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<ul class="summary-list"><li>New York's iconic <keyword id="10388919" type="UNKNOWN" weightage="60" keywordseo="katzs-deli">Katz's Deli</keyword> hasn't changed much since opening its doors in 1888. </li><li>Current owner <keyword id="10388921" type="UNKNOWN" weightage="60" keywordseo="jake-dell">Jake Dell</keyword>, whose grandfather took over the business in 1988, says leaning into New York Jewish, Kosher-style culinary <keyword id="6463276" type="UNKNOWN" weightage="60" keywordseo="nostalgia">nostalgia</keyword> is the secret to its long-lasting legacy.</li><li>But pastrami sandwiches and matzoh ball soup aren't the only reason Katz's <keyword id="412594" type="COMPANY" weightage="60" keywordseo="Deli">Deli</keyword> has endured for 132 years.</li><li>It has a strong financial legacy that any entrepreneur planning for long-term survival will want to emulate: real estate ownership and investment in nation-wide shipping operation.</li></ul><p>Pull open the door to Katz's Delicatessen on the corner of East Houston and Ludlow Streets on the Lower East Side of Manhattan, and you'll be hit with the powerful smell of garlic. </p><p>Carvers in all white - collared shirts, aprons, and paper caps - slice and stack towers of brown and red slow-cured meats on bread smeared with yellow mustard into a Kosher-style sandwich just like Grandma made, if she were a resident of the neighborhood in the early 1900s.</p><p>A red neon sign mounted to the window blinks, "Katz's, that's all."</p><p>When it comes to the secret behind the deli's enduring legacy, this sign nails it. Little has changed since brothers Morris and Hyman Iceland founded the deli in 1888. The menu, decor, and operations remain consistent, even today as many businesses ditch their brick-and-mortar presence, pivot to digital, and adopt ecommerce to endure the pandemic. Current owner Jake Dell, whose grandfather took over the business in 1988, says leaning into New York Jewish, Kosher-style culinary nostalgia is the secret to its long-lasting legacy. </p><p>"It's an old food tradition and people are really excited to see the classics," said Dell, 32. "It's also the fact that it hasn't changed in 132 years. The sights are the same, the sounds are the same, and the smells are the same." </p><div type="image" title="Headshot 4" height="384" width="768" msid="79594763" hostid="261"></div><p>One of those smells is the meat's 30-day slow-curing process, not fast-tracked like other delis, according to <a href="https://katzsdelicatessen.com/our-story">Katz's website.</a> But the melt-in-your-mouth pastrami sandwiches at $23 a pop and steaming matzoh ball soup for $8 isn't all that's kept Katz's Deli afloat through the 1918 pandemic, the September 11 terrorist attacks, Hurricane Sandy, the Great Recession, and changing trends and technologies. It has a strong financial legacy that any entrepreneur planning for long-term survival will want to emulate: real estate ownership, and investment in nation-wide shipping operation.</p><p>And it's kept customers lined up to grab one of its famous order tickets for a simple reason: good old nostalgia.</p><h2>'Who the hell was up this year?'</h2><div type="image" title="Katzs_Counter_CreditKatz'sDeli" height="699" width="1048" msid="79594766" hostid="261"></div>Since World War II, Katz's has been shipping sandwiches, soups, and other Jewish specialities around the country, Dell said. "Send a salami to your boy in the Army" - which rhymes in New York - was its classic catch phrase at the time.<p>But even for businesses with ecommerce operations, 2020 wasn't a year to grow; rather, to survive. Dell declined to share financial figures for the 200-person company and, when asked if revenue increased since 2019, said, "Who the hell is up this year, other than Amazon?"</p><p>Profits may be lagging, but Katz's has some security: The business owns its building. </p><p>"It's a life-saver and I'm not sure we'd be here without it," Dell said. "We're lucky that someone had the foresight to do that a couple of generations ago." </p><p>In addition to owning the brick and plaster valued at $3.3 million according to Property Shark, Dell in 2015 sold two neighboring properties and the deli's air rights - or the rights to the space above the building - for about $17 million, according to <a href="https://www.nytimes.com/2016/04/24/realestate/katzs-delicatessen-sells-land-and-air-rights-new-condo-will-rise.html?smid=tw-share&amp;_r=2&amp;mtrref=undefined&amp;gwh=7A50CB1F39C231DBB29546E3550B67A7&amp;gwt=pay67A7&amp;gwt=pay">The New York Times</a>. The deal allowed Katz's to set up a 30,000-square-foot facility in New Jersey in 2017, which supports nationwide delivery and especially came in handy this year as many <keyword id="34615" type="ORGANIZATION" weightage="60" keywordseo="restaurants">restaurants</keyword> were forced to temporarily close in-house dining and pivot to online-only orders.</p><p>Dell also said that thanks to those banked funds, he was able to keep employees on staff during the pandemic.</p><h2>Just like Grandma did it</h2><div type="image" title="Katz's Matzoh Ball Soup" height="450" width="600" msid="79594771" hostid="261"></div><p>In a city like New York, where your favorite cafe can disappear overnight and a pop-up artisanal pickle shop can sprout in its place, Katz's consistency is unusual. </p><p>Its menu consists of six sandwiches and a handful of Jewish classics like latkes, knishes, and matzoh ball soup. It hasn't changed much since the 1980s. Five years ago Dell added a reuben sandwich by popular request.</p><p>"The truth is, reubens aren't even a deli sandwich, it's a bullshit sandwich," Dell told <a href="https://ny.eater.com/2015/1/28/7919135/meet-jake-dell-the-27-year-old-keeping-katzs-delicatessen-alive-and">Eater</a> in 2015. "You would never have meat and cheese together on a sandwich at a Jewish deli. We didn't even have cheese at all in this deli until 40 or 50 years ago."</p><p>Some employees might remember those days. Dell told <a href="https://www.delish.com/restaurants/videos/a58554/new-york-katzs-deli-owner-video/">Delish</a> many have worked behind the counters for decades, longer than he's been alive - watching the wallpapered photos of <a href="https://www.nytimes.com/interactive/2016/01/29/nyregion/celebrities-restaurants-new-york.html">Wu Tang-Clan members</a> and Sarah Jessica Parker yellow with time. </p><p>Nostalgia is a powerful and compelling force for consumers, said Tom Meyvis, a professor of marketing at NYU Stern School of Business who pointed to Katz's leveraging of its authenticity in recipes, decor, and neighborhood involvement. </p><p>"If somebody else made the exact same products as Katz's, in the exact same way, and in a new place, it wouldn't have the same authenticity," Meyvis said. "You can't just copy that." </p><p>For business owners who want to sculpt emotional bonds with customers in less than 132 years, Meyvis suggests determining what makes the brand special and crafting a strong narrative. "You have to figure out what you're known for and emphasize what is uniquely you," he said. Long histories are good, but not required for garnering interest.</p><p>"It's enough to have a narrative," he said. </p><h2>Being present, even in the darkest of times</h2><div type="image" title="Katz's_NightEntryway_CreditKatz'sDeli.JPG" height="3992" width="2661" msid="79594774" hostid="261"></div><p>What's more, said Meyvis, business owners should establish a connection to their neighborhoods on a hyperlocal level, as a way to strengthen their identity and authenticity with customers.</p><p>Katz's community ties extend beyond its physical presence on the corner of East Houston and Ludlow Street: It's fed customers through crises that have plagued <keyword id="72226" type="COMPANY" weightage="60" keywordseo="New-York-City">New York City</keyword> and the nation. </p><p>Days after September 11, 2011, a 13-year-old Dell watched as his grandfather and father served sandwiches to emergency workers for little-to-no charge. When Hurricane Sandy hit Manhattan in 2012, three years after Dell took over operations, he sliced "thousands of pounds of meat" and gave it away to residents.</p><p>Now, in the midst of the coronavirus pandemic, Katz's has partnered with organizations that support food-insecure individuals and frontline workers. To date, it's donated more than 2,000 meals to healthcare workers across 20 hospitals in New York City, according to Katz's Deli. </p><p>"The key is to put your head down and take care of the community, the neighborhood, and the person right in front of you asking for a sandwich," Dell said. "Then, when things get back to normal, the neighborhood supports you." </p><p>Very little has changed about Katz's traditions in light of today's crisis. There is no in-store dining but tables and chairs are now outside of the deli. Newly erected protective barriers separate customers from the carvers. </p><p>"It's just about surviving and not trying to change to adapt," Dell said. "You're trying to do minor things that make it easier or more enjoyable, but you're not changing who you are at the core."</p>

How New York's iconic Katz's Deli mastered nostalgia to maintain its cult following for 132 years - and get away with a $23 pastrami sandwich

<ul class="summary-list"><li><keyword id="9230137" type="UNKNOWN" weightage="60" keywordseo="katzs">Katz's</keyword> <keyword id="3111540" type="PERSON" weightage="60" keywordseo="pastrami">pastrami</keyword> on <keyword id="56668" type="CITY" weightage="60" keywordseo="rye">rye</keyword> is a bucket-list item for locals and out-of-towners alike.</li><li>It's made with the navel end of beef brisket, cured for three to four weeks, and smoked and boiled until it's soft and extremely tender.</li><li>Like all restaurants in <keyword id="6355838" type="LOCATION" weightage="60" keywordseo="new-york">New York</keyword> City, the famous <keyword id="412594" type="COMPANY" weightage="60" keywordseo="Deli">deli</keyword> is closed for dine-in service, but it has stayed open with help from an increase in delivery orders.</li><li><a href="https://www.insider.com/?hprecirc-bullet">Visit Insider's homepage for more stories</a>.</li></ul><p><em>Following is a full transcript of this <keyword id="21654" type="COMPANY" weightage="60" keywordseo="video">video</keyword>.</em></p><p><strong>Taryn Varricchio:</strong> You might recognize these thin slices of slow-cooked pastrami, a whopping three quarters of a pound of them layered onto chewy rye bread. It's one of the most New York foods you can find, and it's from none other than Katz's, the city's most famous deli.</p><p><strong>Brad Kass:</strong> That pastrami is by far the best pastrami I've ever had in my life. It really just melts in your mouth.</p><p><strong>Taryn:</strong> You know the pastrami comes from Katz's based on four factors: the cut of meat they use, which gets extra juicy and flavorful when it's cooked; the monthlong curing process that gives the pastrami its classic pink color; the signature rub, or bark, around the edge that's made with a blend of spices; and the extremely skillful way they carve it into perfectly thin slices.</p><p><strong>Jacob Grasso:</strong> But I always get their hot pastrami. And it's just so, like, juicy, Liz hates the word juicy, but to describe, it's, like, good juicy, and with the mustard and the rye, it just ties it all together. It's perfect.</p><p><strong>Elizabeth Napolitano:</strong> [laughs] Yeah.</p><p><strong>Taryn:</strong> Katz's is known for having a really long line outside of its doors. So I thought I'd catch up with owner Jake Dell about how he makes some of the best pastrami in the world, even during a shutdown. So, can you kinda tell us a little bit of what you guys are going through right now? The challenges you might be facing, or?</p><p><strong>Jake Dell:</strong> Yeah, this is definitely a challenge, doing an interview like this. A lot of delivery though, which is great, and a lot of shipping nationwide. A lot of customers getting meats by the pound, soups for their fridge, really just stocking up.</p><p><strong>Taryn:</strong> One of the most popular orders is this juicy pastrami on rye, something that takes a month to make, starting with the cut of meat. While you can use a few cuts to make pastrami, Katz's swears by the navel end.</p><p><strong>Jake:</strong> We use navel for pastrami. That's very traditional. And part of what makes the navel so beautiful for this process is that the fat is really just centralized in the middle of the cut of meat. Whereas a brisket can kinda be on the outside, the navel's really on the inside. So when you're smoking it, you're pulling the fat from the center out to the edges. So you really get all these juices and flavors flowing throughout, from top to bottom.</p><p><strong>Taryn:</strong> Then comes the curing stage, the longest part of the process, which can last between three to four weeks.</p><p><strong>Jake:</strong> Curing is basically just a salt bath. It's about taking salt and breaking down some of the muscle, some of the tissue, some of the connective tissue. Salt is good for preservation and good for flavor.</p><p><strong>Taryn:</strong> Cool. And what type of salt do you guys use for that process?</p><p><strong>Jake:</strong> Pink salts are a type of curing salts that basically helps give the rose color to the meat.</p><p><strong>Taryn:</strong> The next stage is all about intensifying flavor. They combine a little bit of salt, pepper, garlic, and coriander to make the pastrami's signature rub, or bark. Then each piece is smoked anywhere from seven to 72 hours, depending on the size and composition of the meat.</p><p>And how does the smoking affect the flavor and the tenderness of the meat? What is happening at that stage of the process?</p><p><strong>Jake:</strong> I mean, that's, when it comes to pastrami, that's everything, right? Smoking and rub is so important. What you're going to put on the outside there is going to really soak through. That smoking process is gonna get these flavors to kind of meld together and go from top to bottom, side to side, piece to piece. And so you really get this beautiful infusion of flavor.</p><p><strong>Taryn:</strong> The cooking process finishes off with steaming the pastrami until it's extremely soft. So soft that the workers behind the counter are considered masters at slicing it.</p><p><strong>Jake:</strong> It's very bizarre to feel the meat be that soft. So, if we tried to put it on the slicer, it would just crumble right through. Forget it. There's no chance that's gonna happen. That's why a lot of places don't cook it this long, because it's a huge hassle and a huge headache. And it takes a tremendous amount of knife skills and years of experience and practice to really know what you're doing with that piece of meat that can just turn into dust if you're not careful.</p><p><strong>Brad:</strong> It kind of has that same texture as, like, really good Texas barbecue, where you, like, it comes off the bone and melts in your mouth. It has that exact same concept.</p><p><strong>Taryn:</strong> By the end of the month, Katz's pastrami is ready to be sandwiched between two slices of rye bread with deli mustard. Since shutting down dine-in service, not as many customers are lining up outside of Katz's, but many are still ordering pickup and delivery.</p><p><strong>Brad:</strong> When I got it a week ago it was still warm, everything was exactly how I wanted it. Actually, I got coleslaw on my sandwich, and they put it on the side, which I think is a genius move, so that it doesn't make the bread soggy, so. It was still just as incredible taking it home and getting it delivery.</p><p><strong>Taryn:</strong> Fortunately, the deli isn't worried about running out of pastrami, since Jake says he can adjust how long he cures the meat.</p><p><strong>Jake:</strong> Right, if business gets too slow you can kind of increase the length of pickling. If it goes really fast, you can decrease. So there's a, it provides a great cushion.</p><p><strong>Taryn:</strong> But we know the future isn't for certain, so Jake says he's taking business day by day. For now, the deli remains open, as it has through recessions, depressions, and other crises over the last 100 years.</p><p><strong>Zach Edwards:</strong> Everyone would be a little hurt if Katz's closed, even for the time being, 'cause it's such a New York City establishment. It boosts the morale of everyone in New York City, having those major landmarks stay open. You know, it shows that New York City is strong, New City is always strong.</p><p><strong>Jake:</strong> If you would've asked me this five months ago in the middle of the holiday rush, "What do you think your Passover's gonna look like?" This is not quite how I envisioned it. I don't think any of us did. So the most we can do is to focus on the meat right in front of us.</p>Read the original article on <a href="https://www.insider.com/katzs-deli-best-pastrami-on-rye-nyc-takeout-delivery-2020-5">Insider</a>

New York's most iconic deli typically has lines around the block. Here's how they've adjusted to takeout and delivery during the pandemic.

<ul class="summary-list"><li>Restrictions in New York City have forced restaurants to change their business models overnight.</li><li>The owner of the iconic Katz's Deli said he doesn't know how long his company can keep going without laying off staff.</li><li>Meanwhile, owners of higher-end restaurants fear they will struggle to adapt to delivery and takeout-only systems. </li><li>A stimulus package signed by the president offers $350 billion for small business loans, but questions still remain over when businesses will get their money, and if there will be enough to go around.</li><li><strong><a href="https://www.facebook.com/BusinessInsiderToday/">View more episodes of Business Insider Today on Facebook.</a></strong></li></ul><p>New York City boasts one of the most diverse restaurant scenes in the world. But the coronavirus outbreak may change it forever. </p><p>Restaurants across the city, including legendary staples of the city's vaunted food scene, have temporarily closed their doors as business owners adapt to their new reality.</p><p>The iconic <a href="https://katzsdelicatessen.com/">Katz's Delicatessen</a> in New York's Lower East Side usually sees thousands of customers per day. Now, it's relying on delivery instead - and selling more products that can be stored for longer periods.  </p><p>"So not just focusing on a dining experience or a restaurant experience, which I've spent so much time thinking about. But thinking about now your in-home experience and what can we do to help with that experience," Katz's fifth-generation owner Jake Dell told Business Insider Today.</p><p>Katz's employs close to 200 people - and for now, it hasn't done any layoffs. But the restaurant doesn't know how long it can keep going without making more changes.  </p><p>"I mean, there's no question it's hard. And the hardest part is actually for the staff, these guys are family," Dell said. "We've certainly had to trim back days and hours, but as long as everyone can get something. We're figuring it out together."</p><p>"We've been here 132 years, so we're used to the unexpected in some ways, but you can never really fully prepare.</p><p>Not every restaurant owner has had the same fortune. A <a href="https://www.restaurant.org/Articles/News/Study-details-impact-of-coronavirus-on-restaurants">survey</a> by the National Restaurant Association found that seven in 10 restaurant operators have had to lay off employees due to the virus, with nearly 50% anticipating further cuts to staff and hours worked in the coming weeks. </p><p>Joe Carroll owns five restaurants and bars, three of which are in Brooklyn. He had to let most of his staff go. </p><p>"I had to let about 83 people or something like that go. So that was brutal in many ways, you know. Especially when we're not doing poorly. The businesses weren't failing there, you know, nothing was closing. So it's a very odd thing to wrap your head around," said Joe. </p><p>Carroll's restaurant <a href="http://www.fettesaubbq.com/">Fette Sau</a> has been serving Southern-style barbecue in Brooklyn's Williamsburg neighborhood for 16 years. So far, delivery and takeout orders have been consistent enough to keep the restaurant afloat.</p><p>But he is concerned that higher-end restaurants, like his steakhouse <a href="https://www.stanselm.net/">St. Anselm</a> across the street, may struggle to adapt to the new status quo. </p><p>"First of all, it's not the type of food that delivers well, plus we've never been set up for delivery. So there's been, you know, just a struggle in the last week trying to get on apps like Seamless and Caviar, because every other restaurant in the city that wasn't set up for delivery is trying to do that too. So they must be overwhelmed," Carroll said.</p><p>Last month, the president signed a <a href="https://www.businessinsider.com/trump-signs-coronavirus-economic-relief-aid-bill-checks-for-americans-2020-3">$2 trillion stimulus package</a> that includes $350 billion to fund small business loans to companies with less than 500 employees - like Carroll's business. </p><p>As of April 13, <a href="https://www.businessinsider.com/government-loans-start-flowing-to-small-businesses-2020-4">over $226 billion</a> of the fund had been allocated to small businesses across the country, but early glitches in the system are making it difficult for lenders to process and disburse the loan payments. </p><p>Bars and restaurants already run on razor-thin margins, with many barely breaking even. Under normal market conditions, <a href="https://www.ibisworld.com/united-states/market-research-reports/single-location-full-service-restaurants-industry/">60% of restaurants</a> don't make it past the first year of operation, and 80% fail within five years. </p><p>With no clear timeline, the survival of many small businesses across the country has been thrown into jeopardy. </p><p>"I mean, it's one thing when one restaurant or a neighborhood perhaps suffers some major loss and everyone comes together to help them out. This is universal. This is countrywide basically, right?" Carroll said.</p><p class="tagline"><i>Do you have a personal experience with the coronavirus you'd like to share? Or a tip on how your town or community is handling the pandemic? Please email <a href="mailto:covidtips@businessinsider.com">covidtips@businessinsider.com</a> and tell us your story.</i></p><p><i>Get the latest <a href="/coronavirus-business-impact">coronavirus business &amp; economic impact analysis</a> from Business Insider Intelligence on how COVID-19 is affecting industries.</i></p>

How iconic New York restaurants like Katz's Deli are adapting to the food scene's new reality

<p></p><div class="KonaFilter image-container display-table"><div><div class="image on-image"></div><p></p></div></div><ul><li><strong>Marc Leishman appeared to be heading towards disaster on the sixth hole of the Dell Technologies Championship when the golf gods intervened.</strong></li><li><strong>Leishman's approach shot appeared to be heading out of bounds when it hit a spectator in the leg and ricocheted towards the green.</strong></li><li><strong>Leishman then sank a 55-foot putt that looked like it was going to go well past the hole.</strong></li><li><strong>The fan got the ball, a signed glove, and maybe $100 for his assistance.</strong></li></ul><p><br>Marc Leishman picked up a birdie he didn't deserve in the first round of the Dell Technologies Championship with the help of a fan's leg and a forgiving cup.</br></p><p>The sequence came on the Par 4 sixth hole after Leishman's drive found a bunker. His approach shot then went wide right and appeared to be heading out of bounds.</p><p>But just when it looked like Leishman was heading to bogey&#xa0;- or worse&#xa0;- the golf gods intervened.</p><p>Leishman's approach hit a fan on the leg and then rolled onto the green, stopping about 55 feet short of the hole (<a href="https://twitter.com/PGATOUR/status/1035575552608886784" target="_blank" rel="noopener">via PGA Tour Live</a>).</p><p>&#xa0;</p><p>Leishman checked on the fan, and as is customary, he gave the fan an autographed glove. The announcers said that it appeared that Leishman also gave the fan some cash&#xa0;- possibly a $100 bill - but that was unconfirmed.</p><p>&#xa0;</p><p>But Leishman's luck had not run out yet.</p><p>The PGA Tour vet's long putt looked like it was going to race by the hole by a good distance. But the cup proved to be more forgiving than most players have experienced, and it was as if it reached up and grabbed the ball for a birdie.</p><p>&#xa0;</p><p>The golf gods were with Leishman on this day. He then turned around and tossed the ball back to the fan who helped make it happen.</p><p>&#xa0;</p><div><div style="width:100%;height:0px;position:relative;padding-bottom:56.667%;"></div></div><div></div><div><div style="width:100%;height:0px;position:relative;padding-bottom:56.667%;"></div></div><div><div style="width:100%;height:0px;position:relative;padding-bottom:56.667%;"></div></div>    <div class="margin-top">        <h3>NOW WATCH: <a href="https://www.businessinsider.com/what-it-takes-world-cup-soccer-player-football-romelu-lukaku-belgium-manchester-united-2018-8">What it takes to be a World Cup soccer player</a></h3>        <div>                    </div>    </div></hr>

The golf gods intervened to help PGA Tour veteran Marc Leishman make one of the luckiest birdies you'll ever see

<p><div class="KonaFilter image-container display-table float_right"><div><div class="image"></div><p></p></div></div>In 2009, Ben Kaufman launched Quirky, a start-up that pledged to help regular people turn their ideas into real products and sell them in stores nationwide.</p><p>Initially, the company looked like it would be a big success.</p><p>Kaufman, now 28, grew his company to 300 employees and raised $185 million. Quirky created hit products, such as a power cord that could pivot, and the royalties made a few members of its inventor community hundreds of thousands of dollars.</p><p>But in the last six months, the New York City start-up has laid off more than 20% of its staff, burned through tens of millions of dollars, and discovered that its founding business model broke at scale. Last week, the company also had to do an expensive nationwide recall of its "Wink" connected-home products because of <a href="http://www.cepro.com/article/quirky_terribly_embarrassed_over_wink_home_automation_hub_recall/">a completely avoidable error</a>.</p><p>How did Quirky go from a super-hyped start-up to a business with burn of $150 million on net-losses of $120 million, desperately in need of a turnaround? Business Insider spoke with more than a dozen people intimately familiar with Quirky as well as CEO Ben Kaufman, who was open about his missteps.</p><p>"We're trying to build an invention machine on the internet - nothing like this has ever been built," he says. "There's gonna be a lot of twist and turns, and this will not be our last twist. But the resilience of this company will be the largest single thing to determine our fate."</p><h3><strong>A 20-year-old with a $5 million business</strong></h3><h2><div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div><p></p></div></div></h2><p>Kaufman has always been an inventor. In high school, he wanted to find a way to covertly listen to his iPod in class. He invented the "Song Sling," an iPod case with headphones that looked like a lanyard. In order to mass-produce his invention he convinced his parents to refinance their home and then flew to China, where he <a href="https://www.quirky.com/blog/post/2012/09/what-raising-money-means-to-me/">burned through $185,000</a> and quickly realized how hard it was to commercialize an idea.</p><p>But he didn't give up. He called the fledgling company Mophie after his two golden retrievers, Molly and Sophie.</p><p>Kaufman started college at Champlain in Vermont, but dropped out during his freshman year out to focus on Mophie full time after he raised $1.5 million from investors at only the age of 19. His investors then hired a more experienced CEO to run Mophie, and the company began making a range of iPod accessories and cases alongside the Song Sling. At age 20, Kaufman was first on <a href="http://www.inc.com/30under30/2007/1-kaufman.html">Inc. Magazine's 2007 30 Under 30</a> list. At that point, Mophie was on track to generate $5 million in revenue.</p><p>But investors felt antsy. They saw Kaufman's attention wander from "iPod condoms," as he called them, to a new business idea that would become Quirky.</p><p><div class="KonaFilter image-container display-table float_right"><div><div class="image"></div><p></p></div></div>With investors' encouragement, Kaufman sold Mophie and its assets (including patents that influenced Mophie's wildly popular Juice Pack product) for "<a href="https://medium.com/@benkaufman/behind-the-invention-the-mophie-juice-pack-a0620f74efcf">pennies on the dollar</a>" to <a href="https://www.crunchbase.com/organization/mophie">mStation</a>.</p><p>He ran with his new business idea, software that could make developing products a social experience. Kaufman incorporated a new company, Kluster, the same day the Mophie acquisition was finalized.</p><p>Kluster's core concept was difficult to grasp. Kaufman wound up with a pile of debt while trying to get Kluster off the ground. With investors' blessings and an agreement to pay it all back, he's since used more than $300,000 of Quirky's money to pay off his debts.</p><p>The following is from a 2014 shareholders' note, but the amount owed has since been reduced by more than two-thirds ($ amount in 000's):<span style="line-height: 1.5em;"><div class="KonaFilter image-container display-table click-to-enlarge"><div><div class="image"><a title_source="Quirky" title_caption="" class="zoomin" href="https://static-ssl.businessinsider.com/image/5540b2cdecad04156fe17bdc-960/unnamed-116.png"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></div><p></p></div></div></p><h3><strong>Need for speed</strong></h3><p>After raising a $68 million Series C in 2012, the company decided to move even faster. It scheduled three virtual product launches per week, which its community would then tweak and comment on. The company once brought <a href="https://www.quirky.com/shop/426">an egg-yolk separator</a> from a concept to store shelves in less than thirty days.</p><p>"You have to make it work, because you don't have an option for it not to," Kaufman once said in an interview with Mashable about the <a href="http://mashable.com/2013/03/19/quirky-ben-kaufman/">company's self-imposed three-products-a-week time line</a>. "You'll look like an idiot if you don't launch a product."</p><p>But Kaufman's commitment to moving at lightening speed was part of Quirky's problem. The company put too much emphasis on plucking ideas from the community quickly and not enough on assessing demand or whether products could be built efficiently. </p><p>"Ben didn't want to pay attention to any product development fundamentals," one former Quirky designer says. "He wanted to bounce around on the moon. But we're still in f---ing gravity!"</p><p>Three designers that we spoke to said they felt rushed, with little to no resources for quality assurance.</p><p>"There was a lot of stuff that I designed at Quirky that I would never put in my portfolio," one former designer said. "The process just wasn't there. It was like baking a cake and taking it out of the oven mid-way. And we're going to sell it anyway."</p><p>Kaufman says the high-pressure environment and speed didn't have significant issues on product quality for the first four years of business. However, product reviews on Quirky's site suggest customers were frustrated by even simple products, which they say <a href="https://www.quirky.com/shop/59">broke quickly</a> or <a href="https://www.quirky.com/shop/72">never worked</a>, and one customer told Business Insider that of the 50-or-so products they ordered from Quirky, most were disappointing, including those without software. </p><p>Kaufman does admit that a lack of tools for quality assurance testing on software became a more serious problem when Quirky's products grew more complex. Several designers say that teams expressed their concerns to Kaufman, but the young CEO refused to slow down. </p><p><div class="KonaFilter image-container display-table float_right"><div><div class="image"></div><p></p></div></div>In 2014, Quirky opened up a customer service center in Schenectady and launched its first line of Wink products.</p><p>More than ever, Quirky's fast-to-market mentality negatively impacted product quality - its smart air conditioner received terrible reviews and the firmware on its hubs needed a major update after units hit shelves. <a href="https://www.quirky.com/shop/596">Disappointment is ripe</a> in <a href="https://www.quirky.com/shop/982">forum posts</a> about <a href="https://www.quirky.com/shop/706">various software products</a> and Gizmodo ran <a href="http://gizmodo.com/why-is-my-smart-home-so-fucking-dumb-1684949715">an extremely harsh review</a> of the Wink system earlier this year. Former customer service representatives told Business Insider it was a painful time to work Quirky's phones. </p><p>"There were mistakes that easily could have been prevented," said one former employee. "An overarching theme at Quirky is the showmanship of it. It was very P.T. Barnum-esque, focusing on being 'The Greatest Show on Earth' instead of on attention to detail."</p><h3><strong>Going too far</strong></h3><p>Kaufman's own quirkiness caused his company to both take off and struggle.</p><p>"Ben is Quirky, and Quirky is Ben," one former employee says.</p><p><div class="KonaFilter image-container display-table float_right click-to-enlarge"><div><div class="image on-image"><a title_source="Quirky" title_caption="Kaufman strapped to a train in one of the " least="" important="" CEO="" commercials.="" class="zoomin" href="https://static-ssl.businessinsider.com/image/553e1550eab8ea4b6a02d98e-960/quirky-1.png"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></div><p></p></div></div>"He's a dick, but hilarious," marketing VP Bret Kovacs wrote as a recommendation on Kaufman's LinkedIn profile.</p><p>That style doesn't appeal to everyone. Six former employees, several of whom were laid off, agree that Kaufman can come off as a bully and creates a frat-esque culture where it's very clear whom his favorites are. If you don't laugh at Kaufman's sometimes-outrageous jokes, for example, you might feel like an outsider.</p><p>A former employee describes Kaufman as "ruthlessly flippant" and detailed a disturbing example. One day in 2012, a source says he saw Kaufman creeping between rows of desks. This person says Kaufman snuck up behind a few employees' backs, made a gun symbol with his hands, and pretended to shoot them. Soon after, the source says those people were fired. Another former Quirky employee corroborated the story. Kaufman staunchly denies it.</p><p>"When we're in an unfortunate situation where we need to cut people for financial reasons we take that super seriously," he says.</p><p>Kaufman has a high 80% approval score based on 39 ratings on the job-review site Glassdoor, where employees have encouraged him to "keep up the hustle" and complimented his down-to-earth management style. But a <a href="http://www.glassdoor.com/Reviews/Employee-Review-Quirky-RVW5724050.htm">recurring </a><a href="http://www.glassdoor.com/Reviews/Employee-Review-Quirky-RVW2523663.htm">complaint</a><a href="http://www.glassdoor.com/Reviews/Employee-Review-Quirky-RVW3574988.htm"> is that</a> Kaufman <a href="http://www.glassdoor.com/Reviews/Employee-Review-Quirky-RVW3294508.htm">needs a boss</a>.</p><p>Three former employees told Business Insider that while Kaufman hires smart people, he does not take full advantage of their talent or advice. He is impulsive and often set in his ways, even when his decisions don't make financial sense for Quirky or seemed like passion projects.</p><p><div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div><p></p></div></div></p><p>For example, Kaufman demanded the production of a smart egg tray even though a team of engineers and designers insisted it didn't make economic sense. In another instance, Kaufman splurged on a $200 facial-recognition scanner for a conference room. Last year, he approved 500 art books with ideas submitted to Quirky by prison inmates to be printed for investors and community members as Christmas gifts, even though the company was hemorrhaging money. He admits the company bought too much inventory on some products, causing $25 million of its losses last year. </p><p>"If I ever go too far, it's because of the passion I have for this place, and the love I have for this place, and the community," Kaufman tells Business Insider. "I want this thing to be so perfect and so great. And, yeah, often I may take it too far, but it comes from a place of love, you know?"</p><h3><strong>Losing Money</strong></h3><p><div class="KonaFilter image-container display-table float_right click-to-enlarge"><div><div class="image"><a title_source="Quirky" title_caption="Here's the breakdown on what Quirky spent to create the speakers." class="zoomin" href="https://static-ssl.businessinsider.com/image/553f945beab8ea7b370ff12b-960/speakers-2.jpg"><span class="sprites click-to-enlarge-icon" title="Click to enlarge"></span></div><p></p></div></div>"It's easy to think things are going well at Quirky," Kaufman told them, noting that the company had shipped 4 million products, increased its revenue 70%, swelled to 1 million registered community members, and had more retail partners than ever before.</p><p>"But that's not the full story of what's going on at Quirky," he continued. "Tonight won't be a rainbows and butterflies town meeting."</p><p>Kaufman told employees the company wasn't making money. He announced its new direction: Quirky would stop making so many products. It would shut down its ecommerce site. A new initiative, called Powered By Quirky, would align the start-up with major brands and help those corporations figure out new products to launch.</p><p>"Quirky had quality issues and they had sales issues, and they're not trying to hide it," <a href="https://www.quirky.com/MarcR">Marc Rumaner, an enthusiastic Quirky inventor</a> who has made more than $45,000 through the site, says. "This change is something they absolutely needed to do. Whether it will be the right move or not, I think time will tell. I'm hoping this new path will be positive - I'm hoping it's a bright future." </p><p>So far, Quirky is working with headphone company Harman, toy maker Mattel, and <a href="http://www.businessinsider.com/amazon-dash-button-2015-3">Amazon's Dash product</a>.</p><p>Inventors would be given a smaller cut of revenue per sale moving forward, between 1.5% and 5%, but will ideally see many <em>more </em>sales. The key will be whether or not Quirky can nail down enough partners to give its community a wide range of categories to invent in, and if those partners can find blockbuster product ideas through Quirky's platform. </p><p>Kaufman told Business Insider that other partnerships are getting locked down, the agreements come with quotas around how many products partners pick, and that he plans to raise a new round of financing over the next few months. </p><p>Will investors give Kaufman another shot?</p><p>Norwest Ventures partner and Quirky board member Josh Goldman declined to tell Business Insider if he planned to participate in the next round of funding, but pointed out that his firm supported the company at every single opportunity for fund-raising. He says he strongly believes in Kaufman and the next phase of Quirky.</p><p>Kaufman, of course, is confident in Quirky's future too.</p><p>"I'm ambitious as hell. The company is ambitious as hell," he says. "The goal is to create this invention platform that understands the pulse of the universe and delivers products as a result. It's a machine-learning, data science project that will exist for hundreds of years."</p><p>Even some of Kaufman's critics believe he will win. </p><p>"It's a company that will never die," one largely critical former employee told Business Insider.</p><p>"I feel like no matter what happens, Ben will always find a way to survive."</p>    <div class="margin-top">        <h3>NOW WATCH: <a href="http://www.businessinsider.com/dell-dude-computer-advertisement-ben-curtis-2015-1">WHERE ARE THEY NOW? Here's What Happened To The 'Dude You're Getting A Dell' Guy</a></h3>        <div>            <div>        <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="l5NDJ5cDodVrG23lsHuA44EjAGPY-MeQ" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div>        </div>        </div>            </div>

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