Patrick Terry

What we talked about

Why he still works

The opening question is why he works today, on the theory that the reason cannot be the same as it was at the beginning. His answer is that the job has changed from building to protecting. What they wanted has already been created, so the work now is making sure that growth does not alter it. Being at the helm is how he guarantees that who they are and what they do stays what it was on day one.

He is precise about the fact that the skill set which made him effective at the start is not the one the job requires now. What made the early years survivable was tenacity and a refusal to be the guy who failed. He credits Kathy, his co-founder and wife, with the same streak. The posture was simply that you are not going to outwork me.

The first year was a cluster, in his words

He is unusually blunt about the beginning. He lived at the first store for the first two or three years. He did not know how to do potatoes. He did not know how to hire. He let a lot of people go and a lot of people quit because they did not want to do what he was asking. He had a vision of what it was supposed to look like and no idea how it was supposed to get there, which he notes are two entirely different problems.

The emotional register of that period is the part most founder interviews skip. Every mistake felt terminal. One bad order and he was convinced the whole thing was over by morning, that everyone would be told, that they would be out of business in a day. He describes living with a constant pit in his stomach, and a nightly question of how to get through the night.

The month at Hotel San Jose

This is the best story on the tape and it needs no help. They were remodeling a house, it was not ready on time, and he had already leased out the house he owned to people who wanted to move in. So the family had nowhere to live and took a room at Hotel San Jose, back when it was still a motel and long before it acquired any allure.

They got the smallest unit in the very back, the one where the door hit the bed when you opened it. He rented it by the month. At night, if he got in early enough, he walked down the street to the laundromat and washed aprons. In the morning he counted the deposit on the bed, took it to the bank, and went to work. His stated goal each night was to get a beer before the bar closed at midnight, and most nights the bar had already closed. That was August. They had opened on July fifth.

The burglar alarm story belongs to the same month. The alarm goes off in the middle of the night, he gets the call, and he is on South Congress heading for the store behind a police car. There is not another vehicle on the road and the officer stops at the red light. Sitting behind him, Patrick concludes the man simply does not want to meet the burglar. He follows the patrol car into an empty parking lot, as he always did, because there was never anyone there.

Honesty as an operating system

Asked what has actually gotten him where he is, he names two things and neither is a business skill. The first is being honest with himself about what he can and cannot do, because the moment he starts pretending otherwise he thinks he is Superman and it gets dangerous fast. The second is being the first to admit a mistake.

The reason he gives for the second is the interesting part. Admitting the mistake is what lets you go fix it, but more importantly it gives everyone else in the company permission to do the same. If the guy at the top says he got it wrong, it is much easier for everybody below him. He describes that as how the company is run, not as a personal virtue.

Born between third base and home

He refuses the self-made framing entirely. His line is that he was born somewhere between third base and home, so he did not have far to go to score. He describes a really special childhood, a good high school life, a lot of friends, and a treasured life since.

His father taught him a sense of balance between work, life and values, which he says he has never fully reached but saw firsthand. His mother was a cheerleader who considered him perfect, a belief he did not have corrected until his forties and required other people to disprove. His conclusion is that having parents who root for you while also showing you the values of life is a pretty good deal.

He then turns the advantage into an obligation. Because he did not have to work as hard as many people do to get where he is, the idea of calling it in strikes him as insulting. That is the logic behind the Saturday when his daughter reported that a milkshake was not up to standard and he and Kathy got in the car, drove over, and checked the machine. His view is that the minute you stop doing that, you should not be running the business.

The same reasoning governs how visible his effort has to be. He is constantly being watched, particularly by employees, and if it is not important to him there is no reason it should be important to them.

Choosing the person you build it with

He gets asked how to find a good life partner and gives a more specific answer than the question deserved. He married late, which meant he had watched a lot of friends marry and seen how those marriages went. He and Kathy are both West Texans, he from Abilene and she from Midland, and he thinks that is a real connection rather than a coincidence.

The operative part is about working with your partner. If the two of you are not on the same page about wanting the thing to succeed, and you work together, it is not going to end well, married or not. Both of them wanted it to work and both were willing to be honest about it.

He also volunteers, with some delight, that he had not started P. Terry's when they married. He had talked about it constantly and she took it for talk. Then one day he came home with a lease.

Being a family man and a business man at the same time

He had been asked this before, and notes that Bobby Jenkins got the same question. His answer is to treat the business as much like family as you can, with the honest caveat that you cannot fire your family. What makes it work in practice is that his personality at the office is identical to his personality at home, so everyone there knows he cares about them and is available, exactly as his wife and daughters do.

That leads to the thesis of the whole interview: the business becomes a reflection of the person running it. It is not aspiration, it is what he considers a natural tendency. Who you are shows up at the burger stand whether you intend it to or not.

He does not romanticize the cost. The first two years there was no other life, and their first child was born two years into the business. He credits the marriage surviving that to Kathy being genuinely all right with it, and acknowledges plenty of people would not have been.

The pricing rule, which is the reason for everything else

Here is where the reflection idea becomes concrete. There is a reason the prices are what they are: the company is intentionally lower than everyone else and intentionally leaves money on the table.

He did not arrive at that from strategy. He arrived at it from standing in a store for years and getting to know customers, including the ones digging through the ashtray for a dime to pay for a meal. Once you have watched that, you understand that a quarter here and a dime there adds up until you have priced yourself out of somebody's budget. His phrasing is that they did not learn it the hard way, they learned it by watching.

The story he tells to explain it is a father and two boys, around six or seven, who came in every week. One day he realized he had not seen them for several months and asked where they had been. One of the boys, unfiltered, said his dad had been broke. Patrick's comment is that it will take your breath, and he notes what it meant in practice: back then four people could eat there for under twenty dollars without thinking about it, and even that had become impossible for this family.

The man with the lawn equipment

The other formative moment is the correction he received from a customer. Late on a Saturday afternoon a man in his late fifties or early sixties pulled up in a truck loaded with lawn equipment, having obviously been mowing all day, and ordered a burger and a Coke. Patrick, assuming he was skipping the fries on budget, offered to buy them for him.

The man did not accept or decline. He asked what they were cooked in. Told the oil had no trans fats or hydrogenated oils, he said he believed he would try that. Patrick's read on his own mistake is the sharpest thing he says all interview: just because a person works hard and watches their pennies does not mean they do not care what they eat. That is the whole reason he insists people on a budget still deserve a quality product.

Humility with 1,600 people doing the work

He enjoys being P. Terry and says so. People compliment him constantly, and he is clear-eyed about why: they had a good experience at a stand, and the reason they had it is the roughly sixteen hundred people doing the work. He also points out the obvious asymmetry, which is that nobody who had a bad experience walks up to introduce themselves. They just keep walking.

That is the quiet rule underneath the whole conversation. The prices stay low, the standards stay checkable on a Saturday, the mistakes get admitted out loud, and none of it is allowed to change as the thing grows.