Food and drink / Health tech / Investing

Here’s a look at Sweetgreen’s DC roots

Its HQ may have left for California, but the fast-casual restaurant chain still holds strong ties to the DMV. Ahead of its IPO, here's how.

A Sweetgreen location in Arlington, Virginia. Photo by Flickr user Tony Webster

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After more than a decade of opening new stores and attracting the big investor attention, fast-casual salad chain Sweetgreen is hitting the New York Stock Exchange with an initial public offering.

In late October, the company filed an initial IPO document announcing its intention and filed an amendment with the SEC last week with terms. The salad retailer, which is valued at $1.78 billion, according to PitchBook, is expected to price its shares at $23 and $25 apiece, trading under the ticker SG. Following the IPO, the company is expected to be valued at $2.7 billion, and it’s on track to double in size over the next three to five years.

Alongside operating as a success story despite a tumultuous 18 months for the restaurant industry, Sweetgreen has also embraced digitalization in its operations. According to its SEC filing for the IPO, 68% of its revenue came from digital orders for its fiscal year, which ended September 26. It operates 140 locations in 13 states, plus DC.

The company has not released an official IPO date, but it’s expected to start trading on November 18, according to IPO Exchange. The news follows its acquisition of Boston-based automated kitchen company Spyce in August. Financial terms were not released, however, the company had raised almost $25 million in total since its founding in 2015.

Although Sweetgreen has made its home in California, the chain actually started off in the DMV, with ties that date all the way back to a small kitchen on M Street. And it’s a root system that remains nearly 15 years after the company’s launch.

Here’s how the company stakes its claim to the DC area:

Its founders are Georgetown grads.

Back in 2007, Georgetown University alumni Nicolas JammetJonathan Neman and Nathaniel Ru founded the fast-casual chain two months after graduating. Its first shop opened up on M Street NW in the Georgetown neighborhood (which, btw, is still standing) quickly rising to success. Over the next six years, the company added 22 locations in the DMV region and along the East Coast in Philadelphia, Boston and New York.

Its connection to Georgetown is actually central to the company’s origin and mission. At the time of its establishment, Sweetgreen’s founders said they started the company with the idea of creating healthy eating options for college students like themselves, and they partnered with local farms and vendors to make it happen. SEC documents show several funding rounds between 2009 and 2013, totaling $6.6 million, before a prominent local investor stepped in.

It’s got DC investors.

Local venture capital firm Revolution has been a longtime investor of the salad company. Prior to its expansion to California, Revolution was a key investor in two funding rounds. In December of 2013, Revolution Growth invested $22 million toward expansion and new store openings in Philadelphia and New York City, and Revolution cofounder and former AOL CEO Steve Case also joined the board as an advisor in the deal.

Then, in 2014, Revolution took part in an $18.5 million investment round for the company alongside Stonyfield Farm founder Gary Hirshberg and Behance CEO Scott Belsky. The funding was put towards opening its first California store in 2015, which later led to a headquarters move to Los Angeles in 2016.

In 2015, the company also nabbed a $35 million round from, again, Revolution Growth as well as T. Rowe Price, an investment firm headquartered in Baltimore. According to Sweetgreen’s SEC filing amendment, T. Rowe owns 8 million shares of Sweetgreen’s Class A Common Stock and Revolution Growth owns 6 million, which represent 10.6% and 7.8% of shares, respectively. In January, the company also raised a $156 million round from Durable Capital Partners, based in Chevy Chase, Maryland.

It owns a DC company.

While Sweetgreen moved on to California for its headquarters, it maintains office locations in Arlington, Virginia and in DC. And the area seems to remain a pretty active spot in its business.

In 2019, Sweetgreen acquired meal-delivery startup Galley, also homegrown in DC, for an undisclosed amount. At the time, Galley said it would continue to operate as its own entity based out of DC. Galley CEO Alan Clifford also joined the Sweetgreen team as VP of logistics through the deal and has since risen through the ranks to VP of digital channels.

Following the acquisition, the two also launched a partnership in DC with food equity nonprofit Dreaming Out Loud to offer prepared meals to families in the area.

“We’re both companies with D.C. roots, and we’re like-minded in our mission and in our commitment to our customers to better understand them and meet them wherever they are,” Neman said in a statement at the time.

Companies: Sweetgreen / Galley / Revolution / T. Rowe Price

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