Sydney investment company TDM Growth Partners is backing Australian fast food franchise Guzman y Gomez’s plans for rapid international expansion, tipping $44 million into the Mexican taqueria chain as it seeks to take on the competitive US market.
TDM Growth Partners will have two seats on the board for its minority stake in the 12-year-old business, which now has 120 restaurants and drive-thrus across Australia, Singapore and Japan – 80% of them franchised.
Guzman y Gomez founder and CEO Steven Marks said the company’s largest capital raise to date began six months ago with the hunt to find the right partner.
“TDM understands the Australian market and the team are our customers. They understand our brand, our commitment to fresh, quality food, our focus on creating exceptional guest experiences and our investment in using data and technology to drive the business,” he said.
“Their support for our strategy has never wavered.”
Some of the cash injection will go towards expansion in Australia, with Marks also hoping to take coals-to-Newcastle by launching his brand of Mexican fast food in the US as well as other new international markets.
TDM partner Tom Cowan, who is joing the GYG board along with Hilton Brett, said his investment firm was impressed by the passion the board and management have for the business as well as their focus on culture.
“We believe people and culture are critical to driving a competitive advantage, and GYG has fostered this from day one,” he said.
“We are excited by the growth profile of GYG — in our experience it is very hard to find an Australian based business with sales of over $200m growing at 30% per annum, and we look forward to being a long term supportive shareholder as the business continues to scale quickly.”
Like Domino’s, which announced its results today, privately owned Guzman y Gomez has focused on technology and food innovations to drive its customer engagement, from free burrito days to a breakfast burrito and drone deliveries to build its annual turnover to more than $200 million.
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