From Food Truck to National Franchise: Mike's Red Tacos Plans Major Expansion
What began as a single taco truck in San Diego is now poised to become a nationwide fast-casual phenomenon. Mike's Red Tacos, founded by entrepreneur Mike Touma in 2021, has announced ambitious plans to expand to approximately 200 locations across the United States through a strategic franchising initiative.
Humble Beginnings and Rapid Growth
The brand started modestly with a food truck specializing in birria tacos - traditional Mexican tacos featuring slow-cooked, richly seasoned meat that became an instant hit with customers. The overwhelming demand quickly enabled the business to transition from mobile operations to permanent establishments.
In 2022, Mike's Red Tacos opened its first brick-and-mortar location, followed by a second outlet in 2024. This steady growth caught the attention of seasoned restaurant industry investors who recognized the brand's potential for national scalability.
Veteran Investors Back Expansion Plans
Bill Phelps and Andrew Feghali of Four Wall Partners, both experienced franchise industry veterans, are leading the investment charge. The pair previously served as early investors in Dave's Hot Chicken, the rapidly expanding chain that achieved a remarkable $1 billion valuation last year.
"I've known Andrew for over a decade," Touma explained to SFGate. "I witnessed firsthand how their team successfully scaled Dave's Hot Chicken while protecting the founders' vision and maintaining product quality. This gave me confidence that we could expand without compromising what makes our brand unique."
Strategic Development and Leadership
The company has secured development agreements with established franchise operators who currently manage major brands including Jersey Mike's, Blaze Pizza, Dunkin', Little Caesars, Carl's Jr., and Wetzel's Pretzels. These partnerships will facilitate multi-unit expansion across numerous states including California, Michigan, Minnesota, New England, Nevada, Texas, Virginia, Arizona, Indiana, and Illinois.
To oversee this ambitious growth phase, Mike's Red Tacos has appointed Vincent Montanelli as president. Montanelli brings nearly two decades of leadership experience from Wetzel's Pretzels to his new role.
"The strength of Mike's Red Tacos lies in the powerful combination of authentic, craveable birria, a robust business model, experienced partners, and strong market positioning," Montanelli stated. "With a team that possesses proven expertise in multi-unit franchising and restaurant leadership, we are exceptionally well-positioned to scale nationally."
Protecting Brand Integrity During Expansion
Touma emphasizes that maintaining the brand's core identity remains paramount throughout the expansion process. The company has built a loyal following around its slow-braised birria, signature consommé dip, and distinctive visual branding.
A corporate-operated prototype location in Pasadena, scheduled to open this spring, will serve dual purposes as both a model for future stores and the company's brand training center. Meanwhile, a third San Diego location operated directly by Touma and his team is expected to open in March.
Market Trends and Industry Context
Investors are betting that birria's growing popularity still has substantial growth potential. Market research firm Datassential projects the dish will appear on more than 5 percent of U.S. menus by 2028, a significant increase from just 0.5 percent in 2020.
Private equity firms have consistently favored franchise restaurant operators due to their recurring royalty revenue streams and relatively asset-light business models. In 2025, Roark Capital agreed to acquire Dave's Hot Chicken for approximately $1 billion, demonstrating the substantial value potential in successful fast-casual concepts.
The expansion initiative comes at a challenging time for the restaurant industry, with many operators grappling with rising labor costs and persistent inflationary pressures. These economic factors have prompted widespread menu price increases across the sector as businesses work to protect their profit margins.
A Surreal Journey
For founder Mike Touma, the transition from parking a food truck hoping to sell out before sundown to planning a nationwide rollout remains somewhat unbelievable.
"Honestly, when we were parking the food truck each day just hoping to sell our inventory, I never imagined this level of growth," he reflected. "The entire experience feels surreal. My primary focus remains on protecting the soul of what makes our brand special as we expand."
