Growth to Acquisition: Factor75’s Success Story
In 2016, Mike Apostal, the CEO of Factor75, was in the midst of exploring financing options to grow its online, subscription-based meal delivery service that ships healthy, restaurant-quality meals directly to consumers throughout the continental US. With an emphasis on “nutrition for performance,” the company’s name stands for the philosophy that 75% of fitness results and everyday performance derive from diet.
The market of customized meal delivery services had taken the world by storm as consumers looked for nutritious and affordable meals that met the demands of their busy lifestyles.
Apostal and the rest of the Factor75 team were eager to launch their growth initiatives and to find the perfect financing option to match all of their needs.
Revenue-Based Financing from Flow Capital
After connecting with Flow Capital and learning about Flow’s minimally dilutive financing structures, Apostal was hooked. Revenue-based financing offered a flexible repayment structure that came with minimal equity dilution, no board seats, and no personal guarantees – a perfect match for Factor75’s growth and financing plans.
Flow Capital closed the deal in 2016 and Factor75 wasted no time. The company was able to grow their operations, expand geographically, and extend into adjacent markets. By 2019, their three-year-growth came out to 1,018%. Over the next four years, Factor75 was consistently ranked in Inc. Magazine’s Fastest-Growing Private Companies in America list.
- 2017 Ranking: #133
- 2018 Ranking: #264
- 2019 Ranking: #447
- 2020 Ranking: #715
In October 2019, Factor75 decided it was time to end the investment. This was part of a unique feature of Flow Capital’s revenue-based financing structure in which there is no fixed term and the investee company determines the best time to buy out the investment, reducing the stress and conservative growth mindset often associated with a traditional term loan.
Factor75 Acquired by Meal-Kit Delivery Giant, HelloFresh
Roughly one year later in November 2020, meal-kit delivery giant, HelloFresh, announced it had acquired Factor75 for a total purchase price of up to US$277 million.
The acquisition came as part of HelloFresh’s growth plan to strengthen its leading position and expand its total addressable market in the US. It also brought together HelloFresh’s global market expertise in delivering fresh ingredients to customers’ doorsteps across 14 countries with Factor75’s proven success in ready-to-eat meals.
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About Flow Capital
Flow Capital Corp. is a diversified alternative asset investor and advisor, specializing in providing minimally dilutive capital to emerging growth businesses.
To apply for financing, visit www.flowcap.com.