Danny Meyer's Growth Fund Invests $10M in Chip City Cookies

Danny Meyer's Enlightened Hospitality Investments raised its second fund this year, for $330 million, and has invested $10 million in Chip City, the New York City-based cookie concept with 14 units that is poised to franchise.

"I don't get credit for discovering Chip City," Meyer said in an interview yesterday in West Village in New York, where he arrived mid-morning after a workout at the gym and then a meeting at Shake Shack, the $2.19 billion burger chain he founded and in 2015 took public.

Instead, his business partner at Enlightened Hospitality, Mark Leavitt, and others became fans after a gluten-free Chip City cookie, in particular, attracted their interest.

"I was introduced to Mark through a mutual acquaintance. At the time we weren't ready for a capital raise," said Peter Phillips, co-founder and CEO of Chip City, which he and a high school buddy started in 2017. But getting through the pandemic "gave me a lot of confidence," he said, and they decided to go for it, speaking with a number of investment firms and ultimately gaining $10 million from Enlightened Hospitality.

"Of all of the investments we've made, only four were my idea," Meyer said, referring to Enlightened Hospitality, formed in 2016 with four decision-makers. "But three of us have to vote yes. I trust my tastebuds and trust my barometer of culture," while others analyze the financial promise and other aspects of the brand. "I was crunching cookies not numbers."

Read more at Franchise Times.