Why did chicken franchise Wing It On sell to new platform Craveworthy Brands? “It wasn’t the best deal for me, it was the best deal for our franchisees,” Wing It On President Matt Ensero said.
Ensero was one of four panelists for the Dealmakers Week webinar “Selling your baby: How founders can find the right buyer an exit without (much) remorse” led by Franchise Times Senior Editor Beth Ewen. The other panelists were David Graham, founder of Code Ninjas; Joshua Coba, founder of Ohm Fitness; and Mike Andreacchi, founder of Junk King.
Craveworthy, launched this year by former Jimmy John’s CEO Gregg Majewski, also owns The Budlong, Krafted Burger Bar + Tap, Lucky Cat Poke Company, Genghis Grill, BD’s Mongolia Grill and Flat Top Grill.
The partnership happened by accident last year, after Ensero was stood up by a potential investor at the Restaurant Finance and Development Conference. He met Majewski at a cocktail party that evening, “and the rest is history,” Ensero said.
For him, after he’s done his due diligence, his gut is more important than the numbers. “Whenever I need a tiebreaker, definitely trust my gut,” he said.
Ensero no longer has to “wear all 9,000 hats” at Wing It On under the Craveworthy umbrella. “So far, so good,” he said.
Graham had the idea for Code Ninjas when he was at his kids’ tae kwon do class, when he decided kid-centered businesses should cater better to parents, who are the ones paying for the classes.
Once Code Ninjas had 30 units open, “It was like a dam broke,” Graham said. “It was just crazy.” Code Ninjas sold 240 units in a year, and only opened nine. “It was pretty daunting,” he said.
Code Ninjas strengthened its team and invested in its supply chain to get more stores open. In around five years, Code Ninjas opened 425 units of its 800 franchises sold, Graham said.
Graham then sold Code Ninjas to Eagle Merchant Partners in 2020. “Fortunately, we were able to find a partner that worked well with us,” he said.
Now, Graham is the CEO of FranchiCzar Holdings, which owns Pinot’s Palette, Valhallan and Iron 24.
Junk King was majority owned by Norwest Venture Partners prior to its sale to Neighborly. Then, he stayed on as CEO, but since the Neighborly sale, he’s stepped back.
Andreacchi calls himself a “silent partner” (formally, he’s a brand ambassador) in Junk King now that it’s under Neighborly. He still has franchisees contact him to catch up and ask their questions. “I’m very transparent with everything,” he said.
He values Neighborly’s “top dog” status in the home services category, compared to Norwest’s lack of experience in the sector.
Andreacchi is undecided in his next career move, but maybe he’ll start a new company from scratch again. For now, he’s working on his golf game. “I’ve realized I’m never going to be very good at that.”
Check out the rest of the Dealmakers’ Week panels here. On Wednesday, April 26, see panelists Patrick Galleher of Boxwood Partners, Chris Gaba of Central Park and Scott Zide of Empower Brands discuss deals outside the restaurant category in “M&A, valuations and deal flow in hot sectors beyond restaurants.”
On Thursday, April 27, Senior Editor Beth Ewen will lead will present the 2023 Dealmakers of the Year awards and talk about growth with some winners: Anand Gala of Gala Capital Partners, Nicole Tanner of Swig, Doug Payne of Ohm Fitness and Dan Beem of Hissho Sushi.