Back, for one night only: five top restaurant chefs who had cooked at one time in the tiny kitchen at 312 Drummond Street in the inner Melbourne suburb of Carlton, each reprising a signature dish from when they had sweated there over the pots and pans.

The Bentley's Brent Savage – then at the helm of Andrew McConnell's Mrs Jones (2003-2006) – offered up sea urchin custard and mud crab. Andrew McConnell (Three, One, Two, 2006-2009) served confit apple with burnt butter ice cream. From Nicolas Poelaert, ex-Embrasse (2009-2013) came veal sweetbread, shallot cream and pickled blueberries, which was followed by pork jowl and charred octopus from The Town Mouse and incumbent head chef Dave Verheul (since 2013). And to kick the evening off, an antipasto (with figs to die for) from the Donnini family, who ran their eponymous establishment from 1979 to 2002.

The special dinner, billed as The Little Restaurant That Could at this year's Melbourne Food and Wine Festival, was unsurprisingly a sellout. But more than simply cheering the pedigreed chefs/restaurateurs who at some point hung their shingle on the door, the event celebrated – like the little engine in the children's classic storybook – that something so small could work, and succeed, time and again.

"There's certainly an energy in that restaurant [space]," says The Town Mouse co-owner Christian McCabe. "Everyone who has gone in has made something of it in a unique way."

Creative hubs

Small fine-diners, though, have a habit of being little hotbeds of creativity, with chefs able to showcase what they can do. It was the motivation for Dan Puskas (ex-Sepia) and James Parry (who staged twice at Spain's Mugaritz) to open up Sixpenny, a 35-seater in Sydney's Stanmore.

"It may sound selfish in a way but we won't really cook for our diners, we cook for ourselves," says Puskas, who worked with Parry at one-hatter Oscillate Wildly, another restaurant of similar size, in Newtown, that also offers a degustation-only menu.

The flipside of that is chefs can control the customer experience. "It's about quality control, having control of how that customer enjoys the experience," British-born ex-Vue de Monde chef Ryan Clift, who co-owns Singapore's Tippling Club, told Life & Leisure on a recent visit to Australia. "Thirty-four seats – one sitting a night only – are enough for the style of food we're cooking, [when] you do up to 30 courses per person."

Adelaide's Jock Zonfrillo, who has 30-seater Orana, agrees: "It's that ability to be involved in every single customer's experience, whether saying 'hello' as they walk through the door or shaking their hand on the way out."

Ex-pat Curtis Stone – who opened Maude, a 25-seater in Beverly Hills focusing on a single ingredient each month – also applauds the hands-on aspect: "If I want to open a 100-seater, you need to manage human resources, costs, do all the book-keeping, all the stuff that takes you out of the kitchen."

It's no coincidence that Japanese restaurants offering omakase-style menus, where it's totally chef's choice, are among the smallest. Raita Noda in Sydney's Surry Hills seats eight; Tempura Hajime in South Melbourne, 12.

Strong culinary ethos

The world over, the smaller the restaurants, the more creative, experimental and aligned to a chef's ethos they can be. Swedish chef Magnus Nilsson's 12-seater Fäviken Magasinet, which harvests and preserves all its food by hand, is an example. In Melbourne, Mister Jennings' owner-chef Ryan Flaherty is planning to open shortly an invite-only restaurant – as yet unnamed – within his restaurant, for six or so guests that is "extravagant" and "pushes culinary boundaries".

Small restaurants, though, can offer young chefs an easier, more affordable way to get started. Mega-chefs such as Tetsuya Wakuda and Shannon Bennett, for instance, began with modest suburban digs. For Puskas and co, the compact suburban premises mean they don't need a financial backer or mountains of debt; and Stanmore helped to avoid the heftier rents of Sydney's CBD. "We work for ourselves, not for the money," says Puskas, who ensures he makes time for family and skateboarding.

Laneway venues

Seeking a small venue 13 years ago to recreate the intimate atmosphere of a Spanish dining room/bar for his then new venture, MoVida, Frank Camorra opted for a lane. "The beauty of laneways is the rents are much cheaper," he says. But it was also a springboard to launching bigger ventures in MoVida Aqui (200 seats) and MoVida Sydney (100 seats). "Starting small lets you refine dishes, be more consistent and keep staff," Camorra says.