NEW YORK, United States — US salad chain Sweetgreen has raised $364 million in an initial public offering, bucking the trend of several wellness companies that have experienced disappointing debuts on the stock exchange recently.
The 14-year-old company, which sold 13 million shares on Wednesday for $28 each, according to Bloomberg, had initially marketed 12.5 million of the shares for $23 to $25. By Thursday its shares had skyrocketed to $51.
Based on its above-range IPO, the brand now boasts a market value of almost $3 billion.
The positive outcome is in stark contrast to Xponential Fitness, Peloton and Hims & Hers, which have all debuted disappointingly over the past couple of years.
Since launching in 2007, Sweetgreen has been disrupting the $800 billion US restaurant industry by rethinking the customer experience and challenging traditional ways of what it means to be a fast-food company.
Every day, across its 97 restaurants (outposts), over 4,000 team members make food from scratch, using fresh ingredients and produce to cater to a cult following of customers. According to the brand, pre-pandemic, outpost customers were its most habitual users, with the average outpost customer ordering approximately six times per quarter.
And, despite a sharp shrinkage in sales due to the closure of its physical sites during the pandemic, it has quickly recovered thanks to its speedy shift to digital and investment in cutting edge technology.
According to CNBC, the brand’s same-store sales rose by 21%, as of September 26th 2021, while its losses narrowed to $86.9 million from a loss of $100.2 million in the year-ago period.
To further boost its recovery and futureproof its offering for the future marketplace, last year the restaurant chain raised a further $2 million in a funding round co-led by Lone Pine Capital and D1 Capital Partners.
“We’re building a new type of food company and a sustainable supply chain to challenge how we think about real food, explore innovative new retail formats, and elevate the consumer experience,” said Jonathan Neman, Co-founder and CEO of Sweetgreen, at the time.
“This foundation will allow us to push boundaries and broaden our impact, doing even more with our suppliers, partners, and technology so that together we can bring about industry-wide change, he added.
With over 50% of the brand’s orders now taking place through digital channels, it believes that mobile dining has cemented itself as the next phase for the future of food. To meet the expectations of its evolving customer base, it is now focused on testing and deploying emerging technologies.
In August, the brand announced its intention to acquire Spyce, a Boston-based restaurant company powered by automation.
It is hoped the acquisition will allow the brand to reimagine healthy fast food with even better quality, consistency, and efficiency.
Off the back of its IPO, Sweetgreen has revealed it plans to use its latest injection of capital to further develop this technology.