Tom Frainier profile picture

Tom Frainier

President / CEO (aka "Chief Bootlicker"), Semifreddi's Bakery

I am nothing without the people around me.

What’s the background to the business?
This basically emerged out of a mid-life crisis. I had done everything right in my life and was looking for another challenge. At the time I worked for Clorox in Finance and Accounting, but when I turned 30 I got offered a promotion and took a long hard look at my situation. One of my assignments was in the M&A department and I was fortunate at a young age to work with the Board of Directors. To be honest, I got a feeling that it was the Emperor’s New Clothes and I didn’t like who I needed to be or how I had to act to get to the top – it wasn’t a good fit for me anymore. Clorox is a great company but I realized that if I was going to get to the top I would have to change my personality.

The last performance review I had before I quit was very good but the feedback was that I sometimes used my wit inappropriately. That didn’t ring true with me as I love to use humor when I talk. Workplaces are often too uptight and I believe it’s not the end of the world if something goes wrong. So with that review I knew I would have to change who I was, but I really didn’t want to do that.

I quit without a job in January 1988. It was tough; I was earning $70,000 a year, which was a good salary, and I had no idea what to do with myself. It felt like I had just jumped off a cliff and didn’t know where I would land. As luck would have it, my sister and brother-in-law had a tiny bakery in Kensington, California. They asked me to help them while I figured out what to do and so I went to work with them for $7 an hour as an employee. I had never baked in my life but when I walked into their 450 square-foot facility at 4 a.m., I felt calm. I felt this was where I should be.

Within a week, I asked them if I could be their third partner, as they wanted to take it bigger. On a handshake we agreed that I would invest $25,000 for 33% of the business. Now, through sweat equity, that has grown to 50%. My brother-in-law, Mike, is still actively involved; my sister, less so as she is kept very busy with her three children. Having two partners works well and we really gel.

Working with my family is good. We lived with each other at first as I couldn’t afford to live on my own initially. I worked 90 hours a week for the first few years, up at 3 a.m., back at 8 p.m. every night. Our partnership benefits as we have the same values and the same ideals – we always agreed that we wanted our people to be the best paid and the best benefited in the artisan bread and pastry industry and I really believe that’s true; we have hit that ideal and we want to stay there. We’ve never been driven by money but by quality, people development, community involvement and environmental stewardship. Therefore, we have always made money. Our sales have grown every year for the past 28 years. We’ve had no outside investors and we’ve never lost money. Someone asked me recently what my exit strategy is; I told him it’s death (!).

BUSINESS BRIEFING

Business goal for the next 12 months: In the food industry there is something called the “slow food movement.” We believe that we are the “slow capitalism movement.” It’s a marathon, not a sprint. Our goal for the next 12 months is the same every year – we want to grow $500,000 a year. We don’t believe in percentage growth targets because, as the base gets bigger, it’s harder to achieve your sales goals, and this sometimes leads to taking on bad customers or expanding your product line too much. By growing at $500,000 year on average, we can give raises, maintain our benefits package and continue to give back to community. We have never laid anyone off. We want to keep doing what we’re doing – producing the best quality bread and pastries in the world at the best price. We have 125 full time employees with full benefits; 90% of them started at entry level. I believe in providing a balanced life for my employees and for myself. For example, if you send an email when you’re supposed to be on vacation then in my book that’s grounds for termination. The biggest gift we can give to our employees is to not have them tethered to the company 24 hours a day. I’m proud of our achievements.

Advice you wish you had known: Anything that appears to be bad almost always turns out good. For example, for years I was worried that our lease was expiring and that we would have to move. But, actually, being forced to move was the best thing we ever did. I also didn’t realize how long it would take to develop a strong culture for everyone in company; I thought it could happen overnight.

Best business decision: Joining Semifreddi’s.

Toughest business decision: In 2000, Pixar bought our building and offered us money to move early. I turned it down. They came back again in 2006/7 and made a final offer of $2 million to move early but, again, I turned it down. I trusted my gut, as logic told me to take it; we are a small margin business and the money would have been welcome. I continued to doubt my decision. However, I had a feeling that the economy was going to crash and that the building we would have had to buy at that time would have been too expensive to develop. We bake and deliver fresh bread and pastries 359 days a year (we are closed 6 days for paid holidays) and the operation is 24/7, so we needed to find a much bigger space to accommodate us. Two years later, in 2009, when we got into the building where we are now, interest rates were lower, the cost of the building was lower and the contractor was lower. We actually did better financially than if we had accepted the $2 million offer. It was the toughest but also the best decision I’ve had to make. We designed our new building from scratch and did everything in an incredible seven months.

Person most admired: I have a few. My parents predominantly; they really set me a good example of being selfless. They taught me that you show up before you’re supposed to work and are last to leave. You don’t complain and you do a good job. They really helped me with my work ethic.

Muhammad Ali. He gave up the prime earning years of his life for his principles and he is an athlete who has stood the test of time.

Cesar Chavez. Through non-violent boycotting he made the lives of farm workers better against all the odds and also stayed humble.

Richard Branson. He’s an off-beat entrepreneur, which I resonate with. He goes into industries where big companies have dominated the pricing and where service has not been that great. He shakes up industries and is successful doing it, but still keeps a sense of who he is as an individual.

Like most about job: My “Chief Bootlicker” title says it all! The people. I could never work from home. I like to teach and see people develop. Some of the managers we have working here started as janitors. For people who normally wouldn’t have the chance to get to that level as they don’t have a college degree, that excites me the most. I enjoy making people’s lives better around me and the challenge of motivating people 24/7.

Like least about job: Hard to say. I’m a “Happy Chappy” but if I were to pick one thing, even though we treat people well, there are still times when one employee will rip you off. Sometimes human nature lets me down but that doesn’t prevent me from being positive or being confident in people. People can learn anything if they’re motivated. For example, there are some people who don’t seem good at math but when it comes to their paychecks they become PhD’s.

Dream job: I’d probably be a rock star (I have no talent but I have the moves!) or a teacher in an underprivileged inner city situation. I love what I do, though. For me early retirement is the booby prize of life. All my friends would still have to work and we wouldn’t be able to relate to each other. I can’t imagine playing golf and vacationing for the rest of my life. I want to have a positive impact on people’s lives and to leave world a better place than when I found it.

BEHIND THE SUIT

Birthplace: I grew up in Buffalo, New York. We moved to Southern California in 1965, then to Northern California in 1973. Although I consider California home, I think I have an East Coast attitude.

Education: Berkeley for my undergrad where I got a B.S. in Finance. I also got my MBA from Berkeley in Finance / General Management.

Favorite book: “Animal Farm” by George Orwell. There is a famous line in the book: “All animals are equal but some animals are more equal than others.” This book showed me that, no matter what the economic system, whether communism, socialism or capitalism, there will always be a “1%”. This proves to me that you can get to the top if you work hard, which is how I’ve lived my life.

Favorite movie: “The Graduate.” I first saw it when I was 14 and I really resonated with his life, and I always wanted to meet my Mrs. Robinson.

Outside of work: Lots of things – exercise, bike riding, basketball and hanging out with family and friends. I listen to live music at least once a month and read voraciously (non-fiction).

Community: We have donated fresh bread and pastries (not day old) to thousands of charities over the past 28 years, far too many to mention, and occasionally we take the crow bar to our wallets and write checks. Our community involvement is mainly around kids, the sick, the poor, the elderly and schools. McClymonds High School in West Oakland is a school we have “adopted.” I believe that if we are successful then we have an obligation to give back to the community. We donate over $500,000 in fresh bread and pastries each year to the community.

Family: I have two daughters. One is currently in Spain as an au pair, and the other is in Thailand doing a World Challenge helping locals to paint schools.