When we first recommended Everytable last March, it had just opened its fifth restaurant in Los Angeles. And it had plans to open 12 by the end of last year.
To see how the company is doing these days, I caught up with founder and CEO Sam Polk. But first, here’s a quick reminder why we liked Everytable in the first place.
Fast and Fresh, Cheap and Healthy
Everytable is not your typical fast food franchise. It didn’t bother to tweak the traditional fast food business model to provide slightly higher prices (like Five Guys) and/or slightly fresher ingredients (like Chipotle). It came up with something completely new, offering fresh dishes like jerk chicken, smoked salmon, blackened fish and several choices of fresh salads… at fast food prices.
Cheap and healthy? How does Everytable do it?
It completely reimagined fast food. Instead of decentralized operations where food is made at individual restaurants, Everytable sets up a kitchen hub where meals are prepared for several restaurants. So its actual restaurants are kitchenless, small, cozy and cheap to build. And its meal pricing is variable: higher in more affluent areas and lower in less affluent areas.
Slow but Steady Progress
Sam wasted no time in telling me that store openings have been going at a slower pace than expected. The company just opened its eighth restaurant, and four more are scheduled to open this year. One was forced to close, which put the company about a year behind schedule. “It was just a more involved process, and we wanted to get it right,” Sam said.
Revenue this year should be around $7 million, and the annual run rate based on fourth quarter revenue is $11 million to $12 million. Sam expects a nice jump in 2020, with revenue coming in at around $20 million, as some of the company’s new business lines find traction.
An Expanded Vision
“We are no longer just a restaurant business,” Sam told me. He has added two more businesses, leveraging his kitchen hubs to make more money.
The first is a fridge-leasing business. It’s a variation (and replacement, Sam hopes) of vending machines. Sam wants to put a fridge filled with his fresh and healthy meals in building lobbies, with a prepaid card granting access to the fridge. He’s signed up 30 customers in the past couple of months.
This business line is currently contributing about 5% of total revenues. But Sam is now in talks with two large office building developers, and if the pilots are successful, the company will be ramping up that number significantly by the end of this year.
The company is also starting a fresh food delivery business. Once again, the meals would come from its hub kitchens. Sam solves the vexing and often expensive “last mile” problem by delivering its fresh meals to the nearest restaurants. From there, DoorDash will deliver it to customers.
Looking Into the Future
Everytable will soon be serving flight passengers. In a coup, it’s lined up deals to place two restaurants in the bustling Los Angeles International Airport as well as in the John Wayne Airport (in Orange County, California). It’s also raising $3.5 million to fund the continuous expansion of its restaurants in addition to funding its up-and-coming fridge-leasing business.
I believe the company is expanding “smartly” – leveraging its assets to generate more revenues and business lines without spending too much more. Everytable’s biggest investors evidently agree. The company has already raised $3.2 million of its current bridge round from previous investors.
Sam has found some exciting new directions for his healthy, local and cheap core product. He now has an even more cost-efficient structure, and by adding more verticals, he has diversified his company’s overall business. My grade for the first 12 months following our recommendation is a solid B+.