Shake Shack founder enters the 'taquitos' business with Mexican Tacombi

Just after endorsing the initial public offering of Panera Brands, Danny Meyer now invests in Tacombi , the chain of Mexican fast food and casual restaurants.

On December 9, the New York-based taqueria , which also owns the Vista Hermosa packaged food brand, announced a first round of institutional funding of $27.5 million. Enlightened Hospitality Investments, co-founded by Meyer, is the lead investor.

Others include two Mexico-based companies: Rodina, a hotel investment firm, and private equity fund Capital Mazapil , and Gary Hirshberg, co-founder of organic yogurt maker Stonyfield Farm.

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“With Enlightened Hospitality, there are three big boxes to check,” said Meyer. “Is it an idea that we would have liked to have ourselves? Then, would we have hired the leader if we had been lucky enough to meet them? And finally, is it a culture that we would be proud of? Tacombi, along with founder Dario Wolos, is "a powerful combination of all three," he remarked.

And where was Tacombi born?

Wolos created Tacombi as a Yucatan beach taco stand in 2006. He relocated his brand to the United States and now has 13 stands in the New York City, Miami and Washington, DC areas, serving tacos al pastor and margaritas by the glass or pitcher. At least five more locations are scheduled to open in existing cities and in Connecticut in 2022. A dozen more are planned for 2023 , including locations in Boston, Chicago, New Jersey and Long Island.

Tacombi's current taquerias are projected to generate more than $50 million in revenue next year. Wolos also forecasts that the Vista Hermosa brand, which includes flour and corn tortillas and chips, will have more than $10 million in retail sales in the United States . in 2022 with a line of frozen burritos coming to a handful of regions.

Wolos will use the capital to expand the line of consumer packaged goods, improve technology for customer orders and expand the network of traditional restaurants. He projects that there will be 75 Tacombi points in the next five years.

“There are 50,000 Mexican establishments throughout the country with a pretty good distribution,” he said. “To be detailed in building a business, I draw on a page from Shake Shack's astute playbook, first building on the East Coast that we think can be replicated.”

The 'future' of Tacombi

Meyer agrees that Tacombi has an opportunity to expand nationally in the next few years into an empty niche that includes an added layer of hospitality as well as cocktails.

“Look at the national reach of other places with Mexican influences, obviously the biggest, the widest and the oldest is Taco Bell,” he says. "Chipotle has been hugely successful." So much mmm! Brands Inc., which owns Taco Bell, like Chipotle Mexican Grill Inc. posted profits last year. Meyer's Shake Shack Inc., meanwhile, had fallen 34 percent at the close of trading on Wednesday from its all-time high reached in February.

Tacombi, which is a full-service bar/fast-casual restaurant hybrid that clings to a Mexican beach-shack vibe, operates out of a separate space. “It allows the consumer the ease of not spending too much money or time, while offering flavor and a little more hospitality. It's fascinating,” says Meyer.