About the Company
Smart Balance Foods is a leading marketer of premium, better-for-you food products under brand name such as Smart Balance, Smart Balance Omega, and Earth Balance. The company revolutionized the margarine market when it introduced a great-tasting spread that contained no trans fats and helped improve consumers’ good-to-bad (HDL to LDL) cholesterol ratios.
In 2004, we partnered with the founder of Smart Balance Foods in a majority recapitalization that included a modest amount of leverage, enabling investment in growth initiatives such as expanded marketing to drive trial and the development of new product extensions.
We encouraged Smart Balance to significantly increase its advertising spend to raise awareness of its products’ benefits and drive trial, which resulted in increased sales.
Additionally, we worked with the founder and management team to drive significant value by conducting consumer research, identifying functional benefits of avoiding trans fats consumption, and launching new product categories, including microwave popcorn and peanut butter.
Less than two years into our investment, Smart Balance became the #3 brand and the #3 SKU in the margarine category, up from #5 and #8, respectively.
When we exited our investment to Boulder Specialty Foods in 2006, sales and earnings had more than doubled and the market share of Smart Balance margarine in food, drug, and mass outlets had quadrupled since the year prior to our partnership.