How We Did It - Luke's Lobster

Luke Holden and Ben Conniff started a small chain of simple lobster shacks. Then they started thinking much bigger.

- Burt Helm

Step into one of the 39 Luke’s Lobster locations from New York City to Taiwan and it’s easy to pretend you’re visiting a classic New England seafood shack: Diners order at simple wooden counters, sit at rough-hewn tables, and munch on a limited (and exceedingly tasty) menu of lobster, crab, and shrimp rolls and chowders, accompanied by simple bags of potato chips. But the Saco, Maine– and Brooklyn-based company’s restaurants are actually the last step in an extensive, tightly integrated seabed-totable operation—one that nearly broke the founders, Luke Holden and Ben Conniff, when they first attempted to set it up.

Luke When I was growing up, my father owned and ran one of the largest lobster processors in North America. It was an intense, high-risk business with very low margins. He was doing $20 million in sales, and taking home maybe $50,000 or $100,000 in income.

Ben A lobster-processing plant is basically an input-output machine. Your input is live lobsters, your output is lobster meat: frozen raw tails, cooked and pulverized bodies for bisques, and knuckle and claw meat that is cooked, picked, and packed and used for rolls and chowders. And the shells get crushed up and sold as fertilizer. You try to use everything, antennae to tail.

Luke In 2009, we opened the first Luke’s Lobster shack in New York City for $35,000. I felt I’d pulled a rabbit out of a hat. It was popular right away—and it was much easier than processing. My family decided to sell that business, and then helped me focus on new Luke’s locations.

Ben By 2012, we had six shacks open, and had saved some of our earnings. We would have liked to put that money toward opening new locations.