The Modern Hotelier #203: How Cashless Tipping Can Improve Employee Morale & Retention in Hospitality | with Elle Rustique
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David Millili: So Steve, who do we have on the episode today?
Steve Carran: Yeah, David, today we have on Elle Rustique, the founder and CEO of TipBrightly. TipBrightly is a FinTech company that makes tipping easy, cashless and app free. Through QR technology Tip, Riley helps hotels and service business empower guests to show appreciation while boosting income and recognition for the frontline employees inspired by her mother, which we'll talk more about later. Elle turned a personal story into a mission to create more equity and gratitude in hospitality. Thanks for joining us, Elle. How you doing today?
Elle: I'm good. I really enjoyed your summary, so a hundred percent.
Steve Carran: Thank you. Thank you.
David Millili: So we're gonna jump in. We're gonna go through a quick lightning round of some questions. We're gonna get to know you better about some of your background, your career, and then we're gonna jump into some thought leadership and industry topics. Sound good?
Elle: Perfect.
David Millili: Okay. What's something you wish you were better at?
Elle: I think remembering things,
David Millili: What's your most used emoji?
Elle: The heart.
David Millili: Okay. What's a luxury you can't live without?
Elle: Hmm. Chocolate.
David Millili: Okay. If you had a time machine, would you go into the future or into the past? And what year would you go to?
Elle: Then we go back to the past. I would go back to the eighties
David Millili: Okay.
Elle: I'd have a good time.
David Millili: What's the best piece of advice you've received?
Elle: Less is more.
David Millili: That's a good
Elle: It was a professor who told me that yes, less 
David Millili: What's your favorite city and why?
Elle: Hmm. New York City, it's the only place in the world that I've been to where, you know, it's a living, breathing ecosystem. You step out the door and you can feel the life
David Millili: Yeah, that's true. That is true.
Steve Carran: Well, that's great. Great job Elle. Great answers. So now we're gonna go on to more about your background and what makes you tick. So Elle, you grew up in Lansing, Kansas, is that correct?
Elle: Yes, that is correct. I did grow up in Lansing, Kansas.
Steve Carran: So how did growing up in Lansing, Kansas shape you into who you are today? Or what did you learn from growing up in Kansas?
Elle: Well, you know, we moved to Kansas from Hawaii, so it was a big culture shock. you know, I think Kansas was all about trying to figure out who I was, how to fit in. You know, what my friend group was, and it, you know, I, I needed to prove myself. I was one of, just two minorities, so it shaped me in the sense of, it really drove me to want to succeed and I really did succeed.
I was the top of my class. I was valedictorian, and my goal was to get outta Kansas. So I loved Kansas and I went to school in St. Louis. Yeah.
Steve Carran: That's great.
David Millili: Right. So you have degrees from Washington University, Columbia, UCL, Stanford, and they're all focused on education. What really led you to be have that focus on education?
Elle: I would say from early on, you know, I really, um, valued education. My mother was a, was an elementary school teacher and my dad was just an avid reader. I think. The first book he gave me was about Malcolm X. So it was really about change. It was about, education for me is a, a process of figuring out who you are and, and doing that in order to make change that's really my assumptions. So, for me, I then went to teaching and from there I, uh, wanted to change the system. I was in a high school that was an alternative high school doing amazing things and yeah, and so I just went through, got degree after degree after degree because I enjoyed it. I really did. I love learning.
Steve Carran: That's great. That's great. So this was a really fun story. I found out, your mother, aside from being in the education side, was also a hotel housekeeper, and on occasions when she got good tips, your treat was a happy meal. Growing up, did that kind of, you know, having your mom's. Housekeeper, I'm assuming that had some type of role in, you know, why you started TipBrightly? Is that right?
Elle: Yeah, a hundred percent. I mean, TipBrightly was inspired by my mother, because, you know, like I said before, I started tip brightly. I, did a lot of traveling. Traveling. And, whenever I couldn't leave a tip, it was personal because I knew that there was some woman who couldn't. Um. You know, have, have the money to spend on her children on groceries.
So when I realized, being a social scientist that, um, we were moving towards a cashless society, I concluded that, service workers or anyone who relied on cash for income were going to be disproportionately negatively. Impacted and, um, you know, these are, these are people like my mom who spent their earnings on their family and so I knew it was something that I wanted to solve. 
Steve Carran: That was great. Now we're gonna dive into your career and how you became the CEO and founder of TipBrightly. So you started out kind of as you went through college and after college, you started out on the education side. You were focused on entrepreneurship at couple facilities like the V Labs, MIT Enterprise Forum, and then at Washington University you were part of the entrepreneurship committee. How did those entrepreneurship roles help you when you started TipBrightly?
Elle: Those roles were really a transition from being an academic, uh, in education to just talking about, say the world in, in different language. So it was all about disruption, you know, technology, and, you know, what were some of the other terms, you know, the whole startup world. So I found that those organizations really, gave me a voice, to start practicing the language of entrepreneurs and also, um, really immersed me in, you know, understanding what some of the emerging technologies were.
So, you know, I left education because, I felt like, you know, the theme here is I really wanted to make a change. And that change wasn't happening fast enough for me in my career. So I leapt from the ivory tower to go and actually, you know, do something. And I had this in mind. I had the problem of a cashless society in mind. 
David Millili: And so when you launched Tip Brightly, you had no background in hospitality, you had no background in mobile payments or really tech. So how did you figure it out and get it started? 
Elle: you know, I think it really just started with, you know, the problem. I really felt like there was, a disconnect between mobile payments and between tipping. So, you know, I started wanting to figure out how to put those things together and it literally was on a post-it. And you know, the more and more I wanted to figure out how to enable it, I just, you know, kept building it out. And I was fortunate to have a, um, A CTO who was able to tra, you know, translate my ideas into code. I don't code. I'm a non-technical founder. and then, you know, alongside, uh, these organizations and, and also meetups 'cause where Tip Brightly is based in Silicon Valley, it's where I live and it's just a fertile ground to learn about, you know, how to start up, how to find product market fit, how to create an MVP, and all of it is li under $20 a session. So I really took advantage of that. It was like basically an independent study and I had my problem that I wanted to solve. I think that was key because I could relate everything to what I wanted to do.
So it took me through the process, of creating, you know, a a an MVPA prototype. And then from there I just learned about the industry and, and went about being a researcher and asking, you know, how, what'd you think of this solution? Do you think it's a problem? You know, applying those kinds of skills that I learned from education as a researcher and then coupled with. my love of learning. So I feel like if there's something you don't know, you can figure it out or you can find someone who knows it. 
Steve Carran: So since starting TipBrightly, what have been some of the challenges that you've found? Was it sales? You had the idea obviously, so that wasn't a challenge, but what were some of the challenges that you've had, whether it's sales, getting the word out about tip brightly implementation? What were some of the challenges?
Elle: I think there are challenges along the way, you know, as an entrepreneur, especially a first time founder. So I could say, you know, one of the first challenges. I felt like I was limited in terms of, you know, my technical ability. So I had to rely on, you know, other people to do that. So that was a challenge.
I knew what I wanted to do, but I couldn't do it myself. another challenge, uh, related to sales is, uh, just. Learning about the hotel industry, you know, it is complex and I think a lot of entrepreneurs or first time founders who are entering that space, uh, don't understand it. So, you know, with the owner, with the gm, with the hospitality group and um, you know, the global brand, they're all of these decision makers and, You need to know how to navigate that. It's, it's, uh, it's a long sales cycle in the hotel industry.
Steve Carran: It is.
Elle: And then I would say funding is also a challenge. but it is for everyone. It's, you know, it's hard to fundraise. 
David Millili: So tell us and those who are listening, what does success look like for TipBrightly. 
Elle: Well, I think success for me is always, um. Not just a win-win, but a win-win win. and you know, the goal of TipBrightly is not just to bring in tipping. It's a transaction, but it's actually to transform. All the stakeholders in the ecosystem. So that means guests and, um, the employees and the employers.
So for me, success is when there's a change in behavior and a change in mindset. So, for employees, they're now empowered, to receive tips and to modify their behavior. They know that their actions, will result in better tips. And now, you know, we have this no tax. So that's actually a whole other thing.
and then, you know, for the guests, they now have an easy way to express their appreciation. It's seamless. They can use their phone, it's contactless. It's clean. And I think that TipBrightly actually has a way of educating guests. So that's a success. and then finally, you know, with the employers, there is, know a whole dynamic that's, that's happening with recruitment and retention and it's very high.
And so I think the industry, they tend to. Wanna hire and hire and fill, um, these positions. And my belief is, you know, why not take the employees that you have and value them and reward them and recognize them? and TipBrightly is a program that I believe can facilitate that. So success is, you know, is when there is this cycle, of appreciation and everyone's benefiting.
Steve Carran: Well said. Very well said. So now we're gonna dive into the industry thoughts section, kind of the thought leadership side of things. And you touched on this a little bit, but I wanna dive a little deeper on this. You know the big problem we've had in hospitality has been LA labor shortage. how have you seen tip brightly not only increase morale, but also retention in hotels with, uh, with the hotels?
Elle: Yeah, so I mean, as research, you know, the numbers on retention. Are are slippery because it's longitudinal and you have to start somewhere and you're not sure, like, you know, when the tipping is. So, you know, I would say just from a, from a numbers point of view, it'll take a while to really, you know, figure that out.
But I would say from anecdotal evidence, from our, our GMs, they're saying that it's, you know, it's improving, you know, their, their attitude and their practice. Like some of them, you know, with Tip Brightly, there's a sign in one hotel. They call them their business cards. Um, so, you know, I think the other thing is the anecdotal, I'm thinking about one hotel group. they've also found that they're not hiring as much as they did before. And then one other hotel said he, he didn't have to hire in a year. Um, yes. And so he hasn't had, had to hire every year. So I don't know if I'm able to name these hotels.
She said, I wanna call out their successes. But, um, yeah, so it it's the anecdotal and I do think that there is a way, um, will be a way to figure out the retention thing with, um, with ai, but, um, watch this space figuring out, yeah, I think it'll help us. Yeah. Track employees.
Steve Carran: Sure.
David Millili: And so in, in a previous conversation that you and I had, uh, you made me aware of something I didn't know that a lot of hotel employees don't even have bank accounts. so what other challenges have you faced trying to get this, this new, you know, cashless tipping model for an industry that's slow to adopt new technology?
Elle: Yeah, I mean, I think that, um, it's not just, you know, the, um, the mechanism of receiving tips or money, it's also mindset. So the service workers, are used to not having transactions being visible. And so with cashless tipping, it's now brought to the surface. And so there's, um, a skepticism, you know, what's gonna happen with, you know, with these tips?
Am I gonna get taxed? And there's a fear. There's fear, basically, the other worry is related to the fear is. About taxes. So that has always been a big challenge with tipping is, you know, being able to explain to them that, you know, you are, you are going to receive tips, is gonna offset, the taxes, but it's hard to kinda figure, figure that out.
And it's sort of like you get tips and it's gonna. You know, it's gonna take away from taxes. But again, that will change and I think it'll be clearer about the guidance that we're sending. But yeah, skepticism and fear. I do wanna add that what we've found across all our hotels is this bandwagon effect.
So once one or two employees receive tips, then you know, the others will start to, to join in. that's just been consistent, and especially if it's a big tip. Everyone feels like, okay, I want that $50.
David Millili: Right.
Steve Carran: Absolutely. Absolutely. So I'm curious about your perspective on this, you know, being in kinda the hotel tech space. Are there any trends you're seeing on the tipping side, on the technology side, or even on the hotel side that excite you in hospitality?
Elle: I do. I mean, I think the one thing that's very exciting, you know, I think about data is that, you know, all of these transactions and relationships. are generating data. And I think that, you know, with, with ai there is a lot of, uh, opportunity for insights to be generated. Like, for example, you know, we have a huge database of guest feedback and we know who's received the guest feedback and, you know, then we have the date.
So there's a lot of things you can do. Like, oh, it turns out that on Friday, you know, most people get really positive. Feedback, things like that. So that's one side. The other side is, um, is just, you know, things that are evolving beyond the QR code. So, um, how do you s. initiate the transaction.
Most of us, us meaning, you know, the digital tipping companies are using QR codes, but there are now, you know, RFIDs we can tap. There's also digital directories, which we're exploring as well. And you know, who. Those kinds of things that are really taking the tipping away from the print to other forms, and non-paper, which is actually pretty, a good thing in terms of, sustainability. 
David Millili: So this is the million dollar question. What advice would you give to someone who is interested in becoming CEOs starting their company that's in hospitality? 
Elle: Honestly, I would say, you know, be be patient and be prepared to, you know, fail early and often. because it's, there's, there's a lot of, you know, learning along the way and things take longer than most entrepreneurs, I think, wanna get things done right away. And with the hospitality industry, things don't move that quickly. So patience is important and you just have to keep trying all these different ways too. So it's persistence, you know. I'd wrap all of that in my advice.
David Millili: Good advice. Yeah, I agree.
Steve Carran: Great advice. So, we've been asking you the questions this whole time. Now we're gonna turn the tables and let you ask David and I a question. 
Elle: I'd like to ask about what makes a good podcast and interview or the what, you know, without naming them, what makes them quite memorable? 
Steve Carran: I think kind of one thing that makes it memorable is almost what you did on this podcast was tying in kind of that emotion or what made you start your own company. What is your kind of advocacy for change in hospitality and what is your passion behind that? So when you come across people like yourself and other people in the industry who are extremely passionate about either working in hotels or trying to make the industry better, I think that makes some of the best podcasts, in my opinion. David, what about you?
David Millili: I mean, you're kind of a good this is a good podcast to talk about it, but one of the things we strive for is educating our listeners. by that meaning making sure that the guests are, you know, we have got diversity, we've got different type of people from either the hoteliers or hospitality tech.
And so to me, that's what makes a good podcast when people are actually learning something from the podcast versus some podcasts where it's just people talking. And if you're always listening to the same people, you're not gonna learn as much as listening to new people. And. We're closing in on how many episodes, but, um, but I think that's one of the best things a podcast if.
Elle: Congratulations. And then I have one other question. So what does success look like for The Modern Hotelier? 
Steve Carran: What does over the podcast world. That's what we're doing.
Elle: What does it feel like sometimes? 
Steve Carran: Yeah. I mean, I think we just wanna continue to grow, not only on as a podcast, but as a media company as well. we have some pretty big goals that we've talked about. but I, I think always we just want to create the best content for hospitality. And beyond that, whether that's featuring hotels, tech folks like yourself or hoteliers, um, just creating the best content we possibly can.
David Millili: Yeah, I think that's it. For us, it's just about. If you focus on the quality, everything else will come, in my opinion. And we've focused on that and trying to make sure that we are continually also trying to improve what we do. So each year we add a little wrinkle or we add some new elements. Our media side of the company is, is really taking off.
So that's exciting to see. So, like Steve said, I've just gotta just keep pushing as you know, being an entrepreneur, you just gotta keep pushing.
Steve Carran: Speaking of quality, the guy who makes us look good. Jon Bumhoffer, our producer is gonna join us here Elle. He's gonna ask you the last question before we get you outta here.
Jon Bumhoffer: I loved hearing your story about why you started your company and what your goal is behind that. And the impact you want to have. And you named a couple of things that, uh, how it impacts positively, team morale and retention. But I'm wondering, has there been a moment or a story that you can think of that has happened since you've started that has really been like, yes, this is why I'm doing this, this is why I'm gonna keep doing it, anything that comes to mind. 
Elle: Oh, I have a story that just encompasses everything around about Tip Bright's success. So one of our first pilot hotels, I'm going to name them because I can't say enough thank you. But hotel in Nashville, North Carolina. And David McCartney's, the GM. He had an employee who was a houseman named Anderson.
And Anderson was amazing. I could see his feedback coming in, you know, high stars, big tips. So we saw one feedback that just blew me away and essentially it was someone from the industry because they said that you know, that IHG, because it was a Kimpton hotel, should know about Anderson and should know that this system in, in that's in place is helping to recognize employees like Anderson. And so I don't know what happened or who that person, but like, you know, within a week, or two, we got a call from Kimpton High, uh, Kimpton Hotels. So I really think it was Anderson who did that.
So that's what I mean. We started off with Anderson, this hotel that was our pilot, and then Kimpton, which really has made a difference for us. And then, you know, and and so on. But that, that's, that's the root it, it's started with an employee. 
Steve Carran: Wow, that's awesome.
David Millili: Great. Well, that does it for another episode of The Modern Hotelier. This is where you get to let people know, where they can get in touch with you, where they can find out more about TipBrightly.
Elle: Okay. Well great. So for all of you who are on LinkedIn, you can find me on LinkedIn. Send me a message, connect with me. if you're interested in learning more about TipBrightly and getting a demo, you should go to our website and just click that button, book a demo, and I also love to talk to people, and so you can reach out. To me as well. So it's elle@tipbrightly.com and I have no problems with doing that 'cause I love to hear from people.
David Millili: Well, that does it for another episode of The Modern Hotelier, the Most engaged podcast in hospitality. Whether you're watching or listening, we appreciate you and hope to be with you again soon. Thank you for joining us, Elle.