New 5.2x exit for ProVen VCTs: leading food distributor that was once a small deli in Clerkenwell
In January, the ProVen VCTs announced the profitable sale of their stake in Lupa Foods, a leading supplier to the UK food industry, to Nordic group Geia Food.
The company was a top-10 holding in both ProVen VCTs. The sale generated proceeds of £9.5 million – a 5.2x cash-on-cash return for the VCTs. Past performance is not a guide to the future.
Lupa's roots go back to 1902, when it started as a little delicatessen in Clerkenwell, London. Pining for the delicious food and produce of his native southern Italy, Luigi Donatantonio opened the shop to import gourmet items and supply his local community.
The ProVen VCTs first invested in 2007, when the company was still known as Donatantonio – a family-run importer specialising in Mediterranean foods, with a Royal Warrant to supply HM the Queen.
What has been the company’s growth trajectory since? Why did manager Beringea invest? How could you invest in similar companies through the ProVen VCTs?
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The ProVen VCTs’ journey with Lupa Foods
The company has scaled significantly over the course of the ProVen VCTs’ investment – diversifying its offering for food manufacturers, recipe box companies and other industry key players.
Growth accelerated when Donatantonio merged with Compleat Food Network in 2018 – supported by debt funding provided by Beringea, the VCTs’ manager. The combined business brought together two of the UK’s most experienced ingredient-sourcing firms and was rebranded as Lupa Foods.
With an experienced team of 35, the business established a reputation for operational efficiency and a customer-centric approach. Besides being an importer and distributor, the company partners with the UK food industry to provide a range of B2B services encompassing new product development, technical support, procurement and logistics.
By the time the investment was exited, the Company was generating £45 million in annual revenues.
We have been on a remarkable journey with the team at Lupa Foods. The business has gone from strength to strength in recent years, expanding its client base, scaling revenues, and strengthening profitability. This has been testament to the leadership and drive of [CEO] Manish Mandavia and the wider leadership team. We look forward to watching the business flourish during this new chapter.
Lupa Foods is a pioneer in the UK’s food industry with an impressive 120 years’ experience. As one of the first food importers in the United Kingdom the company enjoys an excellent reputation, and its industry and product knowledge has no equal.
Why did the ProVen VCTs invest?
Launched in 2000 and 2001, the ProVen VCTs have always focused on growth capital investments.
Their manager Beringea seeks companies it believes have a proven commercial business and an exceptional team capable of taking the company to exit. The companies must be already profitable, or able to show a clear path to profitability. Beringea will aim to be a key part of the team with significant influence in the business.
How to invest in similar companies
The two ProVen VCTs – ProVen VCT (PVN) and ProVen Growth & Income VCT (PGI) – are currently open for investment.
Investors can get exposure to a portfolio of around 55 companies (November 2024) with a bias towards the consumer and B2B software sectors. Manager Beringea operates in both the UK and US, giving it a transatlantic outlook unusual in the sector.
The VCTs target annual dividends of around 5% of NAV – dividends are variable and not guaranteed.
In the 10 years to December 2024, PVN and PGI have produced a NAV total return (including dividends) of 49.6% and 28.0% respectively. Over the five years to December 2024, returns were 10.7% and 10.1% respectively. Past performance is not a guide to the future.
About the manager
Beringea LLP is the UK arm of transatlantic venture specialist Beringea LLC.
Beringea has successfully backed entrepreneurial businesses for over 30 years and currently manages UK and US venture capital funds of more than $900 million – including c.£330 million of VCT assets in the UK, and $470 million across four institutional funds in the US (October 2024).
Meanwhile, the manager’s international footprint means it can provide on-the-ground support to help companies expand across the Atlantic.
Performance of the ProVen VCTs
NAV and cumulative dividends per share over five years (p)
Source: Morningstar. Performance figures are calculated net of fees, on a NAV to NAV basis. Past performance is no guide to the future. Dividends are variable and not guaranteed. The bar chart shows net asset value and cumulative dividends per share for the period 31/12/2019 - 31/12/2024.
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Alex Davies
Chief Executive
Alex was a board director at Hargreaves Lansdown, where he worked for 15 years. He was responsible for building Hargreaves Lansdown into the biggest direct-to-consumer SIPP provider in the UK with more than 150,000 clients and over £12 billion under management. He is a keen investor with a portfolio of shares, funds, student property, EIS and VCT investments.