San Diego's Pop-Up Restaurants Create New Business Model

CAVANAUGH: What happens in the evening in restaurants that only serve breakfast and lunch? Or how about the eateries that are closed one or two days of the week? Most of them just stay idle during the down time. In certain locations around San Diego, things begin to pop. A phenom known as pop-up restaurants is not only offering new choices to San Diego foodies, it also may be creating a new business model for chefs and restaurateurs. Joining me to talk about pop-up restaurants are my guest, Karen golden, food director of the column local bounty, and author of the blog San Diego food stuff. GOLDEN: So good to be back with you! CAVANAUGH: And joining us is Adam Lowe, chef and co-owner of Sundara popup, welcome to the show. LOWE: Thank you for having me. CAVANAUGH: And Chad whites here, chef owner of Plancha Baja med. WHITE: Thank you so much. CAVANAUGH: Now, Karen, if you would, explain the concept of popup restaurants just a little bit more. These are restaurants that sort of take over another eatery from time to time? GOLDEN: Yeah. This is not necessarily a new concept. We had first seen this four or five years ago with Ludo, Ludo bites up in L.A., and he really popularized that. And down here, our first notable popup was bistro St. Germane in Encinitas. And they hosted someone who had been a chef at Ludo bites. And they did that for about 21 days. And it's just a place that serves breakfast and lunch, and it's closed at dinner. So why not take advantage and have a win-win situation with the owners being able to get some income and get people in who may not have been to the restaurant otherwise? And then give the chef a chance to maybe test out a restaurant concept or to just develop some income maybe in between gigs. CAVANAUGH: And just to be clear, we're not talking about the restaurant just opening up and serving the menu it usually does. We're talking about a restaurant that would normally be closed at a certain time opens up really with a new chef. GOLDEN: A completely different concept. CAVANAUGH: And new menu, right? GOLDEN: Yeah. It's really sort of rent a space for restaurants in a way. We haven't seen a whole lot of it since. There have been popups every once in a while. And some places have actually come up with other concepts like I'll take it easy, for instance, which is a Northpark place. They're open at night. But they don't really have a full dinner menu. So they periodically bring in chefs from Baja, they call it their Baja series. And they're going to have another one on the 20th. What we're seeing now is sort of the permanent popup as a business model. And that's -- we've got a new for examples of these. One of them is a group of guys who have created this business at the public market called supernatural sandwiches. And they have been doing prep at a local restaurant in Barrio Logan. And the guy again, his name is Jeff Roberto, a chef, he does a lot of catering. So his place is closed during the day. This is sort of the reverse. So he usually does his business at night, but during the day the place is open. And so he let's them have a popup. And that's enabling them a couple of days a week to make better use of their seafood, and these are great places, by the way. And we also, the other thing we should note, this isn't just a phenomenon in either casual dining or in more up-scale dining. You're seeing this in both. And actually the two guys here are an example of both. CAVANAUGH: Let me go to Adam Lowe, you're a chef and co-owner of sun darra in Ocean Beach, an Indian restaurant. It runs six nights a week. But you don't sort of see that name on the building; is that right? LOWE: We actually only recently hung up our own sign. CAVANAUGH: Okay! LOWE: But before that, for the first seven months, we had to operate with the Point Loma beach cafe's sign up which is fine. It's their restaurant. We're essentially renting space in the evening. So we don't necessarily have the right to put in massive construction. CAVANAUGH: Sure, right so by day, it is a breakfast and smoothy place. LOWE: Correct. CAVANAUGH: And in the evening, six days a week, it becomes sundarra. Is this working for you? LOWE: It's working out great so far. The restaurant is open from 8:00 AM to 3:00 PM. We come in about 3:30 after they've closed and cleaned up. And the four of us, three other owners, we race around scrambling to get everything deconstructed from their restaurant, then we put in all of our stuff, and hopefully we're ready to go by 5:00 PM when we open and we operate as a normal restaurant for the next five hours. Come 10:00 PM, we deconstruct everything and do it all again the next day. CAVANAUGH: Now, Chad, your popup is a little different. Once a month you hold a popup at carnittas snack shack in Northpark. Tell us about your operation. It's different from Adam's. WHITE: Even though it's different, there's a lot of similarities. I don't just only do Carnitas Snack Shack. But it's the same kind of thing. They're already kind of broken down. They're not open at all for that day. So when I come in WHITE: Come into a clean slate. And it's a lot easier for me to build a restaurant that way. About 2 weeks ago I did a Valentine's dinner for three days at coffee cup. Similar to his, I come in at 4:00, I had to be open by 5:00, and it was a race, taking a truck from Chula Vista where I'm renting a kitchen, going up to La Jolla, unloading a U-haul, and just setting up very fast. CAVANAUGH: And unlike Adam, you don't cook on site, right? GOLDEN: Adam doesn't cook cook on site either. LOWE: The majority of our work is done at a commissary kitchen. And we have access to that, we prepare most of the food there, and then we have ship it all down. But we do essentially assemble everything at the Point Loma beach cafe. CAVANAUGH: So that brings the question to you, Karen, how workable is this for a continuing business model for chefs? GOLDEN: Well, I think if you ask most chefs, they'll tell you that this is not necessarily their lifelong ambition. This is not -- this is a means to an end. This is about, I think both of them, and the folks at supernatural sandwich who I know of, to be able to get in and create their vision, whatever their vision happens to be at that time for much less money than it takes to actually rent space and operate a full-time restaurant. So this is a good way in. They get to test the model, their customer base, they get to work out whatever kinks. I think Adam has told me that they are thinking of doing this in another location as a second location. The trick is going to be that if you are prepping at another kitchen and having to schlep all of your food every day or whatever to where you're going to serve it, that could be I think a hassle and an added extense in that way too. They have to rent the space at the commissary kitchen and also have to rent the space where they're going to do their meal service. CAVANAUGH: Let me ask you though, Chad, what opportunities does this kind of a popup restaurant deal open up for you? WHITE: Well, it opens up a bunch of different directions. Other people are looking at your concept, it's a very small organization. It's not -- you're not already involved in a big restaurant. So it's opened up doors for investors to say, wow, I really like what you're doing, and I would like to invest in you to open a restaurant. And ultimately this is like that vehicle. Like Karen was saying, this is a means to an end. You create a low-cost style restaurant, do you amazing food out of it, and then somebody buys into it and says -- GOLDEN: We want to finance you. WHITE: We want to finance it, or you raise up enough money to do it all on your own. CAVANAUGH: Right, right and Adam, I'm wondering if indeed you were to share space with a traditional restaurant rather than a breakfast and smoothy shop, would that open up the door to be able to actually create your food on premises? LOWE: It probably would. You have to go through all the proper health inspections and what not, which isn't necessarily a problem. The main thing for us, starting a restaurant is so cost prohibitive for the average Joe, you could look at spending $400,000 just to get going. We put together a business plan, and we remember starting a restaurant is a very high-risk thing. So you want me to give you $300,000 for a restaurant that sells Indian food, and you're a white boy? Sure! Why don't you give I $600,000? Lives LOWE: And I can still hear the chorus of laughter ringing in my head. So we shelled the project for a few years. And instead of shelling $300,000, we were able to start it for under $10,000. CAVANAUGH: Wow! GOLDEN: And earn income LOWE: Yeah, and the four owners are working, it's profitable. CAVANAUGH: I guess lots of people listening to this might wonder, what kind of eating experiences does this open for San Diego restaurant goers? GOLDEN: Well, it's wonderful. It can be very exciting. We have two different models here. So sundarra, you're getting wonderful, very affordable Indian food. Their food is quite delicious, and yes, they are a bunch of white guys doing this. But they know what they're doing. They have had training at Indian restaurants, they get it. It's an opportunity for the people who live in OB to have something they didn't have before, which is an Indian restaurant. And it means that that part of the street isn't shut down at night. So you've got some things that are going on. Chad is doing it differently. Chad's are more event-oriented. So when Chad, and he has a following of people, he's been at a number of restaurants as chef in the past, so people know his work, not having a permanent restaurant now means when he announces he's going to be at Carnitas snack shack or the coffee cup in La Jolla -- WHITE: Analog will be in May. GOLDEN: Okay. So that means people are going to be really excited to go and get a prefixed meal from Chad, it's going to be different, it's going to be unusual because that's what he does. And it's kind of an event. So I think it'll be very exciting. For the folks at supernatural sandwiches, it means if you can't get to the public market and you're craving one of their fish sandwich, they're out on Thursdays and Friday right nearby. Their customers can still get the food they want, and they're not limited to just the days the market is open. So it's great opportunities depending on what your model is and the kind of food that you do. CAVANAUGH: How do you get out the word of where you're going to be from month to month, from time to time? WHITE: Well, I'm kind of a social media guy. CAVANAUGH: Okay! I figured it was something like that! WHITE: I'm sending out blogs on Facebook, twitter, I'm on twitter -- I'm surprised I haven't tweeted during this deal. [ LAUGHTER ] WHITE: And then also working with the restaurant. So I'm tapping into their marketing resources as well. So this Monday I have a popup collaboration with Farmhouse. So I'm not the only person cooking at this dinner. It's Olivier as well. So I'm tapping into their market and that really gets it out. And I do my own PR right now, but as we continue to grow our businesses, we can afford to do a little bit more of a campaign. CAVANAUGH: And Adam, since you've said you're looking at another now, an additional location; is that right? LOWE: Correct. CAVANAUGH: So that makes more business sense for you to expand to another popup location than it would be to expand to just one location full-time? LOWE: Well, they're both good options. We're certainly -- when we got into this, part of the goal was to prove that we could do it, to prove that there is an audience for what we're making. That so far appears to be the case. One of the things as far as marketing goes, we're every day, six days a week at least. So we had a more traditional marketing push, basically passing out menus to doors. Our lifeblood is repeat business from local residents. But social media and everything to that effect is quite important as well. Yelp has been huge for us. People are kind enough to leave very good reviews from the early day, and there's people who are vacationers down at the sunset cliffs and finding us on yelp and coming by. So anything we can do, basically. But we're -- we want to have a permanent residence somewhere. But in the meantime, the popup thing works great because the start-up costs are so low. CAVANAUGH: So it sounds, talking with these two chef, that what we're seeing is this might be a way for people to break into the industry that they didn't have before. GOLDEN: Absolutely. This breaks down the barriers to getting into a restaurant. It's just a different kind of model. You have to have different expectations, and you have to manage what you're doing much differently. And you've got to be able to get people to remember that you're there. All restaurants have that issue anyway. But if you're only there temporarily, you've got to work that much harder. CAVANAUGH: Well, we did our part today! [ LAUGHTER ] CAVANAUGH: Thank you both very much, and it's good to see you, thanks for coming back, Karen. GOLDEN: Thanks. LOWE: Thank you. WHITE: Thank you.