Torchy’s Tacos Plans IPO That Could Value Chain At $1 Billion

Torchy’s Tacos, an Austin-based restaurant chain, is planning an initial public offering (IPO), Bloomberg reported on Sunday (March 14).

Citing “people with knowledge of the matter,” Bloomberg said the chain is working with Morgan Stanley, Bank of America Corp and J.P. Morgan & Chase Co. Torchy’s, which has more than 75 restaurants throughout the South and Midwest, could raise roughly $300 million and be valued at nearly $1 billion, the sources told Bloomberg.

They noted that the decision is not yet final and the company’s plans could change. Representatives from Torchy’s did not respond to requests for comment, and the investment banks and General Atlantic — the investment firm that backs Torchy’s — declined to comment, Bloomberg said.

In 15 years, Torchy’s Tacos — the business name for the LLC Success Foods Management — has gone from operating a food trailer in Austin to a 10-state mini-empire.

The chain formed a strategic partnership with General Atlantic in 2017 and sold a $400 million stake to a General Atlantic-backed group in 2020, opening 12 new restaurants in the middle of the COVID-19 pandemic.

If Torchy’s does go forward with its IPO, it will be doing so following what we’ve referred to as a “transformative” year for the restaurant industry. While many eateries suffered due to COVID restrictions and an economic downturn, others pivoted and embraced new digital solutions.

For example, a study showcased in the PYMNTS Order to Eat tracker predicted 23 percent of smartphone users would order food via delivery apps by 2023. In fact, that number jumped to 57 percent inside of a year thanks to the pandemic.

And the December 2019 edition of our study predicted Wendy’s digital shares would hit 10 percent of total sales by 2024. Mass digital adoption has drastically reduced that timeframe, with the 10 percent target expected to arrive by next year.

That doesn’t mean future Torchy’s diners should expect a take-out only experience. PYMNTS research found that 61 percent of consumers are interested in eating out in restaurants more frequently than they do now.