Chipotle's loyal employees wrapped in success

On 15th anniversary, Chipotle -- and loyal workers -- can count riches, 778 stores

By Joyzelle Davis, Rocky Mountain News (Contact)

Published July 25, 2008 at 9:05 p.m.

Text size  

• 10 Comments
• Email
• Print

Photo by Brian Lehmann © The Rocky

Monty Moran, President and Chief Operating Officer (left) and Joe Stupp Manager of Customer Service at Chipotle restaurants sit above trash cans showing their hip and fun personality inside a Chipotle at 1480 16th street in Denver.

Steve Ells opened his first Chipotle Mexican Grill 15 years ago this month, a modest 20-seat restaurant on Evans Avenue.

Chipotle today has arguably become the most successful fast-casual chain in the nation, selling its iconic foil-wrapped burritos at some 778 stores nationwide from Manhattan to Issaquah, Wash. Last year, Chipotle rang up $1.1 billion in sales.

Chipotle's success has made Ells a millionaire many times over, earning $7.3 million in salary, stock and options in 2007.

Many of the store management employees who have stuck with Chipotle since the early days have benefited as well - Chipotle offers a two-month paid sabbatical after 10 years of service, and a company car for all restaurant managers who have been with Chipotle at least four years.

There's also the potential for a stock option payoff. Chipotle distributed 774,150 shares among salaried employees ahead of its January 2006 IPO, with 456,150 going to nonexecutive employees like store managers, according to filings with the Securities and Exchange Commission. Under terms of the grant, recipients can't exercise their options until early 2009.

Chipotle also granted an additional 103,400 stock option awards to nonexecutive employees on Feb. 20, 2008, according to SEC filings, that can't be exercised for another three years.

Chipotle stock took a huge hit this week after missing analysts' earnings estimates by a penny, sending shares down 19.7 percent on Thursday alone, and the stock slid another 99 cents on Friday to close at $66.31.

The shares are well off their all-time peak of $155.49 reached in December. But the stock is still triple the company's January 2006 initial public offering price of $22, which is also the exercise price for the first round of options.

While those perks don't put Chipotle employees on par with the gains that Google and other Silicon Valley workers have seen, they did provide an unexpected boost for employees who went into an industry that's often saddled with a reputation of poor pay and benefits.

The Rocky profiled three employees who have been with Chipotle since the early days, and how a job many of them expected to be only temporary turned into a career.

Gretchen Selfridge

Age: 44

Current job: Regional director, overseeing 10 states

How she started at Chipotle: Selfridge was working as manager at Caldonia's in Aurora in 1995 when she was recruited by Chipotle's then-director of operations, who had just dined at the barbecue restaurant.

Selfridge already had 12 years of restaurant experience under her belt, mostly at full-service restaurants, and initially balked at the idea of working at a Mexican fast-casual restaurant.

"Back then no one had heard of that restaurant category, so I was snubbing my nose saying, 'I'm not working in fast food,' " Selfridge said.

It took three months for Selfridge to come around, and she started in January 1996 as the manager at Chipotle's second restaurant, on Colorado Boulevard.

"It was kinda scary; we didn't really pay attention to food costs or inventory. We just served burritos," she said. "I just fell in love with the food. The coolest thing about working there was usually when someone says, 'Can I talk to the manager,' you think uh-oh - what's wrong. But people were asking, 'Can I get a franchise? Can I get one closer to me?' They were flipping out."

Career path: Within six months, Selfridge became area manager overseeing all four Chipotle restaurants. The next year she moved into facilities and construction development, helping architects design the kitchen layout for new stores and buying equipment. By 1998, she oversaw Chipotle's first out-of-state expansion into Kansas.

Every time Selfridge received a promotion, she said, Ells' mom and dad would send her a handwritten letter of congratulations.

How working at Chipotle changed her life: "I never imagined that I could afford my own house in Evergreen," she said. "There's no reason to ever leave. If I left, I'd be leaving my own family."

Monty Moran

Age: 41

Current job: Chief operations officer and president

How he started at Chipotle: Moran didn't officially become a Chipotle employee until 2005, but he's been involved since Ells first floated the idea of opening a San Francisco-style burrito joint.

Moran knew Ells from their Boulder High School and University of Colorado days, and - along with his father - had become dinner party regulars at the Ellses during their undergrad years. Moran, who attended Pepperdine University Law School in Malibu, Calif., was back in town for a visit in the early 1990s when Ells invited him and his father over for burritos.

Moran concedes he felt "a huge sense of disappointment" when he heard the menu, but that changed after his first bite.

"We couldn't believe all of the different flavors. My dad asked Steve if he could invest," Moran said, "but he already had a loan from his own dad."

Career path: Moran moved back to Colorado in 1996, joining LoDo law firm Messner & Reeves, where he eventually became CEO. He brought in Chipotle as one of his first clients, starting off by charging only $1,200 for a lease contract - which, he says, worked out to less than minimum wage for all the hours spent on it. Chipotle soon became Messner's biggest client, and Moran says he became "more and more involved in Steve's vision of changing the food culture in our world."

Moran trained for 10 weeks at the Chipotle store on 120th Avenue in Westminster shortly after accepting the president/COO position, an experience that gave him insight into helping make the career path clearer for employees.

"I'd ask people where do you want to be in five years, and they'd say, 'Here,' " he said. "It wasn't that they didn't have the capacity to become a restaurant manager. They just didn't know it was a possibility at that point."

Did you ever think your career would take you here? "Oh, not at all. I always pictured that I'd be in the courtroom trying cases, which I did, and it was incredibly exciting and enriching," he said. "But what really thrills me at Chipotle is we're building a culture where people know their success is gained by ensuring the success of those around them."

Moran last year received $479,169 in salary and bonuses, $688,500 under a nonequity incentive plan and $2.9 million in stock options and grants. From May to August 2007, Moran sold 27,197 shares, grossing $2.54 million.

Joe Stupp

Age: 42

Current job: Head of customer service

How he started at Chipotle: It all started in high school. Stupp went to Boulder High School with Ells, and they struck up a friendship in German class that lasted through their years at the University of Colorado.

Stupp was waiting tables and working at a Boulder magazine store in the years after college. Ells "must've felt sorry for me," he joked, and hired Stupp in 1994 as general manager at the first Chipotle store on Evans Avenue. Stupp then went on to manage the second and third stores as they opened.

Career path: Stupp is one of the rare Chipotle employees who jumped ship, leaving to manage a Wendy's store just across the street.

"For some unknown reason, I left," he said. "At the time, I just wasn't sure that Chipotle was right for me."

He returned within two years, and by 2001 climbed from area manager to the newly created position as director of customer service. Stupp and his team answer the roughly 200 e-mails that come through the company's Web site each day, as well as keep tabs on the blogosphere, Web site and e- mail marketing. He also picks music played in restaurants.

"They wanted someone who could write a couple words without misspelling them," Stupp said. "And I've always had a quirky sense of humor, which helps, so it doesn't feel like a form letter."

How working at Chipotle changed his life: Stupp was 28 when he started working at Chipotle, still trying to figure out what to do with his English lit degree. Working at Chipotle changed the one-time junk food junkie's eating habits to eat foods "so much more carefully" in his personal life, he said, and he feels "very fortunate" to have been part of Chipotle's growth.

"I've watched this company grow from a pup," he said.

Timeline

* 1984: Steve Ells graduates from Boulder High School.

* 1988: Ells graduates from CU.

* 1990: Graduates from Culinary Institute of America

* 1990-1992: Works for Jeremiah Tower at Stars restaurant in San Francisco

* 1993: Opens the first Chipotle Mexican Grill near DU

* 1995: Opens the second Chipotle on Colorado Boulevard and a third in Littleton

* 1996: Five more metro-area restaurants open

* 1998: McDonald's invests in Chipotle, becomes a minority stakeholder. Chipotle opens its first restaurant in Overland Park, Kan. - its first outside of Colorado * 1999: Chipotle continues expansion in Minneapolis and Columbus, Ohio

* 2001: McDonald's becomes majority owner in Chipotle, introduces naturally raised pork

* 2002: Begins serving naturally raised chicken at a few locations

* 2003: Chipotle opens in New York, is on track to have 100 stores open. Introduces the burrito bowl and sells 7 million first year

* 2005: Opens 500th restaurant in the U.S. Adds salad to menu

* 2006: Chipotle stock doubles in price on its first day of trading on the NYSE. Implements plastic and glass recycling in 70 restaurants

* 2007: Begins serving sour cream free of the synthetic growth hormone rBGH

• July 26, 2008

  6:02 a.m.

  Suggest removal

  JohnSWren writes:

  What great startup stories. We hear people share their startup story each week at the Denver IDEA Cafe. It's free and open to anyone who is starting a new career, project or new business. Join us! More info and RSVP at http://ideacafe.meetup.com/1

• July 26, 2008

  7:02 a.m.

  Suggest removal

  hdfresh writes:

  This story makes me hungry for a Chipotle burrito.

• July 26, 2008

  7:45 a.m.

  Suggest removal

  MiHiman writes:

  I remember the first time I went into this NEW burrito place on 8th and Colorado with friends. I couldn't believe at the time how popular it was all ready with lines outside the door. The portions seemed huge and the taste was/still is unbelievable.
  I mentioned to my friends that I should apply to work here as I have always complained of my choice of ER work. Now I recently celebrated 30 yrs with the hospital and have little to show for it...Hindsight is 20/20..Wish I had talked to Gretchan then..Hey Gretchan...Remember me??? I still have a few good years left.

• July 26, 2008

  7:48 a.m.

  Suggest removal

  Milehighguy writes:

  Can the employees take their stock options in Pesos? That would be a lot more convenient.

• July 26, 2008

  11:12 a.m.

  Suggest removal

  redwhiteandBLUE writes:

  Heavy fines for employers who hire illegals!

• July 26, 2008

  11:23 a.m.

  Suggest removal

  mevantin writes:

  Milehighguy and RedwhiteandBLUE, can't you just enjoy a story of a Colorado startup that has enjoyed profound success? Especially in this tough economy it is nice to see those who are still hiring and paying the bills. I guess every party has a pooper....

  Stop trolling these threads with your own agenda, and enjoy something without whining for a change.

• July 26, 2008

  2:32 p.m.

  Suggest removal

  mrtaco writes:

  mile high and red white and blue are two dim bulbs whose blather isn't worth a peso. i hope they both stay out of chipotles so i don't have to wait as long to get a delicious burrito.

• July 27, 2008

  6:26 p.m.

  Suggest removal

  rj1967 writes:

  If all the big guns are so filthy rich, how come they don't offer insurance to the little people?? If the little people didn't work days, nights, and weekends there would be no filthy rich execs.

• July 27, 2008

  8:03 p.m.

  Suggest removal

  maithoughts writes:

  rj1967, Dead on where are the profiles of the rank and file, who can't afford the gas to drive to thier minimum wage job. So glad these few can afford their high end luxury cars,

• July 28, 2008

  4:06 a.m.

  Suggest removal

  misterchinaski writes:

  employees??? like the people what make my tasty chipotle burrito? oh, you meant executives or the like. nevermind. jerks.

Featured

• Rocky Multimedia

  

  The news comes alive in our videos and slide shows. Catch up on what's happening today.

• Holiday Lights

  

  Is your house the jolliest on the block? Submit your holiday lights display.

• Holiday Gift Guide

  

  Looking to get a jump-start on the holiday shopping season?

• Mount Crushmore

  

  Which four Broncos greats should be immortalized on Mount Crushmore? Vote here.

• Bronco Dean's rant

  

  Listen to Bronco Dean's midweek rant on the Chiefs.

• Broncos Video

  

  Get the latest from Dove Valley as the Broncos prepare for Sunday's matchup.

• Calendar wallpaper

  

  Download this month's desktop wallpaper calendar

• Sam Adams' Open Mic

  

  Open Mic: Stirrin' the Soup with Matt Iseman

• The Rocky @ 150 Years

  

  Read the Rocky's coverage of Colorado's cannibal, Alfred Packer, in 1886.