A Los Angeles-based private equity investment firm has acquired Kansas City-based Service Management Group.
Although financial details were not disclosed, a release noted that Brentwood Associates made a “significant investment.” The firm typically invests $20 million to $200 million, according to its website.
Founded in 1991, SMG combines technology and services to measure and manage customer, patient and employee experiences. One of its more recent offerings is a food-safety alert tool for grocery stores and restaurants to help them track and manage potential food-borne illnesses. Its customer base includes more than 500 brands, including Caribou Coffee, Sally Beauty, Taco Bell, AMC Theatres and McDonald’s. It employs about 375 people.
“SMG has unmatched category leadership, partnering with many of the largest restaurant and retail brands across the globe,” Brentwood Partner Craig Milius said in the release. “The experience management market is rapidly evolving, and we look forward to expanding SMG’s market presence through strategic investments that accelerate technology development and further differentiate the professional services practice.”
With its investments, Brentwood looks for several traits, including exceptional brands with true customer loyalty, meaningful product and service differentiation and the potential for significant growth across multiple channels, according to its website. It invests in companies with $20 million to $500 million in revenue. Last year, SMG raked in $65.05 million.
Brentwood’s investment will accelerate SMG’s innovation and growth and introduce its offering to new industries and geographies. Moving forward, Brentwood plans to retain SMG’s Kansas City headquarters, Operating Partner Jonathan Berkowitz told the Kansas City Business Journal.
The investment firm is bullish on the experience management category, he said.
„We have an investment thesis around the convergence of customer and employee experiences, and when we look at SMG, we feel like SMG is well positioned as a category leader. It has some strengths within the restaurant and retail subsegments and those align quite nicely with Brentwood’s north of four-year history of consumer and technology investing,“ Berkowitz said.
As part of the acquisition, co-founder and CEO Andy Fromm has stepped down from his role and will remain a passive investor. Davin Cushman, a software industry veteran, will take the helm. Most recently, Cushman was CEO of Ignite Technologies, a leading provider of enterprise software solutions.
“As I reflect on my 30-year career at SMG, I’m grateful for the experience, humbled by the success and proud of everything our team and clients have accomplished while helping improve experiences for millions of consumers and employees,” Fromm said in a release. “I look forward to the next chapter of my life and am excited to have an opportunity to play a role in the company’s future success as an investor.”
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SMG gets acquired by Los Angeles investment firm Brentwood Associates – Kansas City Business Journal – Kansas City Business Journal
