Target Information

Three Hills has officially launched the Three Hills Impact Fund in January 2024, which focuses on thematic objectives that align with the UN Sustainable Development Goals. The fund aims to provide flexible capital solutions designed specifically for entrepreneur-owned businesses with impactful models in the European middle market.

As part of this initiative, Three Hills has invested in Operam Education Group, a prominent education resourcing firm based in Manchester, UK. Founded in 2017 by CEO Eddie Austin, Operam specializes in supplying temporary teaching and support staff to underserved schools throughout the UK. The company has effectively implemented a buy-and-build strategy, resulting in eight successful acquisitions to date.

Industry Overview in the UK Education Sector

The market for temporary education resourcing in the UK is currently valued at £1.2 billion and is anticipated to continue its robust growth due to a persistent shortfall in permanent teacher hires and increased staff absenteeism. This growing demand highlights the importance of flexible staffing solutions for schools that face significant challenges in securing qualified personnel.

Operam, through its extensive network and innovative business model, is poised to capture a larger share of this expanding market. The company's strategy focuses on acquiring high-value service providers and regional leaders, which is critical as educational institutions increasingly seek reliable partners to address their staffing needs.

The sustained growth in the UK education sector, paired with a demand for more tailored and responsive staffing solutions, creates a favorable environment for companies like Operam. Continued investments in technology and improved resource allocation within education are also driving market expansion, allowing businesses to create more efficient operational frameworks.

Given these market dynamics, Operam's emphasis on acquiring and integrating various education recruitment agencies will likely enhance its competitive advantage, resulting in increased customer satisfaction and improved educational outcomes.

Rationale Behind the Deal

The investment by Three Hills in Operam not only marks the second commitment from its newly established impact fund but also positions Operam for significant growth. By collaborating closely with Operam's management team, Three Hills aims to strengthen the company's market leadership while facilitating further organic expansion and M&A activity.

This collaboration will allow Operam to leverage the operational support provided by both Three Hills and the reinvestment from BGF, which had previously supported the company's strategic growth since 2019. The combined expertise will enable Operam to scale its operations and increase its impact in the education sector.

Information about the Investor

Three Hills is noted for its commitment to impact-driven investments, highlighting its status as a certified B Corporation. The firm focuses on aligning its investment portfolio with sustainable development objectives while generating positive social and environmental outcomes.

Pablo Vélez, a Partner at Three Hills, expressed excitement about the partnership with Operam, emphasizing the firm's mission to support schools in underserved communities. His confidence in Operam's leadership and established business model supports the strategic importance of this investment.

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The partnership between Three Hills and Operam presents a compelling investment opportunity. The increasing demand for temporary education staff in the UK, combined with Operam's proven track record and strategic approach, positions the company to capitalize on market needs effectively. Furthermore, the ongoing support from BGF adds an additional layer of confidence in the future trajectory of the business.

Three Hills' expertise and commitment to responsible investing, coupled with Operam’s ambitious growth plans, suggest a high potential for significant returns not only in financial terms but also regarding positive social impacts within the education sector. This alignment of interests is essential for securing the long-term success of the partnership.

Furthermore, the scalability of Operam's business model through continued acquisitions indicates a promising outlook for sustained growth. With both organic expansion and M&A on the horizon, this deal could indeed be a landmark investment capable of setting industry standards for education staffing solutions.

Overall, the investment signals a strategic approach to addressing pressing challenges in education while aligning with broader sustainable development goals, making it not just financially sound but also socially responsible.

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