Chris Britt has a long career in mergers and acquisitions, but now that he’s out on his own he’s targeting founder-led companies to acquire and then help to build.
“I like to work with entrepreneurial businesses. I’ve never acquired a business from another private equity firm. I focus on businesses where the entrepreneurs say, I can visualize this person as being the next owner of the company,” he said. “I want them to feel good about the stewardship we can provide.”
Juice It Up is the second acquisition in 12 months for Britt Private Capital, a young family office founded by Britt that allows the West Coast-based financier to shed the stricter time requirements of private equity funds.
“I want to be able to really own and build these businesses over longer periods of time, if I’m still enjoying it and we’re building a lot of value,” he said about the acquisition that closed in February. “One of the issues in traditional private equity is it’s a rigid investment horizon. I invested in more than 50 companies in 20 years” at his former firm, Marwit Capital, “and many of those we sold I didn’t want to sell because they were doing so well.”
Frank Easterbrook was the principal owner, president and CEO of Juice It Up since 2001. It was founded in 1995 with its first location in Brea, California. Today it has 88 units, and Britt and new CEO Chris Braun will focus on boosting average unit volumes.
“I know the average unit volumes of the other brands, and Juice It Up is materially below. I think with a little bit of effort, just getting back to even is a big opportunity. We know what Nekter’s doing, Jamba’s doing, Smoothie King, and we feel like we have a 50 percent growth in average unit volume opportunity just to be in those ranges.”
Britt Capital bought Easterbrook’s interest in this transaction, and Easterbrook became a franchisee.
About a year ago, Britt Capital made its first acquisition, of Mountain Mike’s, a brand that Britt remembered from his college days. “Mountain Mike’s really struck a chord with us, because as undergraduates at Stanford in 1980 to 1984, the first Mountain Mike’s was on the edge of campus.” Mountain Mike’s is up to 190 units.
Brad Gordon, in his mid-60s and the founder of Mountain Mike’s, was “absolutely involved” when Britt Capital bought him out in the acquisition, “and I think he misses it a lot.” The second owner, Robert Quick, in his 30s, was also bought out because Britt Capital likes to buy 100 percent of a company, but Quick has an equity investment in Mountain Mike’s.
Britt says he enjoys finding brands that may be under the radar for others. “Sometimes these opportunities are not presented in a fully polished, packaged manner, and that turns a lot of people off,” he said. In Juice It Up’s case, “Frank didn’t even market the business. We just cold-called Frank, and said, Hey Frank, are you thinking of retiring? How would you like to consider it?”
Britt’s workdays now are different from his past. “I used to work on volume in the traditional private equity business. I want to invest in businesses that I’m thinking about every day, interact with management, but I also want to find things that are very stable if not countercyclical, and/or are feeding into a long-term more secular trend.”
Britt said his motivation is to do his own thing. “I’m 55 years old, and with the remainder of my career, I really want to work with people I enjoy, focus on companies that are exciting and you’re looking forward to being involved with every day.”