Pinstripes, which is poised to go public, believes that 150 whitespace opportunities are in striking distance. The bowling-and-bocce eatertainment chain entered a business combination with Banyan Acquisition Corp. in June that will eventually take it public.
By the end of next year, the 14-unit chain plans to have 23 venues open, resulting in $190 million in estimated sales and $25 million in estimated EBITDA for calendar year 2024.
“For the next several years, our goals include total revenue and adjusted EBITDA annual growth in excess of 20%, respectively, driven primarily by opening new venues and continued same-store sales growth,” Pinstripes CEO and founder Dale Schwartz said during an investor presentation in June.
The company also has identified over 30 potential sites in the next few years and expects to have “equal or greater” opportunities to grow internationally, Schwartz said. The chain is also enhancing its gaming experience with new aesthetics and providing variations to traditional bowling like Angry Birds and Horse, per the company’s S-4 filing. It’s also planning to add projection mapping technology to bowling and bocce. This technology uses overhead lights, infrared lighting and object tracking to create a more interactive experience.
Restaurant Dive spoke with Schwartz about how going public will help support Pinstripes’ aggressive growth strategy.
Editor’s note: This interview has been edited for brevity and clarity.
RESTAURANT DIVE: What made you decide to take Pinstripes public?
DALE SCHWARTZ: We've been considering going public for about five years, mostly to raise some attractive permanent capital so we can continue to do our magic for another 20-30 years. This specific SPAC vehicle allowed us to go public as early as this year. Given some of the timing advantages, and some of the attractive real estate opportunities, we wanted to raise the capital this year. And our SPAC partner has experience operating restaurants, that was another meaningful benefit in working with Banyan.
How will going public support your growth plans?
There’s a tremendous amount of real estate opportunities, thanks to the Amazon Effect and some of the pressures on retailing, and a lot of developments that want exciting experiential offerings, whether it's dining or entertainment. And that's certainly us. And so we were wanting to capitalize on those trends and enter some very exciting markets and exciting developments.
How were you able to identify 150 whitespace opportunities for Pinstripes?
There’s peers of ours, whether it’s Whole Foods, Apple, and others, that throughout the country, look for “quality A” markets and also a lot of quality projects. Our model can work north and south and east and west and in any A-market in the country. We have our eye on some very exciting real estate. Greater Washington, D.C., is a good example. We'll look to cluster. We’re in Bethesda, Maryland. We're already in Georgetown in D.C. We're looking at sites in Tysons and Reston, Virginia.
When you then look at any and all the markets around the country coupled with that type of cluster strategy, 150 is a meaningful number that allows us to create some very substantial value. Our sites are large, around 25,000 square feet.
Will you continue partnering with real estate developers that invest in Pinstripes?
Yes. In every case, landlords provide us very attractive tenant improvement money toward our buildout. Some of the top developers also have invested minority equity as kind of another attractive part of a strategic alignment with them. Depending on the specific circumstances, we will maybe continue some of those equity discussions in the future.
How are you improving operational efficiency and menu development?
On the food side, we've tightened our menu on occasion, we've cross-utilized ingredients, quite smartly, which has had quite a beneficial impact on food costs. We've introduced some very exciting new menu offerings, whether it's tuna poke or our Super Salad that is extraordinarily healthy. So some added healthy fare, and continued refinement and adding new menu items, certainly helps food sales. We do the same on the craft beer and wine selection side.
Nearly half of our business is private events. And so as our private event business grows — weddings, bar mitzvahs, birthday parties and corporate events — the associated food costs and liquor costs and even labor is lower on the private events side of our business, which is also a benefit to us.
On the labor side, we've made some smart adjustments to open and close times. We’ve made some very strategic changes in staffing levels and other labor changes, as well as revisions that continue to allow us to manage labor, if not bring it lower, in the face of industry challenges.
Can you expand a bit more on the adjustments you made to labor and the impact to costs and efficiencies?
Regarding opening and closing times, on some occasions instead of opening at 11:30 a.m., we may open at noon. Then we adjusted the number of team members that need to set up the venue before we open both for front-of-house and back-of-house. Smart adjustments there help, much the same with adjusting closing times on weekdays or otherwise.
The other factor is just training. So coming out of COVID-19, there were quite a few new servers that never had restaurant experience. That was just an industry trend that we were all seeing and so smarter and better ways to train our team translates into better efficiencies.
How are you thinking about growth in 2024 now that you’re going public and will have a lot more brand awareness?
We're planning on opening six to eight locations per year for at least the next 5-10 years in the U.S. Those will all be company owned. Internationally, we're seeing a lot of the same experiential trends. Overseas we will grow with partners. We’ll find local partners whether it's in Mexico City, or Dubai, or the U.K., et cetera. But those efforts will be in parallel with all of our company-owned expansion in the States.
What experiential dining trends are helping Pinstripes?
We’re certainly seeing that COVID-19 accentuated that people like to gather and connect and have those magical moments amongst themselves. Zoom only goes so far. That was always what made Pinstripes unique. So that certainly has been accentuated. Developers want gathering places and are leaning into the mixed-use experiential offerings. That's continuing to happen all over the country.
Suburban markets are benefiting post-COVID from the work-from-home flexible office trends, and most of our locations are in the suburbs, and most of the locations that we're currently negotiating with are in the suburbs. Those suburban trends will continue to help us.
That work-from-home trend is helping our private events business. We're seeing more corporate events and team building events than ever before. Companies are needing the likes of Pinstripes to retain team members and codify their culture when they may only have team members in the office three days a week, or zero days a week. They need those team building events and we're seeing that grow more than ever. All of those trends have been very promising for us.
What are your predictions for future experiential dining trends?
There will continue to be other players that will combine entertainment and gaming, whether it's Top Golf or Puttshack or other concepts that, in their own way, combine entertainment and gaming and dining. The key differentiator with us is that the quality of our cuisine is best in class. The desire for the overall consumer to want to do something just a little different and fun, whether it's a sporting event, or Cirque du Soleil or and get out in the real, bricks-and-mortar real world, will continue.
How will Pinstripes keep its gaming and menu offerings competitive?
We do everything from lunch and dinner to happy hour. We do a Saturday and Sunday brunch buffet of stunning buffet spreads. We, on occasion, do five-course wine dinners. On occasion, we do live music. Certainly all the festivities and celebrations and parties that are going on, and weddings, et cetera, adds an element of excitement. Even if you're coming to Pinstripes only to have dinner, you're among the rest of that excitement. We have outdoor fire pits. So if it happens to be a beautiful, cool evening, we might hand out blankets while you're sitting out by the fire.
For gaming … we plan next year to add some exciting projection mapping technology as an overlay on top of bowling and bocce. We’re constantly looking to stay novel and fresh to give our guests even more reasons to keep wanting to come back.