Last year, the seven-unit Hot Chicken Takeover chain was acquired for 50 cents. Now all of the locations have closed.
The fast-casual concept earlier this month shuttered its last remaining units in Ohio, where the brand was born.
The Nashville hot-chicken chain was acquired by the Craveworthy Brands platform last year along with sister brand Taim. Both were sold by Untamed Brands.
Gregg Majewski, Craveworthy’s founder and CEO, said the portfolio company acquired both brands for $1, literally 50 cents each.
“There’s a reason why it was a dollar transaction,” he said. “Sales were tanking.”
Reports indicated the last restaurant standing in Columbus, Ohio, was in default of its lease, owing “significant amounts” in back rent, according to Columbus Underground.
Majewski said, “Of course there is” unpaid rent. “That’s part of the restructuring process.”
But landlords were not willing to negotiate. And—though Craveworthy kept Hot Chicken Takeover alive for another year, Majewski noted—in the end, there were too many legal issues to overcome.
When Craveworthy acquired both Hot Chicken Takeover and Taim, the existing restaurants were seen as conversion targets, because they were both similar to brands already within the portfolio, Majewski said at the time.
Hot Chicken Takeover was expected to merge with existing Craveworthy brand Budlong to create a chicken concept under a new name.
That was the initial plan, said Majewski, but it didn’t work out.
“We thought it was in the best interest for us not to put the effort in because there was no getting out of it,” said Majewski.
And Hot Chicken Takeover may not be the last Craveworthy Brand concept to die.
Majewski, a former CEO of the Jimmy John’s sandwich chain, launched Craveworthy after acquiring the Bd’s Mongolian Grill, Genghis Grill and Flat Top Grill brands in 2021.
In 2022, he launched Craveworthy, folding in the legacy brands, and embarking on a series of acquisitions. The platform now includes 19 brands, including Big Chicken, Dirty Dough, Fresh Brothers Pizza, Krafted Burger and, most recently, Gregory’s Coffee.
Some, like Big Chicken and Gregory’s Coffee, are not fully owned by Craveworthy, but the platform is a managing partner with a stake in each brand.
Many of the brands acquired were somewhat troubled. Majewski said he goes in hoping to fix each brand for potential growth, but it won’t always be possible.
“We never walk into a situation where everything is roses and pretty Day One,” he said. “And we know what we’re getting into.”
Taim, for example, the Mediterranean sister brand to Hot Chicken Takeover that was acquired for 50 cents, has closed seven restaurants, but now there are two units open and another three under construction, Majewski said.
“Taim is still here and we’re putting gas on it,” he said. “Hot Chicken Takeover wasn’t so lucky.”
Flat Top Grill, one of the three legacy brands, is also down to one unit in Chicago. That location has several more years on its lease, he said, but added, “That brand will not be a growth vehicle.”
Those legacy brands are in locations that are too big to be sustainable, so a number of those restaurants have closed, he said.
Craveworthy has developed a new smaller prototype for Genghis Grill, which shows growth potential. Bd’s Mongolian Grill, meanwhile, is still being evaluated.
Majewski contends that he has said from the beginning that Craveworthy is designed to take gambles, much like a venture capital firm that operates restaurants.
“If one hits, everything pays for itself,” he said. “If multiples hit, you go down as a genius. We’re going to have a lot more winners, but you only need one of them to go.”
UPDATE: This article has been updated to clarify the Taim location count.
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