Foxtrot co-founder Mike LaVitola is plotting the store’s comeback: ‘I just couldn’t sit on the sidelines’

On April 23, Outfox Hospitality — the entity that became the parent company of Foxtrot after it merged with Dom’s Kitchen in November — announced that it was closing all 35 of its stores across Chicago, Texas and the Washington D.C. area. 

LaVitola stepped down as Foxtrot’s CEO at the beginning of 2023 and also left the board in November after the merger with Dom’s. As such, he was no longer involved in the operations of Foxtot. While he said he heard rumors that the company was closing in the days leading up to the April 23 announcement, he still didn’t believe the company would shutter for good.

“It was just so hard to believe that I was hopeful some solution could be found,” LaVitola told Modern Retail in a phone interview. He said he “still doesn’t have all the answers” as to why Foxtrot closed so abruptly.

LaVitola has teamed up with Further Point Enterprises, a New York-based company that bought the assets of Foxtrot in a May 10 sale for $2.2 million, to reopen Foxtrot. A notice posted Wednesday morning on Foxtrot’s Instagram account simply said “a new Foxtrot, coming soon.” A press release, also sent out Wednesday morning, said that Foxtrot plans to reopen locations in Chicago, Dallas and Austin this summer. 

In a 30-minute interview with Modern Retail, LaVitola spoke about what he believes went wrong with Foxtrot and what the company plans to do differently going forward — namely, having a smaller corporate team, spending more time in stores and opening new locations more slowly. Much of it is still up in the air. Foxtrot is still hammering out details with landlords. Meanwhile, LaVitola said conversations with former store managers have only begun in earnest this week, as Foxtrot tries to convince some of them to come back.

As Modern Retail previously reported, Foxtrot raised roughly $186 million in debt and equity financing, which prompted an expansion spree outside of its home market of Chicago into Dallas, Austin and the Washington D.C. area. But, it struggled to meet the outsized growth expectations that were ushered in by this influx of capital. Foxtrot missed its sales goal in 2023 by $35 million, according to former employees. A giant corporate team, an expensive corporate office lease and some misguided store locations were big contributors to losses, former employees said. 

As such, the reopening of the chain will be a feat.

Before it reopens, Foxtrot still has to contend with winning back scorned customers, vendors and employees. LaVitola said conversations with vendors in particular gave him the “confidence” that Foxtrot could reopen.

Still, on the Instagram account of TimeOut Chicago — one of many local news outlets that reported on the reopening — multiple comments lamented how former employees were left high and dry by the sudden closure. “Why would we support this?” one commentator asked. Meanwhile, Outfox Hospitality is still contending with multiple lawsuits, including a class action filing alleging the company violated the WARN Act, and a lawsuit from produce wholesaler Anthony Marano. 

Modern Retail asked LaVitola why he wanted to reopen Foxtrot — putting himself back in the spotlight, as well as the crosshairs of former customers, vendors and employees — versus letting the brand go. 

“The easy thing to do is to let it go,” LaVitola answered. “But who does that help? It doesn’t help any of our vendors, it doesn’t help any of our employees, it doesn’t help any of the community surrounding Foxtrot. We were able to lift up literally hundreds of new and emerging CPG companies that got their start in Foxtrot… I think the right thing to do is put in the effort, and realize there was something. There was a really powerful ecosystem here, and I think that’s something worth fighting for.”

Ultimately, he said, “I just couldn’t sit on the sidelines,” as he watched Foxtrot shutter. 

LaVitola said he started talking with vendors “pretty much the day of” Foxtrot’s closure. “These are all personal relationships.” 

“They were trying to understand what was going on, and then the conversations went more to, like: ‘If there is a path to reopening some stores, how would you feel about that? What position are you in?’” he said. LaVitola said the conversations with vendors were “pretty positive” about reopening, but added that he is cognizant that “they need to be mutually beneficial partnerships.”

Investors approached LaVitola shortly thereafter. “There were several parties who were interested in understanding what was going on, in buying the company, in buying the assets,” he said. David Magruder of Further Point Enterprises, who was involved in a fund that previously invested in Foxtrot, will serve as interim chief financial officer and board member, according to Crain’s Chicago Business. 

Over the past few weeks, LaVitola has been in conversations with former landlords, vendors and employees to inch the new Foxtrot closer to reopening. As Modern Retail previously reported, agreements were being floated to former landlords that involved paying back rent that was past due, and pursuing a revenue share in the future. 

Much is still up in the air. LaVitola said that there is a list of about a dozen stores that are reopening initially, though he added, “The number changes every day.”

“I think fortunately, from a landlord perspective, they know how full and how energized and how exciting the stores were,” he said. 

LaVitola said that while new locations will open this summer, there is no concrete date yet for the first store to reopen. Since the reopened Foxtrot stores will operate under a new company, the team has to apply for new licenses and permits. 

Former employees, LaVitola said, “have very real concerns about what happened… We don’t have all the answers. All all we can do is have a commitment to say — one, we’re obviously very incredibly sorry and, two, this is how we want to run things going forward. Can you help us shape what the next version of Foxtrot is?” 

When asked what he wants to do differently this time, LaVitola said he wants to keep the corporate team small — around 20 people — and, ensure that they spend more time in stores. Foxtrot went through multiple rounds of layoffs in 2023, and it hasn’t been disclosed how big the corporate team was at the time that it shuttered. But in 2022, Foxtrot had roughly 745 employees across its 35 stores and corporate teams.

“I think [for] myself, while I was still there — and certainly on the corporate team — [we] could have been spending a lot more time with the store teams in the stores, and really listening,” LaVitola said. “And that’s what we are committed to doing going forward.” 

He also wants to take a slower approach to expansion. “For the next year or two, it’s all just about getting our existing stores open,” he said. And then after that, he said the focus would be opening one to two locations a year. 

Much of what LaVitola said he would do differently this time could be seen as run-of-the-mill retail executive talking points. Taking a smart, methodical approach to expansion is a goal that many young startups set in earnest when they launch, but find more difficult to adhere to as they grow. The difference, LaVitola said, is that this time he believes he has the lived experience to know how to do it.

“It sounds like platitudes, but it’s also the truth,” LaVitola said. “I spent eight and a half years just on the absolute entrepreneurial grind trying to make everything work, and ended up in a situation where I wasn’t able to be there at the end,” he said. “It’s awful, it’s heartbreaking, it’s terrible — and there’s probably no better way to learn the lesson than the hard way, right?”

This article has been updated to correct when LaVitola stepped down as CEO of Foxtrot; it was in the beginning of 2023.