Tilman Fertitta is the chairman, CEO, and sole owner of Landry’s Inc. and the Houston Rockets. Subsidiaries of Landry’s include Joe’s Crab Shack, Bubba Gump Shrimp Company, Rainforest Cafe, Claim Jumper, Morton’s Steakhouse, Golden Nugget Hotels & Casinos, and dozens more hotels, restaurants, and other commercial properties.
Since 2016, he’s also been a reality star on CNBC’s Billion Dollar Buyer, where he travels the nation on the lookout for new small-business suppliers to help bring more business in to his properties.
Tilman often sounds like Donald Trump when touting his businesses (let’s be honest – Golden Nugget isn’t a place you stay on purpose) and saying “yuge,” but he still seems like a much more down-to-earth and savvy businessman.
The man is no-nonsense and doles out a ton of (mostly) great business advice while introducing audiences to new innovations in the hospitality industry and providing an inside look into his operations. Sometimes he’s right, and sometimes he’s wrong, but it’s always entertaining watching his interactions with entrepreneurs.
Season one is short, and Tilman is just getting his feet wet with the TV crews, but he’s a natural on camera, and it’s clear this series can last as long as he wants. CNBC is in love with him, as are audiences around the country. Let’s take a look at how the businesses that have been featured are fairing today.
Episode 1 – I’m Betting on Y’all
Macaron by Patisse is a Houston-based macaron company owned by siblings Sukaina and Muhammed Rajani. They started the company using over $400k of their parents’ retirement savings. When Sukaina says it’s the best in Houston, she’s referencing this list in the Houston Press. It also has great reviews on Foursquare (do people still use that?) and Yelp.
However, there are at least 20 macaron stores in the city of Houston these days, so they face a ton of competition. That’s part of what drove them to push for a big wholesale account like Landry’s.
According to Tilman, he spends over $50 million annually on desserts for his 500 properties around the U.S., and he could probably go through 25-30k macarons each year.
His culinary people tell him they’re the best (this is likely just for show, as companies audition for this show), and MBP’s secret sauce is using natural flavors for the almond meringue shells. However, Tilman has an issue with the company’s expansion plans, which included building out a commissary for production.
Here’s a clip:
Tilman’s issue is he can’t make a keystone markup with their production costs. This means, he wants a 50% markup, while they’re only making 22%. Also keep in mind a key isn’t what it used to be, thanks to online competitors like Amazon squeezing margins on brick-and-mortar.
They even continue draining profits by expanding to another retail store during filming.
They bid 180,000 macarons per year at $1.00 per unit (over 6x what he feels he can sell). He turns down their offer, but they’re still in business today.
Bravado Spice is a Houston-based hot sauce company by owners Jeremiah Tallerine and James Nelson. You may recognize Nelson from the fourth season of MasterChef. The company also funds itself through Kickstarter (more than once) and has won awards from the Fabulous Food Show, Houston Hot Sauce Festival, ZestFest, Austin Hot Sauce Festival, and more.
Its flavors include hipster flavor combinations like pineapple & habanero, serrano & basil, and ghost pepper & blueberry. As of December 3, 2017, the company website states they’ve sold over 350,000 bottles of hot sauce to 1,100 stores in 33 states. In the show, they mention $380k in revenue since 2013 (which does skip a year), and each Kickstarter raised around $20k.
According to Tilman, he uses over 2 million bottles of hot sauce each year at his restaurants. But he’s not impressed with the vinegar content of the sauces. At the time of filming, the hot sauce was $3.95 per bottle, though it’s currently $5.99+ because they began using a more expensive white wine vinegar over distilled white vinegar due to the taste test at 8th Wonder Brewery in the clip below (and several others throughout the show).
During testing at Bubba Gump, the house sauce outperformed Bravado, and Tilman recommends a co-branded label. However, taste tests had a great approval rating because of their reformulation.
Bravado bids $0.48/ounce, but are unwilling to compromise on the co-branded label. He still accepts their bid and commits to ordering 68,000 bottles per year (48,000 for tables and 20,000 for retail) at a price of $162,000 annually.
Episode 2 – Don’t Blow the Deal
East Side Glass Studio is (spoiler alert) a glass studio in Texas owned by veteran glass artist Leigh Wyatt. Something I learned in talking to glass artists in the cannabis industry is that local glass artists struggle in today’s economy as so much is outsourced to cheaper offshore countries. Wyatt is having the same issue and has only had about $100k in sales the prior year, even with over-inflated prices.
As Tilman explains, the typical supplier markup is 100%, which would be a $150 wholesale price on a $75 cost of goods. But her markup is 566% with a final sale cost of $500 because she’s an “artist.” As a creative professional myself, I absolutely agree with his assessment that she’s making a classic rookie move of pricing herself out of the market.
Tilman spends over $5 million a year on glass light fixtures and wants to give her a chance. It’s nice to see him trying to support a local artist, but she’s a bit…interesting…to work with. For starters, she has limited production capabilities. On top of this, she’s more focused on the value of her skills and experience than the final product, as you’ll see in the clip below.
She lives in the same fantasy world I pointed out that fake freelance travel writer Gabi Logan lives in last year. Pretending you’re Elvis or The Beatles when nobody has ever heard of you disregards the thousands of real professional artists who work on things like this blog or the graphics for the show. It’s always laughable when you meet someone this delusional.
It’s pretty hilarious when he makes her repeat after him that she’s going to grow her business to become a better artist. The show alludes to him making her write it like Bart Simpson in detention, but that’s almost certainly a frankenbite.
When he gives her a chance, she completely fails to meet his specs. If you’ve ever done any client work, you know that’s ridiculous. I’m an artist, and if I’m hired to write an article about artificial intelligence, I can’t turn in an article on peanut butter instead because that’s where my artistic inspiration hit. I can not stand entitled people who act this way – they embarrass both themselves and every other artist in the world.
She even increases her price halfway through the work from $5000 to $8500 then quotes him a $10,000 price moving forward. She doesn’t get the contract because Tilman isn’t a complete idiot.
If you’d like to buy some of this entitled idiot’s work, check her website because she’s not good enough for Amazon. Or check out the real glass artists in my link to the Galleria of Glass above.
Liber & Company is a small-batch, artisinal, ultra-hipster cocktail syrup company in Texas founded and run by identical twins CEO Adam Higginbotham and CFO Robert Higginbotham, along with high school friend COO Chris Harrison. They identify as Millennials (which no self-respecting Millennial does), and focus on using real, natural ingredients in their cocktail mixers.
I also recently received a bottle of the company’s Grapefruit Shrub syrup in one of the small-batch subscription services for my 2017 holiday gift guide. I’ve yet to actually open it, but we’ll get around to it soon for a product review of my own.
In 2014, they sold $280k with a profit of $94,000 with a large portion (70%) sold in retail. They’re only represented in 8 of the 500+ bars and restaurants in Austin.
Tilman states he spends over $5 million per year on cocktail syrups and mixers for his restaurants. He knocks them on both their lack of wholesale orders and high ingredient costs. To maintain his necessary 85% drink margin, he’ll have to raise his drink prices from $8-$10.
Their bid is 3840 bottles of grenadine and 3540 bottles of ginger syrup for a total of $43,746 annually. He instead orders 8000 and 9000, respectively, for a total of $100,000.
If you want to try Liber & Co drinks for yourself, you can find a variety of their cocktail syrups on Amazon. You can also find their drinks at Saltgrass Steak Houses throughout Texas, Colorado, Nevada, and Oklahoma.
Episode 3 – These Aren’t Babies, This is Merchandise
The Jam Stand is a Brooklyn-based jam company owned by friends Jessica Quon and Sabrina Valle. They provide small-batch jams and jellies with unique flavor combinations. They’ve collaborated with Haagen Dazs to create the banana rum jam ice cream for their artisan collection and even have the Martha Stewart seal of approval.
I’ve tried their blueberry vanilla jam, and it’s absolutely delicious. It tastes fresh, sweet, and natural. The red onion chutney is a lot better than it sounds too – I was hesitant to eat it, but it’s actually not bad. As of the time of filming, they were carried in over 750 retail stores, although that seems to have grown since.
According to Tilman, he buys over 50,000 pounds of jam each year for his 500 hospitality properties. He isn’t happy about the individual serving jar being 1.5 ounces, since the hospitality industry uses 0.5 oz jars (which I think definitely needs to be increased, as I always use several packages at a diner or hotel). He also wants exclusive flavors to give him an edge over the competition.
Check out the clip below for his feedback on the sizing issues.
It costs them $1.65 to create a jar that’s sold to the distributor for $3.50. A 9.5 oz jar costs $6.99 at Cost Plus World Market and up to $10.50 on Amazon.
They pitch him Strawberry Rose Champagne in stick packets and Red Onion Red Wine. He orders 250,000 of each flavor for a total of 500,000 units for a total of $300,000. The red onion is served with bread at Mortons, while the strawberry is given out as a breakfast condiment in his hotels.
Try The Jam Stand jellies and jams yourself at Amazon. You can find gift sets or individual jars of flavors like Blueberry Bourbon, Raspberry Jalapeno, and Red Onion Red Wine. They’re also sold in Walmart (although the website states only in stores) and a variety of small-batch companies like Mouth.
Marcellino Bag Company is based in Long Island, where leather craftsman husband Joe Marcellino and co-owner wife Jean Marcellino (called Peter Joseph on their website) create leather goods from their home. Tilman has an issue with this, and he can eat a dick, because I work out of my house too.
Marcellino made $70k the first year and sells his bags for $700, comparing them to Louis Vuitton. He hand stitches the bag with vegan leather, and they get great reviews online (although he’s clearly writing some of his own). Critics seem to agree they’re great quality and American made though.
According to Tilman, he does over $100 million each year in retail sales throughout his properties. He’s not happy with the production cost, sales price, and customized nature of the bags, as you can watch in the below clip.
Tilman teams with Jean to harp on Joe for wholesale before sending him to Atlantic City to meet Alicia Brown, Golden Nugget’s Director of Advertising. He’s a terrible salesman and pulls the “artist” card. It definitely seems to empower his wife to reel him in.
He also can’t afford a decent ecommerce site, so Tilman brings him to Brandfire, who shows him a much better website than he currently has. They say they’ll do it for free for him, but it’s clear that free work cut a lot of corners so it was all for the cameras. Check out his website now, and you’ll see how pathetic the site they gave him is compared to the mock-up they pitched him for the show.
They propose 350 bags at $200 a piece ($70,000 total). Tilman doubles the order and buys 700 bags for $140,000. You can find Marcellino’s bags at Golden Nugget or the website Brandfire half-assed for them (actually quarter-assed is probably the better term since they clearly had a mock-up ready and I’m sure have templates they could have used).
Episode 4 – It Shouldn’t Be This Hard to Make a Deal
Linoto Linen is a Yonkers-based linen sheet company owned by Jason Evege. Many people prefer linen is preferred over cotton because the fabric is breathable. In a place like Arizona, where it’s hot almost year-round, this is a major selling point. Evege is a fashion designer who moved on to start his own business in 2007 and sold over $1 million in sheets in 2015.
They were once available at Walmart, but it’s showing unavailable at this time. The sheets don’t have many reviews online, which says to me they don’t give out a ton of freebies to review sites, who always favor products they can have for free. They’re highly rated by customers on the Linoto website and Wayfair, though, and everyone agrees the higher price is still lower than any linen competitor, except Rough Linen.
According to Tilman, he has over 10,000 beds that require him to buy 60,000 new sheet sets each year. His plan is to pay the higher price and charge guests $15 per night to upgrade their sheets to linen.
He typically uses cotton but is considering a linen upgrade for his luxury customers. It’s an issue he has when Evege attempts to replace the linen with cotton to meet his price point.
Adding to the issues, linen requires a more expensive oxygen-based laundering process than the cheaper cotton sheets, which use a chlorine-based process.
Linoto’s bid is for 1,581 sheets at $385,000, and Tilman points out they’re 4x more expensive, 4x more expensive to clean, and need to be replaced 4x as often. He can’t use the sheets in his hotel rooms, but he does purchase 100 sets at $24,500 for sale in his hotel and casino retail stores.
Tilman has a major issue that he’s online-only. Maybe it’s just the delays between filming and airing, but online-only is pretty standard in the bedding industry these days. Purple, Eight, Casper, and a ton of other online startups are destroying the old guard in this industry, so Linoto is definitely on the right track.
Founder Manveena Singh is a Bronx-based (although the LLC is based in Virginia, likely for tax reasons) perfumer, consultant, and chemist who creates USDA-certified organic products. It’s a farm-to-face brand that includes OPYN (the Only Product You Need) that’s non-toxic and uses natural ingredients.
There are very few reviews available online, although what’s there is decent. Products were once available at Target and Amazon, but neither carries them anymore. It’s a sign her business may be suffering these days. Her LinkedIn also shows she’s not doing this full-time, another clear sign of business troubles.
The company has received over $35,000 in funding from Fundable, has a production cost of $8.55 per ounce, a retail price of $50 per ounce, and a wholesale price of $25 per ounce. They have manufacturing facilities to produce up to 400,000 units in a run.
According to Tilman, he has over 80,000 spa customers each year that buy over $1 million annually on beauty products. The problem is Manveena doesn’t mesh well with the Golden Nugget spa staff, as you’ll see in the clip below.
I’m super confused as to what actually happened to piss off this spa staff. She’s a bit bossy and has attention to detail, but reality shows typically exaggerate people’s flaws. I didn’t see any issues with her, and I’ve worked with some seriously difficult people. If CNBC showed the worst highlights of her, these snowflakes could use thicker skin. Either way, his staff kills her chances.
If you’re interested in trying Manveena’s Solutions for yourself, you’ll have to do so on her website, as it seems to be getting pulled from everywhere else.
Episode 5 – Are You Jackin’ With Me?
Rossmore is a Los Angeles-based artisinal jeweler owned by husband and wife Suzanne (designer) and Cliff Duyn (operations, although his LinkedIn shows this business is his part-time hobby). Their designs have been worn by celebrities like Kate Bosworth, Nicole Richie, Reese Witherspoon, and Ashley and Jessica Simpson. Their designs start at $50 and shoot up into the thousands for each piece, and they pulled $300,000 in revenue in 2015.
Although they state on-air everything is handcrafted, it’s also made clear the manufacturing work is subcontracted out, so they’re not really as handcrafted as Linoto or Marcellino. The company gets some degree of media attention (typical for L.A. businesses), although their social media is much better than their rudimentary website.
According to Tilman, he sells $3 million worth of jewelry to his 1 million retail customers each year. He balks at the high production cost, but sets them up with a pop-up at the Golden Nugget Las Vegas, where they meet Kerri Frick Carr, Landry’s VP of Retail. Cliff isn’t a great salesperson, as you’ll see in the clip below. It’s clear he doesn’t respect the business as much as his day job, and Tilman does a great job throughout the episode highlighting this fact.
Cliff does eventually get his shit together (he clearly loves his wife), and Rossmore’s bid is for 5 kiosks with $20,000 worth of jewelry in each for a total wholesale price of $100,000.
Tilman doubles the order, meaning you can purchase Rossmore Jewelry at Golden Nugget Lake Charles, or at the Rossmore website.
Galanter and Jones is an award-winning, San Francisco-based, heated electric furniture design studio owned by siblings Aaron (design) and Miranda Jones (sales). The company gets some good press coverage, but there are scant reviews online about the actual functionality and quality of the designs. The few reviews available are positive, though, and everyone agrees it’s comfortable, despite being made from cast stone.
Prices range from $3400-$7900, which is mostly driven by materials. They made $560,000 in 2015 at an average of 2 units sold per week.
According to Tilman, he spends $750,000 annually on outdoor furniture for Landry’s. His hope is to keep guests comfortable outdoors during the winter months by spending $90,000 on 36 units for the Golden Nugget Lake Charles. The problem, as you’ll see in the clip below, is they don’t have commercial experience making sectionals that can be configured to fit any business.
They bid for 400 units at a total price of $800,000, stating the price is due to the design needed. He offers $50,000 for 27 on a trial basis and another $200,000 for 100 more units if it works out.
The brother and sister deny the deal, so if you want to try the heated furniture for yourself, you’ll need to buy from their website.
Episode 6 – If Ya’ll Got the Edge, I Want It
iPourIt is an Orange County-based software company founded by Brett Jones (CTO) and Joseph McCarthy (who, according to his LinkedIn profile, is no longer with the company). They provide self-serve RFID beer taps for commercial use that allow you to pour your own beer and pay without the need for a bartender or server (saving you a lot of money on tips). According to their website, they currently have over 1,900 taps installed in bars around the country.
The company has won various B2B awards from the OC Tech Alliance Innovation Awards, QSR Magazine, Protolabs, and Octane. They’re also featured in a variety of media publications. The idea behind it is you account for every drop of alcohol, eliminating freebies and overpours.
They quote the system costs as ~$1200 per tap, although it’s actually closer to $100,000 to install a 10-tap system. They also skim off $0.01 per ounce poured, but still managed to lose $318,000 in 2015.
According to Tilman, he uses 80,000 kegs of draught beer each year, costing $11 million annually. Technical support is a major concern for Tilman, and they don’t make things easier by failing in their own test environment, as you’ll see in the below clip.
In test runs, Golden Nugget poolside customers (which include his son Patrick) prefer iPourIt over the live bartender. They want to replace the bar entirely, which he doesn’t agree with.
They bid $100,000 to build out a 10-tap system, which he agrees to, so long as they’ll give him a 5% discount on the penny per ounce tax.
If you’re interested in trying iPourIt for yourself, you can try it at the Golden Nugget Lake Charles pool or see a list of their clients on the company website.
Further Products was founded by husband and wife owners Megan and Marshall Dostal as a way to turn the glycerin byproduct of Marshall’s biodiesel efforts into a workable product. It’s the same vegetable glycerin used in ejuices for vape pens. These products are well-reviewed by customers, though they get very little media coverage outside the show.
According to Tilman, he spends over $2 million each year on soap for his 500 properties across the U.S. His goal is to go green by buying a more environmentally friendly soap. However, he doesn’t like the greasy feel of their soap and doesn’t appreciate that they avoid foam soaps, which they eventually cave on.
Customers (and science) agree with Tilman that the humectant properties of glycerin do leave their hands feeling greasy. It also costs $30 per gallon vs the $5 per gallon he currently pays.
They place a bid for 1 million bars of amenity soaps for his properties at a total cost of $550,000. They also bid on foam soap, but he denies both bids because of the product quality.
Can’t get enough Billion Dollar Buyer? Check out Billion Dollar Buyer Season 2 Businesses.