Four Foods Group Poised to Join Tech Unicorn Club
Silicon Slopes—Utah is home to four tech unicorns—privately held companies that are valued at $1 billion or more. Now, a Utah restaurant company appears to be poised to join the unicorn club. That’s according to Four Foods Group CEO Andrew Smith, who said his company is on a growth trajectory that should take it to $1 billion within a year.
Smith spoke during a Startup Conversations event presented by Silicon Slopes and hosted at Salt Mine. In discussing the many projects Four Foods Group has in the works, Smith said the upcoming year “is probably going to be the one that will make Four Foods Group the first billion-dollar restaurant operator here in Utah.”
Smith launched the company in 2009 with his wife, Shauna, when the duo approached Kneader’s Café and Bakery with an offer to open a franchise of the concept in the Alpine area. It was the fifth location for Kneader’s, and its first franchise.
This was the couple’s first foray into the restaurant industry. Previously, Smith had been a tech entrepreneur for 11 years. After he sold his final tech company, he discussed the next steps with Shauna.
“Maybe we should just do something really simple. Let’s do restaurants,” he recalled telling her. “Because restaurants are super simple. You just put the money in, you open ’em up. People come and give you money. They’re all happy. There’s no problems.”
In reality, he said, the restaurant business “is one of the hardest businesses you can get into.”
Despite the challenges, Four Foods Group has grown into a major force. It now operates 47 Kneader’s locations throughout the country, with a total of 108 restaurants in its national portfolio. In late 2016, Four Foods Group purchased a majority stake in R&R Barbeque, and it began quickly growing the award-winning barbeque brand. The restaurant now has three locations in operation, with at least six more in development—including in the newly renovated Vivint Smart Home Arena.
Four Foods Group also purchased The Soda Shop, with two locations, and 48 Little Caesar’s locations in the South. Just a few months ago, the company purchased Mo’Bettahs, a Hawaiian food restaurant chain with six locations. On top of all that, announced Smith, “We are buying Swig in two weeks.”
The Little Caesar’s acquisition was a strategic growth move, said Smith. Instead of owning a handful of locations within a large brand, the strategy is to “aggregate and be the number one group in that brand. So our goal is to have 300 to 400 in the brand in the next four to five years. And we’re well on the way.”
Four Food Group offers a unique platform for new restaurant concepts, said Smith. The company provides myriad services, including real estate site selection; development and construction; recruiting, training and developing employees; and HR payroll systems, as well as other food service software solutions.
Smith said they take their time performing due diligence on new restaurant concepts before deciding whether to purchase them.
“We’re approached by a lot of brands,” he said. “But when you dig into it and look under the hood,” either the food quality is not there or the margins are not where they should be.
Four Foods Group aims to have a diverse portfolio, said Smith. That includes diversity of menu, as well as real estate footprint. You can only build so many drive-through locations in an area, for example, because of land and real estate constraints. He said Four Foods Group also looks for niches where there is not a lot of competition—such as fast-casual barbeque or Hawaiian food. And the margins need to be healthy.
Much of the company’s growth has come in the past couple of years, and Smith said there is much more opportunity on the horizon.
“We’ve really put our head down and just grown,” he said. “But now is the time that we’ve now learned what we’ve learned, we’ve got amazing people on our team—I’d say a world-class team—and we understand that this needs to be blowing up.”
It’s that world-class team that Shauna Smith, who is the chief merchandising officer at the company, credits for the company’s success.
“We have surrounded ourselves with people who are smarter than us and have better ideas than us. If we’ve got any really great talent, it’s that we know how to pick good talent,” she said.
When asked what his ultimate goal is, or what he envisions as his stopping point, Andrew Smith said, “This is the last thing I’m going to do for the next couple decades of my career, because there’s always going to be that new restaurant, that new concept. And for us, I think we’re going to build brands and build them so they have longevity behind them.”