Mike’s Red Tacos, based in San Diego, is best known for its birria tacos, but its menu features more than just the buzzy regional Mexican food.Source: Mike’s Red TacosThe restaurant investors behind the success of Dave’s Hot Chicken are making a new nationwide bet on the next-hottest restaurant trend: birria.Mike’s Red Tacos, a San Diego-based birria chain with just two locations, plans to announce on Tuesday a new franchising initiative that will build hundreds of restaurants across the U.S., with support from early-stage backers Bill Phelps and Andrew Feghali, CNBC can report. Financial terms of their investment, which took place in early 2025, were not disclosed.”We just saw that this was a brand and a concept that really had legs to it,” Phelps told CNBC. “And then the critical thing is, we brought down prospective franchisees. … Everyone gave it the thumbs up.”Phelps said he had never heard of birria before Feghali introduced him to Mike’s.Traditional birria is a beef or goat stew, slow cooked with spices and chiles to give the meat lots of flavor. Birria tacos, like those sold at Mike’s, use the slow-cooked meat as a filling and usually include a consomme on the side as a dip for the taco. Once known as a regional Mexican food, birria now appears on 3.7% of U.S. menus, according to Datassential. That’s more than quadruple its menu penetration four years ago, based on the firm’s data, but there’s still a long runway before it reaches ubiquity.Mexican-inspired fast-food brands such as Qdoba, El Pollo Loco, Del Taco and even Taco Bell have released their own versions of birria. And there’s at least 478 restaurant operators running birria-focused restaurants, according to Datassential.Mike’s menu also includes burritos, loaded nachos and fries, and birria ramen.”It appeals to a very broad range of guests — it’s not just your millennials and Gen Zs,” Phelps said, speaking about the …
