Blake Read’s Mexican standoff bowls them over

It’s known as the Pistonhead x Burrito Bowl. And it is the pride and joy of Blake Read.

Beach Burrito Founder Blake Read

It’s known as the Pistonhead x Burrito Bowl. And it is the pride and joy of Blake Read.

“As far as I know this is the first time it has been done in the world,” Read says of the giant ­indoor skateboarding pool that adorns the ground floor of his Beach Burrito Mexican restaurant in the heart of Melbourne’s trendy Fitzroy.

Professional skaters now regularly entertain the evening diners as they tuck into their beers, ­burritos and tacos. “It was my childhood dream to have one and my wife said no to having one in the house,” he adds with a wide smile.

Read spent his youth skateboarding and lived in the US for many years before returning to Australia to open the first Beach Burrito restaurant in the eastern Sydney beachside suburb of Bondi in 2006.

The Fitzroy venue, Beach Burrito outlet No 12 when it opened last year and its first in Melbourne after a long planning battle with the local council, so far represents the crowning achievement for a business that now turns over $20 million annually and is backed by the Brisbane-based $1.35 billion Blue Sky private ­equity group.

Beach Burrito has tripled revenue over the last three years, just opened its 14th restaurant on Sydney’s northern beaches at Dee Why, and two others are set to open in the coming months to add to restaurants in South Australia, Queensland and the ACT.

“Globally it (the skate pool) has put us on the radar of skateboarding. I feel we are a bit of a lifestyle brand. Skateboarding is a big part of who I am. I have always done it, I have never stopped. Dad tried to stop me but he couldn’t,” Read says. “It is about the link between lifestyle and food. It has been a big thing in California. I wanted to bring that back here.”

Before he set up Beach Burrito Read visited taquerias in San Francisco’s Mission district and giant franchises like Chipotle to check the trends in the US fast casual scene, the flavour profiles and the branding.

He says while Australia was well behind 10 years ago, the Sydney and Melbourne fast casual dining Mexican scene now rivals the US, filling the gap between fast food chains and formal ­restaurants.

And after the troubled incursions of US Mexican food chains into Australia during in the 1980s, he believes Mexican food in ­Australia is now here to stay.

Beach Burrito has been ­followed by the likes of Salsas Fresh Mex Grill, Las Olas Fresh Mex Grill, Guzman y Gomez, Mad Mex and Zambrero as well as up-market Mexican food ­establishments such as Touché Hombre and Mamasita.

“There is a lot of legs in it now. Getting products is a lot easier. You can get all the chillies and beans and things. Even when I started you couldn’t get it. Now everyone understands what a taco is, everyone wants it, a lot of pubs have a burrito on their menu now. They are popping up at airport kiosks,” Read says.

“It is also a cultural change. Australia is very accepting of food. We love it. We are good at it. And I think this has a good fit. We were swamped by Thai food and that is here to stay. So is Mexican.”

Guzman y Gomez managing director and co-founder Steven Marks agrees. “Ten years ago the reality of Australian Mexican food was that it was unhealthy and not authentic ... Australia has finally woken up to the fact that Mexican food when done well is full of flavour and ridiculously healthy,” he says.

“At GYG, this means only using fresh produce and meats that are delivered daily. We only use the most authentic chillies, black beans, tortillas and marinades all prepared using traditional cooked techniques in real restaurant kitchens.”

GYG is backed by the former chairman of McDonald’s Australia Peter Ritchie, Carlyle Group managing director Simon Moore, Kmart chief executive and former McDonald’s Australia chief executive Guy Russo and the ­former deputy managing director of McDonald’s Australia Stephen Jermyn.

Together they own about 45 per cent of GYG, with the remainder split between Marks, his business partner Robert Hazan and some of their family.

Over the past five years the group has opened 62 restaurants in Australia.

Each now has an average turnover of $2m a year and growing. Last year GYG year opened its first store in Tokyo as part of its Asian expansion plans.

Over the next 12 months the group wants to open 20 restaurants in Australia, an expansion being spearheaded by CEO Mark Hawthorne, who was managing director of McDonald’s UK ­before returning to Australia last March to run GYG.

His appointment has freed up Marks to pursue the group’s ­global plans, including partnerships in China, South Korea, Hong Kong and Taiwan,

Read is also looking at international expansion after Blue Sky made an investment of $3.5m in Beach Burrito in 2013 to help the company expand into new locations.

The initial move of Blue Sky’s venture capital arm into Beach Burrito in 2007 with a $250,000 investment was unusual for a ­private equity firm.

Elaine Stead, the investment director of Blue Sky’s VC arm, has previously described Beach Burrito as just one example of a ­company in an industry unloved by venture capital.

Blue Sky has subsequently launched Australia’s first listed investment company offering pure exposure to alternative ­assets and made investments in a range of industries such as portaloo provider Viking Rentals, QEnergy and Lenard’s Chicken. It also has a portfolio of residential property developments.

Two years ago Stead revealed that the Beach Burrito investment had generated an internal rate of return of 58 per cent for Blue Sky since 2006.

“They brought a level of governance that I didn’t have in the company,” Read says.

Now Read has expansions into New Zealand and California firmly on his radar after long shunning the traditional franchising model of fast food companies.

His biggest tip for aspiring entrepreneurs in the food industry is simple: “Keep at it.”

“If you believe it is going to work, it will. And stay true — don’t believe what others are telling you,” he says.

“And switch off your social media account — you can make incorrect decisions based on the wrong data.”