The 38-unit Velvet Taco is taking its international flavors to new venues with the planned expansion into nontraditional locations like casinos and airports, the CEO said.
Dallas-based Velvet Taco has grown into six states since its founding in 2011 by restaurant entrepreneurs Randy DeWitt and Jack Gibbons of FB Society, said Clay Dover, CEO and president of the brand.
Velvet Taco is in major metropolitan areas such as Atlanta, Chicago, Dallas, Houston and Nashville, Tenn., where the company opened a 2,798-square-foot restaurant in March with a 1,000-square-foot, 60-seat patio.
Dover joined the company in 2017, after private-equity firm L Catterton in 2016 purchased a majority interest in the brand. Velvet Taco sold to private-equity firm Leonard Green & Partners L.P. in November 2021, though L Catterton and founding company FB Society, formerly Front Burner Restaurants, retained “significant minority ownership stakes in the business.”
The company will soon open its first airport unit at Houston Hobby and plans to announce a deal for a casino unit as well, Dover said.
“There's been a lot of evolution within the brand,” he said. “I think the one thing that we try to do is stay true to the original idea of what made Velvet Taco successful. … As we grow the brand, I think that's always something that is critical to me and to the team: How do we maintain that brand specialness, that uniqueness that people will still remember but yet still be able to scale?”
Dover said that during and since the pandemic, Velvet Taco has updated technology, added a pickup line, created a mobile app, rolled out to-go ordering and catering and expanded the beverage offerings, which are offered to-go where allowed.
“Those are several things that we've done in order to broaden the horizons for the brand,” he said, “but it still comes down to unique amazing tacos at every single restaurant.”
Chicken Tikka, an Indian-flavored taco with basmati rice and an in-house tikka sauce, remains the No. 1 seller, Dover said.
Before the pandemic, Velvet Taco had tested a new kitchen display system, revamped its packaging and gotten third-party vendors.
“I think the to-go experience has stuck around,” Dover said. “Prior to the pandemic we're about 37% take-out business — our average unit volumes are $4.2 million for our mature restaurants — so it's a healthy amount of business going outside of the restaurant.” That has settled to about 50% of sales, he said.
“It's been that way for the last 18 months or so,” he added. “I think it's going to stay. I think that's one of those lingering effects.”
That has required new thinking, he said. “We actually have a process where we say, ‘How will this stand? How long will it stay hot or warm? What's the drive time? How long can it sit out? Will it degrade?’ ... You have to think through those things. So that's one of the lingering impacts from COVID.”
Velvet Taco will enter South Florida later this year, Dover said, with Fort Lauderdale, Fla., and Miami’s Wynwood neighborhood among the first locations. Stores are often open until 4 a.m., which is another distinguishing element.
“We've got a global-inspired brand,” Dover added, citing such items as Korean fried rice tacos and fish and chips tacos.
“We've got a different approach to tacos,” he said. “We are not Tex-Mex. … The new flavors that we have from all over the globe. It’s a huge thing that sets us apart.”
Contact Ron Ruggless at [email protected]
Follow him on Twitter: @RonRuggless