If You Can Make It There

The French fast-food sensation O'Tacos is rapidly expanding across Europe, but it failed to find its footing with its first outpost in the U.S. What should its fellow foreign companies know about coming to the U.S.? And how can American partners profit from their unique ideas?

- By Maggie Ginsberg

What American fastfood connoisseur wouldn't love a massive tortilla pouch packed with meat, oozy cheese, and fistfuls of fries? Overseas, French tacos are all the rage. The category is now one of the fastest-growing across all delivery platforms in France, where Paris-based O'Tacos is gobbling up more than its share of the quick-service restaurant market. Introduced in 2011 by two brothers in Bordeaux who were soon joined by a drywaller from Grenoble, O'Tacos has grown to 307 units across France, Belgium, the Netherlands, Luxembourg, Spain, Italy, and Germany, with annual revenue surpassing $263 million. O'Tacos grand openings-often celebratory events featuring French rap stars and Instagram influencers-are reportedly occurring in France at a faster rate than McDonald's. Fans line up for hours to get their hands on the beefed-up poutine in a wrap.

In the beginning, it was a product that was very popular in the suburbs, says Patrick Pelonero, the drywaller-turned-cofounder-though he means suburbs in the French sense, a more urban, working-class setting than the American definition. (We spoke through a translator.) Now, everybody knows it and everybody eats it. In 2017, O'Tacos opened 72 new locations in France.

That March, it also decided to come to America. To do so, it set its sights where countless entrepreneurial dreamers had before: New York, that glittering melting pot of big ideas, fusion foods, outsized portions, and quick, tasty, eat-it-with-your-hands grub. O'Tacos seemed perfect for the market. But just 14 months later, as O'Tacos' success continued to skyrocket overseas, its only U.S. location closed.

That failed experiment could serve as a stark lesson-for O'Tacos and for any other aspiring franchises-about just how complicated international expansion is...and how much work must be done to find success.