As far as Naf Naf Grill CEO Greg Willman sees it, his emerging brand and private equity group Roark Capital simply had a “fit issue.”
“They were terrific partners,” Willman, who became Naf Naf CEO in May, said Thursday, a day after announcing his fast casual’s split with Roark. “I think it’s more of a fit issue. They’re into big brands and brand optimization. This is the first and only independent emerging brand investment they’ve ever made.”
Roark’s general counsel in the firm’s Atlanta office did not respond to a Restaurant Business request to comment Thursday.
There was much fanfare in 2015 when Roark Capital, funder of major chains such as Dunkin’ and Focus Brands, announced a minority investment in emerging fast casual Naf Naf Grill.
During its time with Roark as a minority investor, Naf Naf grew from 13 restaurants, all in the Chicago area, to nearly 40 units in nine states. Naf Naf started franchising during its time with Roark.
On Wednesday, however, Naf Naf announced the end of that partnership, saying that a group of investors had bought out Roark’s stake in the brand.
The new investor group is “made up primarily of investors that have been involved with the brand since the very beginning,” Willman said.
He said the group includes some of the chain’s original funders, as well as new investors and Willman himself. Willman was Naf Naf’s first franchisee, before becoming CEO, and currently owns two stores in Indianapolis.
“Now, I’m one of the majority owners,” he said. “I couldn’t be more deeply involved in the brand. That has played well with the franchise community, that I’m one of them, I do what they do.”
Pre-pandemic, Naf Naf was doing well in its urban core locations in Chicago, Minneapolis and Philadelphia with its menu of customizable Middle Eastern pitas and bowls, he said. But the coronavirus has posed a host of challenges for the concept.
Naf Naf had about 38 locations pre-pandemic, Willman said. As of this week, 22 have reopened.
“We’re in the process of getting reopen everywhere we can,” Willman said.
A couple of stores have been permanently closed. And Naf Naf is having conversations with landlords on other restaurants, he said.
“We’d like to get everything reopened,” he said. “That’ll remain to be seen.”
Willman said he has not heard any negative comments from franchisees around the separation from Roark and that the chain has roughly 10 franchisee groups affiliated with the brand currently, with 70 restaurants under contract. He said he expects Naf Naf to open “high single digits” of franchised units this year.
“We had very, very good momentum coming into this transaction,” Willman said.
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