Casual Dining Expertise
Red Robin Gourmet Burgers is one of the leading family-oriented casual dining chains in North America. The Company offers a value-oriented menu focused around specialty burgers, with stores typically located in suburban areas that are easily accessible for families. The Company was founded in 1969 and had grown to more than 130 stores by the mid 1990s, but after the founder sold the Company to a Japanese corporation, the business languished and became unprofitable. Mike Snyder, who opened the first franchised restaurant for Red Robin in 1979 and whose stores had the best performance within the system, took over management of the Company in 1996 and systematically returned the business to strong operating performance by 2000. Once operating smoothly, Red Robin was poised for growth and was seeking an outside investor to provide expansion capital.

In 2000, Quad-C partnered with Mike Snyder to purchase a controlling stake in the business. Quad-C purchased a 43% ownership position in the Company while Mike Snyder simultaneously rolled his franchised stores into the business and received a 20.5% ownership position. The transaction provided Red Robin with the capital and shareholder base necessary to start a new growth phase.

Building the Business
With the business operating profitability and the concept re-proven, Red Robin embarked on an aggressive growth strategy that included expanding company-owned stores and the base of franchisees. The Company grew from 175 stores at the end of 2000 to almost 350 stores by the end of 2006, but perhaps more impressive was the increase in profits as Red Robin achieved greater than 28% compounded annual growth in EBITDA over this period.

Successful Initial Public Offering
Quad-C helped Red Robin list on the NASDAQ in late 2002 and we subsequently sold our ownership position over the following two years. The Company’s strong EBITDA growth commanded an attractive valuation multiple from the public market, which, combined, allowed Quad-C to achieve a return of approximately 5x our investment.