With a $100,000 loan from his father, Craig Silbery made his first move into probiotics

A broken marriage and a helping hand drove entrepreneur Craig Silbery to the ultimate pay day. Now he is pouring the proceeds into making Australia a global leader in a red hot sector.

A payout changed Craig Silbery’s life and career. Picture: NewsWire / Nadir Kinani

Craig Silbery has always loved the peace and quiet of suburban libraries, to promote what he calls “slow thinking” in the brain.

A decade and a half ago, Carnegie library in Melbourne’s suburbia became his sanctuary when his personal life was in turmoil.

“Sadly, we didn’t like each other as people from very early on in that relationship. I don’t have regrets about the relationship because I have a beautiful, wonderful son named Luca out of that. But if I look at it objectively, it was two people that didn’t like each other,” Silbery now laments of his five year marriage to ex-wife Isabelle, best known for regular appearances on the Gogglebox Australia reality TV program with her mother Kerry and her grandmother Emily (“Emmie”).

Isabelle has described the relationship in interviews as “loveless”, saying she stayed in the marriage to avoid the stigma of being a single mother.

“It was a difficult relationship,” her ex-husband now continues.

“I didn’t know what I was coming home to each day. It could be loving one day, the next it could be literally toxic. So I started to spend a lot more time at the library and tried to focus on what was making me happy.”

There Silbery started reading extensively about probiotics, especially given Isabelle was pregnant at the time.

His passion for redefining categories and doing things differently to the big companies in the space led him to start a firm that he eventually called Life Space.

It was the first business to develop over-the-counter probiotic formulas for pregnant women and the first probiotic for babies aged six months to three years.

In 2018 Silbery received a windfall of more than $150m for his 20 per cent stake in the firm when Life Space was sold to Chinese healthcare giant By-Health for $690m. Remarkably, Life Space was debt-free at the time.

The payout changed Silbery’s life. Prior to selling Life Space, he infamously had to verify his bank balance before making even minor purchases to ensure he had sufficient funds in his account.

“Life Space was a business that I was proud of, it was growing, and it was very purpose-oriented. We had lots of naturopaths working with us but we didn’t incentivise with dollars, we didn’t promote how much we sold each month, we didn’t have sales scorecards or anything like that,” he says.

“We promoted on how many pregnant women or infants had taken our products. It was a very purpose-oriented business. So it was quite conflicting to go from being purpose-driven to selling the business. There was an amount of money in my bank account which had too many zeros on it. It was a very confronting ­period.”

To this day he believes that Life Space was sold too early in its history, but he chose to support the determination of his business partners, a deeply private Melbourne-based family, to sell.

Despite the sale, and an unusually long five-year non-compete period requested by the Chinese buyer, Silbery remained active in the sector.

He launched successful probiotics products for pets – including priobiotic wipes for dogs – as he explored opportunities for a return to human probiotics manufacturing. Earlier this year, following the expiry of the non-compete agreement, he purchased the assets of Probiotics Australia in Queensland.

He is now investing up to $40m to build Australia’s first end-to-end probiotics manufacturing facility for a firm he has called Speciality Probiotics Australia (SPA). With SPA, Silbery wants to make Australia a global leader in the probiotic sector and plans a sharemarket float of the business in the next four years.

Private equity support

He owns 60 per cent of SPA. Private equity group H&S Investments Australia holds the remaining 40 per cent.

H&S is also an investor alongside Silbery in the ASX-listed goat’s milk infant formula group Nuchev, where Silbery is a non-executive director.

“I’ve known H&S for 14 years. They were behind the success of many famous Australian brands like Life Space and Suisse in China and Asia,” he says.

“They have been tremendously successful themselves and our values are very much aligned on the right way to do business.”

Silbery grew up with his three siblings in the small New Zealand town of Upper Hutt, north of Wellington, long branded with the stigma of being the second lowest socio-economic-ranked community in the country.

“But what sticks with me is growing up in a multicultural society, where more than half of my friends were of a different colour to me, and that was normal,” he says.

His father, Lionel, owned a structural steel engineering business that was started by his grandfather. Lionel and his wife Jan eventually moved to Australia when they retired.

Silbery says his father saw life differently to most.

“He always had a different view on something. While he didn’t talk often, when he did there was always something behind it. It certainly made me think about things and look at things differently before I made a decision on something,” he says.

Craig Silbery at his Brighton home. Picture: NewsWire / Nadir Kinani

After completing a Bachelor of Science degree in human movement and psychology at the University of Otago, Silbery moved to Japan where his brother-in-law was a high priest at a Buddhist monastery near Nagasaki. Silbery lived in the monastery for six months.

After returning home during the Japanese winter, he moved to Melbourne to take on various retail sales and management roles with the likes of Mars Petcare and Masterfoods. During the years that followed he was inspired to start his own business before starting a family of his own.

With a $100,000 loan from his father, which grew to borrowings of $2m in the years that followed, Silbery made his first move into probiotics when he started a firm called Space Vitamins in 2005.

“I was obsessed with how the body absorbs minerals and I was focused on most of the research around that, so we developed a range of multivitamins,” he says.

“Plus there was a lot of emerging research coming out on probiotics. I couldn’t see anyone in Australia doing what I thought they should be in that space, so I pivoted into it.”

He began importing new strains of probiotics from the US before teaming with a family-owned vitamins business led by an entrepreneur named Ben McHarg to establish Evolution Health as the brand owner, manufacturer and supplier of a range of nutritional health supplements and products.

In 2013, Space Vitamins changed its name to Life Space when it launched Australia’s first over-the-counter probiotic formula for pregnant women and ­babies.

The business grew over 300 per cent each year for five years and became the top online brand in China when By-Health put forward its buyout offer at a bumper price. By then Silbery was with his current wife, Lauren, who he had met at a pharmacy conference a year after he separated from his first wife. “My first marriage taught me what I didn’t want in life and what I needed as a person to be happy, which was someone who was calm, kind and consistent,” he says.

New start

He and Lauren were married wearing masks at a wedding registry office in Melbourne in 2020, at the peak of the Covid pandemic. The only other two people present were the celebrant and Silbery’s beloved older sister.

He and Lauren now have a daughter named Jessie, who will turn three in February. Like her husband, Lauren also has a son from her first marriage.

The family is the proud owner of three dogs and has a farm at Merricks on Victoria’s Mornington Peninsula. Silbery also loves fast cars, namely Porsches. At the moment he owns three.

His father is still going strong at the age of 85, as is his mother at 82. They are happily retired on Queensland’s Sunshine Coast.

Specialty Probiotics Australia CEO Craig Silbery on his wedding day. Picture: Supplied

One of Silbery’s greatest lessons in life came from his childhood, watching his father work six days a week and sit at home exhausted on the only day of the week he had off, when he regularly punished his son for being a nuisance.

“He was working hard for the family, which was the done thing at the time,” he says. “But personally, my view on life has been that I didn’t want to start a business while I had a young child. That was a factor in why I didn’t have children until later in life.”

Silbery’s day-to-day activities now include picking up and dropping off his boys at school.

In more recent years he and his father have talked about the lost years in their relationship. But it is what it is. “He is very aware of that and he said he regrets it. When I was growing up, my father would also never, ever tell me that he was proud of me. My mother never, ever gave me a kiss,” Silbery says.

“But the reality is that was that generation at that time. I am still very close to them.”

Silbery’s core passion remains the health benefits that living organisms in probiotics can offer.

SPA recently struck an agreement with New Zealand dairy giant Fonterra to secure access to the group’s acclaimed “hero strains” of probiotics.

These strains are already well-recognized in the market for their effectiveness and are backed by large-scale clinical trials, allowing SPA to provide products that meet consumer demand for quality and scientific rigour.

Craig Silbery with his daughter Jessie. Picture: Supplied

SPA and Fonterra will also work together to optimise processing outcomes and explore potential co-contributions to future clinical research programs.

Separately SPA is close to securing a landmark agreement with Novonesis – formerly known as CHR Hansen, another of the world’s largest producers of probiotic ingredients – allowing SPA’s customers to gain access to high-quality, science-backed probiotic ingredients, including high-concentration and highly stable strains from Novonesis’s probiotic fermentation division.

“Fonterra, Novonesis and SPA have really come together to shake up the probiotics industry not just in Australia, but Australia as a gateway to Asia,” Silbery says.

Contributions

As with Life Space, he now wants SPA to contribute to society.

“I’ve always liked making things and to make something that is healthy for someone is something I’ve aspired to do and I continue to aspire to that,” he says.

“I’ve seen the benefits that our Life Space products provided to Chinese kids growing up and that meant everything to me. So that was my purpose, and it wasn’t about dollars. It was about making a difference in the community. This has opened up opportunities to do other things to help others with their causes. Lauren and I feel passionate about vulnerable children and animals, so we focus our giving in that area.”

Lauren lost her own father after his battle with cancer last year. A few months later her husband made headlines when he donated more than $50,000 at the Sony Foundation’s annual River4Ward event in Melbourne, which raises funds to support young Australians with cancer.

But the proudest moment of Silbery’s life came in 2018 when the sale proceeds from the Life Space sale came through.

They were unexpectedly early, deposited in his bank account not when he was in his lawyer’s office but when he was at home sitting on his favourite couch.

“Literally the first thing I did was pay my dad back,” he says softly. But the sum he transferred was $5m, more than double the $2m he owed his father.

“It was one of the most wonderful moments of my life.”