With the growing middle class and rising disposable incomes around the world, the restaurant industry offers attractive investment opportunities for private equity firms. However, the market is highly fragmented and competitive. Choosing the right partners with deep operational expertise is critical to driving value creation and realizing superior returns. This article analyzes the top private equity firms successfully investing in the restaurant space globally.
Large buyout funds with dedicated restaurant teams
Several large private equity firms like The Carlyle Group, Rhône Group, and Lion Capital have established dedicated teams and funds focused solely on restaurant investments. They leverage their scale, experience across cycles, and operational capabilities to drive consolidation and transform underperforming chains. For example, Rhône has helped Five Guys and Panera Bread scale rapidly in recent years. Meanwhile, Lion revitalized British sandwich chain Pret A Manger.
Specialist sector-focused firms
Beyond the mega buyout funds, there are a few specialist private equity firms exclusively focused on the restaurant industry such as TriSpan and powerful Foods. They concentrate on lower middle-market opportunities often ignored by larger players. With their concentration and hands-on support, these niche firms generate outsized returns from emerging, high-growth chains before they get on the radar of mainstream private equity.
Value-added operational support for portfolio companies
The top-performing private equity firms in the restaurant space combine deep industry expertise with hands-on operational support for their portfolio companies. For example, Roark Capital, the owner of Arby’s and Buffalo Wild Wings, has a Restaurant Leadership Conference where it gather marketing, operations and technology executives across its restaurant companies to share best practices. This allows them to replicate success, apply technology, and improve unit economics across chains.
In conclusion, the most successful private equity firms investing in restaurants combine sector focus, operational capabilities, experience across cycles and the ability to drive consolidation. By choosing the right partners, restaurant chains and franchisees can realize tremendous growth and value appreciation.