Bulk Reef Supply takes investment from Bertram Capital

Reef Builders

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Bulk Reef Supply – the popular saltwater aquatics retailer has taken an investment from Bertram Capital. The terms of the deal were not disclosed. Bertram Capital invests in growing digital commerce companies such as Bulk Reef Supply to help grow their business. This marks a historic time as the saltwater aquatics industry is growing at…
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revhtree

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Happy for BRS and the whole team! Congrats!
 

The Camaro Show

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So does this mean their prices will go up to help pay off the loan?
Exactly, or they were struggling. No one just takes a investment and gives a piece of their company away.
 

Sunwoozy

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Bulk Reef Supply – the popular saltwater aquatics retailer has taken an investment from Bertram Capital. The terms of the deal were not disclosed. Bertram Capital invests in growing digital commerce companies such as Bulk Reef Supply to help grow their business. This marks a historic time as the saltwater aquatics industry is growing at…
Source

Continue reading...
Hmm, Private Equity getting involved. It will be interesting to see if they're able to retain autonomy over the long haul. Everyone having their own reef in the office may be viewed as an unnecessary expense.
 

reeferKen

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I agree Riche a great retirement plan for them, a PE group gobbled up eye doctor practices for 770 million, then 3 years later sold to Goldman sachs for 2.7 Billion.
 
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Tuffyyyyy

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Exactly, or they were struggling. No one just takes a investment and gives a piece of their company away.
I can't see them struggling. The hobby has never been bigger with the pandemic, and (I believe) the previous manufacturing delays have been fixed. I'm think there's a substantial project they want to launch and needed the investment to do it.
 

Variant

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I can't see them struggling. The hobby has never been bigger with the pandemic, and (I believe) the previous manufacturing delays have been fixed. I'm think there's a substantial project they want to launch and needed the investment to do it.
The buyout gave the shareholders liquidity. Whether the liquidity will be reinvested is up to BRS and we'll probably never know unless Ryan upgrades his 360 to a 360,000 gallon system ;).

Just gotta hope and pray that there are enough provisions and voting rights for the original shareholders of BRS to prevent the investment team from forcing a sale to a company like PetCo. It'll be like Live Aquaria all over again. But once an investment firm buys in, there will inevitably be a sale later on. Just a matter of who will come in to replace Bertram Capital 3-5 years from now.
 

Tuffyyyyy

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The buyout gave the shareholders liquidity. Whether the liquidity will be reinvested is up to BRS and we'll probably never know unless Ryan upgrades his 360 to a 360,000 gallon system ;).

Just gotta hope and pray that there are enough provisions and voting rights for the original shareholders of BRS to prevent the investment team from forcing a sale to a company like PetCo. It'll be like Live Aquaria all over again. But once an investment firm buys in, there will inevitably be a sale later on. Just a matter of who will come in to replace Bertram Capital 3-5 years from now.
My assumption is more along the lines of it being a very small stake for a capital injection to finance something. BRS is a pretty mature company at this point, and the Company's partners are already pretty wealthy, so taking this on just to line their own pockets seems farfetched. There is the possibility that Ryan's partner wanted out I guess.
 

Fishyfish22

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Just gotta hope and pray that there are enough provisions and voting rights for the original shareholders of BRS to prevent the investment team from forcing a sale to a company like PetCo. It'll be like Live Aquaria all over again.

Yikes imagine petco gutting BRS like they did dr.fostersmith...
 

naterealbig

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Exactly what I expect from Jake Adams and Reef Builders. An interesting tag line preceding an article with zero substance. Great at passing on "secrets" to others with no followup, no real information, and obviously no collaboration with BRS. The gossip queens of the industry....
 

TerraFerma

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They have been busting their butts for years - nothing wrong with getting paid out for their hard work.

Their model is built upon competitive pricing, product selection, and support. There are no terms in the (yes useless RB blurb) but it's likely a minority stake and I doubt the BRS model will change.
 

Mike konesky

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Exactly what I expect from Jake Adams and Reef Builders. An interesting tag line preceding an article with zero substance. Great at passing on "secrets" to others with no followup, no real information, and obviously no collaboration with BRS. The gossip queens of the industry....
Clearly zero substance, information, or collaboration with brs. Someone doesn't care for Reef Builders...or reading the source listed in their link.

Bertram Capital Announces Investment in Bulk Reef Supply
 
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Mawlbec

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Been in PE/VC for many years.

The play is growth capital to drive EBITDA to a multiple. Special VCs and PEs provide “value-add” by helping the management team operationally or offering their Rolodex. In the old days this was large capital investments for warehouses and increased inventory and better logistics but now the investment is more in sales and marketing with today’s smarter inventory and logistics systems we’ve learned from Amazon.

In return this typically means more administrative and compliance to agreed upon budgets and measures to dress up. Likely founders had to give up equity but I‘ve typically seen these deals restructured and restated so as to “clean up” the balance sheet to make the opportunity look more attractive as the enterprise value grows. The founders are usually granted incentive but are behind a “waterfall”, meaning they have to make money for investors before they really make money for themselves.

I would expect more efficient customer growth and service (yay to us) and wider product offerings (more neutral as this could be a good thing or bad thing for consumers). I’d expect higher brand awareness so attention to BRS products is a great guess. I can personally tell the BRS team is passionate and likely will always stick around until too much money for retirement, but I’m sure one of the selling points to capital was the large and engaged customer base via social media and how much we all tend to love them and their videos. This will become even more targeted as they transition from e-commerce to maybe something more, it was just publically undisclosed.

If things go poorly for them or in the industry there are usually a lot of pain points negotiated by the PE, so I’m sure this decision was not taken at all lightly and everyone agreed this provided a better future ahead.

Just some thoughts.
 

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