Pie in the sky
Tuesday, September 13, 2011/
When customers walk into a Pie Face store, they are greeted with the sight of numerous pies adorned with endearingly childish faces – a smiley face for chicken, a squiggly face for chunky steak and a lip-licking breakfast version.
The faces help create a slightly offbeat, relaxed feel to the retailer. It has certainly helped it build a brand that is edgier and more interesting than its staple product – meat pies – would suggest.
However, the foundation of Pie Face wasn’t as easy and carefree as its anthropomorphic pastries suggest. Co-founder Wayne Homschek admits that, until relatively recently, he had doubts over whether the business would make it.
“It wasn’t easy to adapt to the business,” says Homschek, a former investment banker. “It took me about two years to adjust and there was a lot of self-doubt.”
“When you start a business, you aren’t actually buying a ready-made business. You are buying a piece of paper that pretty much says ‘go out and do it’.”
“I did pretty much the most extreme thing you could do, in going from the financial industry to the food industry. It was a good three or four years until I really knew I’d done the right thing.”
“The business had no cashflow and it had no security. I was 40-years-old when I started, so it was a bit late to go back to banking, so I carried on.”
“I wasn’t until this year that I wasn’t completely pre-occupied with not running out of money and becoming insolvent. That was weighing heavily on my mind until recently.”
A healthy slice of Pie
Homschek’s admission is perhaps surprising given the robust health of the business he set up with his wife Betty Fong in 2003.
Pie Face is planning an IPO next year that will value the company at $100 million, up from its current valuation of $45 million. With 55 stores nationwide, most of which are franchised, and a dozen more in the works, Pie Face is aiming for a $1 billion valuation by 2018.
But Homschek says that the business only hit profitability at the start of last year and has had to work hard to make the venture scalable.
“We had to scale up in 2009, so we’ve dipped in and out of profitability, but we managed to break through the break even threshold,” he says.
“It was hard. Once you hit 25 stores, you’re relatively safe, but less than that and all you’re doing is keeping afloat. Once you break through that, the challenge is getting the right franchisees and keeping them satisfied.”
Pie Face wasn’t the first business venture run by Homschek, who moved to Sydney from his native US in 1989, and Fong.
The duo helmed designer frock brand Paablo Nevada before a new collection devoted to the couple’s favourite restaurants unwittingly gave them the inspiration for Pie Face.
A doodle on a paper tablecloth, which now hangs in the couple’s home, provided the different faces to put on the pies. Combined with the name, a suggestion from Homschek’s friend, and the duo had the basis for a quirky, recognisable brand.