giveaways for corporate clients. And then wanted us to be doing all these cold calls and I just, the whole time it was so frustrating cause I was like, look, all we’re doing is making sandwiches. We don’t need to be taking ourselves that seriously. What people want is food that looks nice, tastes good and is delivered on time. And having sort of that simplicity made… The store I was working at, our catering sales were off the charts and other stores are really struggling because they were focusing too much I think on all of this crazy marketing stuff.

[00:17:00] So, I took that with me and that’s what I want to do. I want to have awesome customer service on my truck. I want to make really good product and I want it to come out in a reasonable amount of time. And that’s what people want. Like that’s what they’re paying for.

Shaun: [00:17:14] What is your marketing strategy for The Bean Machine? How do you find clients?

Erika: [00:17:18] Don’t have one. Word of mouth, I guess, sure. I’ve never actively marketed at all. I just drive around. The van’s adorable. I basically rely on the van to speak for myself. I barely even use social media. I know it’s a thing. You’re supposed to be on Twitter. You’re supposed to be on Instagram. I don’t even know what Snapchat is. I mean, like it’s a chat that you snapped. I don’t even know. I hate it. I really don’t like it at all. See, I would say once every two weeks I put something on Twitter and it’s usually the same post. Like, “Oh yeah, I’m in Denver in a coffee truck. Come find me.” I mean, I really don’t, I haven’t needed it. I don’t know. It’s an awesome tool I think to have out there. But yeah, just not my jam.

[00:18:04] All right, what can I get for you?

Customer: [00:18:05] Can I get a large iced caramel latte?

Erika: [00:18:07] You got it.

Customer: [00:18:10] Thank you.

Erika: [00:18:09] Do you want whipped cream on that?

Customer: [00:18:11] Uh, sure.

Erika: [00:18:12] I will say this, you gave me a copy of Rework. I think the first year I started up. And I had purchased the vehicle in winter and then got it going, sort of that next spring and summer. And I read it. You got to me the book for Christmas and I read it on the plane coming back to Colorado and my biggest takeaway was like, oh, I might be doing this right. And it was just like this sense of relief because it was like, I don’t have any sort of business background. I don’t know anything. I’ve never ran a—run? Ran? ran a business? I’ve never run a business?

Shaun: [00:18:47] English major.

Erika: [00:18:49] Blowing it. No, I didn’t have any business experience. I didn’t take any business classes in college. I didn’t even take public speaking or whatever. I don’t even know. I just sort of went at it with common sense and was like, yeah, I’m going to make coffee. I’m gonna drive around in a bus. Where would people want coffee out of a bus? And sort of went from there. And it’s not like I had everything figured out, but as far as just common sense stuff, it really hasn’t been that hard. And I remember just reading the book and being relieved that I’m not as out of depth as, as maybe I thought I was. And I don’t need to know everything that they must teach you in business school. I don’t even know. But I could just rely on myself and figure it out as I go and that it was fine to be taking a risk and fine to be making mistakes and yeah.

Shaun: [00:19:42] Thanks Erika.

Erika: [00:19:43] Thanks brother. Thanks for visiting me and surprising me on my birthday.

Shaun: [00:19:47] Thanks for having me and let me stay on your couch.

Erika: [00:19:50] You got it.

Shaun: [00:19:51] Love you.

Erika: [00:19:51] Love you too.

Shaun: [00:19:53] Bye.

Erika: [00:19:53] Bye.

[00:19:54] Broken By Design by Clip Art plays.

Wailin: [00:19:56] Rework is produced by Shaun Hildner, and me, Wailin Wong. Our theme music is Broken By Design by Clip Art.

Shaun: [00:20:04] You can find show notes for this and every episode of Rework at rework.fm. You can find us on Twitter @reworkpodcast. And if you want to give us a call, you can also leave a voicemail at (708) 628-7850.