During FSC's ownership period, net sales increased 9x and EBITDA increased 16x. In June 2017, PetMatrix was acquired by Spectrum Brands for $255 million. As a result of the sale, FSC realized a 6.0x cash on cash return and a 43% internal rate of return during its five years of ownership.
INDUSTRY: Branded pet products
Friend Skoler's investment in PetMatrix is a prime illustration of how FSC can partner with business founders to accelerate the growth of their business. In 2012 FSC made a minority equity investment in PetMatrix to provide liquidity to the founding shareholders. Founded by Mark Stern, PetMatrix is a leading manufacturer and marketer of patented, non-rawhide dog chews sold under the DreamBone® and SmartBones® brands. At the time of FSC’s investment, PetMatrix was in the early stages of its growth with a limited SKU count and distribution focused on a small number of leading mass merchant and pet specialty retailers. In addition, the company was largely being run by its founders without managerial or infrastructure support.
FSC worked closely with the founders to build out a management team, establish a corporate office, relocate the company’s third party distribution and logistics operation, negotiate lines of credit, introduce internal processes and controls, and develop financial reports and budgets. FSC also assisted management with marketing program development, brand positioning and general business strategy. During FSC’s investment period, the company broadened its portfolio of innovative products and expanded its distribution to over 44,000 retail doors in North America, including leading retailers in the mass merchant, pet specialty, grocery, drug, and farm & fleet channels. Today, PetMatrix is the pet industry’s leading non-rawhide dog chew brand.