The money from a group of investors led by private equity firm General Atlantic will pave the way for Torchy’s, which enjoys a cult-like following, to expand to another 10 states over the next four years. Austin-based Torchy’s, which promotes itself as a purveyor of “Damn Good Tacos,” currently operates 83 locations in seven states. Former executive chef Michael Rypka launched Torchy’s in 2006 at food trailer on South First Street.
Aside from General Atlantic, the majority owner of Torchy’s, investors in this fresh $400 million round of funding are investment firm D1 Capital Partners, investment manager T. Rowe Price, and hedge funds Lone Pine Capital and XN. Rypka and all other members of the original ownership group also put money into this funding round, which would be enough money to buy roughly 75 million orders of Torchy’s chips and queso.
New York City-based General Atlantic initially invested in Torchy’s in 2017. A year later, Torchy’s tapped G.J. Hart as CEO. Hart previously was CEO of the California Pizza Kitchen and Texas Roadhouse restaurant chains. He joined the board of Red Robin Gourmet Burgers in 2019.
In a November 20 release, Hart says that with General Atlantic being joined by four new investors, “we feel that we have assembled a premier ownership group that will allow us to accelerate our growth and write the next chapter in Torchy’s history.”
Even in the face of the economically destructive COVID-19 pandemic, Torchy’s has opened 12 new locations in 2020 and expanded the brand into three more states.
“We admire the management team’s deep operational experience and commitment to providing an original and differentiated experience. We believe their vision will continue to resonate across a wide-ranging demographic of guests, geographies, and footprints as Torchy’s expands across the United States,” says Andrew Crawford, global head of consumer at General Atlantic and the new chairman of Torchy’s.
As it pursues a nationwide footprint, Torchy’s reportedly is eyeing an initial public offering (IPO) of its stock in 2021, which would transform it from a privately owned company to a publicly held company. Torchy’s and General Atlantic executives aren’t commenting on the IPO speculation.
Crawford told the Bloomberg news service that he envisions Torchy’s evolving from a regional chain to a “super-regional concept” to a national brand that eventually could operate thousands of locations. The company officially operates as Success Foods Management Group.
This story originally appeared on CultureMap Austin.
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