A 69-year-old CEO of a US-based chicken finger chain has said that he turned 19 of his employees into millionaires after selling a majority stake to a private equity firm for "close to" $1 billion. Speaking to CNBC, Bill Phelps, the CEO of Dave's Hot Chicken, said that creating this many millionaires was intentional.
"I had some investors who were like, 'you're giving away too much money, this isn't right,'" he recounted on CNBC's "Squawk Box". "They were absolutely right as investors to stand up for other investors. They have a fiduciary duty, but I have a duty to the people that created this business and I was true to taking care of all of those stakeholders in this deal."
As part of the acquisition, every corporate employee, store manager, and assistant manager at Dave's received a bonus equivalent to roughly their yearly salary, Jim Bitticks, President and COO of Dave's shared.
Dave's Hot Chicken began in 2017 when three childhood friends invested $900 to open a chicken finger stand in a Los Angeles car park. Phelps, a veteran in the franchise business, became CEO in 2019 after an investor group he was part of acquired a stake in the company with plans to franchise the brand.
Phelps' leadership style, focused on giving credit where it's due, has been a driving factor. He told CNBC, "I was told by one of my investors that I had no concept of what management compensation should look like." He chuckled, adding, "And he’s right, because I don’t look at them as management. I look at them as my partners in this journey, and I compensate them as partners in the journey."
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