Dave’s Hot Chicken has been acquired by Roark Capital in a deal valued at approximately $1 billion, the company announced Monday. The private equity firm, known for backing major franchise brands, is taking a majority stake in the rapidly growing fast-casual chicken chain.
Founded in 2017 as a parking lot pop-up in Los Angeles, Dave’s Hot Chicken has since grown to more than 300 locations through aggressive franchising. The chain expects to reach 400 restaurants globally by the end of the year. It specializes in Nashville-style hot chicken, with spice levels ranging from mild to the infamous “Reaper,” which requires a signed waiver.
CEO Bill Phelps, along with the four original co-founders — Dave Kopushyan, Arman Oganesyan, and brothers Tommy and Gary Rubenyan — will stay on to lead the company. All will retain minority ownership in the business.
“Our entire organization is excited about the fit between Dave’s and Roark,” Phelps said. “We’re looking forward to continuing to blow our guests’ minds and unlocking growth for our franchise partners.”
Roark, based in Atlanta, is a powerhouse in the restaurant franchise world. It owns Inspire Brands, the parent of chains like Arby’s, Dunkin’, Jimmy John’s, and Buffalo Wild Wings, as well as GoTo Foods, which includes Cinnabon, Auntie Anne’s, and Jamba. Roark made headlines in 2023 when it acquired Subway in a deal reportedly worth $9.6 billion.
Phelps confirmed in a CNBC interview that the reported $1 billion valuation is “pretty close.” He called the timing ideal: “We were at an inflection point where we could get an incredible valuation, and there was still significant upside for Roark.”
Roark’s international scale and supply chain infrastructure are expected to help Dave’s reduce costs and expand more efficiently worldwide. Phelps projected that the brand could eventually reach 4,000 locations over the next decade.
Dave’s Hot Chicken has stood out in the booming chicken category, driven by younger consumers’ appetite for spicier foods and the “Chicken Sandwich Wars” that began with Popeyes in 2019. U.S. sales for Dave’s soared 57% last year, surpassing $600 million, according to Technomic.
Despite rapid growth, the brand has maintained a focused menu centered on oversized chicken tenders and sliders, with a deliberate avoidance of cost-cutting or menu bloat. “We leaned into what [the founders] created, rather than adjusting it based on conventional wisdom,” said Jim Bitticks, president and COO.
Roark had been tracking Dave’s rise for years. “They came to our 15th store opening,” said co-founder Oganesyan. “When it came time for new investment, they were top of mind.”
Alongside the deal, the company is rewarding its internal team. Phelps, who previously led Wetzel’s Pretzels for 25 years, reportedly helped turn dozens of employees into millionaires through bonuses tied to the sale.
Rapper Drake, an early investor and vocal supporter of the brand, has also helped raise its profile. Every year on his birthday, he gives away Dave’s sliders — a nod to the brand’s blend of cultural clout and culinary heat.
Pump Radar
Stock Alerts
