Beloved Austin Mini-Chain Tacodeli Plans to Expand Across Texas

Austin is awash in new-school taquerias featuring friendly counter service, funky tacos, and high-quality ingredients. Tacodeli is one of the city's best and longest-lived examples: they've kept it casual, local and weird since opening on tucked-away Spyglass Drive in 1999. Since then, co-owners Roberto Espinosa and Eric Wilkerson have grown their taqueria to five locations around Austin. Their slow approach to growth has recently accelerated, with two new stores opening in the past year.

Tacodeli aims to ramp up that growth further as they look ahead to the next fifteen years. First up, planning expansions to Dallas and Houston. If those stores are a hit, further Texas and even national expansion could follow, and new Austin stores are always a possibility. Eater spoke with Espinosa and Wilkerson about Tacodeli's humble beginnings and their goal of growing slow.

What was the initial inspiration for Tacodeli?

Roberto: The initial seed was planted by my dad. We moved from Mexico City to Austin when I was 10 in 1980, and we were missing our food from home. That's not a criticism of Tex Mex, which is more northern Mexican influenced. I remember going to some East Austin joints that were really awesome, places like Dario's and Cisco's, eating huevoes mexicanos with serrano peppers with my dad. We'd have hot pepper eating contests. But Tex Mex wasn't in my vernacular growing up in Mexico City. My dad always talked about opening a restaurant, but he was a CPA and he didn't have a big desire to jump off a cliff.

Tex Mex wasn't in my vernacular growing up in Mexico City

I knew I wanted to do a taqueria, and I decided breakfast and lunch was a good model. It's about quality of life, especially when you're operating by yourself. Here in Austin breakfast tacos are so prevalent, I had to do breakfast, and doing breakfast, lunch and dinner would have been difficult by myself. Now it's turned into a good recruitment tool for staff. People who are passionate about other things can be passionate about us without burning the candle at both ends.

Eric, when did you join the business as a partner?

Eric: Roberto and I had similar trajectories but never crossed paths. We both went to UT, moved to Atlanta, and then moved back to Austin. After [Roberto] opened up Tacodeli, a friend said, You have got to check this out.

We met in December of ‘99,  and I was working there by February of 2000. I loved the food, and Roberto and I were developing a fast friendship. Poor Roberto, he was doing everything. I thought he could use a little help. I was traveling as an IT consultant, and I didn't enjoy it. A few times when I was washing dishes I was like, What have I done?

What were the first few months like?

Eric: There was a lot of anxiety opening a new store. If you go way back to 2000, the tech bust and abundance of tech companies we were dependent on for guests were gone. It was scary time for everybody, not just for us.

Was Spyglass a tough location? It's very tucked away.

Roberto: Our first day we rang in $200. It was a slow, slow sales ramp up, but the silver lining was we were able to learn as we went along. When we opened, there were maybe two buildings on this corridor, and way more under construction. Business would go up as they were leased out by companies. We came in just as the area was developing, so the timing was perfect.

Tacodeli has become an Austin institution over the past fifteen years. How do you evolve while maintaining what people love about the restaurant?

Eric: We stick to a name-based system, rather than number or flashing coaster. That's how we started and that has helped up cultivate relationships with our guests. It's a little harder and there's a lot more "Mikes" we have to find. But the personal component is something we like.

We have to be sensitive about any changes we make. We have a huge number of very supportive guests. We can make a change that seems subtle but it's a potentially big deal to someone else.

Roberto: For instance, we're about to change our chips to organic tortilla chips. We had the guys at Fiesta develop recipes for us. We tweaked the flavor. It's kind of scary.

We can make a change that seems subtle but it's a potentially big deal to someone else.

Eric: Like when we changed our sausage. We were buying it from a vendor, and we switched to a homemade sausage, good quality pork and an in-house recipe. One comment we got was, Who was bonehead who came up with idea of changing the sausage? We used to crumble it up and cook in with eggs, and now we crumbled it across the top. People said, Oh god, what have you done?

Do you think Austin has its own taco culture?

Roberto: People are very passionate about tacos in Austin. It's my favorite way to eat food, but I was born and raised that way. In Austin it seems like people are hyper-passionate. Not in a bad way -- they really do care.

Eric: Our customers are really knowledgeable, they're willing to be adventurous, and also to be more demanding. People also want food that's good for them and good to eat. If it's indulgent, they don't want it loaded with transfats. We serve a lot of pork belly. It's not healthiest thing but it's locally sourced and if you don't eat it every day you're fine.

Tacodeli has expanded very slowly in Austin, and recently you've picked up the pace with two new stores in 2014. How do you manage growth?

Eric: We say a lot of times, Don't grow too much or so fast you kill what's enabling you to grow the first place. That said, it's okay to sell more tacos as long as the experience remains the same.

Roberto: Our culture is really important, and if we grow too fast we feel like we can't really manage that, so we don't want to outpace our ability to onboard people who understand who we are and what we're about.

It's okay to sell more tacos as long as the experience remains the same.

Eric: We hope to provide an environment where people like to come to work. We have great relationships, we have very low turnover, and we do provide full benefits. We were apprehensive about doing two stores so quickly, but we've been very pleased with the caliber of these new teams.

Excited teams are the best recruitment tool we have. We do a lot of promotion from within. It creates more of a career track for people who like hospitality and like working with Tacodeli. We want to give the opportunity to grow and earn more money rather than have the job be just a stopgap in college.

You've mentioned plans on expanding to cities outside Austin.

Eric: We're looking first in Houston and Dallas. We're spending more time in Dallas, so that will be the first market we expand to.

Roberto: We're looking at locations but have not signed leases yet.

Eric: I should say Dallas-Fort Worth. San Antonio, too. We're looking in Texas. If we can replicate what we do in Austin in another city, then we'll do another city, and if we can replicate that success in Texas, then we'll try another state. That's our long-term goal.

A huge number of Austin businesses are expanding to Houston and Dallas, from Uchi to Verts. And Torchy's Tacos now covers much of the state.

Eric: Chuy's is a great success story of an Austin concept, too. We've always felt like we want to grow this thing as much as we can. There's more and more taqueria concepts opening up, space getting more crowded. One Tacodeli every five years is not that aggressive of a pace.

Roberto: We self-fund so there's a limiting factor there. Now that we have five stores, there's an economy of scale. Now we can build every year or two years instead of every five.

Eric: And we're always looking in Austin. That's just a function of growth here. If you'd asked us five years ago how many stores would the city support, the answer would have been lower. We might be erring on the side of caution too much but we feel like it's worked so far. We want to go quicker but not too quick.