Transaction to accelerate BirchStreet’s growth as a leading provider of vertically specialized procure-to-pay software

BirchStreet Systems (“BirchStreet” or the “Company”), a leading provider of procure-to-pay software to the hospitality sector, today announced an investment from Parthenon Capital (“Parthenon”), a leading growth-oriented private equity firm with deep technology and payments investing experience. Parthenon’s investment, in conjunction with existing investor Serent Capital, will further accelerate BirchStreet’s growth as the Company continues to deliver innovative solutions to its customers within the procure-to-pay software suite. Terms of the transaction were not disclosed.

Founded in 2002, BirchStreet’s software platform powers procurement and supplier payments programs for some of the largest and most well-recognized brands in hospitality. Approximately 100,000 users at more than 13,000 customer locations leverage the Company’s platform and broad ERP and accounting system integrations to manage billions of dollars of spend across a wide variety of categories, including food and beverage, operating supplies, maintenance services and capital projects.

Brendan Reidy, a seasoned technology executive with extensive experience in hospitality and foodservice and BirchStreet’s executive chairman, will assume the additional role of CEO. Prior to joining BirchStreet, Brendan served in a variety of senior executive positions with both publicly traded and privately held technology companies. Most recently, Brendan served as the CEO of Compeat prior to its sale to Restaurant365 in June 2021.

“BirchStreet has grown rapidly in recent years because of its specialized product offering, end market knowledge and customer service,” Reidy said. “I have tremendous respect for what the team at BirchStreet has accomplished to date and look forward to building upon that success in this next chapter.”

“It has been a pleasure partnering with Serent Capital over the last four years to expand BirchStreet’s leadership position in the hospitality market. We are excited to extend our growth trajectory in partnership with Parthenon and Serent, with a focus on continued organic growth as well as M&A,” said Sushil Garg, BirchStreet’s founder and board member. “Both Parthenon and Serent have a great track record of scaling technology companies, and we remain committed to developing innovative solutions that solve our customer’s problems across sourcing, procurement and supplier payments.”

Zach Sadek, a partner with Parthenon, commented, “We are impressed with BirchStreet’s clear market leadership position, compelling customer value proposition, and exciting opportunities for future growth. The growing demand for industry expertise, spend visibility and end-to-end functionality in hospitality procurement has created a unique opportunity for specialized platforms like BirchStreet.” Brian Golson, managing partner and co-CEO of Parthenon Capital, continued, “We are looking forward to partnering with BirchStreet and Serent to build upon the Company’s success and support its continued growth."

Lance Fenton, a partner with Serent, added, “We’re thrilled to welcome Parthenon as an investor in BirchStreet. We look forward to working with both Parthenon and the BirchStreet team to expand on the Company's leadership position in the procure-to-pay software suite."

BirchStreet was advised by William Blair & Company and Choate Hall & Stewart LLP. Kirkland & Ellis LLP provided legal advice to Parthenon Capital in connection with the transaction.

About BirchStreet

Founded in 2002, BirchStreet is the leading provider of procure-to-pay solutions for the hospitality sector. BirchStreet’s software platform provides its customers with a full suite of procurement applications, including eProcurement software, accounts payable automation, invoice management, inventory management, recipe management, supplier payments, and reporting and analytics. BirchStreet’s customers leverage the company’s solutions to access a broad network of suppliers and manage billions of dollars of spend annually across a wide variety of categories, including food and beverage, operating supplies, maintenance services and capital projects.

About Parthenon Capital

Parthenon Capital is a leading mid-market private equity firm with offices in Boston, San Francisco and Austin. Parthenon utilizes niche industry expertise and a deep execution team to invest in growth companies in service and technology industries. Parthenon seeks to be an active and aligned partner to management, either through recapitalization transactions or by backing new executives. Parthenon has particular expertise in financial and insurance services, healthcare and business services, but seeks any service, technology or delivery business with a strong value proposition and proprietary know-how.

About Serent Capital

Serent Capital is a growth-focused firm that invests in technology companies with offices in San Francisco and Austin. Serent invests in growing businesses that have developed compelling solutions that address their customers' needs. As those businesses grow and evolve, the opportunities and challenges that they face change with them. Principals at Serent Capital have firsthand experience at capturing those opportunities and navigating these difficulties through their experiences as CEOs, strategic advisors, and board members to successful growing businesses. By bringing its expertise and capital to bear, Serent seeks to help growing businesses thrive.

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