Ted Xenohristos, co-founder of CAVA, grew up in a Greek-immigrant family with a passion for his heritage’s cuisine. Alongside Brett Schulman, former consultant turned CEO, they discuss the humble beginnings of their Mediterranean restaurant journey. They faced daunting challenges, like financial struggles and learning the ropes of the restaurant business, before achieving remarkable growth. Innovative thinking and strategic expansions into new markets, including Los Angeles, led to CAVA becoming a nationally recognized chain with over 280 locations.
Precision, efficiency, and tracking costs are crucial for making a restaurant profitable.
Marketing the Mediterranean diet as a healthy and flavorful alternative can attract customers.
Expanding into new markets, even with challenges, can lead to significant success.
Deep dives
The birth of Kava Mezze and the struggles of the restaurant business
Three childhood friends who grew up on Greek food opened a small Greek Taverna in suburban Washington, D.C. They faced challenges like overpricing menu items and started losing more money as business grew. However, they saw potential in their dips and spreads business and sought the help of Brett Schulman to turn it around.
Expanding Kava with a fast casual format
Brett joined the partnership and they decided to launch a fast casual version of Kava, inspired by the success of brands like Chipotle. They focused on grain bowls, greens, and mains, building the menu around their high-quality homemade dips. The first location opened in 2011 in Bethesda, Maryland, but faced initial challenges as customers were hesitant about the new self-serve format.
Overcoming challenges and scaling the brand
Despite the initial struggles, Kava gained momentum by introducing community days with free lunches and matching donations to a local charity. A severe weather event also brought large crowds to the mall, raising awareness of the brand. The success of the fast casual locations prompted the entrepreneurs to consider further expansion and scale Kava into a national brand.
Lessons learned and future growth
The founders realized the importance of precision, efficiency, and tracking costs in order to make the dips and fast casual restaurants profitable. They also recognized the potential of marketing the Mediterranean diet as a healthy and flavorful alternative. With Brett's expertise and their shared vision, they aimed to grow Kava's presence across the United States and bring their authentic, high-quality Mediterranean cuisine to a larger audience.
Expanding to Los Angeles and the Challenges Faced
The founders decided to expand Kava to Los Angeles, even though it was 3,000 miles away from their home base. They saw it as an opportunity to enter a large market with a great customer profile. However, the challenges in LA were immense, from construction delays to difficulties in hiring and establishing brand recognition. Despite the obstacles, customer love for Kava persisted, and the LA market became one of their most successful.
Acquiring Zoe's Kitchen and Overcoming Challenges
In 2018, Kava raised funds to acquire the struggling fast-casual Greekish chain, Zoe's Kitchen, with over 240 locations. The conversion of Zoe's locations to Kava presented numerous challenges, including stabilizing the declining sales and transforming the menu to align with Kava's concept essence. It required a team effort to fix the menu, reduce waste, and streamline operations. Eventually, Kava experienced positive same-restaurant sales, solidifying their strategy and setting the stage for future growth.
When Ted Xenohristos and two childhood friends opened their first sit-down Greek restaurant in 2006, they had no idea it would eventually grow into CAVA, a sprawling national chain that serves stuffed pita sandwiches and salads. Raised by Greek immigrants, the three founders understood how to make great food, but were rookies at running a restaurant–maxing out their credit cards, and learning the hard way that you should never write dinner orders on sticky-notes. As the restaurant tried to raise its profile by selling its hummus and tzatziki to grocery stores, it continued to lose money. But eventually the founders decided to hire Brett Schulman as their boss. Brett had invaluable experience in the snack food industry, and predicted that CAVA’s Mediterranean cooking would take off among health-conscious diners. He was right. Today, CAVA is a publicly-traded company with over 280 restaurants across the country.
This episode was produced by Sam Paulson with music by Ramtin Arablouei and Sam Paulson.
Edited by Neva Grant, with research from Rommel Wood.
