The “modern cafeteria” concept Lemonade said Tuesday it has received a minority investment from global private-equity firm KKR that will help fuel accelerated national expansion.
KKR, formerly known as Kohlberg Kravis Roberts & Co. L.P., has more than $98 million in assets under management in 15 countries. It has long been active in the restaurant space, but typically with much larger companies.
Los Angeles-based Lemonade Restaurant Group operates 14 fast-casual restaurants in Southern California and two in the Middle East under the Lemonade brand. Industry observers describe Lemonade as one of the more forward-thinking fast-casual concepts on the West Coast.
The deal includes early investor the Horowitz Group, which will maintain its representation on the board. Terms of the deal were not disclosed.
Alan Jackson, Lemonade founder and chief executive, said in a statement that the partnership will help the chain reach new heights.
“KKR has a long track record of supporting management teams in fulfilling their visions,” Jackson said. “KKR will be active at the board level in helping to refine our strategy and grow the business in a purposeful and deliberate manner.”
Ian Olsen, Lemonade Restaurant Group’s chief operating officer, said in a statement: “We truly believe that Lemonade was at a point where it made sense to partner with institutional capital.”
The move, he said, will help the group assemble “a team of world-class talent” to move forward with growth into new markets.
“When measuring the pedigree of KKR and their track record as ‘brand-builders,’ the decision was an easy one,” Olsen said. “We believe this partnership will help us transform Lemonade from a regional brand to something much bigger and broader — part of a national conversation.”
Founded in 2008, Lemonade is known for its rotating seasonal menu, served in a contemporary setting that borrows from the retro cafeteria format.
Guests, for example, might choose from a lineup of salads, like ahi tuna with watermelon radish, snap peas, black sesame and ginger; red quinoa with arugula, Fuji apple, sunflower and pistachios; or voodoo Indian lentils with cauliflower, mango and toasted cashews.
Hot braised entrees might include barbecue brisket, cilantro-mint chicken curry or short-rib pot roast.
Restaurants offer a wide range of vegetarian options, like chili or braised kale with tomato and white beans. Lemonade also serves an array of desserts, from red velvet cupcakes to cookies-and-cream sandwiches. Almost everything on the menu is priced under $12.
The deal is another example of institutional investors’ growing interest in small regional concepts that are raising the bar on quality food in the limited-service space.
Last year, private-equity firm Catterton Partners invested in Chicago-based Protein Bar, as well as Austin, Texas-based Snap Kitchen and the Bruxië waffle-sandwich concept, based in Anaheim, Calif.
TSG Consumer Partners LLC has invested in the Houston-based take-away concept My Fit Foods. Brentwood Associates placed $20 million in Santa Monica, Calif.-based Veggie Grill. And venture-capital firm Revolution Growth invested $22 million in Washington, D.C.-based Sweetgreen.
Earlier this year, Lee Equity Partners invested in the fast-casual pizza concept Project Pie, and KarpReilly LLC took a controlling stake in the deep-dish pizza chain Patxi’s Pizza, based in San Francisco.
Contact Lisa Jennings at [email protected].
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