Wayback Burgers is considering an initial public offering next year, following a recommendation from an entrepreneurial education group, the company said Monday.
The Cheshire, Conn.-based fast-casual burger chain also said it has hired the group, the Atlanta-based Oxford Center for Entrepreneurs, to be an exclusive advisor as it projects a possible IPO next year.
“We’re on solid ground,” said Wayback founder and CEO John Carter. “We have no debt. We don’t see that the growth we have is going to discontinue. But is there an opportunity to accelerate that and do better? That’s kind of where we are.
“Anyone who sees this segment, and the management team we have in place, I think there’s more we could do with it.”
The company has not committed to an IPO next year. The Oxford Center recommended an IPO, and Wayback has hired the center to lead a projected offering or some other strategic alternative.
In an interview, Carter said he “wouldn’t rule out” the possibility of taking on a private-equity investor to provide funds that could take Wayback Burgers to the next level.
The chain does not currently have any private-equity investors.
Carter founded Wayback in Newark, Del., in 1991. In 2008, the chain had 12 locations, and Carter took on founders John Eucalitto, president, and Bill Chemero, executive vice president, to ramp up its growth. It currently has 100 locations and is on track to open another 25 units by the end of the year. All of its restaurants are franchised.
Carter had been participating in a CEO roundtable with the Oxford Center, an educational platform for entrepreneurs and growth company executives. Cliff Oxford, CEO of the Oxford Center, performed an analysis of Wayback Burgers, its needs and the market, and recommended an IPO.
The market for restaurant IPOs has grown strong in recent years, amid a dearth of public growth chains and a belief that restaurants are immune from the sort of disruption the Internet is making with other consumer industries.
While private-equity groups are willing to pay high prices for growth chains, restaurants can get higher prices through an IPO. The stock prices for both The Habit Restaurants Inc. and Shake Shack Inc. more than doubled on their Wall Street debuts.
That has led many smaller concepts to consider the public markets. Few experts expect that trend to end anytime soon.
“It’s a great story,” said Cliff Oxford, CEO of The Oxford Center. “If you look at the growth, they’ve shown they can scale. They have no debt. And they have a worldwide demand for their product. I think it pieces together quite nicely.”
Carter, for his part, said the company has long stated that it would take a strategic look at its business once it hit the 100-location mark. But he also said his company’s recent growth, the addition of nearly 90 locations in just over five years, hasn’t put a strain on its business.
He just believes the company could accelerate its growth at a time when consumers are interested in eating at better-burger concepts.
“I fundamentally believe in thinking about strategizing or planning,” Carter said. “We’re strategizing for the next couple of years — that’s where we are. We have 100 locations and a great story to tell. We have a great trajectory of where we’re going.”
Correction: Sept. 28, 2015 A previous version of this story misstated the year Wayback Burgers took on partners.
Contact Jonathan Maze at [email protected].
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