Friends of Branded!
Happy Saturday and I hope everyone had a good week!
Early on Thursday morning this week, in between some ‘monster-walks’ and ‘bridges,’ two friends at the gym asked if I saw the article in the NY Times about the story of a fake steakhouse on the Upper East Side of Manhattan that then became a real steakhouse for one night only. They had seen the article that appeared in Times on Wednesday, Sept 27th (Section D, Page 4 with the headline: You’ve Been Had. How Was Your Steak?) and wanted to ask me about it.
I'm their hospitality industry guy.
I hadn’t seen the article or heard about this story at all. They had my attention and LD & LWP texted me the article. And just like that, the "Top of the Fold" section for this week was born.
I shared the article with one of Branded’s SMEs (subject matter experts), which is a professional way of classifying or defining the people at Branded that have owned and operated restaurants for a long-time. Readers of the H^2 know that as a much younger man, I had almost every job in front of the kitchen (Front of House) starting as a busboy, barback, waiter and then ultimately a bartender.
I later turned down the offer to be promoted to the role of a manager b/c from what I could tell, I was making more money, working an awful lot less hours and I was having a blast at my job behind the bar, while the managers seemed super stressed all the time. I didn’t see a career path for myself in the hospitality industry at that time and while I’ve come to see the industry very differently over the past few decades, for me and at that time, I capped out as a bartended before leaving the industry for Wall Street.
The above should not be considered my usual “digression” but rather what I feel is a fairly important point in this Top of the Fold section. Despite my working in the front of house (on and off) for a number of years, when it comes to understanding the nuances, workflow, processes, friction, and the myriad of issues that one must work seamlessly and to near perfection in order to be successful as a restaurant operator, I consider myself a “tourist” compared to my partners who have lived the experience for decades as operators.
My point, if I’m a tourist, what do you think the folks that haven’t done anything in a restaurant, other than be a guest are? To be nothing other than polite, they’re even less than a tourist. 😊
But now back to Branded's expert and the article. His thought and comments on the article made me think about the movie, No Country for Old Men (which is the reason for the image used at the top for this week’s edition of the H^2).
Yes, I just shared at little bit about the inner workings of my mind, I hear things and almost always think of movies (or shows, songs or other pieces of content). For the younger readers of the H^2, this movie is a 2007 (and therefore one of the more recent films I’ve ever called upon and used in the H^2) American neo-Western crime thriller written and directed by Joel and Ethan Coen (“The Coen Brothers”) based on Cormac McCarthy’s 2005 novel of the same name.
This is a film I enjoyed very much and have always been amazed at how Javier Bardem, as Anton Chigurgh, and a simple haircut, can still send shivers down my spine.
For those who might prefer a better or more authoritative recommendation on this film than my own, this film was nominated for 8 Academy Awards and won 4 of them (Best Picture, Best Director, Best Supporting Actor and Best Adapted Screenplay). Mic drop!
This movie is something I think about and draw from quite often and it’s the line that Tommy Lee Jones, as Ed Tom Bell, says to Barry Corbin, as his uncle Ellis, an ex-lawman, that he plans to retire b/c he feels “overmatched” by the recent violence. That’s the scene and my takeaway from the film. Bell’s final monologue about age and how the world’s ever-changing circumstances have caught-up with him. According to Mariana Delgado, in an article published, ironically, exactly 2 years ago today (Sept 30, 2021), she wrote of this scene that “it’s about the passing of time and generational change. It’s about the growing nature of violence within the men who claim these spaces. It's no coincidence that these three men were the central focus of the film's narrative, where each of them represented the past, present, and future of these lands.”
Now that was a digression, but it was necessary (maybe). My partner’s first thought on this article and specifically the story of this fake restaurant was that it would never occur to him to invest the time and energy into something like this from either a “operator” or a “consumer” perspective. It just didn’t make sense to him. The quote from the article that specifically caught his eye was 'Mehran’s Steakhouse is a one-time wonder, but we hope not to be a one hit wonder,' Jalali said. 'We hope to do all kinds of fun stuff over the years.’ My partner was struck by this passion and interest and simply asked “why?”
My point is NOT to disagree with my partner, but isn’t that what makes horse races and people so interesting. This wasn’t my project or Branded’s SME’s project. This wasn’t my time, effort, or money. This was the project, initiative, ruse of a group of 20-something year-old friends that shared a four-bedroom brownstone (a “hacker house”) working in the tech industry. The group behind this self proclaimed joke and creators of this fake restaurant, which for one night only, became a real restaurant, according to the NYT article, were Mehran Jalali, Riley Walz and Danielle Egan.
The article sits behind a NYT paywall, and despite my trying (unsuccessfully) to acquire a reprint in a compliant manner (PARS International Corp, you really need to make it easier to do so), I’ve shared a few links from different sources to this story below and for those with access to the NYT, here’s the actual article: New York’s Best (Fake) Steak House Opens Up - The New York Times
The effort these friends put into this joke were SUBSTANTIAL and in order NOT to be a curmudgeon (aka: an ill-tempered, and usually old man), the article made me smile as I thought about other, albeit less elaborate jokes that I may or may not have been part of. I thought about this crew’s whole experience, from the initial intimate cooking with and for friends, to the setting up of a website, posting fake reviews, creating a waitlist for reservations, and ultimately rallying a group of 60 friends to create and execute a four-course meal for over 100 guests! WOW!!! Whatever you think of this whole experience, exercise or otherwise, this crew is anything but lazy and their commitment to the ruse is a testament to that!!! Their exhausting joke brought to mind memories of Andy Kaufman (and I mean that as high praise).
This whole elaborate and experiential joke by these tech-stars made me think about my own time at Wesleyan University when a group of upper classmen hatched the idea to see how fast a rumor could spread throughout the campus. Right then and there, the story of Molly Ringwald enrolling at Wesleyan for the next fall semester was born. This rumor made its way through the campus like an uncontained forest fire, and it still makes us laugh when this crew gets together. ITB!
All the above aside, there were other thoughts that this fake restaurant brought to mind and that’s where I want to go now.
This story is yet another example and a confirmation that the term “experience economy” has gone mainstream and it’s absolutely real and a powerful driver of consumer demand and spend. Consumers are craving experiences and the restaurant industry is certainly leaning into this. This very much includes specifically the full-service end of the market. The OG, Mr. Danny Meyer famously said at one point, in an analysis of the restaurant industry, there are QSRs at one end of the market and super fine dining experiential at the other end. The rest of us, in the middle, compete on hospitality. I think the need to provide experiences that touch all the senses, are social, and unique is moving towards the middle of the market.
A “pop-up fake restaurant” can fool their guests for one transaction and it’s a funny experience. But let’s not lose sight of another takeaway here, a real restaurant must provide experiences that inspire loyalty, intent to return, and referrals in order to support a sustainable business. An obvious distinction but one worth noting.
Another underlying theme in the story is the power of exclusivity and the value of scarcity. Limited availability creates interest and demand and illustrates how marketing is evolving to create this effect, even if it’s artificial. Restaurants used to have to earn word of mouth or earn media attention. Now social media can be manipulated to create the effect.
You want to see a real and authentic example of the power of social media? Influencer NewYorkNico posted about the 97-year-old Lexington Candy Shop and the video got over 25 million views on TikTok. There’s now stanchions and a rope outside the legendary spot to keep the line to enter orderly.
Finally, and at the risk of my own online image, can I at least give the mighty Google a yellow card for their 'participation' or lack therefor in this fake restaurant ruse?
Google has elected to insert themselves into restaurant discovery, ordering, and reservations and I think it’s fair to say that a great deal of the information they provide has questionable value at best and may in fact have no value whatsoever.
Regardless of the value (or lack of it), Google remains one of the most powerful engines and influencers over restaurants. I’ll ask this simple question, how does a steakhouse that doesn’t exist become highly rated on Google and their credibility not take a hit?
Finally, yes, finally, the title of this week’s edition, “don’t believe everything you read" and the second half of this saying "and only believe half of what you see.”
Two attributions are deserved here. The first, to Edgar Allan Poe, who said: "believe only half of what you see and nothing that you hear.” This was later expanded upon by DMX, where he said, “don’t believe everything you hear, don’t believe everything you read and only believe half of what you see.” I’ll end with an erroneous and absolutely fake, but important still important image.
It takes a village!
Readers of the H^2 know that Branded is an active participant on the hospitality industry conference circuit. We love and believe in the importance of in-person experiences and these events are not only often content rich, but bring together segments of the industry and are powerful engines in the creation of relationships and business opportunities.
We also like to say that no one should ever threaten Branded with a good time. We aspire to both work and play hard and these industry events afford us the opportunity to catch-up with old friends and make new ones.
This week, Team Branded is again hitting the road and we’re thrilled to announce that we’re heading out to Palm Springs, CA for the CREATE Experience powered by our friends at Nation’s Restaurant News.
This event is uniquely focusing on growth-minded restauranteurs that are ready to take their business to the next level. The speaker list is strong and that VERY much includes Branded’s Co-Founder and “The Restaurant Guy” Michael “Schatzy” Schatzberg along with an illustrious group of industry leaders and friends.
At the risk of highlighting a few and coming up short to recognize many, here are a few of the speakers Branded is super excited to see in action.
As Branded enjoys doing at most of the conferences we attend, our Hospitality Hangout will be recording our “on the road” from Palm Springs edition and it’s not lost on me how many previous guests of our ‘cast’ are attending and speaking at this event.
With this event now taking center stage for Team Branded, I want to give a special shoutout to our friends at informa including Joe Donnelly and Sam Oches. Joe and Sam are two of the finest people the Branded team is fortunate to work with and call our friends.
In the spirit of a picture saying 1,000 words (or less than half the words typically used in a Top of the Fold section 😊), take a look at these sponsors of CREATE below.
Answer also revealed at the end of the newsletter
By: Julie Zucker, CMO & Partner at Branded Hospitality Ventures
In the world of hospitality, where every customer's experience is a symphony of service, there's a noticeable trend brewing. Chief Marketing Officers (CMOs), the creative minds behind the industry's branding and customer engagement strategies, are stepping into the shoes of Chief Executive Officers (CEOs). It's like watching a marketing campaign go full circle – from crafting compelling narratives to steering the entire ship. Read More
By: Seth Temko, Solutions Services Partner at Branded Hospitality Ventures
Attn: Buyers and Sellers, it's time to start asking the right questions to avoid getting your toes trampled. Similar to a ballroom dance, a buyer and seller must actively participate, and each plays a role. But unlike a ballroom dance, there are no standard prescribed steps or moves. The software vendor must ‘feel out’ the buyer to understand their needs. And the buyer must carefully ‘read’ the software vendor to see if there are any gaps or weaknesses that would signal ‘red flag’ concerns. Read More
MAXIMIZE VALUE, IMPROVE PERFORMANCE
Learn how the Hospitality Industry advisors from CohnReznick can put you at the forefront of advanced financial, operational, and risk management strategies.
By: Noah Stern, Associate, Branded Hospitality Ventures
Restaurant operators understand that having consistent quality in a full-service restaurant, especially across vast geographic locations, can be a true logistical nightmare. However, one EU restaurant group ignored conventional thinking and it just paid off in a big way. Read More
Restaurant Industry Movers in the Market
—Data as of 9/28/23
By: Rev Ciancio, Head of Revenue Marketing at Branded Hospitality Ventures
Maybe you just launched online ordering or maybe you've had for years. Either way, I'll take the Vegas odds on you wished you were getting more online orders. OK, so let's agree. There are a lot of great reasons why we would want to increase direct online orders. Right. Now, how do we get more of them? Here's a quick, 5 step guide to increasing online orders ... that won't cost you a dime! Read More
LIVE From FSTEC - A Culinary Tech Carnival
IN THE NEWS
Hospitality Tech and F&B Innovation IN THE NEWS:
We love to highlight Food Service & Hospitality news, especially when it’s Partners & Friends making it!
- Leasecake: Introducing Cakebot: Approachable AI for Lease Management
- Cut + Dry: Cut+Dry Launches The World's First AI Tool for the Foodservice Industry
- Spendgo: Loyalty programs are getting more cost-effective for restaurants, report says
- Brizo Foodmetrics: How Foodtech Companies are Transforming the Food Supply Chain
- Incentivio: Calculating Return Customer Rate And Their Value
- GoTab: Opening Guide to Restaurant Technology and POS Systems
- Copia: Debunking Food Safety Myths
And in other News…please see some of the stories that caught our attention and that we’re paying attention to. This week was loaded with headlines and news!!
- The Wall Street Journal: Meal-Kit Maker Blue Apron to Be Sold
- Restaurant Business Online: Cracker Barrel fires up its first loyalty program
- QSR Magazine: Domino's Strives for $2 Billion Carryout Opportunity
- Restaurant Business Online: Fat Brands acquires Smokey Bones for $30M
- Reuters: Marriott projects upbeat revenue per room growth as travel demand stays strong
- Nation's Restaurant News: Krispy Kreme promotes Josh Charlesworth to CEO
ANSWER: Shaquille O'Neal
Correct! Shaquille O'Neal, The former NBA star owns a number of restaurants, including "Shaquille's" and "Big Chicken." Fun fact, Shaq owns around 200 companies, 172 restaurants, and 40 fitness centers.
ASK THE HEADLINE
🔍 Got Questions? We've Got Answers! 🌟
Satisfy your thirst for knowledge? Look no further! It's time to dive into our brand-new segment: "Ask The Headline"! 🎉
📅 We'll be answering YOUR questions every week. And here's the best part: you can choose to stay anonymous or receive a fabulous shout-out when we feature your question!
That’s it for today!
See you next week, (about the) same bat-time, same bat-channel.
It takes a village!
Branded Hospitality Ventures ("Branded") is an investment and advisory platform at the intersection of food service, technology, innovation and capital. As experienced hospitality owners and operators, Branded brings value to its portfolio companies through investment, strategic counsel, and its deep industry expertise and connections.
Learn more about Branded here: Branded At-A-Glance August 2023