Who Says Restaurants Are Tough?

Nathan Chan and Mark Rao remember the longest all-nighter of their college career, but it wasn’t to complete school work.

The two friends were in the midst of opening their restaurant, Chengdu Famous Food, in summer 2016. It was July 1 — already a month behind their planned opening date — and they were still setting up at 3635 Lancaster Ave., preparing menus, checking in with staff and making sure they could best serve first-day customers. They stayed up for 72 hours straight.

“In the afternoon right before our break, both Mark and I were passed out on the couch upstairs…” says Chan, a marketing major in the LeBow College of Business.

“…Next to a lot of empty cans of Red Bull,” adds Rao, a fourth-year finance student in LeBow, finishing his friend’s sentence.

The restaurant was a success, but their time as business owners didn’t last long. In early 2017, just a few months after opening Chengdu
and when they were already into the planning stages for its next-door sister business, Woosa Bubble Tea, they received an unsolicited offer to sell both entities. They sold out, making a profit they say tripled their investment.

Rao and Chan met in 2015 during their freshman year in a LeBow class, where they were assigned to present a viable business idea.

At first, their idea was to create a food delivery app, but market research revealed too many competitors. It also revealed something else: There were few authentic Sichuan restaurants in Philadelphia. Both Chan and Rao are self-proclaimed “foodies,” and also both grew up in China — Chan was born in Los Angeles but grew up in Hong Kong, and Rao was born and raised in Chengdu, the capital of China’s Sichuan province.

They decided to shift their sights. Delivering quick, affordable, delicious Sichuan food to the University City audience — especially international students — became the basis of Chengdu Famous Food’s menu.

“Their trajectory has been pretty amazing given the competitiveness of the restaurant space, and they hit the right market at the right time,” says Assistant Dean of the Charles D. Close School of Entrepreneurship Charles Sacco. “As students, they saw something that students in University City wanted.”

Their parents provided funds when they were originally trying to move forward with the app, and then outside shareholders came out of the woodwork to invest in the restaurant from as far away as Hong Kong and as close as Ohio.

Next, the students hired chef Jack Xue, a Chengdu native who also played a big part in the kitchen design. Then the students hired a contractor who guided them through the ins and outs of the industry. For staff and marketing, Rao and Chan tapped friends and classmates, and used social media and The Triangle.

After half a year in business, everything was going well. Customers flowed in from local neighborhoods, and even from as far away as New York City. Philadelphia Inquirer’s food critic Craig LaBan gave them a glowing review in January 2018.

Then, they got an offer they couldn’t refuse, from two regulars who loved the food. The buyers were business students from Chengdu. Chan says they wrestled with the decision at first, but that it ultimately made the most sense to sell.

“After we graduate, we’re not sure where we’re going to be,” he says. “It was time for us to sell. But I would say it was a good, one-year experience of enjoyment in opening the restaurant and nothing gives us more satisfaction than to see customers and their happy faces.”