Investment firm linked to founders of Edge Early Learning, Removery launches $100m raise

Factory Capital, an investment firm linked to the founders of childcare centre chain Edge Early Learning and global tattoo removal chain Removery, has launched a $100 million capital raise as it looks for further opportunities in the healthcare, education and lifestyle sectors.

The Sydney-based firm believes demand exceeds supply in these areas, where it reports its private investments over the past 15 years have generated internal rates of return (IRR) of 50 per cent. 

Via its private equity fund management platform HEAL Partners, Factory Capital and its related parties own 60 per cent of Edge Early Learning, 27 per cent of The Fertility Partners in Canada, and 40 per cent of Removery, the world’s largest tattoo laser removal businesses.

It has also exited investments in Dentalcorp and Dental Corporation in Canada and Australia respectively.

Three of the investment firm's founding partners - Mark Evans, Chris Chambers and Peter Chapman - were co-founders of Edge Early Learning in 2017, with a focus on leading educational programs and beautiful facilities.

The brand now has 78 centres to its name, primarily in Queensland and South Australia, but also in the ACT.

In 2019 Evans and Chambers also co-founded Removery alongside Rachel Tys, Nicholas Tys and Carmen VanderHeiden Brodie.

With its service underpinned by extensive training programs for staff and state-of-the-art PicoWay lasers, Removery has grown to 150 locations throughout the United States, Canada, and Australia.

Whilst previously Factory Capital made investments through its private circle, it is now opening up to external investors to secure $100 million worth of balance sheet capital.

"We scale small unsophisticated but profitable companies into the next generation of category leaders," says Factory Capital chief executive officer Dan Rathie, a former Macquarie executive who joined the firm last year.

"Our proven playbook draws on our execution skills building executive management capabilities, refining the customer journey, enhancing systems, and creating competitive advantages that drive growth and expansion."

The firm claims its proprietary deal flow provides investors with access to founder-like returns which are typically difficult to achieve, with its ancillary funds management business extending the investment lifecycle through to the later stages of a business's growth, while minimising shareholder dilution and preserving investor control.

"This raise marks the evolution of Factory Capital into a holding company," Ritchie says.

"Rather than building these businesses with external capital that must be constantly recycled, we now have the ability to hold them for 10 to 20 years.

"Investors in Factory Capital will also have the opportunity to co-invest directly in the businesses we are building. What sets us apart is our deep operational focus, which drives real value creation - we are not passive capital."

Aside from the aforementioned directors, other investors in Factory Capital include Berkeley Capital, Switzerland-based Mosaic Capital AG and US-based Cach Holdings, LLC.