FORT WAYNE, Ind. (WANE) – Sweetwater is set to grow again as private investment group Providence Equity Partners has agreed to infuse the company with funds. The details of the transaction were not revealed in the press release announcing the move in the end of June.
In the announcement, Sweetwater Founder and CEO Chuck Surack said the investment will allow the company “to reach new heights and further our mission of enabling customers to make music and pursue their dreams.” WANE 15 reached out to representatives from both Sweetwater and Providence for clarity on what the investment means for the future of the company. Both denied offering more information than what was in the release.
Providence has a history of making investments with ties to ecommerce businesses, such as Autotrader, Hulu Blackboard and CDW. Sweetwater recently announced hitting $1 billion in annual sales, with over 1.5 million unique customers.
Information provided in the full press release:
Sweetwater, a leading eCommerce provider of musical instruments and audio equipment, today announced a strategic investment from funds advised by Providence Equity Partners (“Providence”), a premier private equity firm. Financial terms of the transaction were not disclosed.
Since its humble beginnings in 1979, Sweetwater has become an online industry leader serving millions of customers and employing a team of thousands of dedicated employees. Through over four decades of invoking its strong customer experience coined the ‘Sweetwater Difference’, the company has become a leading eCommerce provider of audio equipment and musical instruments in the United States. Sweetwater has a strong track record of sustaining long-term, scalable growth by identifying and capitalizing on new market opportunities. The company recently announced it had achieved $1 billion in annual revenue and served over 1.5 million unique customers and added over 400 new jobs.
Chuck Surack, Founder and CEO of Sweetwater, said: “We are thrilled to partner with Providence to help accelerate our next phase of growth and bring the ‘Sweetwater Difference’ to even more customers. I am incredibly proud of the growth our company achieved over the last year, which would not have been possible without the dedication of our employees and world-class team of music gear experts. I am confident this growth equity investment will allow us to reach new heights and further our mission of enabling customers to make music and pursue their dreams.”
John Hopkins, COO of Sweetwater, added: “Providence is a great partner to continue our momentum and take Sweetwater to the next level. As the world emerges from the pandemic, we believe the firm’s strong track record of helping music-related businesses accelerate their growth will be invaluable. The Providence team appreciates what makes Sweetwater different and we are aligned on how we can further leverage our unique culture to capitalize on new opportunities that create even better customer experiences.”
Scott Marimow, Managing Director at Providence, said: “Sweetwater’s status as an online industry leader is a direct result of its unique culture and dedication to customer service. We believe the company is well-positioned for sustainable growth as live events return and artists and entertainment companies look to provide the memorable experiences that have been absent over the past year and a half. We are excited to partner with such a culture-driven company and look forward to working with Chuck and team to grow the business together.”
Providence has over two decades of experience investing in and creating lasting value at a wide range of digital and ecommerce platforms such as CDW, Autotrader, Hulu, Blackboard, HSE24, Tes Global and Groupe La Centrale. Additionally, Providence’s current and previous music-related investments consist of Ambassador Theatre Group, TAIT, Tempo Music Investments, Superstruct Entertainment, and Warner Music Group. A complete list of Providence portfolio companies can be found at https://www.provequity.com/portfolio.
Michael Dominguez, Chief Investment Officer of Providence, said: “Over the past 42 years Sweetwater has built an industry leader with an extraordinary commitment to service that helps customers fuel their passion for music. We are honored to partner with a company that has stayed true to its customers, manufacturers and employees, all while establishing itself as a pinnacle in the music and audio retail space. We’re excited about the growth opportunities that lie ahead.”
J.P. Morgan served as Sweetwater’s exclusive financial advisor and King & Spalding LLP and Carson LLP served as legal advisors to Sweetwater. The Raine Group served as Providence’s financial advisor and Weil, Gotshal & Manges LLP served as legal advisor to Providence.
Founded in 1979, Sweetwater is a leading online retailer of music instruments and audio gear in the U. S. The company is respected as a leading retailer serving musicians, recording studios, broadcast, education, and houses of worship. Sweetwater’s customers can be found everywhere music is heard and audio is played, broadcast, or recorded, including recording, film, and broadcast studios in New York, Nashville, Los Angeles, Chicago, and Miami; in hundreds of thousands of home recording studios; and in schools and churches nationwide. Sweetwater’s founding and meteoric growth are built on a knowledgeable and experienced staff, outstanding selection and pricing, and, above all, an unwavering commitment to customer service excellence in every situation. For further information, visit Sweetwater.com.
About Providence Equity Partners
Providence Equity Partners is a premier global private equity firm with approximately $45 billion in aggregate capital commitments. Providence pioneered a sector-focused approach to private equity investing with the vision that a dedicated team of industry experts could build exceptional companies of enduring value. Since the firm’s inception in 1989, Providence has invested in over 170 companies and is a leading equity investment firm focused on the media, communications, education, software and services industries. Providence is headquartered in Providence, RI, and also has offices in New York and London. For more information, please visit www.provequity.com.