Background

In 2006, three childhood friends, Ted Xenohristos, Ike Grigoropolous, and Dimitri Moshovitis, all sons of Greek immigrants and passionate about the food they grew up with, started the first sit-down CAVA Mezze restaurant in Rockville, MD. As the delicious mezze (shared plates) and warm environment that they fostered led to crowds of loyal diners, they started thinking of how to bring their food to more customers. They began a packaged foods business and brought on Brett Schulman as a fourth partner. Then, in 2011, they opened the doors to the first CAVA “chef casual” restaurant – bringing modern perspectives to Mediterranean in a convenient, healthy format. Beginning with that restaurant, they made it their mission to bring the Mediterranean Way to customers across the United States.

Key Insights and Vision

• Fast casual was taking share out of out-of-home dining spend from both fast food and casual dining, with consumers seeking healthy, high quality, and convenient alternatives.

• The Mediterranean category had huge tailwinds, with increasing penetration of Mediterranean products like hummus and pita chips at grocery, analogous to the growth of sales of Mexican foods like tortilla chips and salsa two decades earlier. This was fueled by growing awareness of the benefits of the Mediterranean diet.

• No clear national leader had been established in Mediterranean fast casual. When we met Brett, Ted, Ike, and Dimitri in 2013, CAVA was far from the biggest player in the space, but we were convinced they were the best, with superior food; a passionate, caring culture; and exceptional unit economics in their first five units in the Washington, D.C. metro area (the “DMV”).

• We began our partnership with an investment in CAVA’s Series A in 2015 to help CAVA scale beyond the DMV.

Company’s Strategic and Operational Achievements

• From the time of our initial investment in 2015 through 2018, CAVA successfully translated its success in the DMV across the country, with a “coastal smile” real estate strategy stretching from the Northeast down the East Coast, through the South and Southwest, up through California. By the end of 2018, CAVA had scaled to 72 units.
• CAVA consistently demonstrated consumer traction and attractive unit economics not just in major cities, but also in smaller cities like Richmond, VA, and in suburban and exurban environments.
• In 2018, the opportunity arose for CAVA to acquire Zoe’s Kitchen, a much larger Mediterranean fast casual competitor that had struggled in the public markets. We worked with the CAVA team and our partners at Act III Holdings to acquire Zoe’s and integrate it into CAVA, providing scale and a large portfolio of quality real estate in attractive markets.
• Throughout 2019-2022, the CAVA team converted the majority of the Zoe’s Kitchen units into CAVA units, all while navigating the COVID-19 pandemic. We closely collaborated with the team on the city-by-city and site-by-site conversion strategy.
• As of April 16, 2023, through the combination of the conversion strategy and continued new restaurant openings, CAVA had grown to 263 owned and operated restaurants across 22 states and Washington, D.C., with strong unit economics and growth.
• While growing more than 50x in scale, Brett, Ted, Ike, and Dimitri have successfully maintained the strong culture and delicious food that set them apart when we first met them in 2013.

Outcome

• In June 2023, CAVA completed the first consumer growth US IPO since markets had cooled in 2022, raising $365 million to fund future growth while attracting a marquee investor base.
• Artal International S.C.A., an Invus affiliate, remains the company’s largest shareholder.