Planta, the rapidly growing chain of upscale vegan restaurants, filed for Chapter 11 bankruptcy protection this week, the latest in a run of such filings by full-service chains.
The Miami-based chain and more than 30 affiliates declared bankruptcy on Monday in Delaware. The company lists between $10 million and $50 million in liabilities, compared with $50,000 and $100,000 in assets.
The company lists 18 locations on its website, in Florida, Atlanta, New York, Los Angeles, Chicago and Toronto.
Planta was founded in 2016. The chain has rapidly expanded since then, featuring high-end restaurants that serve a selection of Asian-inspired dishes, all of which are plant-based, including Firecracker Wings made with cauliflower and Korean Chick’n Baos, along with a plant-based Planta Burger.
The company’s revenues soared over those years, which sales increasing from $3.5 million in 2016 to $46 million by last year, according to court documents.
Yet the pandemic led to closures and forced Planta to rely more heavily on third-party delivery than planned, which increased costs. The loss of traffic and revenues during the pandemic also led to “irrecoverable damage,” CEO Steven Salm said in a court filing.
He also cited the consumer slowdown in 2023 and 2024, along with rising prices. Higher food prices in particular hurt Planta draining profits. The chain raised prices, which hurt traffic.
But Planta also spent a lot of money to open new locations, building 12 locations in three years, an opening schedule “condensed” due to COVID.
The company has no secured debt. But it raised funds through a convertible note from the hedge fund Anchorage Capital Group, meaning the debt could be converted to equity if it went unpaid by a certain date. It fell behind on its lease payments earlier this year, and ultimately opted to file for bankruptcy.
The company’s growth came amid mounting interest in plant-based meats, largely aimed at meat-eating consumers concerned about the environment. That trend has struggled more recently, however.
The Kevin Hart-backed Hart House closed all four of its restaurants last year, for instance. At the plant-based meat company Beyond Meat, revenues from foodservice in the first quarter fell 23.5% to just $9.4 million. The company cited “weak category demand” and “lower burger sales” to quick-service restaurant customers.
More than 30 restaurant operators have filed for bankruptcy since the beginning of last year amid weakening sales and high costs. That includes several notable full-service restaurant chains, including Red Lobster, TGI Fridays, On the Border, Buca di Beppo and Bertucci’s.
UPDATE: This story has been updated with more information from court documents.
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