Private Equity Franchise Investors: Top Firms in 2026

Key Facts

• Approximately 400 PE firms have invested in franchising at the franchisor or franchisee level, touching roughly 700 brands as of 2025.
• 12.4% of active U.S. franchise brands carry some level of PE ownership or backing, up significantly from pre-pandemic levels.
• Franchise deal volume reached $5.2 billion in 2023, the highest since 2018. Thirty-seven transactions closed in 2024.
• Atlanta anchors the franchise PE landscape, home to Roark Capital Group with $35-38B AUM, the dominant force in the sector.
• The two largest franchise deals on record closed within 18 months of each other: Roark Capital's $9.5B Subway acquisition and Blackstone's $8B Jersey Mike's deal.
• Home services, health and wellness, and chicken QSR represent the hottest subsectors for capital deployment heading into 2026.
• An estimated $2 trillion in uncommitted PE capital globally is actively seeking deployment, keeping franchise valuations in the low-to-high teens on EBITDA.

The Franchise PE Market: Sector Overview

Franchise private equity has evolved from a niche curiosity into a mainstream asset class. The U.S. franchise sector generated $788 billion in total output in 2021, a 16% jump over the prior year. The structural appeal of recurring royalty income and proven unit economics keeps fund managers returning.

Roughly 400 firms are now active across both franchisor and franchisee investments. Their footprint spans quick-service restaurants and fitness studios to home services platforms and mental health clinics. Atlanta serves as the sector's primary hub, anchored by Roark Capital Group. Other major centers include New York (KKR, Franchise Equity Partners), Los Angeles (Levine Leichtman Capital Partners, Gala Capital Partners), St. Louis (Thompson Street Capital Partners), and Boston (Summit Partners). Franchise-focused deal activity remains largely U.S.-centric even as platforms like Neighborly and FOCUS Brands extend across dozens of countries.

PE investment in franchising operates at two distinct levels. At the franchisor level, firms acquire entire brands or majority stakes, as Roark Capital did with Subway for $9.5 billion in 2023-2024. At the franchisee level, fund managers buy multi-unit operator portfolios, as Olympus Partners did by acquiring Excel Fitness's 90-plus Planet Fitness locations for $675 million in 2024. A growing cohort now operates at both levels simultaneously, reflecting the sector's maturation and the expanding range of entry points available to investors.

Franchise PE Firms: Comparison at a Glance

The firms below represent the most active PE franchise investors across major strategies, ranging from mega-fund generalists deploying billions into single deals to franchise-specialist vehicles with concentrated mandates.

Roark Capital and KKR dominate by capital deployed, but the most strategically differentiated players are the specialist vehicles. Princeton Equity Group's deliberate exclusion of restaurants creates a cleaner focus on home services and healthcare. Franchise Equity Partners' permanent minority model fills a structural gap that traditional buyout funds cannot address.

Top Picks by Investment Strategy

Largest AUM in Franchise PE: Roark Capital Group commands more franchise-sector capital than any other dedicated firm, with $35-38 billion under management and a recently closed $18 billion fund. Its portfolio spans Subway, Inspire Brands, FOCUS Brands, and Self Esteem Brands.

Mega-Fund Franchise Play: KKR's $545 billion portfolio includes Neighborly, the world's largest home service franchise platform, with 29 brands and 4,800 franchisees across nine countries. No other diversified firm has made a single franchise bet of comparable scale.

Growth Equity Leader: Summit Partners deploys $10 million to $500 million in growth-stage businesses, including Snap Fitness with its 1,500-plus global locations. Its $35 billion-plus platform spans North America and Europe, offering franchise brands international expansion infrastructure most PE sponsors cannot match.

Top Non-Restaurant Franchise Specialist: Princeton Equity Group, backed by a $350 million initial fund, deliberately bypasses QSR to target home services, healthcare, and business services. Its portfolio includes Five Star Franchising (700-plus units) and Ellie Mental Health (250 franchise sites under development in 26 states).

Strongest Fitness and Beauty Track Record: TSG Consumer Partners backed Planet Fitness from 2012 through its 2015 NYSE IPO, then acquired CorePower Yoga (200-plus studios) and Sola Salons (650-plus locations). No other fund has an equivalent multi-cycle record in branded franchise fitness and personal care.

Most Founder-Friendly Capital Structure: Franchise Equity Partners offers passive, permanent minority equity backed by $1 billion in committed capital. Multi-unit operators retain operational control while accessing institutional capital for growth or generational ownership transitions.

Best Mid-Market Franchise Turnaround Record: Sentinel Capital Partners has completed 14 franchise investments spanning Taco Bell operators, Church's Chicken franchisees, and Pet Supplies Plus (sold for $700 million in 2021). Its contrarian approach targets systems others have written off.

Rising Multi-Brand Operator: Gala Capital Partners, operating from Southern California, focuses on the 50-plus-unit range, rescuing Cicis Pizza from bankruptcy in 2021 and building a portfolio of five multi-unit restaurant concepts across distressed and growth situations.

Top Franchise PE Firms in Detail

Roark Capital Group

The dominant force in franchise PE, Roark manages $35-38 billion with an $18 billion most recent fund dedicated exclusively to franchise and franchise-like business models. Its platform strategy has no peer. Inspire Brands, which includes Arby's, Dunkin', Buffalo Wild Wings, Sonic, Jimmy John's, and Baskin-Robbins, employs over 650,000 workers. FOCUS Brands covers multi-channel food service internationally, and Self Esteem Brands runs 5,000-plus fitness and wellness locations in 32 countries. The 2023-2024 Subway acquisition at $9.5 billion is the largest franchise deal on record. It used approximately $5 billion in debt backed by royalty income, a whole-business securitization technique Roark has pioneered across its portfolio. For founders of scaled, royalty-heavy systems targeting a nine-figure majority exit, Roark is the sector's most active buyer.

KKR

The clearest proof that franchise platforms can absorb mega-fund capital at scale, KKR's acquisition of Neighborly in 2021 gave it the world's largest home service franchisor: 30-plus brands, 4,800 franchisees, and over 10 million customers served annually across nine countries. Neighborly passed through two prior PE owners (Riverside Company and Harvest Partners) before KKR acquired it, each sponsor adding brands and franchisee count. KKR's franchise exposure sits within a $545 billion portfolio spanning private equity, infrastructure, real estate, and credit, giving Neighborly access to operational and financial resources that dedicated franchise funds cannot replicate. The deal confirmed home services aggregation as a proven institutional-grade strategy for the largest PE fund managers.

Franchise Equity Partners

FEP occupies a structural gap that buyout firms cannot fill: permanent, passive minority equity for established multi-unit franchise operators. Launched in 2021 with $1 billion in committed capital managed by HPS Investment Partners, the firm targets operators across chain restaurants, auto dealerships, beverage distribution, consumer and business services, and heavy equipment. Its first investment was a stake in Pacific Bells, one of the largest Taco Bell franchisees in the country. Subsequent deals included Fresh Dining Concepts ($44 million, 2022), Georgica Auto Holdings ($77 million, 2022), and 7 Crew, the second-largest 7 Brew franchisee (2025). Family-owned, multi-generational operators seeking growth capital or succession solutions without surrendering operating control represent FEP's primary constituency.

Princeton Equity Group

Princeton Equity Group's defining characteristic is what it refuses to invest in: restaurants. With a $350 million initial fund and a focus on consumer, healthcare, and business services franchising, the firm targets high-quality systems with strong unit economics and credible management teams independent of the founder. Co-founders Doug Kennealey and Jim Waskovich conduct direct franchisee conversations before every deal, surveying systems comprehensively before committing capital. The portfolio demonstrates the thesis: Five Star Franchising operates 700-plus units across home service brands, and Ellie Mental Health has 250 franchise sites in development across 26 states. The non-restaurant mandate creates a disciplined pipeline concentrated in sectors with structurally higher franchisee satisfaction and recurring service demand.

TSG Consumer Partners

TSG Consumer Partners has built the strongest documented track record in branded franchise fitness and beauty, with an estimated $16-20 billion in assets under management. Its 2012 majority investment in Planet Fitness preceded a 2015 NYSE IPO, generating a high-profile exit by 2017. TSG then backed Sunshine Fitness, the largest Planet Fitness licensee, and sold that position to Planet Fitness in 2022 for $800 million. The firm subsequently acquired CorePower Yoga, the largest U.S. yoga studio operator with 200-plus locations in 23 states, and Radiance Holdings, covering Sola Salons (650-plus locations) and Woodhouse Spas (80-plus locations). For limited partners evaluating branded consumer franchise exposure, TSG's multi-cycle fitness and wellness record is unmatched among PE peers.

Sentinel Capital Partners

Sentinel built its franchise reputation through contrarian mid-market buyouts that other firms declined. Its restaurant portfolio spans Border Foods (Taco Bell, Pizza Hut, KFC), Falcon Holdings (Church's Chicken), and Southern California Pizza (Pizza Hut), alongside non-restaurant positions including Massage Envy, Vital Care, and Interim Healthcare. The Pet Supplies Plus exit at $700 million in 2021 demonstrated Sentinel's capacity to build enterprise value in franchise retail across a multi-year hold. With 14 franchise investments in its history, Sentinel represents one of the deepest operational track records of any middle-market firm investing across U.S. and Canadian franchise systems. Its experience with turnaround situations, including returning Falcon Holdings to positive EBITDA from negative, sets it apart from growth-only competitors.

Gala Capital Partners

Gala Capital Partners targets the 50-plus-unit range where brands carry institutional potential but require operational expertise that most financial sponsors lack. Founder Anand Gala grew up working in franchise restaurants and brings 35 years of hands-on multi-unit experience to diligence and value creation. The portfolio spans Mooyah Burgers (2017), Cicis Pizza (rescued from bankruptcy in 2021), Dunn Brothers Coffee, Dillas Quesadillas, and Rusty Taco. The Cicis turnaround demonstrates a distressed recovery capability that differentiates Gala from growth-only specialists. Southern California multi-unit restaurant operators seeking an operationally experienced partner rather than purely financial capital find Gala's model distinct from most PE alternatives.

NewSpring Franchise

NewSpring Franchise combines over 20 years of direct franchise operating experience with the resources of a $3.5 billion-plus total platform. Its franchise portfolio includes Blo Blow Dry Bar, Great Harvest (fast-casual bakery, acquired 2024), Shake Smart (healthy fast-casual, acquired 2024), and Central Bark. The firm targets lower-middle market consumer products and services franchisors with scalable systems and strong franchisee unit economics. Emerging franchise brands seeking a partner with genuine multi-unit operating experience, rather than a purely financial sponsor making its first franchise investment, get both sector expertise and institutional resources from NewSpring.

Thompson Street Capital Partners

Thompson Street Capital Partners manages $4.5 billion from St. Louis with target investments between $50 million and $500 million across healthcare, software, business services, and engineered products. Its 2021 acquisition of Freddy's Frozen Custard and Steakburgers marked a deliberate expansion into restaurant franchising. Freddy's had grown to approximately 400 mostly franchised units in 30-plus states, with a differentiated fast-casual positioning and lines stretching past 100 cars even during the pandemic. TSCP's Freddy's thesis mirrors its broader sector approach, targeting scaled profitable platforms with open white space and professional management capable of continuing organic unit development. The deal demonstrated that disciplined non-specialist fund managers can generate franchise sector value without a dedicated franchise mandate.

Investment Trends Shaping Franchise Private Equity

Home Services Platform Consolidation

Home services franchising is the most active arena for PE platform strategy execution. Neighborly operates 30-plus brands with 4,800 franchisees under KKR, while Authority Brands, Empower Brands, and Threshold Brands are building parallel multi-brand platforms with backing from APAX Partners, MidOcean Partners, and Riverside Company respectively. The strategic logic is consistent: fragmented residential service categories, predictable recurring demand, and royalty fee income make home services a natural aggregation target. PE firms accelerate the buy-and-build cycle by adding tuck-in acquisitions in adjacent categories such as cleaning, restoration, and lawn care.

Franchisee-Level Investments Accelerating

PE firms increasingly acquire portfolios of franchise units at the operator level rather than purchasing franchisors outright. Olympus Partners paid $675 million for Excel Fitness's 90-plus Planet Fitness locations in 2024, serving 750,000 members, and Eyas Capital acquired Bojangles' largest franchisee in 2025. Franchise Equity Partners' permanent minority model provides a third structure between full majority buyout and no institutional capital, capturing operators who want a partner but not a buyer. This shift reflects both improving unit-level economics in fitness and services and the difficulty of acquiring quality franchisor assets at reasonable multiples.

Health, Wellness, and Mental Health Franchise Growth

Healthcare and mental health franchising has attracted significant capital as demand for outpatient services outpaces provider supply. Princeton Equity Group backed Ellie Mental Health across 250 franchise sites in 26 states, and Levine Leichtman Capital Partners invested in Caring Brands, a global home healthcare franchisor. Fitness franchises held by TSG Consumer Partners, including CorePower Yoga and Sola Salons, reflect consumer demand for premium wellness experiences across economic cycles. PE investors view healthcare services franchises favorably because demand is structurally recession-resistant and royalty streams remain durable even during downturns.

Whole-Business Securitization Gaining Traction

Roark Capital's Subway acquisition applied whole-business securitization at its largest scale yet, using approximately $5 billion in debt backed entirely by franchisee royalty streams. This structure treats recurring royalty income as bond collateral, enabling higher leverage ratios than traditional EBITDA-based financing. Roark deployed this technique across multiple portfolio companies before Subway, and other sponsors are now evaluating it for brands with royalty-heavy EBITDA composition. Franchise systems weighted toward one-time fee income rather than recurring royalties cannot qualify, creating a measurable valuation premium for royalty-dominant businesses.

Declining Rates Reviving Franchisee Portfolio Deal Economics

Restaurant franchisee portfolio acquisitions declined as interest rates rose from 2022 through 2024. Pre-COVID, multi-unit QSR portfolios offered approximately 12-15% annual cash-on-cash returns for buyers using moderate leverage. As rates decline from their peak, deal economics are improving and lenders are actively seeking to deploy capital in this category. Franchise deal volume hit $5.2 billion in 2023, the highest since 2018, and 37 transactions closed in 2024 despite limited price disclosure, signaling active underlying market conditions.

How to Evaluate Franchise PE Firms

The most important filter is fund strategy fit before any other criteria. A $350 million franchise-specialist fund and a $545 billion diversified mega-fund both invest in franchising, but their check sizes, hold period expectations, and post-acquisition involvement differ fundamentally. Founders seeking $10-50 million in growth capital should target Princeton Equity Group or NewSpring Franchise. A multi-unit operator needing a minority partner for succession planning should contact Franchise Equity Partners rather than Roark Capital, which operates exclusively through majority control structures.

Track record in your specific vertical matters more than general PE credentials. Sentinel Capital Partners has 14 franchise investments across its history and understands franchisee independence dynamics at a granular level. A generalist firm making its first franchise deal may underestimate the complexity of managing franchisee relationships through operational change. Exits verify claims: TSG Consumer Partners delivered an $800 million exit from Sunshine Fitness after building Planet Fitness into a public company, and Harvest Partners grew Neighborly across multiple ownership cycles before selling to KKR.

Limited partners evaluating general partners with franchise exposure should examine EBITDA composition within the target portfolio. Royalty-based recurring revenue commands premium exit multiples in the low-to-high teens, while portfolios weighted toward one-time franchise fees carry more valuation risk at exit. Firms sharing franchisee satisfaction data from independent third-party surveys demonstrate diligence quality and operational discipline. Without that data, IRR claims become difficult to assess independently, especially for systems with fewer than 50 units where franchisee satisfaction can swing dramatically based on a handful of operators.

Which Firm Fits Your Needs?

Franchise founders with $2 million or more in EBITDA and royalty-dominated revenue have the broadest set of options among active PE franchise investors. Roark Capital is the natural conversation for founders of established multi-brand systems targeting a nine-figure majority buyout. Princeton Equity Group and NewSpring Franchise offer growth capital for consumer and services franchisors that want to preserve management involvement while accessing institutional resources and operational expertise.

Multi-unit franchise operators seeking liquidity or expansion capital without relinquishing control should evaluate Franchise Equity Partners first. FEP's permanent minority structure is purpose-built for family-owned and multi-generational operators in restaurant, auto, and services verticals. Operators in the 50-plus-unit range with distressed or underperforming assets may find Gala Capital Partners the most operationally capable partner, given founder Anand Gala's 35 years of hands-on franchise experience spanning bankruptcy situations and growth platforms alike.

Limited partners building diversified alternatives portfolios with franchise exposure can access the asset class across multiple risk profiles. TSG Consumer Partners and Sentinel Capital Partners offer mid-market franchise track records spanning multiple economic cycles. KKR provides franchise exposure within a globally diversified mega-fund structure. For concentrated franchise mandates with genuine sector differentiation, Princeton Equity Group's non-restaurant focus and Franchise Equity Partners' permanent capital model offer substantively different return profiles from the generalist PE field.

Methodology

This guide to private equity franchise investors draws on publicly available transaction data, fund disclosures, and franchise industry research current through early 2026. We selected firms based on documented investment activity in franchise systems at the franchisor or franchisee level, verifiable fund size or assets under management data, and notable transaction history. Market statistics on deal volume ($5.2 billion in 2023), PE penetration rates (12.4% of active U.S. brands), and active firm counts (approximately 400) reflect franchise industry research published in 2024-2025. Deal multiples and EBITDA thresholds represent ranges reported across multiple industry sources. No firm paid for inclusion in this guide.