Camino Partners, which has $350m earmarked to help emerging brands with a proven concept and strong early consumer demand, is looking to invest in entrepreneurs who – like KIND founder Daniel Lubetzky – want to “build long-term value with values.”
But to do this, Camino Partners Managing Partner and former KIND executive Elle Lanning says the investment group wants to meet entrepreneurs where they are in their journey and help them blaze their own path forward, rather than follow that of another company which might not apply.
“In Spanish, which his Daniel’s first language, camino means journey, and what that means for us as it relates to this type of work is that no one’s journey [building a business] looks the same. … And we really don’t believe that what works for one brand or business and one set of people is … the way of the truth and the light,” Lanning said.
As such, she said, “the way we advise each company will be very unique to their situation.”
This might include a hands-on approach in which Camino Partners acts as a leadership team for a brand and meets with founders on a weekly basis, as it did when it first invested in the European breakfast and snack brand Belgian Boys, said Lanning.
Or, she said, it might be a more “on demand approach” that focuses on commercial development and branding for companies that are further developed or run by second-time founders, as in the case of Camino’s partnership with gimme seaweed, which was founded and led by Annie Chun and Steve Broad.
This flexible, personalized approach to investing is grounded in the Camino team’s experience as operators who know what it takes to not just make decisions but also execute them, said Lanning, adding this means that Camino is bringing more to the table than just capital.
“I like to say we’re operating partners with capital versus investors,” Lanning said.
Camino Partners seeks ‘meaningful minority positions’ in brands
Because Camino Partners plans on “being heavily operational,” Lanning said the team’s ability to invest in brands and entrepreneurs is less constrained by capital and more by time.
“We have to choose to curate a much smaller set of partner brands and businesses where we know we can lean in and deliver the support and guidance that they need,” she said.
This means the group is “targeting an average investment size of $20m, which would naturally take you to a place where … you’re looking at brands that are beyond the concept level, have a strong early consumer demand and are ready to build across a broader set of sales channels,” or which need to build out their infrastructure internally or their supply chain so they can move up, Lanning said.
She added that as equity investors, Camino Partners is looking for “meaningful minority positions,” rather than a 5% or 10% investment, which will allow the team to offer not just meaningful capital but also avoids diluting its attention so that it can offer its experience and skills.
“A lot of other investors may put management fees or retainer fees on a company’s P&L. But we look at that as part of the package that we are offering,” she said.
Camino Partner’s ‘ready-to-scale’ criteria
By focusing on a smaller set of 10 to 12 investments in the first few years with enough additional capital for follow-on support, Lanning said Camino will need to ensure each investment is a good fit for the group.
She explained this includes having a value-based culture and a product that creates value for the consumer.
Camino Partner’s also will apply a “ready-to-scale” criteria when evaluating potential investments, which includes:
- Values-aligned partners,
- Businesses solving for unmet consumer needs,
- Ability to travel – aka market versatility,
- Brands with a story to be told,
- Solid economic foundation, and
- Capital-efficient approach
Once Camino finds a good fit, it won’t be in a rush to exit, Lanning said.
She acknowledged a trend in recent years of investors quickly building up a business in two or three years and selling it, but she added Camino wants to ensure the team and brand are solid and than any potential acquisition will help further their journey.
Meet with Camino at Expo West
While Camino already has several brands in its portfolio, including gimme seaweed, Belgian Boys, the better-for-you Mexican brand SOMOS and the fast-casual Mediterranean grill CAVA, its team will be at Expo West with an eye out for additional partners as it supports its existing ones, Lanning said.