The fast-casual Native Foods Café chain on Tuesday announced a $15 million investment by two private-equity firms to support the meat-free concept’s planned national expansion.

Based in Chicago but founded in Palm Springs, Calif., Native Foods Café is a 16-unit restaurant chain with a plant-based, made-from-scratch menu.

The new investors include Laurel Crown Partners LLC, based in Los Angeles, and Huntington Capital, based in San Diego. With the deal, current owners Daniel Dolan and partner Andrea McGinty, who acquired the chain in 2009, will retain majority ownership.

Dolan said the investment will help speed the pace of new openings.

“We’re really revving up for the next stage of growth,” he said.

This year, the company plans to add 12 to 14 new restaurants and another 25 to 30 units in 2015. The goal is to reach 200 units within the next five years. All units are company-owned, and Native Foods has no plans to franchise.

Most locations are in Southern California, though the chain has also pushed into Colorado and Oregon, where more units are planned. Most recently, however, Native Foods has been developing in Chicago, where the chain will open its fifth location next month and another two later this year.

Dolan said Chicago locations are averaging even higher sales volumes than in more vegan-friendly Southern California, which has affirmed his belief that the concept has national potential.

“We always felt this was a national concept,” said Dolan. “But we needed to prove to investors and landlords that it wasn’t just a West Coast concept.”

In the fall, the company will make a first-time push into the Washington, D.C., area, where it has signed five leases.

Dolan declined to give specifics on systemwide sales, but he said new units are averaging about $2 million, and top-performing locations are closer to $2.5 million. The restaurants are typically between 2,800 and 3,000 square feet.

Laurel Crown, which previously held a stake in Morton’s The Steakhouse, is the investment vehicle for the Paul family of Pittsburgh and Los Angeles. Stephen Paul, the fund’s managing partner, previously served as a board member for Morton’s and will join the board of Native Foods Café.

“Native Foods Café’s management team has the vision, discipline and acumen to make Native Foods a household name,” said Paul in a statement. “By investing our resources in the growing company, we can make a greater impact together.”

Huntington Capital is known for investing in fast-growth brands. Other food-related investments in the firm’s portfolio include Michael’s Bakery Products LLC, parent of dessert supplier Michael’s Cookies, according to the firm’s website.

The recent investment in Native Foods follows a $10 million injection of capital last year from private-equity firm NGEN Partners, based in Santa Barbara, Calif., and New York, which targets companies that positively improve the environment and human wellness. Peter Grubstein, managing partner of NGEN Partners, also sits on Native Foods’ board.

Contact Lisa Jennings at lisa.jennings@penton.com.
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