catering industry in the United States

50 | FORBES junE 21, 2016

J e

f f

S c

io r

t in

o f

o r

f o

r b

e S

scratch. Today she is cofounder and co-owner

of That’s Caring, which sells gift baskets tied

to a social purpose, and nuphoriq, a marketing

company that specializes in helping other cater-

ing companies. Both ventures were started with

the financial support and advice of Tom, Larry

and Kevin Walter, the three brothers who own

Tasty Catering. At last count some 11 employees

have started a dozen ventures while working

for Tasty. The spinoff companies generate a

combined $19 million in annual revenue—nearly

double the parent company’s revenue.

“Turning our employees into entrepreneurs

has provided many advantages for our busi-

ness,” Tom Walter says. “We have created more

employment for more people, we don’t lose our

W hen Jamie Pritscher

joined Tasty Catering as

a logistics manager in

2006, she was happy to

land a job. The business,

which at the time had just under $5 million

in annual revenue, had recently moved into a

23,000-square-foot building in Elk Grove Vil-

lage, Ill., and Pritscher was one of several people

brought on to keep up with the growth. “It was

scary,” she says, “because I was essentially creat-

ing my position. I had to figure out how to pay

for myself.”

Pritscher succeeded so well that she has

gone on to take advantage of the unusual culture

at Tasty to create two new businesses from

By Darren Dahl

tasty catering has won accolades for its food and its workplace culture. but its most impressive product may be the business owners it’s grooming.

small giantsENTREPRENEURS

Jamie Pritscher told Tom

Walter (both above) she

would quit if he didn’t

change the way he ran the

company.

Serving Up Entrepreneurs

F0621p050 ENT TastyCatering LO.indd 50 5/19/16 7:41 PM

52 | FORBES junE 21, 2016

neurs. The goal was to see if the employees of

even a small, blue-collar business could find the

kind of fulfillment that would get them excited

about coming to work—and sticking around.

Soon after, Tim started exploring how Tasty

could generate more revenue from its kitchen,

which sat unused 16 hours a day. Online, he

found an open request from several school

systems for 800,000 muffins that would meet

certain dietary restrictions. He submitted a bid

and won, but Tasty’s ovens weren’t big enough

to handle the job. So he suggested buying new

ones that would cost $85,000.

Instead, his father and uncles decided to

invest the money in a company, T.F. Processors,

that is owned jointly by the four Walters with

Tim serving as CEO. Today it bakes muffins,

breakfast breads and cookies for private labels as

well as for Tasty, has 18 employees and generates

some $2 million in annual revenue.

Pritscher started That’s Caring in 2008.

Three years later she teamed up with Erin

Walter, Tim’s sister, to launch nuphoriq, a

marketing agency whose first client was Tasty

Catering. Like many of the spinoffs, nuphoriq,

which employs 12 and expects revenue to top

$750,000 this year, started out filling a need for

Tasty before looking to expand.

The other spinoffs include Touhy Capital,

which provides billing, bill payment and payroll

services, and Rios Ventures, which rents trucks

to Tasty and others. “Each spinoff has a different

ownership structure,” Tom Walter says. “Each

company is in a different market. Each company

could be sold without impacting the others.”

Every week the leadership teams for Tasty

and the spinoffs—12 people in all—gather in a

modest conference room at Tasty. The CEO of

each company recaps its financials and chal-

lenges. “The final say in any decision is made

by the CEO of that company,” Tom Walter says.

“Shareholders like me don’t make any decisions

for the spinoffs.”

Meanwhile, Tasty Catering, the proud parent

company, has continued to thrive. Perhaps most

impressive, its annual employee turnover is 2%

in an industry that averages 50%. And its profit

margins, Tom Walter says, are nearly twice the

industry average.

best and brightest due to a glass ceiling, and we

attract entrepreneurial young people because

of our history as an incubator. Also, the younger

entrepreneurs are providing a 401(k)-type rev-

enue stream for us as we exit our businesses.”

Growing up in Chicago with ten siblings,

Tom Walter took a while to hit his entrepre-

neurial stride. When he decided at the age of 24

that he needed a job—but didn’t want to work

for someone else—he partnered in starting sev-

eral bars, nightclubs and restaurants. Eventually,

in 1984, he and two of his brothers started a hot

dog stand called Tasty Dawg.

Over the next five years the stand turned into

a small chain and then evolved into Tasty Cater-

ing, a corporate catering service that has grown

to 49 full-time employees, with another 100 sea-

sonal workers, and $10 million a year in revenue.

Tasty has created a workplace that has earned

the company numerous awards, including being

named one of the psychologically healthiest

workplaces in America. But it wasn’t always so

healthy. In fact, as recently as 2006, Pritscher and

Tim Walter, Tom’s son, who had joined the busi-

ness full-time a year earlier, became so frustrated

with the way Tom and his brothers were running

the company that they threatened to quit.

While the brothers had distinct roles—Tom

handled sales, Larry logistics and Kevin human

resources—there was enough overlap to create

tension among the staff. If a customer delivery

was late, for example, Pritscher had to answer to

all three brothers, each of whom seemed to have

a different idea for how to solve the problem.

Eventually, she went to Tim Walter and said, “I

don’t even know why I am here. I can’t do any-

thing without their say-so.”

Tim, it turned out, felt the same way. Togeth-

er they decided to issue an ultimatum. “It was a

cold, dreary morning, and the first thing I had to

face was an employee-led confrontation,” Tom

Walter says. “I didn’t know any way else to lead

but command and control, but they wanted us

to change our leadership behavior. If we didn’t

change, they both said they would leave.”

The threat worked. Moving forward, the

Walter brothers decided, employees like

Pritscher would be given not just the opportu-

nity to do their jobs but also to become entrepre-

small giantsENTREPRENEURS

“If you want to build a ship, don’t drum up the men to gather wood, divide the

work and give orders. Instead, teach them to yearn for the vast and endless sea.”

—Antoine de SAint-exupéry

final thought

M a r g i n

P r o P h e t

TRYING TO

KILL THE

BLOOMBERG

a former commoditieS trader at bloomberg

for five yearS, Morgan DoWney, 43, Started

money.net in 2014. hiS goal: to offer a

Superior alternative to the $25,000-a-year

bloomberg terminal at a fraction of the price.

Why StArt A

competitor?

two big things. there’s a

market need for a more

intuitive, more affordable

product than bloomberg

and thomson reuters.

they’re difficult to use.

they feel like they were

designed in the 1980s.

they were designed in

the 1980s.

WhAt WAS the

Second thing?

price. Jpmorgan pays over

$400 million a year just

for bloombergs. bank of

america pays close to

$500 million.

doeS your SyStem

hAve A BloomBerg-like

terminAl?

no. We’re building a

platform. people want

to boot up one piece

of software that’s got

everything. We priced it

at $150 a month. people

did a double take, it was

so low. —Susan Adams

F0621p050 ENT TastyCatering LO.indd 52 5/19/16 7:41 PM

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