Midas Touch: Joe Carroll on His Secret of Restaurant Success

Joe Carroll

Joe Carroll

From Spuyten Duyvil to Fette Sau to St. Anselm to Semilla, Joe Carroll has a knack for matching concepts and spaces. Recently, Iris7 sat down with Carroll to glean some insights and find out what bold new idea he’s cooking up.

HM: How did you get into the food and beverage business?

JC:  I was working for a music trade magazine and in early 2000 the writing was on the wall. I thought, ‘Man, I better figure something else out here.’ I was really worried about sitting in a cubicle somewhere.

I had gotten interested in craft beer in the 90s. But all the bars serving it were dive bars, sports bars or fratty bars. They had lots of beer, but no particular focus on quality. I felt like two things needed to happen for beer to progress forward: 1. Beer had to be served in a better environment. 2. It had to make the jump to fine dining. You couldn’t just say because it's not Budweiser or Coors its craft beer.

My wife, who I was dating at the time, decided to use some savings and we put $80,000 on credit cards and opened Spuyten Duyvil on Metropolitan Avenue in the Williamsburg. All in it cost $160,000. I thought in the worst case the place would do ok and I would slowly make the money back. But the bar took off.

HM: What made you think Williamsburg was the right place for your concept?

JC: When we saw the space, we really loved it. The location was also good, sandwiched between two subway stops on a main thoroughfare. And it was inexpensive, relatively. So we went for it. We opened in September ’03, a time in this neighborhood when the best beer you could get was a $2 can of Pabst Blue Ribbon. By '05 the condo boom had started.

HM: What came next?

JC: When we opened Spuyten Duyvil our goal was to pay our bills, live our life, and not have a boss. That was it. We worked behind the bar for the first year. Then we kept pulling back. I thought, ‘This is cool. I don't have to work.’ It was awesome but it gets a little boring. I wanted to be creative.

I had wanted to do bar-b-que for a while – something else I had gotten into in college in the 90s – but it was a matter of finding the right space for the right idea and marrying them together. Then a friend told me that the garage space across from the bar was open. When I saw this garage, I was like, ‘Wow this is a great space for it.’ When we told the landlords we were going to do bar-b-que they were like, ‘What?’ The night we opened Fette Sau, we were out of everything by 9. The numbers are still insane for a 1,200 sq. foot restaurant.

HM: So is everything you do an outrageous success?

JC: No. At the time we were building out Fette Sau, I found out Bedford Cheese Shop was leaving their space and I thought I might be interested in doing a beer grocery. I knew it would cost me the same as to open a bar and the margins would be less, but I just said, ‘Fuck it.’ Before Fette was even finished I took that space and we opened the both right around the same time.

Spuyten Grocery was the first to sell Mast Brothers chocolate retail, the first to sell Rick's Pickles on premises. It was fun but we only ever broke even, so after 5 years we walked away. But as a result of the grocery, we spun off a business I still have with two other partners -- Gotham Artisanal. It’s a distribution company for all the cocktail components we sold at the grocery. It does very well.

HM: It sounds like you have a knack for refining mistakes into successful concepts.

JC: I guess. That happened again with St. Anselm. Originally, my dad and I wanted to do hot dogs and sliders. We were looking for a pizzeria or a Chinese take-out place. A year went by and we couldn't find anything. When the space St. Anslem is now in became available we opened it up as a hot dog and burger joint. I broke my first rule -- fitting the space with the concept. I knew it wasn't the right concept for the space and sure enough six months in I pulled the plug.

It hurt because we had put $300,000 in and now we were sitting on the space. Then we decided on what St. Anselm is now – basically a blue collar steak house. It’s a neighborhood-y, cozy, steak house. One month in New York magazine gave us a stellar write up and that was it -- from that night on we have been slammed.

HM: Did you set out to build an empire?

JC: That wasn't the plan. I had a deck of ideas and once you get ideas that you love you really want to make them happen. A lot of making this work, a lot of what I do is real estate. When you are in hospitality, the real estate is almost the most important thing -- what it looks like, the infrastructure, the location.

HM: Do you have a strategy around real estates?

JC: Unfortunately, we didn't have the money to buy when we first got started and now real estate is just so expensive. It scares me because rents have gotten astronomical. On Bedford you are talking $150 - $200 a square foot. Most restaurants can’t make money once they are paying north of $100 - $150 a square foot, especially in New York City where you are often talking about small restaurants. If you have 1,000 square feet at $150 - $200 a square foot you can't do enough turns a night to justify the money.

HM: You recently opened a Fette Sau in Philadelphia. Was that a real estate-driven decision?

JC: Creativity and happiness are what drive this whole thing, which bit me in the ass a little because I was so adamantly against doing another Fette Sau when everyone was saying you should do more. I was like, ‘I want to do something different. I did that already.’  I think I missed a little bit of a window of opportunity to open 10 more Fette Saus in Manhattan or wherever in that period of time before everyone started doing this urban bar-b-que thing.
So I partnered with Steven Starr to do more Fette Saus because I felt like it needed to happen. I also felt like I didn’t want to put my resources into it and more importantly I didn't want to take my staff from here and put them in other cities. Steven is one of the greatest restaurant operators ever and we got along very well.

HM: Then, of course, came Semilla, which received a Michelin Star.

JC: I had a very good friend who was doing a pop up at a coffee shop. I happened to have a lease on another space and they took it and started Semilla, which financially might be the biggest success of them all. Eater and Bon Appetite named us one of the best restaurants of the year. It also got best chef of the year and a Michelin star. For me, it’s an executive producer role – I judged the talent well.

HM: Have you tapped all of your ideas?

JC: Not even close.

HM: What’s next?

JC: It will depend on what's available, what space is talking to me. I am still talking to Steven Starr about setting up a side business -- our Indy label for restaurants a little bigger than what I would do but a lot smaller than what he would do. They would be my ideas and I would handle the budget, with his financing and his team to manage it. And we are also talking with Thompson Hotels about opening Fette Sau in London.

I want to self-finance but I also want to get things done.