New York’s restaurant community was caught flat-footed this month when James Beard-nominated chef Wylie Dufresne announced that he would close his modernist bistro, Alder, at the end of August.

Despite plenty of critical genuflecting in front of innovative dishes like rye pasta with pastrami (a playful riff on the classic sandwich) and root-beer pudding, the restaurant struggled to garner a regular clientele.

Conventional wisdom says that with accolades comes a certain kind of protection from financial worry, like a positive-feedback bubble wrap shielding the space from monetary trouble. Giant thumbs up should at least attract diners in droves.

Conventional wisdom says that with accolades comes a certain kind of protection from financial worry.

Increasingly, though, the quality of a restaurant and its ability to stay afloat seem to have little to do with one another, as some of the country’s most critically acclaimed spots continue to shutter even after receiving ample critical praise.


We know the rate of failure is extraordinarily high in the restaurant industry. We’ve all heard the fear-mongering stats about how 80% of New York restaurants shutter within the first five years. While it’s easy to understand restaurants felled by sub-par cooking, service, and ambiance in an uber-competitive marketplace, it’s harder to explain the vanishing of restaurants and bars that have been hoisted on the shoulders of critics and tastemakers.

Is it simply a lack of financial planning that sinks talented restaurants? Crowdfunding and pop-up culture have knocked down many of the barriers to entry for young-gun cooks attempting to get their food in front of a receptive audience. What isn’t so clear, though, is what happens to these pop-ups once they grow up and out. A long-term, sustainable business and a fly-by-night pop-up with a wavy financial model are completely different beasts, no matter how stellar the food. Without a partner on board with a serious affection for Excel spreadsheets, it’s easy to slip into trouble.

almaAri Taymor in the kitchen at Alma (Photo: @almarestaurant)

The Los Angeles Times recently highlighted some of these woes in a feature on food-world darling Alma, where chef Ari Taymor and partner Ashleigh Parsons are at risk of closing after enduring a relentless legal battle this year.


“The industry has a tendency to spit people out,” Alma’s Taymor told the Times. “People are chasing goals that don’t return an investment—Michelin stars don’t lead to financial stability.” The duo launched a Kickstarter last month to help offset legal costs; so far, they’ve raised more than $48,000 dollars.

People are chasing goals that don’t return an investment—Michelin stars don’t lead to financial stability.

New York and L.A. aren’t the only towns that have been shocked by the shuttering of beloved, celebrated restaurants. Earlier this year, Seattle Magazine took a look at why so many of the cities best restaurants (including longtime favorite Boat Street Cafe and popular newcomer Little Uncle) have closed in recent months, citing location and ingredients that are too high quality as contributing factors. Even after being named one of Eater’s 38 best restaurants in the country by Bill Addison, Detroit’s Torino ceased operations unexpectedly in June, identifying miniscule kitchen space as a primary issue.


Almost every issue is unique yet alarmingly similar, boiling down primarily to logistical difficulties or budgetary woes. Far less common are instances of creative divisiveness amongst staff or similarly heady, tabloid-worthy reasons for calling it quits.

In New Orleans, longtime fine dining stalwart Stella! closed abruptly in 2014 as chef and owner Scott Boswell filed bankruptcy and redirected energy towards his more casual, French Quarter brunch hub, Stanley. The end of Stella! led to swirls of debate in the city about what fine dining would look like going forward, as the grande dames of yesteryear (like Galatoire’s and Arnaud’s) give way to the popularity of more causal restaurants.

foie
Foie gras BLT from the now-shuttered Stella! (Photo: chefscottboswell.com)


The chasm between dining establishments that cause critics to salivate and what the majority of people want to eat on a day-to-day basis is undeniably vast. In Alma’s case, publicity caused a shift in perception that launched an unanticipated domino effect: The restaurant is no longer perceived as a neighborhood joint as demand for reservations increase, thus forcing the chefs to live up to their own hype by bear-hugging the very elements (pricey ingredients; ambitious, loss-leading dishes) that might just keep away regular diners. It’s a vicious cycle of keeping up appearances versus meeting a bottom line.

Far too often at restaurants, the perception that everything is hunky-dory (shiny Beard awards! magazine spreads!) has everyone fooled until it’s revealed that things are not so swell after all. The story is nothing new, of course. Even Mario Batali, when reflecting on his early restaurant days, notes just how important a strong partner is to balance the head-versus-heart of operating a restaurant:


“It was so great to open my very first restaurant in New York City and I don’t regret a second of it, but I was unable to hold onto it through disagreement about operating procedure,” Batali told Food52. “I learned quickly that without a thoughtful and confident partner, I would not have made it nearly as far as [my partner] Joe Bastianich and I have made it.”

It’s a sober reminder that restaurants are, at the end of the day, a business—ambitious chef-driven restaurants may please the kitchen cognoscenti, but that sort of recognition doesn’t always register with everyday diners who fuel the bottom line.