Key Takeaways
- • Custom Flavors, a developer and manufacturer of liquid and powdered sweet flavor systems based in San Clemente, California, has partnered with private equity firms Butterfly Equity and Graham Partners; deal terms were not disclosed.
- • The company generates approximately $20 million in EBITDA and operates an Innovation Center in San Clemente along with a processing facility in Concord, North Carolina.
- • Alex Wendling, who was promoted to chief executive officer of Custom Flavors earlier in 2026, will continue to lead the company with support from co-founders Mike Wendling and Steve Bishop.
- • Butterfly Equity and Graham Partners cited Custom Flavors' technical capabilities, strong customer relationships, and market positioning in functional, better-for-you, and clean-label product applications as drivers for the partnership.
Summary
Custom Flavors, a family-owned flavor systems manufacturer headquartered in San Clemente, California, has formalized a partnership with private equity investors Butterfly Equity and Graham Partners. The two firms have invested in the company, which specializes in liquid and powdered sweet flavor systems for industrial food and beverage applications. Custom Flavors generates approximately $20 million in EBITDA, according to Food Business News publisher reporting on the transaction.
The company's operational footprint includes two key facilities: an Innovation Center in San Clemente and a processing facility in Concord, North Carolina. Leadership remains unchanged, with CEO Alex Wendling—who received his promotion to the top role earlier in 2026—continuing to oversee operations alongside co-founders Mike Wendling and Steve Bishop. The PE firms did not disclose specific transaction terms or valuation metrics.
Aaron Kirkbride, partner at Butterfly Equity, emphasized the firm's long-standing interest in Custom Flavors, stating the company has "best-in-class technical capabilities, strong customer relationships and a deep commitment to quality and service." Andrew Snyder, managing partner and president at Graham Partners, highlighted the strategic rationale for the investment, noting that "demand for functional, better-for-you and clean label products is growing quickly, and those are exactly the applications where great flavor is hardest to get right." Graham has previously established a dedicated flavor investment platform, positioning Custom Flavors as a core holding within that strategy.
The partnership reflects broader consolidation trends in the specialty flavors sector, where private equity capital continues to target companies with established market positions in high-growth consumer segments. Custom Flavors' reputation for solving technical challenges in clean-label and functional product formulation aligns with accelerating consumer demand for transparent, health-conscious food and beverage offerings.
The company's operational footprint includes two key facilities: an Innovation Center in San Clemente and a processing facility in Concord, North Carolina. Leadership remains unchanged, with CEO Alex Wendling—who received his promotion to the top role earlier in 2026—continuing to oversee operations alongside co-founders Mike Wendling and Steve Bishop. The PE firms did not disclose specific transaction terms or valuation metrics.
Aaron Kirkbride, partner at Butterfly Equity, emphasized the firm's long-standing interest in Custom Flavors, stating the company has "best-in-class technical capabilities, strong customer relationships and a deep commitment to quality and service." Andrew Snyder, managing partner and president at Graham Partners, highlighted the strategic rationale for the investment, noting that "demand for functional, better-for-you and clean label products is growing quickly, and those are exactly the applications where great flavor is hardest to get right." Graham has previously established a dedicated flavor investment platform, positioning Custom Flavors as a core holding within that strategy.
The partnership reflects broader consolidation trends in the specialty flavors sector, where private equity capital continues to target companies with established market positions in high-growth consumer segments. Custom Flavors' reputation for solving technical challenges in clean-label and functional product formulation aligns with accelerating consumer demand for transparent, health-conscious food and beverage offerings.
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