Texas Roadhouse is on track to become the biggest casual chain in the US — here's how it grew from small beginnings in the Midwest

Irene Jiang / Business Insider

• Texas Roadhouse's sales are gaining on bigger chains like Olive Garden.
• The chain started from just one location in 1994 to hundreds in 2023, with plans to reach 900.
• Founder Kent Taylor worked at KFC and Hooters before he found investors for Texas Roadhouse.

The first Texas Roadhouse opened in Clarksvillie, Indiana in 1993.

Photo By Raymond Boyd/Getty Images

Source: Texas Roadhouse

It wasn't an easy road though, and founder Kent Taylor worked at other restaurant chains and concepts before landing on Texas Roadhouse.

Texas Roadhouse.

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Taylor worked as a KFC area manager before starting Texas Roadhouse.

Omar Marques/SOPA Images/LightRocket via Getty Images

Source: Made From Scratch by Kent Taylor

He wasn't successful within the KFC system because he was a "freethinker," and a "rogue," Taylor wrote.

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Taylor also managed a Hooters location before pursuing his own restaurant ideas full-time.

Hooters Facebook

Source: Mashed

Taylor left the job and pitched John Y. Brown, former Kentucky governor and partial owner of KFC, on his restaurant concept for the fifth time.

Photo by Stephen J. Cohen/WireImage

Brown invested $80,000 in Taylor's steakhouse concept, but it wasn't Texas Roadhouse.

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It was a Colorado-themed steakhouse, called Buckhead Bar and Grill.

Colorado Springs, Colo., May 2, 2006.

Ed Andrieski/AP Photo

When the partnership with Brown fell apart, Taylor came up with another idea: a cowboy-themed steakhouse.

Texas Roadhouse.

Mary Meisenzahl/Insider

Source: Fortune

Things weren't easy from there, though. Taylor says he pitched the Texas Roadhouse concept to more than 100 investors before he found backers.

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Source: Biz Journals

In 1992, Taylor found three investors willing to put in $100,000 each after being convinced by his concept drawings on a cocktail napkin.

Texas Roadhouse

Source: Texas Roadhouse

Taylor recruited staff for the growing Texas Roadhouse chain by eating at other restaurants and introducing himself to servers, hosts, and cooks he thought were doing a good job, he wrote in his book.

Waiters.

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Managing partners who ran each location had skin in the game because Taylor required they put $25,000 down and receive 10% of the location's profits.

Texas Roadhouse.

Mary Meisenzahl/Insider

Source: Restaurant Finance Monitor

Taylor and his team originally considered giving out free popcorn before settling on the chain's iconic rolls.

Texas Roadhouse.

Mary Meisenzahl/Insider

Source: Made From Scratch by Kent Taylor

Developing the perfect recipe for the rolls took three weeks, experimenting with different types of yeast and flour.

Texas Roadhouse.

Mary Meisenzahl/Insider

There was also an ill-fated attempt to sell Mexican food at the restaurant, which lasted just two weeks thanks to "poor execution and almost no sales," Taylor wrote.

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Since then, the chain has expanded from medium-sized US cities to smaller markets, with promising sales.

Texas Roadhouse.

Mary Meisenzahl/Insider

Source: Restaurant Business Online

In 2002, singer Willie Nelson became an official partner of Texas Roadhouse by promoting the chain, and some locations have a corner of decor dedicated to him.

AP Photo/Hans Pennink

Source: Mashed

By 2004, 10 years after it first opened, there were 162 Texas Roadhouse locations in 32 states.

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Source: Marketwatch

That same year, Texas Roadhouse filed for an IPO.

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In the SEC filing, Texas Roadhouse said its operating strategy was based on high-quality food, low price points, and only serving dinner during weekdays.

Texas Roadhouse.

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The chain expanded outside the US for the first time in 2011. It now has 15 locations in Middle Eastern countries.

Texas Roadhouse.

Mary Meisenzahl/Insider

Source: Texas Roadhouse

Texas Roadhouse has grown steadily since, with 643 locations as of September 2022.

Texas Roadhouse.

Mary Meisenzahl/Insider

Texas Roadhouse executives are planning to eventually grow to 900 US locations, the company said in October 2022.

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Source: Restaurant Business Online

That pace of growth could put Texas Roadhouse on pace to become the largest casual chain by sales in the US.

Texas Roadhouse.

Mary Meisenzahl/Insider

In 2021, the chain did $3.7 billion in sales, with average unit sales of about $6 million, according to earnings statements.

Texas Roadhouse.

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Those high sales are how the chain can outpace or come close to competitors with more locations, like Chili's and Olive Garden.

Diane Macdonald / Contributor/ Getty Images

In 2021, CEO and founder Kent Taylor died at age 65.

Texas Roadhouse

Source: Insider

President Jerry Morgan took over as CEO and oversaw an explosion of the chain's to-go business.

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