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#96 ⁠⁠They've Given $900k of Interest Free Loans. Only $5k Has Defaulted | P. Terry's

Podcast: Hear how the founders of P.Terry’s have maintained subsidiarity even as they have scaled to $150M+ in revenue and 1800+ employees

Listen on: Fio (Catholic Spotify) | Apple Podcasts | Spotify | YouTube

Today’s Topic & Guest:

Kathy Terry & Patrick Terry | P. Terry’s Burger Stand

We’ve got a juicy episode for you today!

P. Terry’s, the famous Austin burger joint(s) started as one store, but are now doing over $150 Million across 37 stores and 1800 employees.

The founders have done an incredible job of maintaining subsidiarity with their employees and solidarity with their community.

Said in non CST speak, they…

  • Offer interest free loans to their employees (over $900k so far)

  • Bake a cake for each employee their birthday (they have someone who bakes cakes full time)

  • Offer flexibility if someone is late

  • Do profit sharing

  • Donate profits one Saturday each month to a local Austin charity

  • Kept their prices low and quality high, even though it meant smaller margins

In short, these two are one of the best modern examples we have of CST lived out in business.

I don’t want to spoil it so I’ll leave it there. Enjoy the episode!


News / Updates:

  • Pray with us: the Novena to St. Homobonus runs Wednesday, Nov 4 to Thursday, Nov 12, ending the eve of his feast on Nov 13. He and Our Lady, Queen of Heaven and Earth, are now the official patrons of the Guild.

  • Missed the Town Hall? The recording and notes are up for Guild members: why Catholic Founders exists, our 3 core commitments, cohort onboarding, and the new directory.

  • New: the Steward tier ($500/yr). Request a spot in a curated mastermind of 5-8 founders at a similar stage. It also helps us pay Oscar a proper wage.

  • Next Guild topic call: Tuesday, Nov 10, 5-6 PM CT, on Reclaiming Culture using public holidays (members only).

  • In-person meetups, open to all Catholic business owners: Columbus All Saints’ Day meetup (Sun, Nov 1), Nashville Workout & Coffee, Dallas Mass + Breakfast, Charlotte, Nashville and Wausau. Don’t miss out!

  • And make sure to pray for the souls in purgatory as we approach All Saints’ and All Souls’ Day. 🙏

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Core Lesson:

The Intention You Have When You Start Dictates the Goodness of The Thing You Build

Some people give you a line when you ask them a question. Not Kathy and Patrick. Our first question gives away what kind of people they are.

When we asked ‘but yet you still treat your employees like family’ — it was simple for them. “But of course.”

They were raised by business owners in an era where you took care of people, your community, and you did the right thing. You weren’t in it only for the money. You were in it to make a living, to provide for your family, and to do work that you didn’t hate.

Patrick really wanted to start a burger stand. He was willing to be the only employee in order to make it work.

Through this grafting and hard work, he spent all the hours with the employees for many many years. He also saw what the customers were like and what they wanted. He wasn’t in some ivory tower, or should we say some private equity office, making decisions that affected people he didn’t know.

The policies that we talked about that are so admirable, started with him knowing that one of his guys had a car breakdown and needed a taxi to get in. He also needed money to repair his truck. He didn’t want to work his shift so he paid the taxi bill and loaned him money to fix the truck and told him to pay back as he could.

And this persists to this day.

If he were in it to get rich, there is no way he would still have these policies. There’s no way they’d have a full time cake baker to deliver a cake on each employees birthday.

Make sure you know the intention you have before you set out on this business journey. And make sure that your intention is one in-line with your faith.

There are so many other lessons from this conversation that I’d like to share, but you’re just going to have to listen to the episode.

Please do us a favor and share this with your friends!

God Bless & Happy Building!

~Silas Mähner

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Key Episode References:

Select Quotes:

  • “If that would change the way we treated our employees and the way we ran our business, then I think we’d rather slow down than change.” — Kathy Terry

  • “Our goal every day is to not break our end of the deal.” — Patrick Terry

  • “We realized that we needed to be the safety net, because so many of these people didn’t have a safety net.” — Kathy Terry

  • “I wanted to run a burger stand. I wanted to be my own boss.” — Patrick Terry

  • “When you throw out moral obligation, you better be able to back it up.” — Kathy Terry

  • “No one’s gonna care about your business like you do.” — Kathy Terry, quoting The Intern

  • “I wasn’t gonna allow it to fail. If I had to live there at the burger stand, I would.” — Patrick Terry

  • “You have to think about how much is enough.” — Kathy Terry

  • “Sometimes all you have is your word.” — The Terrys

Key Moments: (outline)

  • 00:28 – Can 1,800 employees really be treated like family? “But of course.”

  • 02:21 – Costco vs. Sam’s Club, and how you measure success

  • 04:11 – The two-way deal between employer and employee

  • 05:48 – How capitalism became extractive and transactional

  • 09:22 – Milton Friedman and the shift to shareholder value

  • 11:07 – Scaling a business that stays human

  • 14:18 – Vin’s broken-down car and becoming the safety net for employees

  • 16:58 – Giving Back Saturdays: a full day’s profits to local nonprofits

  • 21:46 – Over $900K in interest-free employee loans, with only about $5K defaulted

  • 23:15 – Why every employee gets a birthday cake

  • 24:30 – Selling to an Employee Ownership Trust to lock in the culture

  • 28:54 – Know your people: “that’s where all the joy is”

  • 33:27 – “We didn’t set out to build a Catholic business”

  • 41:27 – How to know when it’s time to take the leap of faith

  • 45:33 – Walking away from the buyout offer

  • 49:43 – Keeping prices low while everyone else raises theirs

  • 52:04 – How much is enough?

  • 54:54 – Advice for scaling: grow at a pace your culture can handle

  • 56:57 – Closing and Rapid Fire


Hire Catholic Overseas Talent

In LatAm and the Philippines, there are millions of Catholic remote workers (across all domains) who want to work for ethical bosses.

Often, they’re treated as second-class citizens or work for organizations that ask them to do questionable things. They reach out to us in search of a Catholic boss.

So, we started ParacleteVA (website coming soon).

With ParacleteVA, we’ll find you vetted, Catholic overseas talent who will help you move your business forward.

How it works: Pay a $500 finders fee when the candidate starts, and $500 if you’re still happy with them after 30 days.

To get started, reach out to catholicfounders@gmail.com with what you’re looking for, and we’ll get started.

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