My colleague Joe Guszkowski wrote about Authentic Restaurant Brands, the owner of Pollo Tropical and other chains, which hinted that it might one day want to go public with a roster of regional growth companies.
Several companies have in one form or another been eyeing an IPO, notably Jollibee, the Philippines-based chicken chain planning a U.S. offering. The market for such offerings remains tenuous, however. And IPO investors have been skeptical enough of restaurant companies that many are reluctant to go public until the environment improves.
Instead, companies like Denny’s and Potbelly are going private. If anything, restaurant chains are abandoning the public markets. And we expect some big chains to consider going private at some time during the year because of depressed valuations.
But let’s look at some companies that can, should or are considering an IPO.
7 Brew
We’ve heard some speculation at ICR this week that the fast-growing drive-thru coffee chain would consider an IPO. If it did, it would be as big an offering as Cava in 2023 or Shake Shack in 2015.
According to Technomic, 7 Brew has averaged 110% annual system sales growth between 2019 and 2024. It is generating ultra-long lines for new openings. It is getting some of the industry’s best franchisees.
If it is planning to go public, it should go soon and take advantage of a market hungry for more opportunities to invest in the red-hot beverage space. Black Rock Coffee Bar last year proved that a coffee chain can go in this market, and it does not have 7 Brew’s numbers.
Jersey Mike’s
Charlie Morrison, the CEO of the sandwich chain, did the rounds at ICR this week and made presentations to investors.
Blackstone just bought the chain, so it’s not as if an offering would be imminent. But the company has boasted 20 straight years of same-store sales growth. It is now opening locations in Europe under the guidance of founder Peter Cancro. It is one of the industry’s most consistent performers.
Morrison clearly has the chops to take a company public and did so with Wingstop a decade ago. It would not be surprising at all to see Jersey Mike’s going at some point.
Inspire Brands
The owner of Dunkin’ and Arby’s has long been speculated as a future public company and it makes all kinds of sense given the size of Inspire and its restaurant chains.
But it might take some time before it’s truly ready for such a move. Dunkin’ has been thriving in recent years even in the face of intense competition from the aforementioned 7 Brew (and Dutch Bros, etc.). But some of its other names have had their shares of challenges more recently.
Sales in 2024 at Arby’s, for instance, fell more than 6%, according to Technomic. They declined 2.7% at Sonic. But it seems more a matter of when, not if, Inspire goes public.
Cooper’s Hawk
This is another chain long believed to be eyeing an IPO. Bloomberg reported last year that it was planning an offering.
The polished casual-dining chain’s system sales increased more than 12% in 2024, according to Technomic. But it is one of the industry’s most interesting names. Its wine club is the nation’s biggest and operates a lot like a loyalty club. We appreciate interesting ideas like that.
The field
A number of recent IPOs have been under-the-radar concepts that we wouldn’t have thought as candidates, such as Gen Korean BBQ and the aforementioned Black Rock.
Plenty of growth chains exist that could see opportunities to raise funds with an offering, especially if they’re in markets investors are eager to get into or if they have unique business models.
Several other companies have long been considering an offering and could go public if the market grows friendlier for restaurants. We’ll see if that happens this year.