LeBron's Blaze Charts IPO Path With Deliveries, 500-Store Target
(Bloomberg) -- Blaze Pizza, the restaurant chain backed by basketball star LeBron James, is expanding deliveries across the U.S. to take on Domino’s and ready itself for an initial public offering.
Founded in 2011, the fast-casual upstart also is going national with a new 14-inch pizza deal for online orders that’s meant to compete with industry stalwarts Domino’s Pizza Inc. and Pizza Hut. Jumping into the to-go and delivery arena means the company may be ready for an IPO in two years, co-founder Rick Wetzel said.
“It remains on our horizon,” Wetzel said in an interview. “We want to get to about 500-plus restaurants. We want to build the second leg for the business,” he said, referring to delivery and takeout.
The Pasadena, California-based chain has said previously that it will eventually seek to raise money through an IPO, but the company now sees this goal being reached earlier than before. Blaze also just hired a former Nestle SA executive to lead its digital growth division, a new arm of the company.
The 14-inch pizzas for delivery are a departure from the mainstay of Blaze’s menu, 11-inch pizzas meant for personal consumption. System sales, a metric that includes money generated from company and franchised locations, rose 23 percent last year to $341.5 million. The company didn’t provide 2018 same-store sales, which is a key metric for the industry.
Blaze now has 316 locations in 42 states and five countries.
The fast-casual category -- typically considered a step above commodity fast food -- has faced troubles in recent years, and many chains have struggled since going public. Potbelly Corp. and Noodles & Co., both of which turned to the public markets in 2013, are trying to regain their footing in the fiercely competitive industry that’s grappling with higher labor and rent costs.
Blaze’s discounts and 14-inch pizzas, delivered through Postmates Inc. and DoorDash Inc., are similar to some of the deals that have been successful for Domino’s and Pizza Hut. But Blaze says it can win over customers from bigger competitors with its ingredients that include arugula, pesto and even vegan cheese.
“We’ve got a more modern offering,” said Elise Wetzel, the chain’s co-founder and chief marketing officer. “We’re going after those larger players.”
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