Rapid Decline How Pandemic Favorite 1800 Lasagne Became Insolvent Just Five Months After Opening
The rapid decline of 1800 Lasagne has surprised many in the Melbourne hospitality scene. Just five months after its grand opening, the popular eatery has become insolvent. Founded in 2019 as a home delivery service, it gained momentum during the COVID-19 lockdowns, finally opening a restaurant in Thornbury in November 2020.
Business Growth and Expansion
Initially gaining popularity through word of mouth, 1800 Lasagne’s sales skyrocketed from $712,000 in its first year to an impressive $3.8 million in the 2024 financial year. This rapid growth earned the restaurant recognition, including a hat from The Age’s Good Food Guide.
Financial Challenges
Despite its success, the restaurant faced ongoing financial troubles. The liquidator’s report indicates that 1800 Lasagne operated with consistent annual losses since its inception. Key factors contributing to this decline included:
- Undercapitalization
- Difficult trading conditions
- Cost of living pressures
- Failed expansion plans
- Historical tax liabilities
In fact, it is alleged that the business traded while insolvent for over four years. This raises questions about the directors’ responsibilities, particularly concerning preferential payments made to themselves before settling creditor debts.
The Liquidation Process
The liquidator estimates that 1800 Lasagne’s insolvency claim could reach approximately $2.7 million. This figure reflects the increase in liabilities from March 31, 2021, to July 30, 2025. The federal government plans to help settle some of the $390,000 owed to employees, primarily for unpaid superannuation.
Director Accountability
Current company directors, including co-founder Kellock, face potential personal liability for tax obligations and other debts due to personal guarantees they provided. Recent legal actions also highlight the tax office’s pursuit of unpaid taxes amounting to $423,000, which could lead to significant personal repercussions for Kellock.
Conclusion
The story of 1800 Lasagne serves as a cautionary tale of rapid expansion without the financial footing to sustain growth. As the hospitality industry continues to face challenges, this case underscores the importance of sound financial management and accountability among business leaders.
