SA国际传媒

While some restaurants have been hit hard by the coronavirus pandemic, one venture firm is making a $90 million bet on the industry.

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Salt Lake City-based has formed its inaugural food and beverage fund to invest in profitable restaurants looking to scale.

Mercato Partners’ Managing Director has partnered with restaurant industry veteran and former tech executive Andrew Smith to launch the fund, dubbed . Their goal is to fill a void in the food and beverage industry 鈥渂y delivering access to growth capital鈥� as well as provide advice from people with years of experience in scaling other restaurant concepts.

In 2008, Smith noticed that despite the economic downturn, many restaurants were still performing well.

鈥淩estaurants were filled to the brim, and lines still out the door during the 2008 crash,鈥� he told SA国际传媒 News. 鈥淓ven when the market鈥檚 down, people still have to eat.鈥�

Smith then founded , a restaurant operator that ultimately grew to running 175 locations with more than $1 billion in revenue. Smith said he treats growing concepts similarly to growing startups.

That 50-plus person team is now part of Savory, helping restaurant owners with things like real estate selection and negotiation, development and construction of each restaurant location, and project and event management, among other things.

The fund will write initial checks of $5 million to $10 million, Smith told SA国际传媒 News.

鈥淲e buy the equity from them and the founders take it off the table to de-risk themselves,鈥� he said. 鈥淭hen we鈥檒l provide an additional $5 million to $10 million for growth.鈥�

Savory plans to invest in seven to nine concepts out of the fund. So far, it鈥檚 already put money into three: 聽Mo鈥橞ettahs, R&R BBQ and Swig.

Profitability, as well as resiliency, is a requirement.

鈥淎 lot of brands have been compromised over the last three months due to COVID. But a lot have innovated through this and are doing just fine,鈥� Smith said. 鈥淭hose are the brands we are really intrigued with.鈥�

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