Company Description
Massage Envy was founded in 2002 to capitalize on the significant unfulfilled demand for professional, affordable, and convenient therapeutic massage services. At the time of our investment, Massage Envy was already a leading franchisor of therapeutic massage services with a first-mover advantage through a network of approximately 600 clinics.

Background
In 2008, an independent sponsor unsuccessfully bid on Massage Envy when its founder sold the business. Following the sale, the independent sponsor cultivated a relationship with Massage Envy’s CEO in the hope that the business would soon be sold again. When the new owner decided to sell in late 2009, the independent sponsor was one of only a handful of potential bidders invited to participate. The independent sponsor, who did not have sufficient capital, needed to secure a partner with deep financial resources and an established record in franchising to provide certainty of closing and support a rapid growth strategy.

The Opportunity
To partner with an independent sponsor to acquire a proven franchise concept with excellent unit economics and rapid growth prospects.

Accomplishments
Structured Mutually Agreeable Economic Arrangements with Independent Sponsor: Sentinel and the independent sponsor were able to quickly and amicably agree on the financial terms of their respective investments and proceed toward submitting a joint bid.
Utilized Knowledge Gained in Prior Sale Process: The independent sponsor's existing relationship with Massage Envy dating back to its prior sale by its founder was instrumental in positioning Sentinel to act quickly and aggressively. 
Selected as Winning Bidder: The combination of relationships with key stakeholders, our deep franchising experience, and certainty of closing led to Sentinel's selection as the winning bidder. 

Outcome
During our three-year ownership, Massage Envy grew from approximately 600 to nearly 850 operating clinics with a backlog of more than 270 additional clinics waiting to open. With systemwide sales nearly doubling and average unit volume increasing significantly, revenue and EBITDA more than doubled. During this time, the independent sponsor remained actively involved at the board level. In August 2012, Massage Envy was sold in a management buyout to another private equity firm in a highly successful transaction for both Sentinel and the independent sponsor.



Case studies have been selected for illustrative purposes for management teams of midmarket companies considering a partnership with Sentinel and should not be considered an offer or solicitation of services or an actual or implied endorsement of Sentinel or any security, investment, or portfolio company. The portfolio companies highlighted are not representative of all current and prior investments of Sentinel. A list and description of investments since Sentinel’s inception is available on this website.

Company Description
Founded in 1999, WellSpring was (i) a manufacturer and marketer of specialty prescription ("Rx") pharmaceuticals, (ii) a manufacturer and marketer of over-the-counter ("OTC") drug products, and (iii) a provider of outsourced contract manufacturing ("CMO") services to pharmaceutical and biotechnology clients in the US and Canada. WellSpring's founder developed a strategy to acquire efficacious Rx and OTC products from larger pharmaceutical companies and then leverage WellSpring's manufacturing capabilities to make the acquired products and capture additional margin.

Background
By 2010, WellSpring's founder had significantly scaled back his day-to-day involvement and retained an investment bank to manage a sale process. During the process, an operationally focused independent sponsor with a successful record in healthcare but without permanent capital completed substantial due diligence. The independent sponsor was granted exclusivity because of its healthcare industry credentials and the rapport established with WellSpring's founder. Needing a lead equity partner for the transaction, the independent sponsor reached out to a select group of private equity firms, including Sentinel. As a result of our experience working with independent sponsors, investment record in healthcare, and strong chemistry established with the management team during initial meetings, Sentinel was selected to lead the transaction.

The Opportunity
To partner with an independent sponsor to acquire a proven healthcare platform with multiple avenues for growth.

Accomplishments
Structured a Mutually Agreeable Economic Arrangement: Sentinel and the independent sponsor were able to quickly agree on the financial terms for their respective investments.

Successfully Closed the Transaction: The combination of relationships with key stakeholders, the independent sponsor's deep industry experience, and the certainty of closing provided by Sentinel led to the timely and successful completion of the transaction.

Worked as Partners to Streamline and Reposition the Business: Sentinel and the independent sponsor worked together with management to sharpen WellSpring's focus by divesting its Rx portfolio and using the proceeds to drive growth in its OTC and CMO businesses. WellSpring completed three add-on acquisitions for its OTC portfolio and invested in the sales infrastructure of its CMO business to increase its pipeline.

Outcome
During Sentinel's ownership, WellSpring successfully simplified and refocused its operations to drive growth. WellSpring more than doubled the revenues of its OTC business and doubled the number of products made in its CMO facility. During this time, the independent sponsor played an active board and oversight role alongside Sentinel. In 2018, after completing our investment objectives, WellSpring was sold in a highly successful transaction for Sentinel, the independent sponsor, and WellSpring's management.



Case studies have been selected for illustrative purposes for management teams of midmarket companies considering a partnership with Sentinel and should not be considered an offer or solicitation of services or an actual or implied endorsement of Sentinel or any security, investment, or portfolio company. The portfolio companies highlighted are not representative of all current and prior investments of Sentinel. A list and description of investments since Sentinel’s inception is available on this website.