NASHVILLE, TN – Private equity firm Roark Capital, which holds a significant stake in franchise businesses including Subway, has acquired Dave’s Hot Chicken in a deal reportedly valued at $1 billion. This acquisition highlights the booming demand for chicken in the fast food sector and marks a major milestone for the rapidly growing Nashville-style hot chicken chain.

Key Facts:

• Billion-Dollar Deal: Roark Capital’s acquisition of Dave’s Hot Chicken for an estimated $1 billion aims to accelerate the chain’s rapid growth and expansion plans.
• Rapid Ascent: From a $900 street stand in 2017, Dave’s Hot Chicken has grown to over 300 global locations and plans for 4,000 worldwide within a decade.
• Leadership Continuity: The current leadership, including the founders, will remain to ensure consistent menu quality, operations, and marketing.

While Roark Capital expands its portfolio with a thriving chicken brand, its Subway brand has faced recent challenges, including store closures. The Dave’s Hot Chicken acquisition represents a strategic move into a high-growth segment.

Dave’s Hot Chicken: 4 Facts About A Billion-Dollar Acquisition

The rapid ascent of Dave’s Hot Chicken from a modest street cart to a billion-dollar brand in just eight years can be attributed to several key factors that made it an attractive target for a major investor like Roark Capital:

1. A Simple Menu With Just 4 Choices: The menu at Dave’s Hot Chicken has just 4 choices: hot chicken tenders, sliders or both. Customers get a simple ordering experience, reducing the barrier to a tender juicy meal.

2. They Began With A Food Cart And Just $900: The brand’s journey began in 2017 with a $900 investment from four friends who launched a pop-up street food cart in a Los Angeles parking lot. This humble beginning, coupled with overwhelmingly positive rave reviews from early customers and food critics, quickly propelled the brand into the spotlight.

3. They Specialize In Nashville-Style Hot Chicken: This distinctive dish, originating from Nashville, Tennessee, features fried chicken generously coated with a spicy paste or sauce made with cayenne pepper. This preparation delivers an intense heat and a unique, deep flavor profile, distinguishing it from traditional fried chicken.

4. Roark’s Strategy Is High-Growth, Franchised Restaurant Concepts: Roark Capital’s acquisition of Dave’s Hot Chicken underscores its strategy of investing in high-growth, franchised restaurant concepts. While Roark also owns other major food brands, including Inspire Brands (which includes Dunkin’, Arby’s, and Jimmy John’s), and the struggling sandwich giant Subway, the Dave’s Hot Chicken acquisition seeks to capitalize on the recent popularity of chicken in the fast-food market.

Dave’s Hot Chicken has rapidly expanded through franchising, now boasting over 300 locations globally with ambitious plans for further growth. The continued leadership of Dave’s Hot Chicken’s existing team suggests a focus on maintaining the brand’s core identity and quality as it scales under Roark Capital’s ownership. This acquisition underscores the current appetite for chicken-centric fast-casual dining and Roark Capital’s strategic investment in a brand with significant growth potential, even as one of its other major holdings navigates a more challenging landscape.