Edinburgh-based private equity firm Inverleith announced it has held the final close on Inverleith Limited Partnership, the firm’s first fund, at its hard cap of EUR60 million (US$70.5 million).
Inverleith was founded by former Chairman and Chief Executive of Noble Group, Ben Thomson, and former president and managing director of The Glenmorangie Company and partner and head of UK for L Capital, Paul Skipworth.
The firm targets its investments toward UK-based and (opportunistically Northern European) consumer brand businesses with revenue of up to £30 million (US$48.6 million).
“With Inverleith Limited Partnership we look forward to helping to build market-leading brands through our hybrid of hands-on operational expertise, investment experience and deep consumer focus,” said Paul Skipworth, managing partner, Inverleith.
Driven by macro trends that include an increased consumer awareness of both mental and physical well-being and the role that food plays in human health; rising popularity of craft brands; the adoption of e-commerce as a channel for growth; and the ability for small startups to rapidly innovate and adapt to market demands, Inverleith acquires majority or strategic minority stakes in scalable businesses with a “strong defendable market position”, according to the firm’s website.
“A number of macro trends are creating an attractive and sustainable investment environment within our target sector. We believe Inverleith’s differentiated skills will allow us to continue to capitalise on these trends to deliver attractive returns to our investors,” notes Skipworth.
Already Deployed
Inverleith Limited Partnership has already been deploying capital through two completed investments: the first being in the Scotch Malt Whisky Society, the world’s leading subscription single cask malt whisky society, and the second occurring only last month, in UK-based hemp food and beverage company, Good Hemp.
Good Hemp fits Inverleith’s investment criteria well. Founded in 1998 by Henry Braham and Glynis Murray at their farm in Devon, England, Good Hemp produces a range of hemp-based products including hemp milk, protein supplements, protein flours, and hemp seeds.
“Whilst many asset classes seem to be pretty fully valued at present, we believe there is a real opportunity to invest in smaller, disruptive consumer brand companies that have great products in fast growing markets,” said Ben Thomson, chairman and partner, Inverleith. “By bringing managers from our networks, we can professionalise the team, particularly in marketing and sales, to build companies to a size where they become attractive acquisitions for trade players or mid cap private equity buyers.”
The global hemp-based food market is expected to see a CAGR in excess of 24 percent between 2018 and 2022, according to Technavio. This impressive growth is forecast to be largely driven by an expanding vegan population and a higher rate of diagnosis of celiac disease.
Hemp (cannabis sativa) contains no THC and is one of the oldest and most sustainable crops grown. Produced without pesticides, hemp is high in omega oils, protein, fiber, vitamin E, potassium, and iron. The plant captures four times the CO2 as the same area of trees, and requires 14 times less water than cotton.
“Good Hemp continues as a successful investment within our health and wellness investment category,” said Skipworth at the time. “The company is firmly placed to take advantage of the high growth plant based food & drink trend, with high quality hemp based products which are nutritionally rich, whilst also being manufactured from a sustainable plant.”
-Lynda Kiernan