The private equity firm Savory Fund, which is based in Lehi, Utah, announced on Wednesday that it has invested in Houston, Texas’s Hot Chicken.
The chain operates 11 locations in six states. It was founded in 2021 by Edmond Barseghian and plans to grow through franchising. The brand features a menu of hot chicken sandwiches, tenders, salads, soups, waffle shakes and loaded fries with seven signature sauces.
It’s the latest indication of the rising popularity of hot chicken concepts, as brands such as Dave’s Hot Chicken grow rapidly across the U. S. , while major brands including Popeyes, KFC, Chick-fil-A and McDonald’s feature spicy versions of sandwiches and nuggets on their menu.
For Savory, it is the latest in a string of investments in growth concepts. The firm has invested in concepts such as Swig, Via 313, Hash Kitchen, Pincho and Mo’Bettahs. The firm has $600 million in assets and combines restaurant industry experience with a focus on growth.
The firm called Houston TX Hot Chicken, or HHC, “a standout star of the hot chicken phenomenon.”
“For the past five years, Savory has been keeping an eye on this flavor segment,” said Andrew Smith, cofounder and managing partner of Savory Fund. “We’ve met and looked at a lot of brands that are trying to do what HHC has already done, and we’re excited to make this strategic investment.” ”.
Barseghian said that the deal should help “amplify our operational capabilities.” “The journey ahead is electrifying,” he said.
Terms of the deal were not disclosed. Harrington Park Advisors was the financial advisor for HHC. Mayer Brown was legal advisor to Savory Fund. Greenberg Traurig was legal advisor to HHC.
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Houston’s hot chicken scene is sizzling. Music City’s famous spicy fried chicken has become very popular all over H-Town in the last few years. But who really owns Houston’s hot chicken scene? The answer is complicated, as many important people are trying to get a piece of the spicy pie.
The Hot Chicken Heats Up
Inspired by Nashville’s iconic Prince’s Hot Chicken Shack, hot chicken restaurants started popping up in Houston in the early 2010s. Small independent joints led the charge, tweaking the classic Nashville flavors to better suit local tastes. The trend started gaining serious steam around 2018 as hot chicken’s popularity boomed nationwide. By 2020 lines were winding out the door at many Houston hot chicken spots.
Major players started entering the market. Lucky’s Hot Chicken arrived in 2019 with its first Houston location, bringing a proven franchise model focused on nailing consistent spice levels. Homegrown chains like Houston’s Own Hot Chicken also expanded rapidly. Meanwhile, countless single-unit operations rounded out the scene.
There are no signs that the hot chicken craze will end any time soon. Competition is getting tougher than ever as small businesses and big chains fight to be the biggest in their fields.
Key Players in Houston’s Hot Chicken Game
With so many restaurants crowding into the hot chicken space a few big names have emerged as power players
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This is Lucky’s Hot Chicken. It has 5 locations in Houston and a strong franchise system, making it a major hot chicken force. Its range of consistent spice levels is a big draw.
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Gus’s World Famous Fried Chicken: While better known for traditional Southern fried chicken, Gus’s offers spicy chicken options that command attention in Houston’s hot chicken landscape.
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Houston TX Hot Chicken: Founded in 2021 by social media influencer Edmond Barseghian, this rapidly expanding chain now has 3 Houston locations. Its bold flavors and marketing have made it a brand to watch.
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Local Independents: Dozens of small independent players also help shape the scene, like Burning Beak, Hot Chick Houston, and The Kickin’ Chicken. Their neighborhood vibe and uniqueness contribute to the diversity of options.
Different Ownership Structures
In Houston, ownership of Hot Chicken is split not only by brand but also by how the business is set up. This leads to distinct strategies and expansion models:
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Franchises: Lucky’s and emerging chains like HHC rely heavily on franchising for growth. This allows for quicker scaling but can risk brand consistency.
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Corporate Chains: Established brands like Gus’s operate their Houston units under corporate ownership. This provides tight operational control but requires major corporate investment.
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Independents: One-off restaurants are often passion projects of chef-owners. Their independence fosters creativity but limits expansion capabilities.
No single ownership structure dominates Houston’s scene. This diversity of approaches has fueled hot chicken’s explosive rise. Chains, franchises, and independents all bring something unique to the table.
Key Investors Flock to Houston Hot Chicken
Houston’s breakout hot chicken success has attracted investor interest. In late 2023, private equity firm Savory Fund acquired a stake in Houston TX Hot Chicken. With Savory’s backing, HHC plans to open 10 new locations across Texas by 2025.
Lucky’s Hot Chicken also took on an investment partner in 2022, teeing up an aggressive nationwide expansion. And behind many independent hot chicken concepts, local investors help bankroll startup costs in hopes of sharing in the profits.
For investors, Houston’s booming hot chicken market presents a tempting opportunity. Consumers’ spicy cravings show no sign of dying down. And the scene still has ample room for growth despite increasing competition. But quality and smart branding will determine which concepts truly thrive in the long run.
Customers Are the Ultimate Owners
While high-profile chains and investors may capture the headlines, Houston diners themselves ultimately decide hot chicken’s fate. Their patronage and preferences shape the landscape far more than any one owner. Consumers “vote” daily with their chicken purchases, collectively determining which flavors, brands, and structures earn their share of the market.
In a sense, Houstonians own hot chicken collectively. They choose which concepts to support, propelling humble startups into breakout stars or leaving arrogant brands behind. Savvy operators realize pleasing customers is their only path to success. In Houston’s hot chicken game, the diner is king.
So while many players help shape the scene, no one truly owns Houston’s hot chicken outright. Consumers crown their winners through loyalty. And local chefs and entrepreneurs will keep innovating, striving to earn their crown in this fiery, crowd-ruled kingdom. The only guarantee is more heat ahead in H-Town.
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FAQ
Who is the owner of Houston’s hot chicken?
Houston’s Hot Chicken was co-founded by Edmond Barseghian and Houston Crosta. Barseghian, also a social media influencer, initially developed the hot chicken recipe and spearheaded the brand’s early growth, including its social media presence.
What restaurant does Houston Crosta own?
Edmond Barseghian and Houston Crosta help start Houston’s Hot Chicken. They are both in their early 30s, so they are young, but they already run one of the
Who owns the hot chicken franchise?
Dave’s Hot Chicken acquired by Roark Capital Dave’s Hot Chicken acquired by Roark Capital. As was rumored earlier this year, Dave’s Hot Chicken announced on Monday that it had been bought by Roark Capital for $1 billion.
Is Houston’s hot chicken a franchise?
They began offering franchises on January 19, 2022. The total investment necessary to begin operation of a Houston’s Hot Chicken® restaurant is between $529,450 to $1,021,000.
Who owns Houston’s restaurant?
Houston’s Restaurant is part of a group of upscale American casual dining restaurants, owned by Hillstone Restaurant Group, whose main corporate headquarters is in Phoenix, Arizona. There are 39 Hillstone locations in 11 states.
Where is Houston’s Hot Chicken located?
Houston’s Hot Chicken will open at the corner of Green Valley and Pebble Road. It will take up more than 2,029 square feet of space in the building that used to be Brooklyn Bagel Deli.
Why is hot chicken so popular in Nashville?
And for decades, hot chicken flourished, mainly served in Black communities, as this was during the time of segregation. Over time, hot chicken became a local tradition of particular pride across all of Nashville, with festivals and competitions dedicated to the culinary specialty.
Where did Dave’s hot chicken come from?
Dave’s Hot Chicken did not originate in Nashville, but it mastered the formula for viral growth. The franchise was founded by Armenian-American chef Dave Kopushyan along with his childhood friends Arman Oganesyan, Tommy Rubenyan and Gary Rubenyan. Dave’s started with humble beginnings.
Does Hattie B’s have hot chicken?
In addition, an honorable mention should go to Hattie B’s – a restaurant chain specializing in Nashville-style hot chicken. Though it hasn’t franchised or grown as quickly, it is often compared to Dave’s and has 13 locations, mostly in the South, and continues to grow steadily.