How the Bros. Melman Capitalized on the Power of Partnership: Guest

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For restaurateurs R.J. and Jerrod Melman, business is personal. As brothers and business partners, they’ve successfully opened four restaurants in Chicago and Los Angeles, helping to grow the Lettuce Entertain You portfolio to include Hub 51, Paris Club, M Street Kitchen and Stella Rossa Pizza Bar.

The family business includes their sister Molly, head of training and employee development, as well as their father Rich, a James Beard award winner for Outstanding Restaurateur. I sat down with the Melman brothers during a rare quiet moment in their Paris Club dining room to discover the secret behind their powerful partnership.

What motivated you to partner with your siblings and become restaurateurs?

R.J.: We were both working in the restaurant business beforehand, so we were restaurateurs before we were partners. Jerrod and I were both at Osteria Via Stato and I had four months between projects and he was managing. We enjoyed working together and started to formulate ideas of what we wanted to do. Three to four years later Hub 51 was born. Molly joined us after she was working in NY as a teacher and she came back and started working with us at Hub. Now she’s in charge of all of our training and employee development. I had opened six restaurants -- in various capacities -- before we opened Hub together. All of us had restaurant careers beforehand.

Jerrod: For me, I grew up working at the restaurants -- it was the only thing I did that made any sense. I don’t think I got into it thinking it would be a career -- I looked at it as an opportunity I’d be foolish not to explore. I had one of the best restaurateurs in the country living at home and wanting to teach me. I could have left school and done something else for 10 years and realized I should have given it a shot. I thought it made more sense to try managing for my dad’s company out of the gate. I thought I would try it for five years and if I didn’t like it, I’ll go do something else. But it sucks you in. I don’t want to work in an office. I really like being in restaurants.

What do you think is critical for a successful business partnership? And how do you and your brother ensure that your working relationship has these components?

R.J.: You have to be good people and want to make a partnership work. You need to have balance and clear delegation of what you do. Being good complements to each other is a great asset and the ability to compromise. Some days are more difficult than others but at the end of the day we have the same goal. When our visions align it’s better than when one person likes something and the other person doesn’t. We try to find something we both like -- not one or the other, but in the middle.

Jerrod: Trust. Knowing that you have each other’s back and are working towards the same thing. Mutual respect. I don’t there’s one key.

Different partnerships work in different ways, but know that you’re moving in the same direction. We talk all day every day…we can’t escape each other. When it comes to differing opinions, it’s whoever has the most conviction. If we fight and I say, “I don’t want to do this” and he does, it’s up to one of us to convince the other. Early on we said we would each have a one-third vote and our dad would have the other third so two could outvote one. It’s unspoken that if two people feel one way, we’ll try it. We’re lucky that it’s not a business of science and black and white. There’s a world of gray so we can find something in the middle that will make both of us happy.

One of the things our dad always talked about in partnerships is that someone always needs to be 51 percent. You can be almost equal, but someone needs to have the deciding vote and be in charge. There are times when R.J. defers to me and times when I defer to him.

Do you think there are unique challenges of partnering with a family member? If so, how do you overcome these obstacles?

R.J.: Absolutely. It’s probably 100 times more personal. It’s more difficult to walk away from. Other people in business -- their partnership could split up -- but if ours did we’re still siblings. It makes things more personal. You work hard every day. We have the same goal and we’re on the same page so when you look at it from that perspective, it makes it a lot easier.

Jerrod: I can’t speak for other partnerships, but when we go home at the end of the day, we’re still family. For me it’s been more rewarding than negative because you know this is someone who will always be in your life. I look at other partnerships and wonder what makes them work, but I know what makes ours work: we have a lifelong trust.

We’re lucky that we’re brothers, then best friends, then partners. We work through any issues there are. We know that our goal is the same. We may go about reaching our goal differently, but know we want to get to the same place. Our goal is to connect with people and have the business feel right, serve good food and provide good service… and as our mother would say, not embarrass our father.

What advice would you offer to aspiring entrepreneurs who want to forge a business partnership?

R.J.: Look to find people who know what you don’t know and complement you. The tendency is to find someone similar to you. Great partnerships come from finding someone who balances you.

Jerrod: One of the ways we’re lucky is that we had a lifetime of working together, even as kids around the house playing, so I know R.J. inside and out and he knows me inside and out. Just like a marriage, the better you know someone, the better decision you can make about choosing a partner. The more you can discuss ahead of time, the better the partnership will be. If you’re looking for a good partner, you would want someone with complementary strengths. We have taken on other partners that aren’t siblings and we look for people that bring something to the table that we ourselves don’t have.

In 10 years, what do you hope to have accomplished through your partnership?

Jerrod: I know what R.J. is going to say. Continue to do things we’re passionate about.

R.J.: I was going to say to continue to incorporate new partners. We incorporated two new partners with Paris Club and I think we’d like to do new projects with new partners and provide opportunities for them.

Jerrod: He would have said it if I didn’t say it. So much of what we do is a labor of love. There are a lot of cuisines that don’t excite me today, but could one day. If you told me to create an Indian restaurant I would say it’s not where my passion is, so my hope is that we continue to do things we’re passionate about. We’re not money driven -- we’re driven by projects that excite us and we think we can do well.

What's the best example of a time when your partnership failed?

Jerrod: At one point, everyone in the partnership has quit, but you come back and work it through. We’re all very passionate about what we’re doing and very opinionated. The respect is always there, but it doesn’t mean you can’t fight. The truth of the matter is we could do it alone, but we don’t want to.

Tune in later this week for Part II of Inc. Well's conversation with the Melman Bros. Meanwhile, follow us on twitter @incdotwell.

Rachel Gillman has an insatiable appetite and an obsession with entertainment. She can be followed on Twitter @RachelGillman.

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