Who’s Taking
Your Lunch Money?
Story By joshua fruhlinger
Design by JEREMIAH MCNAIR
Chipotle Mexican Grill had just 16 locations when McDonald’s took a major investment stake in 1998. By 2006, McDonald’s divested its interest. But, by then, Chipotle was operating 500 locations. Today, the fast-casual leader includes more than 2,000 restaurants, revenues approaching $500 million, and a workforce of more than 45,000 people. And as of 2018, its CEO is Taco Bell ex-CEO Brian Niccol. Full circle, anyone?
Starting with
Chipotle
Back to Top
the tangled web of fast casual
Click your favorite fast casual spot in the outer ring and see with what other restaurant chains they share funding.
THE
KINGS
OF FAST CASUAL
Steve Case
Leo AND OLIVER Kremer
Daniel Boulud
Danny Meyer
Joseph Bastianich
The term “fast casual” does everything in its power to make it clear that it is not, under any circumstances, fast food. In the mid-90s, when Chipotle first launched its lunchtime disruption (see below), they made it clear that it was not Taco Bell. It felt clean and tasted good: you could see it being made; there was a chef satuéing fresh vegetables in an open kitchen. Everywhere was evidence that what you were about to eat didn’t arrive frozen in some 18-wheeler from who knows where. Fast casual was born.
These weren’t just brands backed by corporations, they were founded by real people, with real values. Founders who met at college, yoga instructors who just wanted others to eat healthy, farmers who had an idea over a cup of tea on a Sunday morning. But those nascent stories are just that: stories. Sure, some of them contain a kernel of truth, but the real story of the fast casual boom is Private Equity, without whom your favorite quinoa bowl would be unable to pay sky-high rents for prime locations or compete for insane quantities of quinoa and heirloom beets.
And once a fund or a firm finds profit in fast casual, they’ll try to replicate their success, creating a web of interconnectivity and shared investors that makes for a few surprising associations—one of Sweet Greens’ backers was Mario Batali’s main man, while Five Guys’ profits fuels Honeygrow. So just who’s making money on your favorite bowl of supergreens? And what else do they own? We’ve got the tangled web.
How did it start?
Back
How did it start?
Base: Revolution Growth, the DC Venture Capital firm he founded in 2005, has substantial investments in both Cava and Sweetgreen.
Protein: "The sky is the limit with Sweetgreen. There really is an opportunity to position it as the leader not just across the country, but maybe all across the world."
Two Sides: Revolution has a stake in Groupon, ZipCar, Living Social, DraftKings, PolicyGenius, and others.
STEVE CASE
Starting with chipotle
DANNY MEYER
Base: Meyer started it all with New York’s Union Square Cafe in 1985. He launched Shake Shack on a whim as a hot dog cart in Manhattan's Madison Square Park, only adding burgers in ‘04.
Protein: Meyer says fast casual is the combination of “everything we know from fine dining” applied to the systems of casual dining.
Sides: Union Square Hospitality also has a piece of Dig Inn, Tender Greens, and a slew of New York restaurants such as Blue Smoke, Jazz Standard, Daily Provisions, Marta, and Vini e Fritti.
LEO & OLIVER
KREMER
Base: Dos Toros has now hit $50 million
in revenue, has more than 20 locations,
and they've raised $15 million from
Growthpoint Capital.
Protein: "The burrito is not a revolutionary idea. But there were no good burritos in
New York. That was weird," says Leo.
"We thought, 'Someone should do that.'
Once we had that realization, it became
an execution challenge, being that we
had zero experience."
Sides: Their main guy at Growthpoint, Nick Marsh, is the same guy who made Chopt the massive fast-casual giant that it is today.
Base: Pretty much invented fast casual with Cosi in the 1990s. Marsh saw the future again in recognizing that people would line up for expensive salads. In 2006, he became an early investor in Chopt, which now has 57 locations.
Protein: "There wasn’t really a name for [this] particular niche of the restaurant industry, but now there’s a whole bunch of different companies evolving people’s thinking about fast food."
Sides: He has a piece of Dos Toros and Mendocino Farms.
NICK
MARSH
RON
SHAICH
Base: After selling Panera for billions, he created Act III which has a stake in Tatte Bakery, Cava, Zoe’s Kitchen, and Life Alive Organic Café. Panera calls them “competitors”, and has taken Shaich to court.
Protein: “My mom died of a heart attack in 1992. Roughly around my 60th birthday, I started thinking more about my diet, and I realized I needed to eat in a much more thoughtful way. Not all proteins are good proteins, and not all carbs are bad carbs.”
Sides: Life Alive Organic Cafe, and Tatte Bakery.
Former CEO of AOL, maestro behind the
$164 billion merger
of AOL and Time Warner—considered
the most disastrous
media merger in history.
Brothers, co-creators of Dos Toros. Leo left Third Eye Blind (he was the bassist) to bring Mexican food that doesn't suck to New York City.
CEO of Union Square Hospitality Group, founder of Gramercy Tavern, Shake Shack, and other New York institutions.
CEO of Chopt Salad, Managing Partner at GrowthPoint, and investor & current executive chairman at Mendocino Farms.
Founder and Executive Chairman of the Board of Panera Bread Company, now runs Act III Management Group.
Base: Revolution Growth, the DC Venture Capital firm he founded in 2005, has substantial investments in both Cava and Sweetgreen.
Protein: "The sky is the limit with Sweetgreen. There really is an opportunity to position it as the leader not just across the country, but maybe all across the world."
Two Sides: Revolution has a stake in Groupon, ZipCar, Living Social, DraftKings, PolicyGenius, and others.
STEVE CASE
CONNECTING THE QUINOA
Meet the jolly green venture capital giants behind your favorite grain bowl.
connecting
the quinoa
Behind every biodegradable cardboard bowl of Shroomami is a private equity player making money across the lunch spectrum.
Click your favorite fast casual spot in the outer ring, and see who they share (at least some) green with.
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Click your favorite fast casual spot in the outer ring, and see who they share (at least some) green with.
Behind every biodegradable cardboard bowl of Shroomami is a private equity player making money across the lunch spectrum.
Get more stunning visual stories every week.
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share
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