🍟 3/29/2023 – Youth Athletes United: The Ultimate Platform For Youth Sports Franchises

DEEP DIVE

Youth Athletes United is on a mission to empower kids through sports, by teaching them how to have fun while learning the fundamentals. 

Their long-term goal is to positively impact the lives of over 1 million kids every year

To achieve such lofty goals, they will need quite a bit of scale…which is why they’ve been quietly acquiring franchise brands, and are attempting to become the largest youth sports franchise platform in the world. 

And so far…they’re off to a great start. 

Who They Are

Adam Geisler and John Erlandson met while working at Authentic Brands Group, a global brand development, marketing and entertainment platform that does $24.7 billion in sales each year.

It was there where they recognized they both had a love for sports, and empowering kids. 

So in 2018, they formed Youth Athletes United, which had 2 small youth sports businesses under ownership: Soccer Stars and Amazing Athletes

Today, under the Youth Athletes United umbrella lies:

  • 117 franchise owners
  • 268 units in operation – 84 units are corporate owned
  • Recently Signed/In Development – Amazing Athletes new 1 unit/owner, JumpBunch to Amazing Athletes conversions 15 owners/units, TGA new 1 unit/owner, SS 20 new owners/32 units 
  • 3 different franchise brands

It’s a fantastic amount of progress in just 5 years, as they’ve set a pace that, if continued, will see them become an absolute dominant force in their industry, as other platform companies have done in different industries. 

Think Xponential Fitness, the publicly traded company, and owner of boutique fitness brands like Club Pilates, Row House, Rumble, CycleBar, Stretch Lab, and more. 

Adam and John care more about making an impact on kids than going public, but don’t be surprised by the numbers their franchises put up.

The Franchises

Soccer Stars

Soccer Stars was founded in 2000 in Manhattan, and is targeted at kids from age 1-8+.

Until recently, it primarily existed as a non-franchised business. That changed last year, when Adam & John began franchising it, which gives us a peak behind the curtain on their financials. 

I provided a full breakdown on their brand in October of last year, but here are the highlights from that edition:

  • Corporate Territories Open: 13
  • Average EBITDA: $615,475*
  • Investment Range: $69k – $90k

*Based on 13 locations

Those are pretty astounding numbers, and it all comes from providing soccer classes for kids!

Given those numbers, it’s no surprise that today, the system has grown to 20 franchise owners, 32 franchised units, and 55 corporately run units within 13 territories across 19 states.

Amazing Athletes

Amazing Athletes was founded in 2003 in San Diego, and offers a multi-sport enrichment program targeting kids age 2-6. 

Their sessions offer 10+ sport based activities and are taught in schools, rec centers, daycare facilities, and fields across the country. In fact, some of their programs have become so popular that they’ve developed sub-brands underneath Amazing Athletes. 

Little Rookies is a popular option for preschoolers in the Spring, while Karate Zoo is a new program they’re currently piloting.

This brand is the longest franchised brand of the YAU family, and has 69 franchise owners that run 110 franchised outlets. 

In 2019 (pre-covid), reporting owners showed $11,212 in average monthly revenue, while in 2021 the units are on the uptrend with over $7K in average monthly revenue. As we’ll learn from a franchisee shortly, these businesses have the potential for a very high margin. 

Recently, Amazing Athletes made it to Franchise Business Review’s Franchise Hall of Fame, marking 10 consistent years of earning awards based on overall Franchisee Satisfaction!

TGA

TGA provides junior golf and junior tennis lessons for kids aged 6-14+ years. 

Founded in 2003 in Los Angeles, the TGA franchise offers a chance for Youth Athletes United to continue impacting kids as they leave pre-school, and embark on their journey from Kindergarten to 8th grade.

This brand has 28 franchise owners operating 42 franchise units nationwide. According to the 2022 FDD, full-time operating franchise owners in the top 50% averaged $381,958 in revenue (median of $328,830). And that’s off a $33,800 – $52,100 investment. 

While the name says just TGA, they also offer 6 more sports offerings, including cheer, Flag Football, volleyball, lacrosse, hockey, and ultimate frisbee. Pickleball launching in Q2 2023!

The Strategy

Youth Athletes United has strategically put together their current portfolio. 

The advantage they’ve optimized for today? To own the “first sport experience”.

Whether it’s Soccer Stars or Amazing Athletes (or the Little Rookies program via Amazing Athletes), Youth Athletes United has a triple threat offering for impacting kids as soon as they’re physically able to start participating in sports. 

Once kids grow from toddlers to preschoolers, Amazing Athletes and Soccer Stars have extension programs that become semi-competitive, and allow kids to remain within those programs as they grow older. 

Meanwhile, TGA functions as an alternative option that begins with the 6+ age group. 

But what does life actually look like as a franchise owner of one of these brands?

From the Franchisee

I spoke with a multi-brand and multi-territory operator out of Florida named Brittany, who shed some light on what life is like as a franchisee of Amazing Athletes and Soccer Stars.

Brittany was working as a personal trainer in 2018, and after doing a kids training session, realized she loved working with kids. 

For a time, she tried launching a business herself, but like many, struggled with what I’d call the “0-1 stuff”. 

Creating logos, branding, figuring out the specific insurance needed, what kind of background checks a children’s businesses required, etc. 

Every business is full of surprises, and doing it on your own is tough folks.  

Luckily, she stumbled across a local franchisee of Amazing Athletes, and nearly immediately bought out the next closest territory.

This was back in 2019, and in late 2022 she added Soccer Stars to her portfolio, in the same county where she currently operates Amazing Athletes. 

Because they’re under the Youth Athletes Umbrella, she gets to take advantage of the streamlined technology system that every franchisee across the YAU platform is given. 

This allows her to manage all her KPI’s, onboard new hires, and maintain consistency across her separate franchises. 

She also gets to use a mobile app for her coaches that makes scheduling, identifying locations, attendance, and more far easier.

The quality of the technology is impressive, but shouldn’t be a surprise, as Youth Athletes United is already benefiting from the scale between their 3 brands, and are reinvesting it into better operational systems for franchisees. 

Beyond the tech, they also have 100+ employees, 30% of which are dedicated to franchising.

Brittany’s Long-Term Vision

As to be expected, Brittany admitted the covid pandemic was a challenge. After surviving and maintaining relationships with her clients during that time, her businesses are both thriving again.

She mentioned projections of close to $500,000 in aggregate annual revenue this year, at close to a whopping 50% margins. These can be the perks of non-brick & mortar franchises folks. 

Beyond the numbers though, she’s starting to hit her operational stride, as she has her growth playbook down pat. 

When she lands a new trial for Amazing Athletes with a pre-school, she’ll do the coaching sessions herself until she has the buy-in. Then she hires a coach to take it over, and then it’s rinse & repeat.

Even better, she’s at the point where she has coaches that have been with her long enough who can take on the free-trials from the get-go. 

Brittany also mentioned that the multi-sport aspect of Amazing Athletes allows her to cross-promote her other brand. In practice, this means the kids who really enjoy the soccer aspect of Amazing Athletes get to do it regularly via her Soccer Stars business. 

Deep, Not Wide

Brittany has ambitions to quadruple her revenue from the ~$500k she expects to do this year, to over $2,000,000 in the next 6 years (which would signify the end of her 10 year franchise agreement).

To hit this goal, she plans on going deep in her market, not wide. Meaning she doesn’t plan on buying out other territories, but rather squeezing as much as she can out of her 1 county in Florida.

So while she has plenty on her plate at the moment between Soccer Stars and Amazing Athletes, when I asked her about the prospect of adding TGA to the portfolio, her response was immediate:

It definitely makes sense to buy TGA at some point

Her confidence in that statement indicated to me that it’s truly a matter of when, not if, Brittany will become a TGA franchise owner in the future.

And the best part is, this is exactly part of the plan Adam and John have had for franchisees of their platform. They want franchisees to go deep within their platform, as they ultimately aim for 60% of their franchisees to be multi-brand operators.

With the low cost and high margin services these businesses offer, as long as franchise owners keep having fun, new franchisees will continue to go deep with Youth Athletes United. Thankfully, that’s what Adam & John are pros at, having fun.

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