After a three-and-a-half-year hold, Summit Park has exited its majority investment in Fast Growing Trees, a direct-to-consumer provider of trees, shrubs, and live goods, to Berkshire Partners. According to the company, it is the largest online nursery in the world.
Cove Hill Partners participated on this transaction in partnership with Berkshire Partners and Summit Park will maintain a minority equity interest in the company.
Fast Growing Trees (FGT) sells more than 1200 varieties of trees, plants, and shrubs through its three websites – www.fastgrowingtrees.com, www.brighterblooms.com, and www.plantingtree.com. The company provides on-demand delivery and customers typically receive their order within three days of placement.
FGT partners with growers throughout North America to source its products and operates its own nursery located just south of Charlotte in Fort Mill, South Carolina. FGT, led by CEO Adam Smith, was founded in 2003 by members of the Zboch family.
“It has been a pleasure to work with Summit Park, whose partnership allowed us to successfully build out our leadership team, improve our operations and supply chain, and build our brand in the market through enhanced marketing capabilities,” said Mr. Smith. “We are excited for our next chapter of growth with our new partners as we continue to build on our success and disrupt traditional channels in our large and rapidly growing category.”
Summit Park invested in FGT through its second fund in February 2018 and over its ownership term the company more than quadrupled revenue and EBITDA.
“FGT has experienced tremendous growth and has positioned itself as the clear category leader for e-commerce live goods,” said Jim Johnson, a co-founding partner at Summit Park. “I am proud of our achievements in partnership with Bob Harris (former CEO), Adam Smith and the entire FGT team, and we are thrilled with the outcome for Summit Park, our investors, the Zboch family that re-invested alongside us, and the management team who will continue with the business.”
“Our management team led a transformation across multiple facets of the business – including revamping the supply chain, adding sophistication to marketing and customer care, and investing in fulfillment capabilities, which enabled the business to take advantage of a secular shift in how consumers are shopping for live goods,” said Mike York, a principal at Summit Park.
Charlotte-headquartered Summit Park invests in lower middle-market companies that have operations primarily based in the Eastern half of the United States and have revenues between $20 million and $150 million, and EBITDA between $4 million and $15 million. Sectors of interest include business and consumer services, light manufacturing, and value-added distribution. The firm is currently investing out of its third fund, Summit Park III LP, which closed in August 2018 with $245 million of capital.
“We are pleased to have the opportunity to partner with Adam and the company,” said Josh Lutzker, a managing director at Berkshire Partners. “Fast Growing Trees has built its reputation as a disruptor in the DIY live goods retail market, and we share the company’s vision of delighting customers by offering them top-quality products delivered right to their homes.”
Boston-based Berkshire makes majority or minority equity investments of $100 million to $1 billion in companies with enterprise values from $200 million to $2 billion. Sectors of interest include consumer, business services and technology, industrials, communications, and healthcare. Berkshire focuses primarily on North American companies however it will pursue select international opportunities as well.
Boston-based Cove Hill is known as a long-term and patient investor that makes control and influential minority investments in North American-based consumer and technology companies. Zack Kaplan, a managing director at Cove Hill, leads the firm’s investment in FGT.
The sale of FGT is Summit Park’s fourth exit from its second fund, Summit Park II LP, which had a final closing in April 2015.
William Blair & Company was the financial advisor to FGT.
© 2021 Private Equity Professional | September 20, 2021