RADNOR, Pa., USA – NewSpring, a family of private equity strategies, today announced that NewSpring Franchise, the Firm’s dedicated strategy focused on investing in innovative franchise and multi-unit concepts, has completed a growth equity investment in Federal Donuts, a Philadelphia-based culinary pioneer in the fast-casual space with Donuts, Fried Chicken, and Coffee. The investment will be used to activate the brand’s growth by opening new locations throughout the Mid-Atlantic and beyond.
Founded in 2011 by five hungry Philadelphians whose lives were changed by donuts—partners Tom Henneman, Steve Cook, Michael Solomonov, Felicia D’Ambrosio, and Bob Logue—Federal Donuts packages culinary excellence into a spirited fast-casual restaurant. Its affordable comfort classics and unexpected flavors make Federal Donuts an institution in the Greater Philadelphia area, currently with eleven locations, including inside Whole Foods Markets and sports and entertainment arenas. By partnering with NewSpring, Federal Donuts will gain access to capital, infrastructure, technology, and additional resources that will facilitate its continued growth.
“In 2011 when Steve, Mike, Bobby, Felicia, and I bootstrapped this business on a quiet corner in South Philadelphia, we couldn’t have imagined what Federal Donuts would become,” said Tom Henneman, Partner and CEO of Federal Donuts. “We have a product that people love and we love to serve. Since 2020, we’ve opened three beautiful new stores in Center City that we’re really proud of. Taking this next step to partner with NewSpring will give us the opportunity to be a part of so many more neighborhoods and fulfill our potential.”
Steve Cook, Partner of Federal Donuts and Co-owner of CookNSolo Restaurants, remarks, “We’ve been doing this for 20 years, and Federal Donuts is the most fun we’ve ever had in the restaurant business. NewSpring really understands our industry, and we’re going to have a lot of fun building FedNuts’ next chapter together.”
NewSpring Franchise invests in capital-efficient, consumer-facing, and fast-growing multi-unit businesses with exceptional management teams in the lower-middle market. With their most recent investment in Central Bark, the NewSpring Franchise General Partners continue to support several fast-growing, multi-unit concepts, including Duck Donuts, Blo Blow Dry Bar, and Turning Point.
“Federal Donuts has an outstanding culinary and customer experience with proven unit-level economics that will support the brand’s continued rapid growth. Combined with the James Beard award-winning excellence Michael, Steve, and Tom bring to the table, the company is well-positioned to broaden its consumer demographic in new and existing markets through geographic and product expansion,” said NewSpring Franchise General Partner Satya Ponnuru. “We’re very excited to partner with these leading restaurateurs, including Tom Henneman, who will continue in his role as CEO, to accelerate the growth of Federal Donuts.”
Federal Donuts CEO Tom Henneman, Steve, and Mike maintain an ownership position in the business and will stay closely involved in both strategic and day-to-day operations. As part of the transaction, Satya Ponnuru, NewSpring General Partner Patrick Sugrue, and Jeff Benjamin, the Co-Founder and COO of Vetri Management Corp, will join the Federal Donuts Board of Directors.
About NewSpring
NewSpring partners with the innovators, makers, and operators of high-performing companies in dynamic industries to catalyze new growth and seize compelling opportunities. The Firm manages approximately $2.5 billion across five distinct strategies covering the spectrum from growth equity and control buyouts to mezzanine debt. Having invested in over 180 companies, NewSpring brings a wealth of knowledge, experience, and resources to take growing companies to the next level and beyond. Partnering with management teams to help develop their businesses into market leaders, NewSpring identifies opportunities and builds relationships using its network of industry leaders and influencers across a wide array of operational areas and industries. To learn more, visit www.newspringcapital.com.
About Federal Donuts
In Philadelphia, the cradle of liberty, Federal Donuts is a hometown hero. The donut shop is as you know, an American institution, and Philadelphia’s favorite shop was founded in 2011 by five hungry Philadelphians in South Philadelphia whose lives were changed by donuts. The donut, fried chicken and coffee shop—from Partner/CEO Tom Henneman, Steve Cook and Michael Solomonov—is known for its affordable comfort classics in tantalizingly delicious, unexpected flavors that change all the time. The crowds come for donuts first, served either Fancy (glazed and decorated each morning) or Hot Fresh (fried to order and tossed in flavored sugars). Federal Donuts’ twice-fried, super crispy chicken is with savory dipping sauces, in dry seasonings, or naked. In addition, Federal Donuts serves up its Philly favorite Chicken Sandwich, a twice-fried boneless chicken breast dusted in house ranch seasoning, and topped with American cheese, dill pickles, and the shop’s not-so-secret recipe for “Spicy Rooster Sauce”, all on a Martin’s Potato Roll.
To learn more about one of Federal Donuts’ eleven locations in Philadelphia (1219 S. Second Street; 1526 Sansom Street; 3428 Sansom Street; 701 N. Seventh Street; 540 South Street; 21 S. 12th Street; 1776 Benjamin Franklin Parkway), 15 E Wynnewood Rd inside Whole Foods Market Wynnewood, 2101 Pennsylvania Ave inside Whole Foods Market Center City, and the seasonal concession at Citizens Bank Park & the Wells Fargo Center, visit federaldonuts.com.
