What investors look for in the food service industry
On the stage of the 25th European Foodservice Summit in Amsterdam, investors from leading firms exchanged views on their strategies and approaches regarding goals in the hospitality sector.
Participants of the investor panel came from three different countries and three different investment firms: Eduardo Velasco from L Catterton (France), Yasha Estraikh from Piper (UK), and Alessandro Baccarin from CVC Capital Partners (Luxembourg) provided insights into their industry to participants from the hospitality sector. The three experts shared their experiences and revealed what they consider the decisive factors for successful investments in a rapidly changing industry. The panel was moderated by experienced industry insider Vincent Mourre, a partner at WhiteSpace Partners.
Brand Identity & Consistency & Loyal Customers
Eduardo Velasco of L Catterton highlighted the importance of global consumer trends within his company’s investment strategy. Promising market leaders of tomorrow could be identified through an international network and a deep understanding of consumer needs and brand concepts, according to Velasco. When asked what makes a successful gastronomy brand, the financial expert cited three criteria: a strong brand identity, combined with consistency and a loyal customer base.
Companies in L Catterton’s portfolio must possess the necessary flexibility and innovative strength to successfully expand in international markets. Among the food service brands in which what is claimed to be the largest and most experienced private equity firm focused on consumer industries has invested, are the Spanish better-burger chain Goiko, P.F. Chang’s, Outback Steakhouse, and many more.
Balance Between Intuition and Planning
Yasha Estraikh from Piper was convinced that companies located between the early startup stage and a full takeover, in particular, hold great potential for further growth. The British investors focus on the home market of the UK. The current portfolio includes, for example, the steakhouse chain Flat Iron. Piper focuses on supporting companies with a clear growth vision and stable customer loyalty. In a challenging market environment, the right management and operational efficiency are crucial. The balance between entrepreneurial intuition and sound strategic planning is the key to unlocking a company’s full potential.
“More Than Just a Capital Provider”
The approach of CVC Capital Partners, as Alessandro Baccarin explained, is to assist management teams in recognizing and seizing international market opportunities. It is crucial that brands consider local culture in their expansion and adjust their offerings accordingly. A good example from the CVC portfolio is the Italian sandwich brand La Piadineria, which, since its enormous expansion in its home market, is now seeking success outside of Italy. CVC Capital Partners considers itself not just a capital provider but a strategic partner that supports management with in-depth expertise and operational assistance in implementing growth strategies.
Together, all three panelists emphasized the importance of a partnership-based collaboration between investors and companies. “The day-to-day operations remain in the hands of management, but we are there as sparring partners with our expertise,” said Alessandro Baccarin. This close collaboration, the investors agreed, is invaluable for making necessary strategic decisions and keeping companies on course for success in a market environment characterized by uncertainty. In an industry continuously shaped by innovation and change, the ability to act both flexibly and strategically is a crucial competitive advantage.
