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Food IPOs in 2023: Cava Group, BranchOut Food and Others

Food IPOs in 2023: Cava Group, BranchOut Food and Others

Cava Group is among one of the few food IPOs in 2023 and the only restaurant on the short list. Photo courtesy of Cava Group.

Recent initial public offerings (IPOs) from food companies such as Cava Group and BranchOut Food might give the impression of a reawakening IPO market after a seemingly quiet year. However, EY’s latest Global IPO Trends report for the second quarter of 2023 suggests otherwise. While a few IPOs have captured media attention, the broader US IPO scene remains muted.

Worldwide, Q2 2023 witnessed 310 IPOs, marking a three percent drop year-over-year. In the US, only 31 IPOs were observed during this period, down by 17 percent. Intriguingly, the IPO count in the Americas stands at 77 year-to-date, mirroring the figures from the same period last year. For context, over 1,000 firms debuted publicly in 2021. The current year has demonstrated a sharp dip, influenced by rising interest rates, supply chain hiccups and geopolitical shifts.

As for the food industry, three companies have already gone public this year, and several others are in talks to do so. Whether Impossible Foods will close an IPO by the end of the year remains to be seen, but here are the food companies that have announced IPOs this year, including Cava Group, BranchOut Foods and Instacart.


Related: Potential Food IPOs to Look Out For in 2022


1. Cava Group

The Mediterranean fast casual chain Cava Group achieved a notable $4.7 billion valuation after a successful market introduction on June 15. Upon its debut on the New York Stock Exchange, shares were priced at $42 each, almost twice the IPO’s set price of $22, marking an 89 percent increase. Through this offering, Cava sold approximately 14.4 million shares, securing $318 million.

Cava was founded by three Greek-origin friends — Ted Xenohristos, Ike Grigoropoulos and Dimitri Moshovitis. They launched their maiden restaurant, Cava Mezze, in Rockville, Maryland in 2006. Within a mere two years from its inception, Cava began offering its distinctive dips and spreads in nearby grocery outlets.

The quick-service restaurant sector has consistently reported robust sales in the past few months, even amidst rising concerns of an impending US recession. This year has witnessed notable listed counterparts like Chipotle Mexican Grill and Shake Shack enjoying a surge of over 48 percent each. This growth surpasses that of fast-food giants McDonald’s and Restaurant Brands International (RBI).

2. BranchOut Food

BranchOut Food Inc., a budding natural food brand with a proprietary technology for producing and marketing dehydrated plant-based foods, finalized its IPO in June. The company sold around 1.2 million common stock shares at a price of $6.00 each, yielding gross proceeds of approximately $7.14 million before factoring in underwriting reductions, commissions and anticipated offering costs. 

Starting June 16, the shares of BranchOut have been available for trading on the Nasdaq Capital Market under the “BOF” ticker. The funds acquired from the IPO will be channeled by the company towards settling debts, bolstering working capital and covering general business expenses, inclusive of operational costs and capital investments.

Founded in 2017, BranchOut has risen to the top of the natural food industry. The company is equipped with a proprietary technology platform tailored for the production and promotion of dehydrated plant-based foods. The brand holds licensed rights from an external entity for an innovative dehydration technique, specially crafted to dry and process delicate fruits and vegetables like avocados, bananas and more.

3. Instacart

In its Nasdaq introduction earlier this week, Instacart made a notable entrance, initiating trading at roughly 40 percent above its IPO price. After starting with a $30 IPO price on Monday, Instacart’s shares swiftly soared by up to 43 percent, touching over $40 shortly after trading started around noon. The shares later stabilized, reflecting a more modest 12 percent increase.

This shift nudged Instacart’s market capitalization to approximately $11.1 billion, up from its initial $9.9 billion. However, it’s still significantly lower than its $39 billion pre-funding evaluation achieved in a March 2021 private fundraising round. 

Established by Apoorva Mehta, Max Mullen and Brandon Leonardo, Instacart made its debut in the San Francisco Bay Area in 2012, facilitating food deliveries from neighborhood grocery stores. The following year, Instacart unveiled the Express membership program, later renamed as Instacart+, providing customers with unlimited free deliveries for a nominal monthly subscription. Instacart’s demand skyrocketed during the COVID-19 lockdowns and talks of an IPO were rampant ever since. 

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