How to Manage Purpose and Profit, According to the CEO of a Pizza Chain With $400 Million in Revenue
Scott Svenson, the co-founder, and CEO of MOD Pizza explains his theory behind not compromising ideals to move the bottom line.
MOD Pizza’s founders didn’t need to start another business. They’d sold their first–fast-casual coffee chain Seattle Coffee Company–to Starbucks, earning a sum that would make their family comfortable for life. But in the afterglow of their success, Scott Svenson and his wife and co-founder, Ally Svenson, wanted to give back to their community.
They donated money, and they joined nonprofit boards. Nothing seemed to scratch their itch–perhaps because their actions felt like one-off tokens. When they came across an idea for a scalable enterprise applying the fast-casual restaurant model to pizza, something clicked: They could both use their skills to simultaneously build a fast-growing company and do some good for the world.
They called it MOD Pizza, a place where customers could order custom pizzas to be made in minutes. Behind the counter, the mission happened: Managers would strive to provide employment opportunities, good salaries, and benefits to individuals who’d faced barriers to employment, such as formerly incarcerated individuals, people undergoing rehab, and people with disabilities. One of the company’s driving principles: People deserve second chances.
If they built it, Svenson realized, the company would “make ongoing impacts in communities and society generally long beyond when we’re involved. That’s what got us excited.”
MOD now has more than 460 locations and reported $398 million in net revenue in 2019.
But there is, in any purpose-driven business or social enterprise, a tension between profit and purpose. Well-meaning ideas often can compete with the realities of the bottom line. MOD has never felt that tension more keenly than during the pandemic, Svenson told said in an interview for Inc.’s weekly podcast What I Know. But crisis is no time to compromise.
“For companies that do have a strong sense of purpose, make sure that you’re using time like this to reinforce and double down on that purpose,” he said. “It’s so easy to dilute it or abandon it at times of crisis because sometimes you just don’t feel like you have the capacity or resources to do it.”
Instead, Svenson urges leaders to focus more acutely on their purpose, and let it drive them through the times when profit isn’t as expected.
“I think if a purpose is true and sincere, it can be the path out of a crisis like this,” he said. “One of the things we’ve talked a lot about through this crisis is it’s been an opportunity for us to go back and really think about our culture.”