Cousins Jim Tselikis and Sabin Lomac came up with their million-dollar business idea during a reunion in Los Angeles in 2011. The two were feeling nostalgic for their childhood in Maine--in fact, leading up to the visit, their main focus was the Nintendo console they had played religiously as kids.
"Sabin called me and said, 'Don't come unless you have the NHL '94,'" says Tselikis, referring to their favorite retro ice hockey video game. Tselikis relayed the demand to his mother in Maine, who found the game and console and got them to Tselikis before his flight west. Over thumb-aching Nintendo marathons, the cousins hatched a plan to sell Maine lobster from food trucks in cities that don't typically offer the Northeastern delicacy.
The franchise business they created, Cousins Maine Lobster, generated $20.5 million in revenue last year hawking lobster rolls, lobster tacos, and clam chowder, among other seafood specialties. Lomac and Tselikis launched in 2012 with just one food truck in L.A., and have since grown the business to 32 trucks in 18 cities, along with six restaurants. On April 17, the co-founders are releasing their first book, which explores how they built their business.
Lomac, 36, and Tselikis, 33, wanted to create a company that celebrated their Maine roots--they grew up on the southern coast of the state--and tapped into the popularity of food trucks. They pooled their savings, bought a truck, and sold the buttery lobster rolls they missed from their childhood to customers on the West Coast. Days after opening their first truck, the co-founders were offered a spot on Shark Tank, where Barbara Corcoran offered them $55,000 for 15 percent of the company. Annual revenue jumped from about $900,000 in 2012 to nearly $2.1 million the following year.
Caught in a trap
What Lomac and Tselikis didn't realize was they built a business on a commodity with dramatic price volatility. When they started the franchise part of the business in 2014, Tselikis says, the price of lobster had increased by $3.50 to $5 per pound in the two years since the company's launch. The co-founders didn't want to deviate from the menu they had created, but they had to find a way to explain lobster's unpredictable pricing to franchisees and customers.
For the cousins, lobster wasn't just a delicacy they enjoyed back home; it represented one of their state's most important and well-recognized commodities. Maine's aquaculture industry contributed $137.6 million to the state's economy in 2014, according to a 2017 report by the University of Maine.
Lomac and Tselikis decided to send franchisees to southern Maine so they could learn firsthand about the lobster industry and its economic impact on the state. Each one spends three days in Portland, waking up at 5 a.m. to work the lobster boats before visiting the processing plants where the live crustaceans are cooked.
The swings in price are primarily dependent on the size of the season's catch, the founders say, though the cost of bait materials can also have an effect. "It's hard for people to understand the volatility of the market if you're not from Maine," says Lomac. "We show them how hard the job really is so they can get a better understanding of why the product is so exceptional and why the market could go up and down."
Lomac added that the trips up North gave sellers more confidence in their product. What's more, franchisees are able to pass what they learned in Maine on to customers who question the fluctuating prices. In the company's early years, lobster rolls sold for between $12 and $13; now they're about $16.50, depending on the location.
Craig and Quinn Betts, a husband-and-wife duo based in Nashville, opened their first food truck with Cousins in April 2016 and visited Maine before the launch. Neither had been to the state before and said the trip gave them a comprehensive knowledge of the lobster industry.
"It was really helpful to understand the product, how it was sourced, where it came from, and what it actually took to get it from trap to truck," says Quinn, 50, who operates another Cousins truck in Phoenix with Craig and is about to open a Cousins restaurant in Nashville. "It was really helpful to begin having all that information."
Part of what makes Cousins Maine Lobster so successful, the co-founders say, is their relationship. While they grew up close, the two went their separate ways for college and their early careers. Tselikis landed in Boston at a sales job for a medical supply company, while Lomac worked in real estate in L.A. Since the two partnered, they put an emphasis on spending time together in a social context--especially for nostalgic games of NHL '94.
"In fact, I beat Sabin the other day," says Tselikis, adding that they have the Nintendo console in their office. "I had a shutout, and he owed me $500 for it."
"There's only been two shutouts in existence--I won the first one, let's make that clear," Lomac responded. "He just got lucky."