Franchise Equity Partners, an independent and newly established private investment firm, has officially launched as a portfolio company of investment funds managed by HPS Investment Partners, LLC.

Franchise Equity Partners will focus on partnering with owner operators across the United States franchising sector with an initial target portfolio of $1 billion. The firm will be led by co-founders and Goldman Sachs alumni, Michael Esposito and Scott Romanoff.

FEP intends to make permanent, minority equity investments in established owner-operators across the franchise ecosystem. The firm will focus on a spectrum of industries including restaurants, automotive dealerships, beverage distributors, machinery and other consumer and business services.

“The U.S. franchising sector is an important, growing and attractive portion of our economy that we believe is currently underserved in terms of financial equity-based options suited to the unique financial and strategic goals of its operators,” said Michael Esposito.