Adam Lowenstein and Justin Herrick own
the most popular Mexican joint in town, own
one of the most popular college bars in the city, have Ann Arbor's most recognizable form of
green transportation, and recently took ownership of
one of the coolest little downtown dive bars as well. They haven't earned a single credit in business school, yet they've gone from opening a hole-in-the-wall counter service in 2004 to running three restaurants, three bars, and a small fleet of green buses just six years later.
Just how did these unlikely entrepreneurs become the golden boys of Ann Arbor business?
The story that almost wasn'tIt's a story that should never have been. If not for a series of happy accidents, Lowenstein and Herrick might not be Facebook friends, let alone successful business partners. Herrick is seven years older than Lowenstein and though the two attended the same tiny boarding school in California (
Midland School), they shouldn't have crossed paths. Happy accident number one - during breaks from Amherst College, Herrick spent a lot of time at Midland. His father was a science teacher there and his younger cousin Katie was a student. It just so happens that one of Katie's good friends at Midland was a young Adam Lowenstein.
"It's a tight knit community and despite the age difference I got to know him pretty well," says Herrick.
Lowenstein graduated and left to study film and video at the University of Michigan while they kept in touch. That should have been it. Herrick was on track for a career in medicine and Lowenstein was studying in Ann Arbor. Enter happy accident number two -- never underestimate a Californian's love for Mexican.
"Unlike a typical California campus, Ann Arbor didn't have any good Mexican at the time," Lowenstein says. "Every time I came home that's pretty much all I'd eat."
Lowenstein wasn't shy about his gustatory struggles. On Christmas break his junior year, Lowenstein's complaints found an interested ear. After reconsidering a career in medicine, Herrick and a friend (Joe Swain) had an idea to open a burrito place in Australia, but the plan had fallen through. Herrick listened to Lowenstein's scouting report and the pair schemed. By the end of break a plan was forming.
"We tripled our projections right off the bat"Lowenstein turned 21 in the summer of 2003 and quit school (he would resume his education and earn a degree in 2006). With modest savings and some help from their parents, Herrick, Lowenstein, and Swain drove from California to Ann Arbor with the goal of opening a burrito place within six months. By March of 2004, Big Ten Burrito was born.
Swain had experience managing two burrito places back home but none of them had any idea of how to run a business. Lucky for them, business boomed from the start. Big Ten Burrito became an immediate campus hit and their quickie burritos filled customers' stomachs and the partners' pockets.
"We tripled our projections right off the bat," says Herrick.
"The success was overwhelming," says Lowenstein. "The first day was exhilarating and on day two I woke up and I realized the restaurant was still there and it would be there forever. I imagine it's similar to how parents feel the morning after they bring their baby home from the hospital. Excitement mixed with panic."
Swain, who'd never intended to remain on board for long, was bought out and returned to California. Big Ten Burrito signed a wholesale contract with the University of Michigan to supply pre-made burritos for sale on campus. The partners purchased a second location on Packard, primarily as a prep site to make the 600 burritos a day required by the university. Next, a family paid for the rights to put a Big Ten Burrito franchise in Lansing.
Two retail locations, a potentially lucrative wholesale deal at a major university, and the beginnings of a franchise. This is when the golden boys turned their attention to the Ann Arbor bar scene.
More good times for Good Time Charley's"Other than Rick's, there weren't a lot of places students flocked to on campus at the time," says Lowenstein.
An agent mentioned a large bar on campus called Good Time Charley's was for sale. The bar had performed well in the past, but its recent track record was unimpressive. They had no experience running a bar, let alone a full service restaurant, but when had that stopped the pair before? Lowenstein and Herrick recognized this and jumped at the chance.
"It's a great location, a large patio, and the price was right," says Lowenstein.
"We knew we could make Good Time Charley's work," says Herrick.
No more happy accidents - this is where good business sense is clear. The partners retained the former owner as a consultant until they could get their sea legs and opened during the two busiest weeks of the year, around finals and spring graduation. Within months Lowenstein and Herrick owned one of the most popular campus bars in town, beating their projections once again. Expansion didn't stop there. A year later, the pair opened the
BTB Cantina above Good Time Charley's - a full service bar version of their popular State Street location. Around this time the
BTB Party buses, a venture with
Underground Printing co-owner Rishi Narayan that uses refurbished buses running on vegetable oil to transport students to BTB locations or for special events, hit the road. By the end of 2009, Good Time Charley's was buying
more liquor than any other bar in Washtenaw County. And that doesn't include beer.
T
here were setbacks. The Lansing franchise closed in 2008 and BTB lost its contract with the University ("a blessing in disguise," says Lowenstein), while the addition of Qdoba and Chipotle franchises gave BTB stiffer competition. The Packard location, underutilized as a prep space, didn’t make as much financial sense and the partners eventually closed it in 2010. But just as they seemed to be consolidating their core businesses, Lowenstein and Herrick expanded once again.
"Someone emailed over a business listing," says Herrick. "The Alley Bar was for sale and we knew we could make it work." They missed on an initial bid but hit on a more attractive deal later on, giving them a downtown bar with a proven track record that was under-performing. "We knew the location had performed well when it was run well," he adds.
On paper, Alley Bar is the simplest of the partners' ventures. It doesn't serve food and has a staff size more in line with the State Street BTB.
"This is the first business we've had where everything has gone exactly to plan," says Herrick. "It's kind of nice."
"The most important business to get right is the first one."Their success sounds simple: locate a need and offer a solution. That or target an under-performing business with a history of success, work hard, and return it to glory. The BTB locations fulfilled the demand for good, quick Mexican, and Good Time Charley's and Alley Bar were both under-performing businesses with a history of success that needed new blood.
To Herrick, all the credit goes to that one hole-in-the-wall burrito joint on State Street. "The most important business to get right is the first one," he says. "From there you're playing with house money. From there you have momentum and you can mess up a bit."
The partners state, almost with a sense of relief that there are no plans to expand in the near future.
"We want to be sure the original State street location is strong, keep Charley's working and develop the Cantina concept more," says Herrick.
"We have no plans to expand," says Lowenstein.
But you never know. We've heard that song before.
Richard Retyi is Assistant Director for
Athletic Media Relations at the University of Michigan. He writes a
biweekly(ish) column for AnnArbor.com called "Lie to Your Cats About
Santa" and has a cool new blog called InBedByEleven.com. His first previous article for Concentrate was A2's Best Bar Eats.All photos by Doug CoombePhotos
L to R - Adam Lowenstein and Justin Herrick at BTB Cantina Adam and Justin in front of Big Ten Burrito on State Street
Justin and Adam behind the bar at Good Time Charley's
Adam and Justin and a whole lot of beans in the kitchen at BTB Cantina
Adam and Justin at the Alley Bar on Liberty Street
Adam and Justin at BTB Cantina