Ridgemont Equity Partners, a Charlotte, North Carolina-based buyout and growth equity investor, has made a growth investment in Northstar Recycling Co. LLC, East Longmeadow, Massachusetts, alongside the company’s founders, brothers Seth and Noah Goodman. Founded in 2011, Northstar provides managed waste and recycling solutions to leading food, consumer packaged goods and other industrial clients. Seth and Noah Goodman will remain in their respective roles as CEO and president of Northstar after the transaction, the financial terms of which were not disclosed.
“Seth and Noah Goodman and the rest of the Northstar team have built a highly-differentiated business helping large, sophisticated, consumer-facing companies achieve their zero-waste-to-landfill and related sustainability goals,” says Ryan Jack, principal at Ridgemont. “Northstar’s fundamental value proposition to its customers is a comprehensive solution for diverting industrial waste streams away from landfills into more sustainable outlets while also providing enhanced tracking and reporting of waste diversion outcomes through the company’s proprietary technology platform.”
Jack says Ridgemont will work with the Northstar team to expand its service offering to existing and new clients while maintaining its focus on recycling.
“We are excited to announce our new partnership with Ridgemont and begin the next chapter of growth for Northstar,” the Goodmans say in a joint statement issued on behalf of the company. “With additional resources and support, we will be able to expand our services for our existing clients and recycling outlet partners, serve a broader customer base and build a more scaled platform providing comprehensive managed waste solutions. Ridgemont shares our focused vision to continue to help businesses recycle more and landfill less, and we look forward to working with the Ridgemont team to execute our growth strategy.”
The brothers tell Recycling Today, “Northstar has grown significantly over the last decade, and we are focused on continuing that growth trajectory with the help of a strategic partner who, among other things, can help us identify and prioritize growth opportunities. Such growth will come both organically and potentially through acquisitions and add-on investments.”
Among the investments Northstar will make is in its tech-enabled reporting, analytics and data services capabilities related to the company’s core recycling service offering, the brothers say.
“Ridgemont is a partner that can provide substantial financial resources and strategic support to better allow for such growth, and they share our vision for the market opportunity we see to continue to expand our business,” the Goodmans add.
“Northstar also believes that leaning into this growth will create new and exciting opportunities for our employees,” they say. “Ridgemont portfolio companies have grown their number of employees by 50 percent on average during Ridgemont’s investment period.
“Finally, Northstar believes continued growth and new resources will also enhance our overall customer and employee experience,” the Goodmans add. “Ridgemont has been recognized in Inc. magazine’s list of top founder-friendly private equity firms for three consecutive years, and we believe they bring a strong cultural alignment to high-growth entrepreneurial businesses like Northstar.”
When Recycling Today profiled Northstar in 2016, the company had 34 employees and offices in Little Falls, New York; Warrensburg, New York; Philadelphia; and northern Kentucky in addition to Longmeadow. The company was trading 140 commodity types and managing 50,000 tons of material per month, or 600,000 tons annually, recycling 75 percent, while 25 percent was used in waste-to-energy applications, composted or used in animal feed.
Northstar says it now has more than 150 employees and manages more than 1 billion pounds of material every year, approximately 95 percent of which is diverted away from landfills into diverse beneficial reuse applications.
In conjunction with Ridgemont’s investment in Northstar, Seth and Noah Goodman, in partnership with the principals of Ridgemont and Cowen and Co. LLC (“Cowen”), created the Northstar Sustainability Fund, which is focused on making long-term commitments to charitable organizations that positively impact local communities by promoting food donation, landfill diversion, beneficial reuse of resources and other environmental, social and governance initiatives.
Financing for the transaction was provided by Barings, Cliffwater Corporate Lending Fund and PNC Erieview Capital. Goodwin Procter LLP served as legal advisor to Ridgemont. Cowen and Finn Dixon & Herling LLP served as financial and legal advisors to Northstar, respectively. Moore & Van Allen PLLC served as legal advisor with respect to the organization of the Northstar Sustainability Fund.