GRAND ISLE, LOUISIANA – AUGUST 14: Todd Graves, Raising Caines Founder, attends CCA Louisiana Receives $500,000 donation from Raising Cane’s Owner and Founder Todd Graves to Build Five Artificial Reefs, Starting with “Raising Cane’s Hotel Sid” Reef off the Coast of Grand Isle, Louisiana.
When Todd Graves and Craig Silvey came up with the idea for a restaurant in southern Louisiana that only sold chicken fingers, they probably didn't expect to get the lowest grade in a startup-pitching assignment for Silvey's LSU undergraduate business class — or to get rejected for bank loans when they tried to make it a reality.
Yet the concept, which eventually became Raising Cane's Chicken Fingers, propelled Graves to his debut Tuesday on the Forbes 400, a ranking of America's richest people. He's reportedly the country's 107th-richest person, with an estimated net worth of $9.5 billion, largely driven by his ownership stake in Raising Cane's.
"If people tell you something can't be done, it makes you strive so much more to do it," Graves, now 52 and the company's co-CEO, told students at Nicholls State University in 2009.
To raise enough money to open the fast-food chain's first location in 1996, Graves moved to California from Baton Rouge, Louisiana, to work 90-hour weeks in an oil refinery — and, later, fish for salmon in Alaska — according to the company's website.
He spent between $40,000 and $50,000 of his own money, plus roughly $100,000 from friends, family and a Small Business Administration loan, to get his restaurant off the ground, he told the "Trading Secrets" podcast in May.
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Today, Raising Cane's — named after Graves' yellow lab Raising Cane — has more than 800 locations internationally and brought in $3.7 billion in net sales last year, a company spokesperson tells CNBC Make It. Graves owns more than 90 percent of the company, and has no plans to take it public or sell his stake to private investors, he said.
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"I want my kids in the business to be able to carry our values on after their mom and I are gone," said Graves. "They can turn this into a worldwide business and continue to grow."
Learning to balance risk and reward
When Graves and Silvey — who left the business in 1999 — opened their first location in Baton Rouge, Graves had zero business management skills, he said. He worked seven days per week at the restaurant, from opening at 8 a.m. to closing at 3:30 am the next morning, he added.
As the company grew, Graves figured out how to recruit employees and develop leaders on the fly, he said: "I was building a plane while I was flying it."
Most entrepreneurs finance their businesses with a mix of debt and equity. Graves relied almost exclusively on loans when starting out, he told the "How I Built This" podcast in 2022. He'd offer private investors a 15% interest rate on a loan, which he'd then use to secure additional funding from community banks that treated the debt as equity, he said.
In retrospect, the approach was "stupid," and nearly cost him the business when Hurricane Katrina hit Louisiana in 2005 — shutting down 21 of his 28 storefronts in the Baton Rouge area — but it allowed him to maintain his ownership stake while growing his company, he said.
"Debt to equity, you should have proper balances in your business, and that helps you get through tough times like a major hurricane — but I levered everything," said Graves, who credited his business' survival to reopening as much as he could quickly after Katrina passed. "Luckily I lived through that, but that's when I really learned to balance risk."
Seizing the right opportunities
The company — which turned 28 this year and is on its third real-life yellow lab mascot, Raising Cane III — had its first billion-dollar quarter in sales earlier this year and is on track to finish 2024 with nearly $5 billion in sales, says the Raising Cane's spokesperson.
Contrary to the company's hard-charging early expansion, Graves now preaches the value of not rushing into opportunities or growing too quickly at his brand's expense, he told "Trading Secrets."
"The vision of Raising Cane's is to someday have locations all over the world, and be the brand for crave-able chicken finger meals, great crew, cool culture and active community involvement," Graves said. "You have to stay disciplined, because if you are successful, opportunities are crazy, and you can grow it towards something not special at all."
His outlook echoes advice from other successful entrepreneurs. Kind Snacks founder Daniel Lubetzky and Vuori CEO Joe Kudla advocate for taking a step back to self-reflect before big decisions, and Rocket Lab CEO Peter Beck says he takes his time to analyze any potential opportunity.
"Sometimes, you can take big risks. Sometimes, you need to be very safe and methodical about how to back out of situation," Beck told Make It last year. "Control the things you can control and acknowledge the things you can't control."
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