First Round: Christmas comes early for Cherry Hill

Everyone have a peaceful, relaxing December? Thought not. If First Round’s inbox was anything to go by, the industry was working right up until the last minute, ‘wrapping’ deals and jingling funds all the way up to Christmas Eve.

One firm determined to reap the benefits of the holiday season is Keystone Capital, which in December announced that it had completed its acquisition of Cherry Hill Photo from Eureka Growth Capital.

Cherry Hill is, according to Keystone, “the US market leader in providing mall-based holiday photography services and products”. Yes, Cherry Hill provides Santa Claus to mall-based grottos throughout North America. Last year it placed more than 500 “naturally bearded” Santas in locations across the region.

First Round was beyond delighted to discover that there’s at least two private equity firms in the world that believe in Santa Claus. Well, at least believe in the colossal profit-making potential of other people believing in Santa Claus.

Personally, First Round would have said yes to this deal faster than you can say “Rudolph the red-nosed reindeer”, but it’s understandable that some more prudent members of the investment committee may have taken a bit of convincing. After all, Christmas comes but once a year, no matter how much glam-rock favourites Wizzard may will it other-wise; no shopping mall has need of a faux Saint Nick outside of December, naturally bearded or otherwise.

But fear not, Cherry Hill has it covered. When the warmer weather rolls around, it can also take care of all your Easter Bunny needs. The company also runs a side business in special event photography.

In fact, Cherry Hill is a business that has “money-spinner” written all over it. Keystone has no doubt considered capitalising on the reve-nue/EBITDA growth potential of expanding into the increasing number of global holidays.

There’s a clear business case for putting an army of naturally bearded Santas to work around other religious festivals, as well as more esoteric ‘holidays’ such as Halloween and annual British staple, the Beard of the Year.

After all, surely all LPs want for Christmas is (reven)ue?