SEMCAP Food & Nutrition Division Makes First Investment in Purely Elizabeth

Private equity firm SEMCAP invested in breakfast brand Purely Elizabeth last November, the company announced today. The deal, part of a $50 million round, marks the first investment by the firm’s newly launched Food and Nutrition division, which is led by managing partner John Haugen, the former general manager of General Mills’ 301 Inc. investment group.

“I couldn’t think of a better business, brand and authentic founder than Elizabeth [Stein] and Purely Elizabeth,” Haugen said. “We’re obviously thrilled to use this as a launchpad [and] continue to expand from here.”

The $50 million round was co-led by SEMCAP along with Swander Pace Capital and SEMCAP’s Partner, Fresh Del Monte. The raise marks Purely Elizabeth’s first funding since 2017, when Haugen oversaw a $3 million investment into the brand while heading 301 Inc. Whipstitch Capital served as the exclusive financial advisor to Purely Elizabeth in the transaction. The deal will also see Haugen returning to his previous seat on Purely Elizabeth’s board, a move Haugen said will provide “strategic continuity.”

SEMCAP, which was founded in 2018, has three divisions under its purview – health care, education and, now, food and nutrition– which represent “the future of humanity,” Haugen said, and areas that are “ripe for ongoing investment in disruption.” The investment group is in the process of raising its first fund for the food and nutrition group — Haugen declined to comment on the source of capital for the Purely Elizabeth deal.

“With the SEMCAP food nutrition fund, we can truly follow the consumer,” Haugen said of his new role. “We can be on the leading edge of helping to reimagine where the food system is going, and we can make investments that I think can drive great returns for our shareholders, but also create a really positive impact.”

Moving forward, the fund plans to invest in “mid-stage high growth” businesses that are generally over $25 million in revenue and on their series C or D financing rounds. Brands must also have an established proof of concept as well as “demonstrated evidence of scale,” Haugen said.

Purely Elizabeth has enjoyed 55% CAGR over the last five years, he said, while nearly doubling its retail footprint to 15,000 stores.

In addition to investments in operations and manufacturing, Stein said the financing will go towards funding an entrance into “a whole new category,” as well as supporting the launch of new branding later this year. The company will also seek to expand its existing presence in the natural channel as well as reaching a more mass audience via conventional grocers2, Haugen added, noting that retailers appreciate the premium-priced line for bringing incremental revenue,

“Retailers don’t want me-too brands that just trade share,” Haugen said. “She will bring traffic into the store because her products are on the shelf. I think that’s what’s driven her growth and that’s what’s going to continue to drive her growth and expansion.”