Nick Kokonas on how restaurants can fix themselves

As a restaurant industry outsider, Nick Kokonas’s approach is markedly innovative, and he’s never been afraid to do things his own way.

Nick Kokonas and his business partner, the chef Grant Achatz, were looking forward to celebrating the 15th anniversary of Alinea on 4th May. Over the years, the Chicago-based restaurant has received 12 James Beard Awards and is one of 13 restaurants in the US to earn the coveted Michelin three-star rating.

There was good reason to celebrate, until almost overnight, there wasn’t. Like the rest of the restaurant industry worldwide, Kokonas found himself fighting for his restaurant to stay alive. The other restaurants and bars in the Alinea Group – Next, Roister, and The Aviary – as well as Tock, the restaurant reservations software company he set up in 2014, also faced a bleak future.

The industry has never seen a crisis on this scale before. But Kokonas, already on his sixth Zoom call of the day by the time Courier catches up with him, says in typically unfiltered fashion: ‘If you just sit home and say, “Wow, the restaurant industry is so fucked”, well then yeah, it will be. Because it won’t get unfucked by sitting on your ass at home. You have to unfuck things yourself.’

A former derivatives trader accustomed to looking at big pools of data and recognising patterns, Kokonas was one of the first major restaurateurs in the US to recognise how destructive Covid-19’s impact would be on the industry – which makes up an estimated 4% of the US GDP and employs almost 12 million people. Looking at the data from Tock, Kokonas saw how the restaurants signed up to the platform in Hong Kong went from being ‘95% full daily to 0%’, and realised restaurants back home were about to suffer a similar fate. ‘I knew I needed a plan.’

A few days later, Kokonas gathered all the managers from his restaurants to instruct them on the big changes he was about to implement. Safety measures included mandatory temperature checks each morning and recorded hourly hand-washing sessions for every member of staff. While he was telling them ‘there’s a very high possibility our restaurants don’t exist in six weeks, the president was tweeting, “Nothing is shut down, life and the economy go on”,’ says Kokonas. ‘So there were a few smirks; a few people thought I’d lost my marbles.’

‘It was like having a battle plan.’

Time, of course, has proven that Kokonas wasn’t losing his marbles but, rather, taking ownership of the problem. By the time the governor of Illinois announced that restaurants would be closed indefinitely from 15th March, the Alinea Group already had a plan in place. Every employee was furloughed immediately and given a $1,000 stipend walking out of the door. All of the ownership and upper management, Kokonas and Achatz included, gave up their salaries.

‘It was like having a battle plan,’ Kokonas reflects. ‘We set up the website so our staff knew exactly how to apply for unemployment.’ Kokonas knew government funding alone wouldn’t be enough to guarantee his staff would have jobs to return to, so he made an abrupt decision to pivot both of his businesses, transforming the restaurants into carry-out venues and Tock into ‘Tock to Go’, a takeout and delivery service platform. Three days later, Alinea hired back 60% of its 300 employees and was serving 500 meals a night through its takeaway service. The following week it was serving 1,250 meals a night and making back roughly 75% of its previous revenue.

Kokonas’s outside-the-box thinking has regularly ruffled feathers. It was his pursuit of greater efficiency that led him to founding Tock. The platform, which Kokonas describes as ‘Shopify for restaurants’ and forces prospective diners to put down a deposit to secure a reservation to prevent them flaking, allows restaurants to sign up to provide meals for delivery or pickup within minutes. Waiving its usual monthly fees as a result of the pandemic, Tock To Go – in contrast to delivery apps like Deliveroo, GrubHub, and UberEats which charge 20-30% per order – charges a flat 3% commission.

Created in just six days, Tock to Go has users spanning countries from Germany to Australia, comprising both high-end restaurants like LA’s two Michelin star n/naka and dive bars like Chicago’s Nisei Lounge. ‘We’ve added 465 restaurants in the last two weeks and we’ve got another 800 in some stage of onboarding right now,’ says Kokonas. ‘It’s about helping out restaurants of every type.’ He adds, ‘In the past four weeks, we served 28,500 meals out of Alinea alone – that’s more than we usually do in the course of a year.’ He confirms that Tock To Go will remain a permanent part of the business. The dishes are less cerebral than Alinea’s usual three-star fare, but you can get a portion of duck cassoulet, a goat’s cheese side salad and banana cream tart for $42.50 (rather than $300 you’d usually spend to eat in-house).

Alinea experienced its highest ever sales in a single day over the Easter weekend – something Kokonas, never afraid of upsetting the status quo, proudly broadcast on Twitter. When some pointed out it was an insensitive thing to do when the industry is facing such a challenging time, Kokonas said they were ‘missing the point’. ‘I’m trying to set an example that what you think can’t be done, can be done,’ he says. ‘We’re obviously not getting anywhere near those numbers now, but are we still getting enough to employ 60% of our employees? Yes. Is it enough to feed people and make them happy? Yes again.’

Unsurprisingly, Kokonas has strong views about the US government’s historic bail-outs of small businesses. The $349bn paycheck protection program (PPP) ended up in the hands of too many big businesses. For example, Shake Shack received $10m and, while it opted to hand the loan back itself, the question begs why such companies could apply for loans in the first place.

‘Is it wrong that a publicly traded company with $40m in the bank got it and your local pizza place didn’t? Absolutely,” says Kokonas. ‘But the government doesn’t work right on a good day. Why should we expect this was going to be brilliantly planned when it was come up with in five days? Ultimately, it’s up to the individuals to take it and do with it as well as you can.’

‘We’ve been through some shit before… we’ll get through this.’

The mishandling of the situation led acclaimed chefs such as David Chang to state that the hospitality industry may never recover. Kokonas, however, is more interested in trying to cut through all the noise to find solutions. ‘We’ve been through some shit before,’ he says, having endured 9/11 as a trader and the 2008 global financial crisis with Alinea. ‘We’ll get through this.’ Closures will happen but what about those that do come out the other side? Kokonas says, ‘I guarantee there’s a 25-year-old chef out there who hasn’t had the opportunity to build her own place because she couldn’t afford the lease rates six months ago. Eight months from now there’s going to be some mothballed restaurant, left over from some guy who didn’t run it right to begin with, and she’s going to go in there and get it at half-price. And you know what? That is going to be a great fucking restaurant. That’s what happens out of times like this.’

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