On Wall Street, stocking cafeterias with local offerings

On Wall Street, stocking cafeterias with local offerings
New York:  After leaving Wall Street more than four years ago, David Kostman recently returned.

But Kostman, a former banker at Lehman Bros., wasn't doling out deal advice. He was dishing up lunch at Goldman Sachs - or more specifically hummus, salads and wraps.

"A lot of the really senior people are friends of mine," said Kostman, 47. "They like to say the managing director from Lehman is serving them hummus."

Kostman, the co-founder of the Mediterranean chain Nanoosh, is among a stable of local restaurant owners periodically invited to set up shop in Goldman's cafeteria. During a week in October, Nanoosh served hundreds of employees in the firm's Lower Manhattan headquarters.

Corporate cafeterias have become a side business for many local dining spots.

Aramark, the Philadelphia-based food services company that runs Goldman's cafeteria, recently tapped Rosa Mexicano, Hot Clay Oven and Fresco by Scotto, an Italian restaurant with a to-go location near the investment bank's old headquarters on Broad Street. A local sushi place, Mai, has a chef working in Goldman's cafeteria on a daily basis. Restaurant Associates, which runs the cafeterias of financial firms like Bank of America, Deutsche Bank and Credit Suisse, follows a similar strategy, setting up pop-up stations with local chefs.

"Our competition is really the street," said Edward J. Sirhal, the president of Restaurant Associates. "We're not looking for national brands. It's about local, specialty products."

Goldman has developed a reputation as a corporate foodie. The cafeteria tries to offer seasonal ingredients and features items like cage-free eggs and organic meats. On Friday, the menu will include tandoori chicken with mint raita and croque-monsieur sandwiches.

Since moving its headquarters to West Street in 2009, Goldman has helped improve the neighborhood's dining choices. The firm encouraged the restaurateur Danny Meyer to expand in the area. Meyer has opened North End Grill behind Goldman's headquarters, as well as a Shake Shack and a Blue Smoke barbecue restaurant.

Goldman Sachs and Aramark declined to comment.

Kostman's partnership with Goldman started last year after an Aramark representative made contact with him. "It was a totally unsolicited, cold email in the general mailbox of the company," Kostman said.

Business was robust at Goldman, Kostman said. Foot traffic in the cafeteria is so heavy at lunch that employees receive a discount if they eat during off-peak hours.

During the week, he would run into acquaintances from his banking days who wanted to talk about the Israeli technology scene. "It did feel like a reunion," said Kostman, who once advised technology companies on mergers and other transactions.

Kostman still remains connected to his old life in small ways. He serves on the boards of the Israeli software companies NICE Systems and Retalix, which recently agreed to be acquired by the NCR Corp.

Nanoosh has also been testing software made by LoyalBlocks, a startup backed by a venture capital firm, Gemini Israeli Ventures. Customers who download the LoyalBlocks app get rewards for frequent visits. The restaurant, in turn, gets information on its customers' eating habits.

Kostman, who has a law degree from Tel Aviv University and a master's in business administration from Insead in France, got the inspiration for Nanoosh in London in the 1990s. While working at NM Rothschild & Sons in his early investment banking days, he would sometimes eat at the Wagamama noodle chain and was impressed by the comfortable, casual dining.

But he put the idea on the back burner to focus on his business career. After leaving Rothschild in 1994, he quickly climbed the ranks at Lehman. In 2000, he left finance to join VerticalNet, an online business software maker, and was later the chief executive of Delta Galil USA, a private label apparel company. He went back to Lehman in 2006 to head up banking for the global Internet group.

While at Lehman, Kotsman and two partners started Nanoosh, with a single location on Manhattan's Upper West Side. The aim was to offer fast food that was healthy.

In March 2008, he decided to leave Lehman to focus on Nanoosh. By the end of the year, the restaurant had attracted about $2 million in angel financing, according to Kostman. Since then, Nanoosh has expanded to four locations in New York and New Jersey and even opened a space in Berlin.

Nanoosh also makes appearances in corporate cafeterias around the city. Along with Goldman, the restaurant has sold its fare at JPMorgan Chase and PricewaterhouseCoopers. The arrangements, Kostman said, help Nanoosh build name recognition among an affluent customer base.

"I think there's a huge opportunity to build a huge chain of a few hundred locations," Kostman said of his restaurant. "I'm very optimistic."

© 2012, The New York Times News Service
Story First Published: December 07, 2012 10:34 IST

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