On what felt like a perpetual loop, First Watch CEO Chris Tomasso kept hearing he should meet Jerry Morgan. The CEO of Texas Roadhouse appeared to share philosophies on leadership, company culture and operations, and, to a more tangible point, views on guarding those founder-led principles from the frontlines of being a publicly traded restaurant company, which First Watch had just become in September 2021.
But what onlookers didn’t realize is, if you went back to the late 1970s, Morgan was racing motorcycles in a mud pit where First Watch’s Bradenton, Florida, headquarters—just off Cooper Creek Boulevard—sits today. Tomasso and Morgan, naturally, didn’t know, either.
The two finally met in the dune-backed summer haven of Nantucket at an investor conference. Morgan asked where Tomasso was based. Sarasota, Florida? Morgan not only was raised there, his mother lives down the street from First Watch’s corporate office, which was called “Countyline Road” decades ago—a divider that split Sarasota country on the south side and Manatee, or Bradenton, to the north. Regardless, it was just a tiny dirt trail that Morgan liked to rev up and speed through on two wheels.
Yet there was more nostalgia to unravel. Yes, Morgan hails from First Watch’s hometown. But so does Tomasso. In fact, they attended the same middle and high schools, and even enrolled in mirror DCT work experience programs that jumpstarted their working lives.
“That’s also when I found out that Jerry is a lot older than me, which he doesn’t look it,” Tomasso jokes. They graduated from Sarasota High School, home of the Sailors and Pee-wee Herman, a decade apart—Morgan in 1978 and Tomasso in 1988. Before, they strolled the same halls at McIntosh Middle.
Morgan was the definition of a legacy student. His math teacher’s first class included his mom. He was in the last. Morgan’s mother, father, and both sisters graduated as Sailors.
Tomasso moved to Sarasota when he was 9 and stayed until he left for the University of Central Florida. He returned in 2006 and has been there ever since.
As Tomasso and Morgan swapped old stories, the deeper they got, the more threads they started to connect. Morgan played in the Sarasota Redskins Youth Football program and became “more interested in football than anything else.” He was a 6-foot, 145-pound tight end/defensive lineman who got a rush from catching passes and cutting through defenders. But ultimately, Morgan realized he was staring across the line at guys half a foot taller and 50 pounds heavier. So he got realistic.
Morgan engaged in the DCT program where he could work full-time and still go to school. He began in the garden center at now-defunct discount department store Woolco. “That’s where I really got my first taste of retail and customer service and being a business individual,” Morgan says.
Outside of working and playing football, what was Morgan getting into? “We did hang out in the Shell parking lot on the north side,” he laughs. “Chris was probably over there on the concrete with the fancy hot rods and stuff.”
Truthfully, Tomasso was keeping a pretty similar schedule. The DCT program was intended for students who didn’t do all that well in class or who came from circumstances where they needed to make money to help their families. Tomasso’s household was a lower-middle class one. And he knew if he wanted to drive when he turned 16, he was going to have to pay for it. Tomasso started washing dishes at his uncle Louie’s pizza restaurant when he was 13. He got to be a prep cook and had a goal to move up to the pizza oven. On his first night doing so, a frantic Friday, Tomasso opened the pizza door and saw something fall. “I thought it was something on the pizza oven,” Tomasso said at the NextGen Restaurant Summit. “It was my eyebrows getting singed.”
In the end, Tomasso raised enough cash to buy a 1967 Pontiac LeMans convertible, which he bought a year early at 15 knowing it would take a year of repairs to get on the road.
While Morgan played football, Tomasso was part of a Sarasota High basketball squad that went undefeated his freshman year. He played travel ball and eventually bought a piece of the gym’s parquet floor to make a table that resides in his office today. Tomasso quips you could count his stats—rebounds, points, and assists—on one hand.
“So that’s what I did,” Tomasso says, “to help support my family and to save money myself … and any free time I had, I was playing basketball on park hoops and church hoops.”
After Woolco, Morgan moved to Houston, Texas, where his dad and uncle lived, to work for Telesphere, a company installing long-distance dialers in hotels across America. He did so for a couple of years until his uncle, a local lawyer, told him a story. He was doing legal work for an operator who owned 10 McDonald’s. “And he just couldn’t believe how much money this guy was making,” Morgan says. “So he actually went and got a franchise partnership and bought two Burger Kings in Waco, Texas.”
He asked Morgan to come along. Morgan cleared the idea with his dad and left the phone world to get into restaurants. “It was kind of weird,” he says. “Growing up, I’d say, ‘I never want to be in the restaurant business or the grocery business,’ and yet as soon as I walked through the doors at Burger King, I was like, I like this craziness. It almost brought back the spirit of being on a football team, where we had to really work hard together if we were going to pull this thing off.”
Morgan’s gridiron passion translated over. The commotion and teamwork and interconnected webs of surviving a restaurant shift fit. Morgan spent two years at Burger King before moving to one of only two brands Norman Brinker ever created—Bennigan’s (the other was Steak & Ale). Over the next 10 years, Morgan says, he “started to swallow the pill for the restaurant industry.”
“And when I got the opportunity to join Roadhouse, I just fell in love with the business at that time,” he says. “I knew this is where I was going to be. I never would have imagined the journey from being a managing partner to a CEO, but I just went to work every day and my grandma always said, ‘if you go to work and you work hard, good things are going to happen.’ And she was right.”
As the well-worn story goes, Texas Roadhouse, name and all, didn’t start in Texas. Kent Taylor, also a Bennigan’s veteran, founded the brand in 1993 with a $300,000 investment from three Kentucky doctors. Three of the first five stores failed as the concept spread across the map. There was a Cincinnati, Ohio, unit. One in Sarasota and Clearwater, Florida—those to balance the original Clarksville, Indiana, location. Taylor bought a PO box in Dallas and put a Texas address on all his comment cards to try to give his steakhouse some Texas cred.
It wasn’t until 1997 when Texas Roadhouse landed in the Lone Star State. And that Grand Prairie location would end up managed by Morgan.
He worked through the system, earning Managing Partner of the Year in 2001 before becoming market partner later in the calendar. In 2015, he was named regional market partner and oversaw north of 120 restaurants in 14 states. As unlikely as this journey might feel to some C-suites, it fit Taylor’s mantra of placing the art of running great restaurants above anything else. And Morgan was that embodiment to a tee. There was no corporate cloth in his makeup. Morgan even wore a ballcap in his executive announcement.
It was the timing nobody could plan for, as Taylor passed away in March 2021. Morgan said then, part of accepting what happened was acknowledging his mentor envisioned him carrying the brand forward. “And then I realized the obligation that I had to the company,” he says.
Just as a quick refresher, in the past six quarters, Texas Roadhouse’s same-store sales have climbed no less than 7.3 percent. The brand last February crossed $4 billion in revenue, more than doubling where it was in 2017. It’s now barreling toward $8 billion.
Tomasso knows a little bit about stepping into big shoes as well. When he was named CEO in June 2018 after a 12-year run as CMO, Tomasso succeeded Ken Pendery, who helped First Watch’s founder, John Sullivan, open the company’s second restaurant in San Mateo, California, 39 years ago.
Like Morgan, and in spite (or maybe because of), burning his eyebrows off as a teenager, Tomasso had no designs of working in restaurants. He majored in public relations and advertising at UCF and, in his last semester, landed an internship with the NBA’s Orlando Magic. Tomasso drove to the airport to pick up Shaquille O’Neal when he first came to scout the city that would draft him with the first overall pick in 1992. They hung out and Tomasso brought the 7-foot-1 future hall of famer—and prolific restaurateur—to fraternity parties. “I went over to his house a lot, became pretty tight with him,” Tomasso says. “And it just opened a bunch of doors for me.”
Tomasso graduated from college on a Saturday and had a job lined up Monday with what was then-called Regional Sports Network. Six months later, he shifted to PR and communications firm Curley & Penn, mostly because Tomasso liked the idea of working on Universal Studios as an account. Long story short, he pitched Hard Rock International, signed them, was lead, and, a couple of years later, headed to the global brand as an-in house employee.
Tomasso helped Hard Rock open cafes all over the world. He rose to VP of worldwide marketing—the youngest VP in company history. Tomasso had offices in London, Barcelona, L.A., New York, Orlando, and Miami. He spent more than 10 years there before being offered the position of vice president of marketing at Cracker Barrel. The casual chain was looking for an executive with retail and restaurant experience. Hard Rock uniquely splits its business half retail and food. It had a restaurant those days clocking $55 million per year.
“We’ve got to really treat our employees great if they’re going to treat our guests right,” Morgan says.
“[Cracker Barrel] made me one of those offers where you just can’t say no,” Tomasso says. “Our kids were young. They weren’t in school yet. So my wife and I said, if we’re ever going to do something like this, let’s do it now. We moved to Nashville for three years and then the private equity firm that invested in First Watch called me and said, ‘hey, we have this brand that we know is special. But we need somebody to help us grow it.’”
Tomasso was at Hard Rock and Cracker Barrel during high-growth eras. When he first came onboard with First Watch, the chain had 60 restaurants in nine states. It would erupt to more than 250 ahead of his CEO appointment. Today, the fastest-growing full-service chain in America has 492 stores in 29 states and visions of 2,200 domestic restaurants.
Same-store sales grew 7.8 percent in Q2 and total revenues were $216.3 million, a 17.3 percent increase over the prior-year period.
“I always say, it’s like a pinball machine. And I just got bumped over here into restaurants and I love it,” Tomasso says. “I love the cause and effect of it. I love serving people. I love growing and winning and I never, like Jerry, intended to be in it. But once I was in it, I knew I was in it for good. So that’s what I’ve been doing for the last 26 years.”
Even before meeting Morgan, Tomasso says he was often asked what public restaurant brands First Watch admires. Texas Roadhouse was an easy target. He calls it “one of the best-operated restaurant companies in America.”
“And it’s such a strong culture that you can feel when you walk into the restaurants, or you meet anybody there,” Tomasso says. “And I love, love, love that you can just tell that all of their decisions are customer focused.”
“There are certain pressures that public company CEOs get placed upon them,” he adds, “and for watching Texas Roadhouse over all these years stay true to really what’s made them special throughout the process has been extremely impressive.”
As any restaurateur can attest, dining out when you’re in the business is like a former pro athlete trying to referee a pickup game. He visits Texas Roadhouse and “sees all the little things.” But it is, after all, a segment defined by the little things. “They do an incredible job,” Tomasso says. “And by the way, they came up as the dark horse in a very, very crowded space. To then become the leader in that space in such a short period of time, I think, is a testament to the leadership of the organization, Kent and now Jerry, just taking the brand where it can and seeing what the opportunity are—aligning and understanding who their customer is.”
Morgan voices similar vibes about First Watch. Texas Roadhouse’s Made From Scratch DNA is a theme also central at First Watch. The brand has famously kept a seasonal menu program (five launches per year) sourced and cultivated from small footprint to large, with no plans to let that equity slide. “When you walk into First Watch, you respect how they treat the food and how they serve it,” Morgan says. “Because they serve it to make an impression on you. That, to me, that’s the impressive-ness of the brand.”
What’s also interesting about Morgan and Tomasso’s budding relationship is they’re veterans of different aisles. Morgan has been through the wringer of publicly held restaurant life, but he’s still pretty fresh as a CEO. Tomasso flips that coin.
But, unsurprisingly, both concepts dig roots in familiar places. Morgan says he’s picked up leadership lessons from his high school days all through the restaurant journey, from one store to half a dozen to 14 states worth. “When I was a managing partner, that was my restaurants, had my name on the door, I made the decisions,” Morgan says. “Everything I’ve done since then is to support the operator that’s on the ground; that’s absolutely engaged with our employees and our customer. I went from being a head coach to an athletic director to the president of the university to now, the owner. So every one of those requires a different role, but you have to stay committed to the true deal, which is can they play the game at the highest level?”
Tomasso shares as he became CEO, one of the things that instantly became clear was people were watching. How he carried himself. What he said in meetings. He wasn’t just “Chris” any longer. Now, things had to be “CEO ready” before they go in front of him. So Tomasso became cognizant of body language, verbiage, and everything from how he walked around First Watch’s square-shaped office to the way he presented ideas.
Morgan says restaurant leaders need to create vision. And for both brands, you’ll often hear the oft-used banner of fostering a “people-first company.” Yet it’s been lived out front, quarter to quarter, publicly, over the years at each. Texas Roadhouse generally fields a flurry of investor queries on earnings calls about absorbing margin erosion in favor of staffing up. Morgan just told the room in July the company would continue doing so because running great restaurants requires a commitment to people, process, and investment, with a long-term view. And generating traffic boils down to the chain’s ability to “attack our execution at the highest level right now.” If that’s going to cost Texas Roadhouse extra hours and dollars to satisfy escalated volume, the brand is going to foot the bill, Morgan said on the call.
First Watch’s story echoes in myriad ways, but you can just look at the COVID playbook as a reminder (more on that here). The brand looked up every single manager, close to 600 accounts, and promised to make them whole by providing a bonus upon their return to work to assist with hardship costs incurred as a result of the pandemic and work to close the gap between the federal and state benefits they received and their First Watch salary.
“We’ve got to really treat our employees great if they’re going to treat our guests right,” Morgan says.
Morgan reels it back to high school. You never realize the fundamentals and how they shape you until you stop thinking about them, he says. And that settles when you’re older.
Pop Warner football, high school sports, working while studying, Morgan says all these factors helped him realize he wasn’t always going to win. “But that doesn’t mean you give up,” he says. “Chris and I probably went the hard route a little bit compared to some others, but I think because of what we learned on the courts and on the field was that we still have to go out there and try every single day to do our best. That’s what we’ll contribute to the team and to the success of our families.”
Morgan was a quiet kid with bad skin who didn’t recognize he grew out of it until he was in it. Suddenly, people were looking up to him and before long, he was leading one of the most-beloved restaurant brands in the country. “It’s special to know that you weren’t always like that,” he says. “You had to earn the right for people to respect you.”
Tomasso and Morgan say they’ll keep in touch and continue to lean on one another for advice. Morgan jokes that even though he’s a “little older,” there’s a lot he can still learn from Tomasso and First Watch.
“I’m thankful now that we’ve got this open line of communication,” Tomasso says. “Hopefully we got a lot more years in the industry and we can help each other.”