Capital Allocators – Inside the Institutional Investment Industry
Business:Investing
3G Capital’s buyout of Burger King may be the most successful private equity deal you’ve never heard about. Over the last fourteen years, or the length of a typical private equity fund, 3G turned a $1 billion investment into $28 billion in value. The annual dividends from the investment accruing to 3G today are around 70% of its invested capital. The deal is one of the highest earning buyouts ever.
3G is an organization with a storied history. Founded by Jorge Paolo Lemann, Carlos Alberto Sicupira, and Marcel Herrmann Telles, the group created an owner-operator model of investing. They rose to prominence through building the largest beer company in the world, initially buying local brewer Brahma in 1989, expanding it and merging with a competitor to become AmBev in 1999, merging with Interbrew to become ImBev in 2004, and taking over Anheuser Busch in 2008 to become AB InBev.
Twenty years ago, Alex Behring, a young star on their team, moved to the US to form 3G Capital and take the approach abroad.
Burger King was the second largest hamburger fast food chain after McDonalds in 2010 when 3G took it private. What it accomplished since then has been extraordinary.
My guests to discuss 3G and the deal are Alex Behring and Daniel Schwartz. Co-Managing Partners of 3G Capital.
Our conversation covers the history of 3G, Alex's journey to form 3G Capital, and the 3G playbook. We then dive into the deal, covering the sourcing and deal dynamics, improving operations, growing the business, taking the company public unexpectedly, and reloading to buy Tim Horton’s, Popeye’s, and Firehouse Subs. Today’s Burger King is part of Restaurant Brands International (QSR), a public company with a $32 billion market cap and $50 billion enterprise value.
This classic deal will widen your aperture on what’s possible with a long-term, compounding holding period and operational excellence.
Learn More
Follow Ted on Twitter at @tseides or LinkedIn
Subscribe to the mailing list
Access Transcript with Premium Membership
Chad Summe and Mike Veith – Corridor of Commerce at eGateway Capital (EP.364)
Tilly Franklin – Endowment Model at Cambridge University (EP.363)
George Michelakis – Chess Master’s Approach to Long-Short Equity at Gladstone (EP.362)
WTT: The Next Alpha Frontier
Brian Christiansen – High-Conviction Growth Investing at Sands Capital (EP.361)
Ana Marshall – The Climb to Investment Excellence (EP.360)
[REPLAY] Ana Marshall – Preparing for the New Environment at Hewlett (Capital Allocators, EP. 288)
[REPLAY] Ana Marshall – Applied Direct Investing at the William and Flora Hewlett Foundation (Capital Allocators, EP.111)
Morgan Housel – Same as Ever (EP.359)
[REPLAY] Morgan Housel – The Psychology of Money (Capital Allocators, EP.155)
2023 Top Episode #1: Seth Klarman – Timeless Value Investing, EP.328
2023 Top Episode #2: Dmitry Balyasny – Multi-Strategy Platform at BAM, EP.341
2023 Top Episode #3: Kipp deVeer – The World of Private Credit at Ares, EP.329
2023 Top Episode #4: Stan Miranda – Modern Endowment Model at Partners Capital, EP.334
Year in Review 2023 (EP.358)
2023 Top Episode #5: Gregg Lemkau – The Evolution of MSD, EP.291
Gary Sernovitz - Inside the CIO Seat (EP.357)
Thomas Haugaard - Hard Currency Emerging Markets Debt at JHI (EP.356)
[REPLAY] Andy Acker - Empty Rooms: Investing in Biotech at Janus Henderson (Capital Allocators, EP.274)
[REPLAY] Daniel Graña – Janus Henderson Investors Emerging Markets Equity (Manager Meetings, EP.13)
Create your
podcast in
minutes
It is Free
The emPOWERed Half Hour
U.S Property Podcast
Aligned Money Show
Dubai Property Podcast
The Ramsey Show
The Clark Howard Podcast