When Dutch Bros Inc. began making moves to go public, the last major restaurant chain IPO was Shake Shack, which filed for an initial public offering in 2015. But now that foodservice has become a hot commodity on Wall Street, Dutch Bros president and CEO Joth Ricci is even more assured that now is a good time to go public.
“It just felt like a good time, and we have a great story to tell,” Ricci told Nation’s Restaurant News. “We felt that the market was going to continue to recover after COVID last year. And we were building the basis of a foundation to grow.”
The Grants Pass, Ore.-based coffee chain is seeking a $3.3 billion IPO valuation, or $18-$20 per share and will use the ticker symbol, BROS.
They key turning point on the road to filing for an IPO, Ricci said, was partnering with private equity company TSG three years ago. TSG helped them to look at their performance and growth potential and set up a plan to move forward.
“They're arguably the best in the world at what they do,” Ricci said. “And working with consumer-facing companies evaluating good businesses and being a partner in growth, they've helped us with their experience in expanding multi-unit concepts.”
Ricci said that the peak of the pandemic last year did not hold them back from moving forward with IPO plans. Rather being an essential business allowed them to springboard forward into developing more digital technology investments like a new mobile app and rewards system which was launched Feb. 1 of this year. Since then, 2.7 million people signed up for the app and Ricci said they look forward to building upon that digital platform in the future.
“Going public solidifies us as a company,” he said. “I think it will help us fuel our growth as we tell our story in more markets and infill markets. […]Being on Wall Street, we’ve hit that spot where we belong with the other great companies on the stock exchange.”
After 30 years in operation, Dutch Bros. Coffee currently owns 470 drive-thru cafes in 11 states. In 2020, revenues increased 61.3% despite the challenges of COVID-19, though expenses were also up, which cut net income by almost 80%.
This has been a record-breaking year already for U.S. public offerings. First Watch just registered for a possible IPO this week. Krispy Kreme has plans to go public later this year, and Sweetgreen just announced an IPO in June. In July, Portillo’s confirmed that the company has plans to go public and had just submitted a draft registration, while Olo was also one of the highest-profile public offerings this year, with Noah Glass’ digital platform beginning to trade publicly in March.
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