My Food Bag on course for IPO
Founders step aside as delivery service gears up for next phase of growth
My Food Bag is on track to list before the end of next year and there is strong market appetite for the company to go public, commentators say.
Cecilia and James Robinson, cochief executives of the food delivery company, said yesterday they were stepping down from their roles and were in the process of choosing a new boss to take the company into the next growth phase.
Both would remain on My Food Bag’s board.
After Auckland-based Waterman Capital’s investment in the firm in 2016, Robinson said the company was looking to list within the next three years.
Yesterday she confirmed the business was still on track for this, meaning an IPO would likely be in the next year.
“When we went through the transaction 18 months ago [ with Waterman] we said that My Food Bag would absolutely be looking at an IPO, and none of those goals have changed,” she said. “That timeline is still in play.”
James Lindsay, senior portfolio manager at Nikko Asset Management, said that after a lull in new company listings in recent years, the market would welcome a new offering.
“Adding diversity to the market is always useful and good growth stories are normally well supported,” Lindsay said.
“There has been a bit of a hiatus where there hasn’t been much on the go for a few years but [there is always] appetite in the New Zealand market for good ideas priced well.”
The Robinsons founded My Food Bag in March 2013 with MasterChef winner and dietician Nadia Lim, her husband, Carlos Bagrie, and former Telecom chief executive Theresa Gattung.
The concept is based on delivering a week’s worth of recipes and the ingredients needed to make them.
Within the first three years, the company reached $100 million in annual revenue and 30,000 customers across 14 cities in New Zealand and Australia.
The most recent reported figure for revenue was $150m a year.
Craigs Investment Partners research analyst Mohandeep Singh said there was investor appetite for new opportunities, particularly businesses that had a good growth story.
“The important thing, for retail investors at least, is it’s a well-known brand. It’s generally a bit easier to get things away if it resonates with retail investors and certainly My Food Bag will — there will be a lot of homes that have it delivered.
“From a trying to sell the idea to investors perspective, a lot of people will already be across My Food Bag, and it’s a business that still has a growth slant,” he said.
At the time of Waterman’s investment, the company was valued at $120m and company records showed the investment firm owned 70 per cent of the company.
Brian Gaynor of Milford Asset Management said the company was likely to be looking for a chief executive who had more experience with fastgrowing companies and taking a firm public.
“It has grown very fast but there is quite a big difference between growing from $0 to $100m compared with $100m to $500m,” he said.
“They probably need someone who has more experience of that, particularly on the investor side.”
The company said its succession plan had been in place since last year to give the board and business time to find a suitable chief executive.
Cecilia Robinson said the decision was also based on wanting to spend more time with their young family.
They have a 51⁄ 2- year-old son, Thomas, and a 20-month-old daughter, Leila.
“We have a really young family and we’ve been working for a really long time, so we’re going to take some time out for our family.
“Clearly My Food Bag is a focus for us in a governance capacity, but we’re really going to enjoy our children and do some travelling.”
It has grown very fast but there is quite a big difference between growing from $0 to $100m compared with $100m to $500m.
Brian Gaynor, Milford Asset Management