“Man, it’s been wild,” Federico Castellucci III says over the phone.
It was the beginning of April, and the president and CEO of Castellucci Hospitality Group was preparing to debut a new pop-up, takeout steakhouse concept Castellucci & Sons. (It did well enough that the company introduced a second pop-up location on April 15.) The menu boasted filet mignon, cowboy-cut bone-in ribeye, “dinosaur” beef ribs, porterhouse steaks for two, and a variety of sides such as manchego-creamed spinach, wood-grilled mushrooms and asparagus, and, of course, mac & cheese. This is still the South.
This was also about two weeks after the coronavirus outbreak led Atlanta mayor Keisha Lance Bottoms to announce that restaurants in the city had to cease dine-in operations.
It was a pivot. The company has done lots of that lately.
CHG’s portfolio of restaurants in the Atlanta area includes Sugo Kitchen in John’s Creek, Double Zero Napoletana at Emory Village, The Iberian Pig in Decatur Square and Buckhead, Recess and Bar Mercado (both in Krog Street Market), and Cooks & Soldiers in West Midtown, which is considered the group’s premier fine-dining establishment.
From top to bottom, Castellucci said he directed his staff to try new things to keep the business going. All of the restaurant’s websites were redesigned to reflect the new no-dining-in model. “Our whole menus are out the window. We have to change everything. And if it doesn’t work? Change. Do something different before we start losing more money, you know?”
One thing that didn’t change was public access to CHG’s restaurants. None of them reopened today, after Georgia governor Brian Kemp announced April 20 that he would allow restaurants to resume limited dine-in service on April 27.
“First we need to work through the logistical challenges that will go into getting our businesses ready to fully reopen, then we will decide what is right for CHG,” Castellucci said in a statement, adding that “the decision is driven by the data and information we’ve received thus far from health and public officials and it’s what we feel is best for CHG, our team and our customers. For now, we’ll continue to give our guests exceptional dining experiences to the best of our abilities within their own homes.”
The new CHG restaurant websites also highlight the company’s Feed The Frontlines initiative, which lets customers add a $15 charge to their purchases. CHG matches those dollar amounts, which go to providing meals for hospital workers.
Castellucci said the company even made the fancy Cooks & Soldiers menu more takeout-friendly, yet sales weren’t matching up to what his other restaurants were doing. “So that’s when I was like, we’ve got this wood fire grill, we have the best culinary team of any of our restaurants — and a lot of restaurants out there — and we’ve got access to amazing beef. Let’s open a f*cking steakhouse; all the steakhouses are closed!”
It’s basically Castellucci’s version of a “cloud” or “ghost” kitchen setup. The idea is that companies put a number of small commercial kitchens in a large space, and rent them out to chefs or restaurants looking to serve takeout and delivery customers ordering through services like UberEats and DoorDash, or via their own drivers and systems. But instead of renting the setup to others, Castellucci is using it for his own restaurant brands.
“I think the cloud kitchen model is interesting. I just think in Atlanta, I don’t know that the density is here to really make it work like it does in some other cities. And I feel like the model only really works with chains. If I want Chick-Fil-A, and McDonald’s, and all these places in one building, churning out orders so someone can basically just pick them up and deliver them to all these people, that makes sense to me: big brand partnerships. But [with] independents, there’s just not enough business there to make cloud kitchens work.”
Castellucci isn’t the only person operating a restaurant-industry-affiliated business and trying new ways to run things, in real time, during the coronavirus pandemic.
GettaBite, an app that digitizes communication between restaurants and customers, is also doing things a bit differently these days.
Co-founders Evan Walker and Rain Li launched GettaBite at the beginning of 2020, focusing first on the Atlanta area. Their original focus was to feature food deals you’d normally only find on bar and restaurant social media channels, such as half-priced wine, beer and food discounts. As of early April, the company featured more than 1,000 weekly deals and received more than 300,000 deal views monthly.
Now, they’re offering restaurants free use of their new GettaBite To-Go service. The new feature helps Atlantans stay informed on which restaurants and food vendors offer pick-up and delivery options during the pandemic.
“I don’t think we’ll come out the same way we came into this thing,” Walker says. “When Rain and I first conceptualized, launched and built GettaBite, our focus was discovery.” Now, he says, demand has changed. “People are going crazy being stuck at home. They need alcohol and they want takeout food.”
In response, Walker says GettaBite has added several hundred new deals and posts, sharing restaurants’ percentage savings on meals, free deliveries, family meal specials and packages.
Li admits that the pandemic’s challenges to the restaurant industry at first seemed like an “app-killer” for GettaBite. But with GettaBite To-Go, she says the startup is both pivoting and staying the course.
“We came to the conclusion that these are temporary solutions. We are still primarily a ‘bringing people to the restaurant’ app,” Li says.
That means continuing to prove value to an industry known more for using chalkboard advertising than digital savvy. Companies like Single Platform, whose API helps restaurants publish and manage online menus, are seeing increasing popularity, and with the realization that digital touchpoints are one of the only ways to reach customers these days, there’s an expectation that most things will figure out ways to reimagine those connections.
“I’m an optimist by nature. The best outlook in the next six months is tech startups like GettaBite will help transform the way we discover great things like food. Whether that’s us getting better at recommending deals or supplying offerings, or other companies working together, I think with regard to restaurants, companies like us continue to innovate and come up with great ways to connect.”
Walker says there’s sizeable demand for finding deals and meal offers as coronavirus continues to affect the restaurant industry, making budgeting even more important as so many Americans face layoffs or furloughs. Restaurants will benefit from GettaBite’s direct connection to hungry users, and those users will reap the benefits of getting literally digestible information about good food at great prices. This period, he believes, shows that their model will survive the times.
“Our hope is that this pivot will allow our users to get on GettaBite and find out how you can use it. As we get out of this thing and get to a somewhat stabilized economy, we can help people get back into restaurants.”
In the meantime, he says, “We want to be the go-to for to-go.”
Sifted, another food-oriented platform based in Atlanta, is also making new moves. The company, which streamlines the lunch-ordering process for offices and workplaces and serves clients as far as Denver, Seattle, Austin, Phoenix and San Francisco, switched gears in one week to launch two new services.
Reached by email, co-founder Kimberly Lexow says Sifted has been many companies’ “outsourced chef team,” providing efficient ways to provide one of the startup community’s most universal perks: free office lunch. In less than five years, Sifted has bootstrapped to $13 million in revenue without funding or debt. Inc. also named Sifted one of Atlanta’s 10 fastest-growing companies in 2019, praising its three-year growth and goodwill initiative of catering custom food orders, collecting the leftovers, and donating them to nonprofit organizations.
“But what happens when those offices close? When you no longer have work to support the 200 staff who count on you? You leverage what you have and you start something new,” Lexow says.
Those two new businesses are Sifted Provisions, a new service offering curated, chef-driven “Provision Packs” of fresh, shelf-stable groceries and home essentials, and Sifted Kitchen, a curated selection of hand-blended spices. The idea: help customers keep their kitchens stocked and avoid virus exposure at grocery stores.
Starting two consumer-facing businesses from a B2B company, and not having a true timeline of when the coronavirus lockdown will end, have been big challenges, Lexow shares.
“Selling direct to consumers is different and has required a shift in our marketing, sales, and communication strategies. The pandemic and the subsequent work-from-home policies of every one of our clients across the country has reminded us of our scrappy roots, and our dedication to thoughtful experimentation. We know how to work with limited resources, and how to match our unique mix of talent and experience with market need.”
Lexow says Sifted employs more than 200 people, and although hourly employees were temporarily furloughed (with full benefits still paid), salaried workers’ jobs have been sustained by the new Sifted businesses.
“There’s no denying food focused businesses have been some of the hardest hit during this time. And yet, at the core, food will always be an essential need. How it’s sourced, delivered, and purchased is changing, and technology is helping us rewrite that story.”
Part of the new story for Sifted includes a collaboration with CHG, through Sifted Provisions.
The two companies have joined forces to make Cooks & Soldiers’ meal kits available as ready-to-heat “Take & Bake” meals. The meals are add-on options to the Provision Packs, and include items like curried sweet potato soup, glazed 2-pound duck, pork and beef meatloaf, za’tar-seasoned loaves of bread, and smoked salmon quiche, all of which feed multiple people.
“We’re doing so many crazy things at every brand,” Castellucci says. “Every restaurant is rolling out a meal kit. We’re doing a pizza meal kit at Double Zero where we give you the dough, a jar of sauce, some pasta, cheese and the sauce. Make your own pizza/pasta where all the work’s done, you just have to roll the dough out and throw it on top of the oven. We’re doing pork cheek tacos at Iberian Pig. Our most popular stuff for each brand, we’re rolling out, just to see if there’s demand for it.”
Castellucci says he doesn’t blame restaurateurs and owners who’ve had to completely shut down, eliminating jobs and sources of revenue that impact the supply chain and larger economy. “I think most operators in our shoes were just like, ‘You know, we just can’t do it. We’re gonna close up, lay everybody off, and figure it out.’ And honestly, I get that.
“It’s a small-margin business. When 80 or 90 percent of your sales go away, most people have a few days of cash. Not weeks or months — a few days. And I know, because I’ve been there.”
Lexow doesn’t mince or soften words when speaking about her outlook. “The food system in our country is broken,” she says. “We spend less on food than what it costs to grow, harvest and transport it. It’s time for a reset and a new model. An international pandemic stresses an already weak system and highlights all the inefficiencies and injustices.”
Castellucci remembers difficulties from the not-too-distant past, such as making payroll back in 2007, as the Great Recession was beginning to take hold. “Every Monday, the money would go into the accounts, and by the weekend we were bouncing checks. That would happen every single week.”
He says he’s fortunate to have grown from those tough times, and credits the support he received working and struggling alongside his family as helpful to today’s challenges. “I’m going to do everything I f*cking can not to go back to that. That is literally my life’s goal,” he laughs.
And Lexow agrees with the sentiment behind Castellucci’s spirited ethos. “Think beyond old constraints and outdated models. This is the time to experiment and make real a future that provides equity and value along the entire food chain.”
Lexow believes this experience has been an equalizer across industries and funding structures. “Companies and consumers are re-prioritizing and it requires we look at technology and tech companies through a new lens. In a time of crisis, people put first the have-to-have over the nice-to-have. Now, more than ever, we’re having a much needed dialogue around the importance of food-focused businesses,” she says.
“We’re optimistic and excited to see what our fellow food entrepreneurs do with this new insight and freedom.”