On the Margin
Melman not eager to follow Shake Shack example

Melman not eager to follow Shake Shack example

This post is part of the On the Margin blog.

Famed restaurateur Danny Meyer has made an awful lot of money this year thanks to the remarkably successful IPO of his better burger chain, Shake Shack.

That has to have other upscale restaurateurs thinking something similar — indeed, many of them are creating their own fast-casual concepts with an eye on growth.

Just don’t expect Rich Melman to be one of them.

Melman does have a better burger concept in the six-unit M Burger. Yet, speaking at MUFSO in Dallas on Monday, the founder of Lettuce Entertain You Enterprises indicated he wasn’t all that eager to follow in Meyer’s footsteps and make it much bigger.

“I’m part artist and part businessman,” said Melman, who founded Lettuce Entertain You in 1971. The company now has more than 100 locations and dozens of concepts. “The artist part of me doesn’t like to do a lot of duplicates. I never like to do more than 10 of anything.”

To be sure, Melman suggested his partners might think differently. But, he said, “If my partner said to me they didn’t want to do any more, that’d be fine.”

“My goal is not to be the richest, the biggest or the most well known,” he added. “My goal is to be the best that I can be.”

All that said, Melman had good things to say about Meyer and Shake Shack, which has become a phenomenon in just a few years and went public early this year to great fanfare. Now, even after a recent pullback in stock price, it’s trading at the highest valuation multiple of any restaurant company on Wall Street.

And its sales are surging.

“Danny was smart to do what he did,” Melman said. “People like hamburgers.”

Contact Jonathan Maze at [email protected]
Follow him on Twitter: @jonathanmaze

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