For Boston's next café empire, growth isn't everything
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Patrons line up at Tatte Bakery & Cafe in Boston in 2019. Photo: Pat Greenhouse/The Boston Globe via Getty Images
Two Boston-area café brands have quietly grown from neighborhood hangouts into a multi-state empire.
Why it matters: Boston-area brands Tatte Bakery & Café and Life Alive Organic Café have expanded to dozens of locations across the Northeast and mid-Atlantic.
- Tatte filled much of the cafe void left by Starbucks' closures and has become nearly as ubiquitous in some parts of town as our iconic purple-and-orange coffee chain.
- Sometimes it feels like you can't throw a rock in Boston without it landing in a skillet of shakshuka, one of Tatte's signature dishes.
The expansion comes under the guidance of Ron Shaich and his Act III Holdings investment firm.
- Shaich, who co-founded Au Bon Pain in 1981 and later built Panera Bread, has taken a deliberately different approach to what a regional cafe empire can look like in the 2020s.
- For his new chains, the formula is something of a throwback: patient capital, no outside investors and growth treated as a consequence of quality rather than the target.
State of play: Tatte, founded in 2007 by Israeli-born pastry chef Tzurit Or, has grown to 50 locations across Massachusetts, D.C., Virginia, Maryland, New Jersey and New York.
- Life Alive, a plant-forward vegetarian concept founded in Lowell in 2004, has expanded from three locations to 13 across Massachusetts and the D.C. area.
What they're saying: "Our goal for it is not to be the next Panera or anything else," he said of Tatte. "Our goal for it is to be, without exception, the very best cafe in neighborhoods across this country."
Catch up quick: Shaich founded Act III after leaving Panera, financing it with his own capital.
- That structure removes the pressure that typically warps growth decisions, he tells Axios.
- "Growth is a byproduct. That is what happens when you have a great concept," he has said.
Zoom out: Shaich's first major Act III investment was in Cava, the Washington, D.C.-based Mediterranean fast-casual chain now with over 400 locations in 29 states and Washington, D.C.
- Act III has been a backer of Level99, a Natick-based "eatertainment" venue that combines physical and mental challenges with scratch-made food.
- A location at Disney Springs outside Orlando, Florida, is planned next.
The big picture: Act III's model — founder-friendly governance and a focus on high-quality niche categories — represents a contrarian bet that the next wave of successful restaurant brands won't be built by scaling fast, but by scaling carefully.
What's next: Both brands continue to expand in the mid-Atlantic and Northeast markets.
- Life Alive's new Seaport location signals an appetite for a higher-profile urban footprint in one of Boston's busiest areas.