May 4, 2021

By Lynda Kiernan, Global AgInvesting Media

Los Angeles-based private equity investor Butterfly takes a “seed to fork” approach when building out its portfolio of agriculture, aquaculture, food and beverage, food distribution, and food service investments.

Its latest investment within this framework gained Butterfly a majority stake in Pete and Gerry’s Organics – the top producer of organic, free-range, and pasture-raised eggs in the U.S.

Headquartered in Monroe, New Hampshire, with a second processing site located in Greencastle, Pennsylvania, Pete and Gerry’s had humble beginnings in the 1800s as a three-generation family farm raising chickens and producing the highest-quality eggs possible.

In 2003 the company became the first Certified Humane egg producer, and in 2013 became the first egg producer in the world to achieve a Certified B-Corporation status. Today, the company partners with more than 130 family farms countrywide that adhere to the strictest standards of humane animal treatment and environmental sustainability, with its Pete and Gerry’s and Nellie’s Free Range brands being the top ranked egg brands in their respective segments.

“After growing a family business over several decades, Pete and Gerry’s has achieved a position in the market where we are poised to accelerate growth,” said Jesse Laflamme, CEO, Pete and Gerry’s.

“The choice to bring Butterfly into our family business required careful consideration of the alignment of values, mission, and the intention to build and grow. After meeting with the Butterfly team it was obvious they were the most ideal partner for our business and for all our stakeholders, from family farmers to our customers and consumers.”

Spread Those Wings

State by state the U.S. is adopting cage-free requirements for chickens in the egg industry, with a few of the latest being Michigan and Colorado, which both passed legislation on the subject last year, and Utah (which produces 1.5 billion eggs per year reflecting a $75 million industry in the state), passed bill 25-2 this March requiring that egg-laying hens be cage-free by 2025. 

As consumers become more aware of their food chains and more concerned with animal welfare within those chains, along with the passing of new legislation, signs are pointing to cage-free eggs being the future of the industry. And as such, investors are taking notice and gaining stakes in the space.

Sunrise Strategic Partners acquired a minority stake in Vital Farms, the largest producer of pasture-raised and ethically produced eggs in the U.S. at the time, in 2017. That same year saw private equity bidders queueing to bid for New Zealand’s Mainland Poultry, which includes the business Zeagold Foods, New Zealand’s largest egg producer. 

Two years later, Vital Farms was the first investment made by Colorado-based asset manager Manna Tree, before the company filed for an IPO in July 2020. 

And as the industry moves toward more humane production practices, either due to consumer demand or regulatory requirements, it will be businesses such as Pete and Gerry’s that will be best positioned to thrive and grow.

“Pete and Gerry’s is a forward-thinking, mission-driven company that provides a better egg to consumers, a better life for hens and a better model for America’s small family farmers,” said Dustin Beck, co-founder, Butterfly. “Butterfly is absolutely aligned with their mission and looks forward to supporting the team to continue these efforts.”

– Lynda Kiernan is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Oilseed & Grain News. She can be reached at lkiernan@globalaginvesting.com.