diff --git a/.changeset/nice-jars-talk.md b/.changeset/nice-jars-talk.md
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+---
+'@backstage/backend-test-utils': patch
+'@backstage/backend-app-api': patch
+'@backstage/plugin-catalog-node': patch
+---
+
+Internal updates of `createServiceFactory` from `@backstage/backend-plugin-api`.
diff --git a/.changeset/real-poets-run.md b/.changeset/real-poets-run.md
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+---
+'@backstage/backend-plugin-api': patch
+---
+
+The `createServiceFactory` function has been updated to no longer use a duplicate callback pattern for plugin scoped services. The outer callback is now replaced by an optional `createRootContext` method. This change was made in order to support TypeScript 4.9, but it also simplifies the API surface a bit, especially for plugin scoped service factories that don't need to create a root context.
+
+A factory that previously would have looked like this:
+
+```ts
+createServiceFactory({
+  service: coreServices.cache,
+  deps: {
+    config: coreServices.config,
+    plugin: coreServices.pluginMetadata,
+  },
+  async factory({ config }) {
+    const cacheManager = CacheManager.fromConfig(config);
+    return async ({ plugin }) => {
+      return cacheManager.forPlugin(plugin.getId());
+    };
+  },
+});
+```
+
+Now instead looks like this:
+
+```ts
+createServiceFactory({
+  service: coreServices.cache,
+  deps: {
+    config: coreServices.config,
+    plugin: coreServices.pluginMetadata,
+  },
+  async createRootContext({ config }) {
+    return CacheManager.fromConfig(config);
+  },
+  async factory({ plugin }, manager) {
+    return manager.forPlugin(plugin.getId());
+  },
+});
+```
+
+Although in many cases the `createRootContext` isn't needed, for example:
+
+```ts
+createServiceFactory({
+  service: coreServices.logger,
+  deps: {
+    rootLogger: coreServices.rootLogger,
+    plugin: coreServices.pluginMetadata,
+  },
+  async factory({ rootLogger, plugin }) {
+    return rootLogger.child({ plugin: plugin.getId() });
+  },
+});
+```