Billionaire financier George Soros now has majority ownership.
The Dinosaur Bar-B-Que on Willow Street in Syracuse. It was the first Dinosaur restaurant, followed by restaurants in Rochester and Harlem. A location in Troy is expected to open this fall.By Bob Niedt
and Michelle Breidenbach
Staff writers
It was 1976 and the neighbor boy was at Nancy Luckwaldt’s Liverpool door ready to prepare a home-cooked meal to ease the nausea from her pregnancy.
Even then, John Stage said he wanted to be a chef.
Over the next decades, Nancy and Larry Luckwaldt donated cash and sweat to help their kid neighbor build the Dinosaur Bar-B-Que into a hometown rib joint that is the iconic identity of Syracuse.
As the Luckwaldts became grandparents, Stage brought his partners another gift.
One of the richest men in the world was willing to buy out the Luckwaldts’ shares in the company. In 2008, the Luckwaldts sold most of their stake to George Soros, whom Nancy knew only as “a hedge fund financial person” from New York.
The quiet transaction turned over majority ownership of the home-grown honky-tonk on Willow Street to a controversial billionaire financier from New York City.
The owners plan to add two or three restaurants a year, according to promotional material from their real estate consultant. If they pull that off, it would dramatically rev up the slow-cooked success that produced three restaurants in 20 years.
It all hints at a drama that could unfold in coming years, as the new management team tries to expand the business without killing the funky edge that has made it one of Syracuse’s top tourist attractions and best-known brands.
The new Team Dinosaur includes Soros and his two sons. George, Robert and Jonathan Soros are so connected they put their names on the liquor license at the new Dino in Harlem.
George Soros, billionaire financier, bought the lion's share of the Dinosaur Bar-B-Que with his sons in 2008. "They found an interesting company, a fun company; it was something they really liked. This is a very small part of what they do," said Dinosaur CEO and founder John Stage.The team also includes executives from Soros’ investment group and restaurant professionals who have spread familiar chain restaurants around the globe. The founder of a company with expertise in real estate, marketing and designing a restaurant owns a piece and sits on the board.
While Stage and the Luckwaldts used to casually brainstorm about the future over heavy wood restaurant tables beneath graffiti-covered walls, Dinosaur Restaurants LLC has quarterly board meetings. Ownership is outlined in a flow chart.
That chart documents an ownership that ranges from “Soros Strategic Partners II LP” to Jeffrey Coons, an f-bombing veteran Dinosaur chef nicknamed “Cooter” — capturing on one page the mingling of change and the Dino’s biker roots.
Amid the change, one constant is Stage. He retains his 22 percent ownership and, as CEO, he says he still calls the shots. He resists any talk that the Dinosaur is changing.
“We will never open restaurants unless we can do it right,” Stage said. “There’s no master plan to say we’re going to throw these restaurants all over the place.”
Stage said the company will open new restaurants one at a time, when the vibe is right. The next possibilities are in Buffalo or Brooklyn, he said.
“John is in charge,” Larry Luckwaldt said. “Same motorcycle. Same driver.”
Slow growth and loyalty
The Dinosaur was founded by Stage and other bikers in 1983, when they catered motorcycle shows up and down the East Coast.
The Luckwaldts got involved in 1990, when Stage was working on getting a liquor license for the new Syracuse restaurant. Larry Luckwaldt had been working as a wholesale liquor distributor and offered to help. The Luckwaldts also offered to help finance the new venture — a first-time investment for the couple. Another partner was Mike Rotella, one of the founders.
They opened a second restaurant in Rochester in 1998 and expanded into Harlem in 2004. (After losing their Harlem lease, they’re opening a new place across the street in September.) The next Dinosaur is set to open this fall in Troy, near Albany, where Stage’s mother and sisters live.
The Dinosaur brand sauces, spices and prepared foods are marketed in supermarkets on the East Coast, including Whole Foods and Wegmans. Those store products account for less than 10 percent of the Dinosaur’s overall business, Stage said.
Along the way, Stage has surrounded himself with friends who remain part of the Dinosaur organization.
I. Stephen Davis, whose G&L Davis Meat Co. of North Syracuse makes Gianelli sausage, owns 2.3 percent of the new company, according to records the Dinosaur gave the state Liquor Authority. G&L has supplied all of the Dinosaur restaurants with meats since the first restaurant opened.
Andrew Boucounis, whose Andy’s Produce in Syracuse has supplied the Dino with peppers, onions and tomatoes from the start, is also a minor shareholder, records show.
Longtime Dinosaur employees Abigail Doyle, Coons and Garth Caruso, a trio now working in the Harlem restaurant, have clocked a combined 45 years with the company. They took the bonus they received to move to Harlem and turned it into shares in the company.
Remember the baby Nancy Luckwaldt was carrying when the neighbor kid offered to cook? Lindsay Amorese has worked at the Dinosaur for 12 years.
‘We got an opportunity’
Like most Upstate businesses, the Dinosaur borrowed money from banks and small local investors.
Once he set up shop in Harlem, Stage quickly learned that Manhattan restaurant owners had other options. New York is the investment capital of the world and some of those monied investors liked barbecue.
“New York is a funny place,” Stage said. “A lot of people are always looking around. So I got to know them through a friend of a friend.”
For more than a year, Stage said, he became friendly with members of the Soros team, including Mark Pinho, David Wassong and George Soros’ son Jonathan. “I’ve not met the old man,” Stage said.
At the same time, the Luckwaldts were looking to cash out, slowed by age and the burden of restaurant work. “I really didn’t know how I would ever be able to retire in this type of business,” Nancy said. “So many people have expressed an interest in the Dinosaur (over the years). Nothing ever materialized.”
Stage eventually went to the Luckwaldts and said, “Hey, listen, we got an opportunity,” Larry said.
No one would disclose the amount of Soros’ purchase price. Soros Strategic Partners owns 58.41 percent, records show.
The Luckwaldts maintain a small ownership stake and can still be found around the Syracuse restaurant.
Boucounis, of Andy’s Produce, said at first he struggled with the sale.
“Everyone felt let down,” he said.
Later, Boucounis came to understand that taking on investors eases the burden of a company poised to grow. “It’s nice to have a little war chest behind you,” he said.
He understands the risk, too.
“These are not cookie-cutter operations, where they’ll open one every three months,” he said. “The challenge will be to find the perfect level — six or eight (restaurants) or whatever number is in (Stage’s) mind.”
Changes at the top
With Soros on board, Stage ushered in a new organization, with experienced players rooted far from Syracuse. Most of them declined to comment for this story, deferring to Stage.
The chairman of the new company is Peter Roland Hearl from Australia. He retired from his job as the Asian director of Yum! Brands, a U.S.-based restaurant company whose holdings include the KFC, Taco Bell, Pizza Hut and Long John Silver’s chains. Hearl came to the group through Pinho, a friend of Hearl’s son.
“He came with his son to eat there, and he loved it,” Stage said of Hearl. “I got to know him, and we threw a few cold ones back. He’s a good ol’ boy from Australia, so we hit it off.”
The chief operating officer is Robert Flohr. For a decade, he was president of the Stir Crazy restaurant chain, which doubled its number of fast-food stir fry restaurants during his tenure.
Wassong, a Dinosaur vice president, is a managing director at the Soros company and is the chairman of the board of directors of Bluefly Inc., an online clothing retailer in which Soros owns a majority stake.
Andrew Moger, of the firm Branded Concept Development, is also on the board and owns a stake in the company. BCD is a Manhattan restaurant growth adviser, which means it helps restaurants with real estate, design and construction. Red Robin, Checkers, Five Guys Burgers and Fries and Qdoba Mexican Grill are among its clients. (See BCD's promotional material.)
Moger said his firm advised Stage on design, contractors and other issues at the new Harlem Dinosaur. He did the same for the coming Troy restaurant and helped expand the Syracuse Dinosaur into its second floor.
There is room for growth for the company, particularly in New York City, Moger said.
BCD’s material lists potential Dinosaur growth territories in Brooklyn, Queens, Buffalo and Long Island; northern New Jersey; Westfield and Fairfield counties in Connecticut; and Boston.
The Harlem shuffle
Stage is overseeing every detail of the new Harlem restaurant when he’s not making weeklong visits to the other Dinosaur locations.
He bought an apartment building in Harlem, where he lives and rents three other units. Property records show he bought the building for $1.2 million in 2004. He also maintains a residence in Syracuse.
If Harlem is an example of things to come, the design combines Syracuse soul with professional chain restaurant sight lines and wide, open spaces. The touch of the new management is evident in the design of the dining room, where waiters can easily get to the bar.
Stage still demands his restaurants are built the old-fashioned way, with remnants salvaged from abandoned barns and buildings, decorated with artistic inlays and kitschy graphics.
In the new Harlem restaurant, old-time tattoos are burned into a blocklong bar by the same artist who worked on the Syracuse place. He points to the dining room tables for more Syracuse flavor.
“All my friends from Syracuse are building these tables,” he said. “This is all Upstate action here.”
The lightning rod
Soros certainly has enough money to finance any expansion.
Soros, 79, has a net worth of $14 billion, according to Forbes.
His life runs on several tracks. He is both chairman of Soros Fund Management and founder of the Open Society Institute, a philanthropic organization.
As a fund manager, Soros made a fortune in hedge fund investments. His ability to predict markets has made people both suspicious and awed. The gamble that launched him to celebrity status came in 1992 with a bet against the British pound that cost the British government about $6 billion and won $1 billion for Soros investors.
The Soros team does not talk about its investments, but it is safe to say the 35th richest person in the world likes to make money. He talks about it like an art form, “in the same way that a sculptor must be interested in clay or bronze,” he told his biographer.
Around 1990, he turned over his investment work to others, including his sons, and used his earnings to promote his political philosophy. Soros was born in Budapest in 1930 and fled Nazi occupation for England, and later the United States. His Open Society Institute supports dissidents in former Communist countries. He has given away $7 billion to causes in 70 countries.
Soros also used his fortune to support Democratic candidates for office in the U.S. He spent $25 million on campaigns against President George W. Bush, including the liberal activist group Moveon.org.
The Soros team bought into at least one other restaurant chain.
In 2007, a year before the Dinosaur investment, Soros Strategic Partners became a partner in the Mastro’s Restaurant business in Arizona. Like the Dinosaur deal, the Mastros who created the upscale steakhouse retain some ownership. They declined an interview request.
The new investors told the Arizona Republic at the time that they planned to “professionalize” finances and operations and expand by two or three locations a year.
Downplaying the connection
The Soros investment in the Dinosaur was never announced. In June 2009, at least a year after the sale, a reporter for the Albany Times Union discovered it in documents the Dino submitted to the Troy Industrial Development Authority.
Stage rues the day the news became public. Whenever the Soros name comes up, Stage says, he receives negative comments from customers and critical e-mails.
Stage also says he wants to keep his privacy. For those reasons, he was reluctant to participate in this story.
Stage likes to point out that the “Soros boys,” as he calls them, are investors. They are not restaurant people.
“They found an interesting company, a fun company, it was something they really liked,” Stage said. “This is a very small part of what they do.”
Stage said there is no master plan to open a certain number of restaurants in a set number of years.
“That’s the good part about these guys,” Stage said. “They understand that, and they never would want to mess with what we’ve got by expanding too much. I’m a firm believer that the landscape is littered with people who grew too fast.”
Stage, 50, would also like to retire someday. But he said his life doesn’t operate on a five-year plan.
“The plan is,” he said, “if and when I ever stop enjoying this, that’s when I move on.”
Contact Bob Niedt at bniedt@syracuse.com and Michelle Breidenbach at mbreidenbach@syracuse.com or 470-3186.