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Indiana backs Butterfly food and ag fund

The $30bn pension has committed $75m to a food-focused fund managed by KKR spin-out Butterfly Equity.

The Indiana Public Retirement System has committed $75 million to Butterfly Equity’s food and agriculture-focused Butterfly Fund II, according to materials from a Board of Trustees meeting released Friday.

According to an INPRS investment update included within materials released after the meeting, Butterfly Fund II will make investments of between $50 million and $80 million in North American businesses in the agriculture and aquaculture, food and beverage products, food retail and distribution and restaurant sectors.

The fund has a 10-year investment period with a one-year extension possible at the discretion of the GP and two one-year extensions possible with the approval of the limited partner advisory committee, according to the INPRS document.

The commitment marks the first exposure to agriculture-related private equity for the $30 billion INPRS, which previously only had exposure to agriculture through commodities futures contracts, according to an INPRS representative.

Los Angeles-based Butterfly is a private equity firm focused on the food industry that was founded last year. The firm invests throughout the value chain, organizing its investments under distinct verticals devoted to agriculture and aquaculture, food and beverage products, food retail and distribution and restaurants.

The firm was co-founded by former Vista Equity Partners executive Dustin Beck and Adam Waglay. According to his LinkedIn profile, Waglay spent more than eight years as a principal at KKR after four years in the consumer/retail investment banking division of Goldman Sachs.

Butterfly made its inaugural investment last June, when it purchased a significant minority stake in Los Angeles-based fast-casual restaurant chain Lemonade Restaurant Group for an undisclosed price.

KKR was an existing investor in Lemonade, and in a statement, welcomed Butterfly’s involvement with the company.

“We are excited to be working alongside Butterfly and expect their investment and involvement to be instrumental as the business continues to grow and expand,” KKR head of consumer retail – Americas Nate Taylor said.