Danny Meyer, founder of Union Square Hospitality Group, and Peter Phillips, founder and CEO of Chip City, discuss the genesis of their partnership on “The Claman Countdown.”
Chip City, the New York-born cookie chain that grew rapidly in recent years with the backing of a major hotel investment firm, has closed all of its locations nationwide.
“Despite significant efforts to stabilize our business in the face of significant macroeconomic headwinds, we have made the very difficult decision to close all of our Chip City locations. We are grateful to our dedicated employees and loyal customers who have supported us for 10 years,” the company said Friday.
The closure marks a dramatic turnaround for Chip City, which grew from a single store in Astoria, Queens, to a multistate cookie chain while attracting millions of dollars in outside investment.
POOL SUPPLIES RETAILER FILE IN BANKRUPTCY, TO CLOSE 76 STORES
The closure marks a dramatic reversal for Chip City. (iStock/iStock)
Childhood friends Peter Phillips and Teddy Gailas founded Chip City in 2017. The company became known for its oversized cookies and rotating menu featuring more than 180 flavors.
Its growth has attracted Enlightened Hospitality Investments, a growth equity fund affiliated with restaurateur Danny Meyer’s Union Square Hospitality Group. EHI announced a $10 million investment in Chip City in 2022 to help accelerate the chain’s expansion.
At the time, Chip City operated 14 locations and was preparing to expand beyond its New York base into other markets.
Retail headwinds force women’s clothing giant Cato to close dozens of locations
A Chip City location in Brooklyn, New York The popular chain has closed all of its locations nationwide. (Google Maps/Google Maps)
The company eventually expanded into several states, including New Jersey, Connecticut, Maryland and Virginia.
Chip City was still publicly focused on growth earlier this year. In announcing the promotion of Nicolas Baizan to president, the company said he would help lead its “next phase of growth, with a focus on strengthening revenue and profitability across its 39 locations.”
The closure also comes as Chip City is embroiled in litigation with Phillips, its co-founder and former CEO.
STARBUCKS CLOSES 250 STORES: “DIFFICULT DECISION”
The company became known for its oversized cookies. (FDA/Fox News)
Phillips alleges in a lawsuit filed Sept. 28 that Chip City failed to pay compensation and benefits he says he was owed after he resigned as CEO in March. The lawsuit also names Enlightened Hospitality Investments and company principals Nicolas Baizan and Fred LeFranc as defendants.
Phillips is seeking compensation and benefits, he says, remain unpaid. The allegations have not been proven in court.
CLICK HERE TO GET FOX BUSINESS ON THE GO
The company’s social media accounts had continued to advertise its cookies shortly before the closure announcement, including promoting a crispy seasonal apple fritter cookie on Thursday.
Representatives for Chip City did not immediately respond to FOX Business’ requests for comment.
Gn bussni
