P.F. Chang’s 34-year-old CEO on what he learned from billionaire John Paulson

The son of a neurologist and pharmacist, Adamolekun was born in Nigeria and raised in several places, including Columbia, Md. He attended Brown University as an undergraduate and received a master’s from the Harvard Business School. His pre-P.F. Chang’s resume included positions at Goldman Sachs, TPG Capital and Paulson & Co., the firm run by legendary investor John Paulson.

At Paulson, Adamolekun led the acquisition of P.F. Chang’s, a privately held chain, founded in 1993, that he considered something of a diamond in the rough. The deal closed in 2019 — for a reported $700 million — with Paulson partnering with TriArtisan Capital Advisors on the purchase. By 2020, Adamolekun took over as CEO of the restaurant company, which is headquartered in Scottsdale, Ariz. (Adamolekun also remains a partner of Paulson & Co.)

In the past three years, Adamolekun has implemented changes both small and large — from redesigning many of the chain’s 300-plus restaurants and opening a flagship in New York City to tweaking the menu (he nixed an Asian-inspired mac ‘n’ cheese dish). And he’s done all this while maintaining a vigorous workout schedule — he wakes up every day at 4:30 a.m. and runs 7-8 miles.

MarketWatch caught up recently with Adamolekun to hear about his work at P.F. Chang’s and more. Here’s what he had to say (the interview has been edited and condensed).

MarketWatch: You’ve had this fascinating journey: born in Nigeria, raised in Maryland, educated at Brown and Harvard, working with Goldman Sachs and John Paulson and now running P.F. Chang’s. How do you feel your background led you to this moment?

Adamolekun: It’s certainly a unique story when you put it all together, right? But I think the key thing is each individual step in that journey led to the next step. So you can even take it from the very beginning: My parents deciding to bring us to America from Nigeria allowed anything else to be possible. Going to Brown allowed me to get to Goldman. Succeeding at Goldman and being one of the top analysts is why I got recruited to TPG. I had to be one of the best people there to get to Harvard.

Now, in terms of PF Chang’s, I was working for John Paulson, who’s a brilliant investor. Doesn’t do a whole lot of private equity [and] this was a private-equity deal. But what was interesting about the company was just how great a brand it was and is. It’s a company that everybody knows. When it landed on my desk to look at, I knew P.F. Chang’s. I grew up next to one in Columbia, Md. I went there for a homecoming dinner once. And when you talk to people, everybody has a story like that. They know P.F. Chang’s, they love P.F. Chang’s. It’s a tremendous brand. And we loved the product, the food. And then we thought there were opportunities to invest to make it even better. And that’s what we spent the last few years doing.

Charles: What have been some of the key changes you’ve implemented and why?

Adamolekun: I’d characterize them in three main categories. Number one is the dining experience. So I mentioned the food was good, and that was true when we bought it, but we’ve added more of an ambience to the restaurants, so you don’t come just for food. Creating the experience part of the equation has been key. We’ve remodeled about 80% of the restaurants, introducing new color schemes, introducing new furniture, painting murals. Then [there’s] theater with the actual food. So you can have a dish like our fried dumplings. They were delicious before, but they came simply served on a white plate. Now, they come served on a hot stone plate. Our waiters will drizzle soy sauce on it, the whole thing sizzles and smokes and people pull out the cameras and put it on Instagram. It’s a lot more fun.

Two is the off-premise dining business — delivery, takeout, catering. There was a demand for it and the company at the time didn’t have the infrastructure to really deliver consistently. So that was an investment in technology, in building an app, building a website, some infrastructure in the restaurant [such as] separate entrances for the delivery people. So a lot of investment just to make it easy, to make it fast, to make it convenient.

And the last thing I’ll say is we knew we could improve the effectiveness of our people by investing in our people. By getting great people, reducing turnover, arming them with the best technology.

MarketWatch: What about any menu innovations? Talk about what you’ve added or subtracted.

Adamolekun: The food was good when we looked at it in 2018, but the menu had sprawled. Some things had had gotten added that maybe weren’t perfectly aligned with Asian cuisine. And the [now discontinued] mac ‘n’ cheese is a great example. They put “Asian” in front of it and said “Asian mac and cheese.” But I’ve eaten plenty of mac ‘n’ cheese in plenty of places and it’s not an Asian dish and it’s not something unique to P.F. Chang’s. So we took a look at the menu, the items that weren’t great fits and that the consumer wasn’t demanding. So mac ‘n’ cheese was one example. I like to tell people we want to do less better. Like, focus on the core items and things people really come to us for and leave kind of everything else that doesn’t belong to other [restaurants].

And then we innovate selectively. We’ll do a limited-time offering roughly once a year over the holiday period. We’ll introduce things like the Wagyu steak that we did last year, the Cantonese-style lobster, the sticky toffee pudding. They’re high impact and really exciting.

MarketWatch: You recently opened in New York City’s Union Square neighborhood. It takes a lot of guts to bring a chain Asian restaurant to a city with no fewer than three Chinatowns. Tell us about the decision to move into that market.

Adamolekun: We have flagship restaurants in a few places. New York is one. Honolulu, Las Vegas, Atlantic City, Dubai [are others]. These flagships…they’re a step above even our normal restaurants. The whole idea is they don’t feel like a chain restaurant. They’ll have new and unique menu items that you can find only in that location. In New York it’s an espresso martini — we stamped the top of it with a dragon, and it’s a very cool drink. The idea is to make [the restaurant] feel “unchained,” if you will. These [flagships] are some of our top performing restaurants — New York being one, but also Vegas.

MarketWatch: You’re very young to be a CEO. Talk a little bit about how that came to be.

Adamolekun: Truth be told, I don’t think much of it. At the end of the day, the most important thing is the company. I did the [acquisition] deal because I believed in the business and I believed in the potential of the business. And I pitched it to John Paulson. John agreed. And I didn’t plan to be CEO.

Now, sometimes the moment calls, whether you ask for it or not. In the middle of COVID, I needed to step in as CEO to get us through that crisis. I did that. And I stayed and it’s been a remarkable experience and we’ve made a lot of progress.

MarketWatch: I’m just thinking that somebody younger like yourself really gets certain things — say, online delivery and using your phone to order food. Does youth have an advantage in certain ways?

Adamolekun: Maybe it’s an advantage I don’t think about it cause it’s who I am. I will say that it’s good to stay close [to the younger market]. Even the new generation coming up…their trends are different than the millennials, which I am. But you just got to listen. There’s something about empathy and listening to people and relating to them, even if it’s not your own experience, that I think is helpful in life generally, and certainly in business. Because you can’t speak for all the consumers. There’s a lot of consumers that I won’t personally relate to, but their opinions are just as valid as a consumer that I do relate to.

MarketWatch: You’re also one of a relatively small number of Black CEOs. What do you think can and should be done to increase the number of Black men and women at the C-suite level?

Adamolekun: I think the best thing is for people to have examples. I think of my own life. I’ve had plenty of examples of high-achieving people in my own family or people that I grew up around and that inspired me to set a high bar for myself. So I think the more examples of success and leadership and C-suite positions that Black people hold will inspire hopefully the next generation to pursue that and to believe that they can achieve that. To the extent that I can, I try to be an example, just as many people have been examples for me. And hopefully that makes a change over time.

MarketWatch: We’re still in this period of high inflation. How does that affect your company? I’m curious if you’ve had to raise menu prices to offset those higher costs.

Adamolekun: That is something that you have to deal with. Now, some of that you can absorb and some of that gets passed on via pricing. My hope is things are more under control now. If you look at most of the inflation segments — goods especially [are] coming down, shelter is flattening and coming down in some regions. Services are still going up, but generally speaking, it seems to be more or less under control. My hope is that that we’ll get to a period of more stable inflation going forward.

MarketWatch: But have you had to raise menu prices at any point?

Adamolekun: We have. And most companies have as well. It’s a fine line: If you raise prices, you make it hard for some people to come to your restaurants. There’s no way to avoid that. So you have to manage the business and manage the [profit and loss] to a point, but also really think hard about the impact you want to have on your consumer and make sure that people can still come to you. So, there’s no good answer. There’s no like, “This is exactly how you solve it.” You have to look at all the data, look at all the math, look at all the analysis and make decisions.

MarketWatch: What’s the best lesson you’ve learned from John Paulson?

Adamolekun: John’s a man of remarkable conviction. John’s been incredibly successful because he’s very smart, he’s diligent, he does the work and he has a degree of conviction I’ve never seen in anybody else. Like when he is sure, he is sure. Look at what they call the greatest trade ever. Everybody thought John was crazy for a long time when he was betting that mortgages would come down in 2008, right? So you learn how he approaches investing, the amount of work he does, and then the conviction he has once he’s made a decision. That’s really an impressive trait.

MarketWatch: You get up at 4:30 every day and run 7-8 miles. How and why do you do this?

Adamolekun: I’ve always been an athlete. I grew up playing sports. I played football in college and before that I played pretty much everything I could. When I was at Brown, we had winter workouts. We had to start at 5 [in the morning], and in the winter in Providence, R.I., it’s like zero degrees outside.

I like the routine precisely because it’s hard. It builds a level of discipline and a level of deal-with it-ness. Like, “Here’s a problem, deal with it. You got to be up, go do it.” There’s a mental benefit to that sort of conquest to start the day. So I do enjoy it. Now, do you ever really want to [do it]? No, and that’s precisely the point.

MarketWatch: What’s your favorite menu item at P.F. Chang’s?

Adamolekun: The Chilean sea bass, although I’ve got a close number two. We added [that] Wagyu steak last year in the holiday period and that’s nipping at the heels of the sea bass for me.

Those are two tremendous dishes. You can’t go wrong.

MarketWatch: Final question: Would you ever consider taking P.F. Chang’s public?

Adamolekun: A company like ours has a lot of options for capital and public capital certainly is one of them. This company was public before, it certainly could be in the future. It’s not something we’re imminently working on or that’s [in] the cards immediately, but certainly an option.