August 16, 2022

By Lynda Kiernan-Stone, Global AgInvesting Media

Los Angeles-based, food-focused private equity investor Butterfly announced the closing of its second fund with capital commitments of $1 billion. Nearly double the size of its predecessor, the closing of this fund brings Butterfly’s total AUM, including its first fund and co-investments, to almost $4 billion. 

“We are beyond excited to announce the closing of this sophomore fund and are overwhelmed by and thankful for the receptivity and support we have received from our investors and their confidence in our team,” said Adam Waglay, co-founder and co-CEO, Butterfly.

Led by partner and head of portfolio operations (and another former KKR executive) Derick Prelle, Butterfly partners with founders and management teams to accelerate growth and transform businesses by leveraging highly specialized operational resources.

Examples of category leaders in Butterfly’s portfolio include:

Chosen Foods – a pioneer and leader in avocado oil and creator of a line of avocado-based kitchen staples. 

MaryRuth Organics – a rapidly growing health and wellness brand offering vitamins, minerals, and supplements. 

Pete & Gerry’s Organic Eggs – the leading U.S. producer of organic, free-range, and pasture-raised eggs.

And Pacifico Aquaculture – the only producer of ocean-raised striped bass in the world. 

The announcement of the close of its second fund comes after Butterfly signed a definitive agreement to acquire QDOBA from Apollo Global Management with the intention of merging it with its existing brands to create a leading fast casual restaurant platform in North America with nearly 800 locations.

It also follows the announcement that Butterfly, together with Bolthouse Farms, the top supplier of carrots to North American retailers and number one premium refrigerated beverage brand, have agreed to acquire Evolution Fresh from Starbucks earlier this month – a move that will strengthen Bolthouse’s position as a leader in the premium juice and refrigerated beverage categories.

Earlier this year, Butterfly also sold a majority stake in Orgain, the leading plant-based functional nutrition platform in the U.S., to Nestlé Health Science.

“When we launched Butterfly, we knew the opportunity for a specialized focus in the food sector across the seed to fork spectrum was significant, but it has far surpassed what we expected in many ways, and this is just the beginning,” said Waglay.

“Through these uncertain times, the food sector has emerged as one of the most important sectors for investing and we are humbled to be at the edge of this new frontier as a partner of choice working with such incredible food industry leaders, innovators and disruptors to drive transformational change and growth where it matters the most.”

Reflecting a passion for exacting a positive impact through food, concurrent to the firm’s launch, Butterfly also established the Butterfly Equity Foundation with the goal of improving the health and wellbeing of all people through greater access to nutritious food.

At the core of this mission is food justice, which Butterfly believes is central to physical and mental health, cultural identity, the environment, and more. Toward this end, the Foundation furthers the work of nonprofits that foster food security, promote health, and support affordable food retail in low-access neighborhoods.

This foundation is supported by Butterfly’s general partners who have pledged to contribute 10 percent of their net profits, in addition to outside funds from individuals and corporate donors to the cause.

“Consumers around the globe care more today than ever before about doing business the right way,” said Dustin Beck, co-founder and co-CEO, Butterfly. “Across our portfolio, we have a vigorous focus on leading by example in the food system, both with our philanthropic efforts and our commitment to making a positive impact, which is passionately embraced by Butterfly and its partners as demonstrated by our commitment to B-Corp certify our investments and our firm itself.”

Beck continued, “We’re thrilled to have this opportunity to partner with founders and management teams on their journey to create strong businesses, particularly in such a fun, exciting and disruptive space within the food ecosystem. We’ve been able to bring a set of intangibles to the table beyond traditional capital partners, particularly around our operational and technological capabilities, to help our underlying companies realize their full potential.”

~ Lynda Kiernan-Stone 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 Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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