Episode #522: Curtis Christopherson on Effective Franchise Training, Revenue Models, and Industry Trends

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I am super excited to announce that we now have a formal partnership

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with the prospect wizard. And when I say wizard, I

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mean wizard. Obviously, you have a website. This allows

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you to convert your website traffic visitors directly

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into leads. It's not just another chatbot, and it's not AI, but

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it allows a visitor to call, text, or leave a voice mail,

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immediately goes to you, your sales team, or anyone else in the club

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instantly. MIT shows a study that if you contact the lead within

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10 minutes, chance of them converting goes up 9 times

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that of the average. We got the Atlanta Clubs on it, Vida

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Fitness, Gold's Gym, Mountainside, City Fitness

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Philly, College Park. Become one of the

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next halo companies to deploy the wizard. It's easy to

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use. Go to the prospectwizard.com. Get a free

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30 day trial. Talk to my boy, Dave Gallon. He will get you all set

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up and let the leads flow based on the

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wizard. Go get them.

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This is Pete Moore on Halo Talks NYC 2024.

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We are gonna talk about innovation. We're gonna talk about

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longevity, and we are bringing on Curtis Kristofferson

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from the great city of Vancouver, And

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we are going to talk about building a 25 year business at

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Innovative Fitness, and then we're gonna touch on a recommendation app

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that everybody should know about called workout. So Curtis, welcome to your first

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halo talks, and we are gonna be elevating wellness as our trademark

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term. So good to see you. Yeah. Thanks for having me. Awesome.

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So let's first start with your bricks and mortar. How you started? I know you

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were one of the top or the top, trader in Canada. We know a lot

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of traders in Canada, so muzzle tough on that reward and

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and, status. But talk about how you methodically built your

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PT business, and let's talk about, like, what's around the corner.

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Yeah. Awesome. So we've been in the game for the last 25 years. When we

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went to market, personal training was not as mainstream as it is

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today. It was, you know, for the affluent and, you know, I would

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say athlete or celebrity profile. We started at

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one location, and we built the brand of innovative fitness over the last 25

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years, through some tough times. You know, the

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dotcom bubble, the financial crisis, and then obviously

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recently through COVID. But we've focused on

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that 4000 to 5000 square foot high end boutique

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model, specializing in 1 on 1 and 1 on 2

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personalized fitness and training. And,

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and our business model, 17 locations today, 10

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of which are are franchise locations and, span

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from Vancouver to Vancouver to Toronto. So 2 major

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major markets in Canada and, and have have done

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a good job over the last 25 25 years of establishing

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community. And what's the size of the average studio? You know, how how does

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that operate? Are you buying a membership like you're buying one to a health club?

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Are you doing, 12 month commitments? Obviously,

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people get very intense about training, and sometimes maybe that subsides when

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they come back. So how have you structured the location, and then

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how does the membership work? Yeah. Our average footprint is about

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4000 to 5000 square feet. We have anywhere between 12

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20 full time personal trainers that work, you know, under each roof. And

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then, how our our current model works,

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which is evolving, but our current model to date has been always prebooked and

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pre prepaid, training services or or personalized

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services, like nutrition as an example. So it is is not a membership

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based model, and it is either prepaid in

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in service packages, whether it's monthly, 3 months, 6 months in advance.

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And are each one of those let's just use ProHealth Trainers as an example. Are

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they exclusive and they are full time to that actual

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location? Yeah. Correct. Yeah. We we try to provide

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full time employment. The training and the services are only,

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they only get paid for for what they do, but our job and

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responsibility is to to really have the demand and and bring in,

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the supply of of trainers based on that demand. And so, you know, most of

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our trainers work between 25 and 40 hours a week, and,

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and, you know, obviously, scale up their their clientele the longer they

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are with us. Gotcha. And then from a standpoint of

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franchising the business, how did that happen? Was that

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methodical on your end to grow, or is that people from

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certain areas said, look, I love your model. I kind of don't want to do

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this myself and I want to be under your umbrella.

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And they convinced you to, allow them to to

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to be underneath you. You know, I think it was a little bit of a

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little bit of both. In 2003, we expanded our footprint into Seattle

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and Bellevue. And what we knew is at the time, the further out

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that we got, the harder it was to control, and there was always a face

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of the brand. And, you know, really having someone that had a vested interest, that

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was, you know, boots on the ground, that could create the community that we were

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looking for. So when we did that, I think we were young too,

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and we weren't as sophisticated or systemized as we are

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today. And so what we did is we took a step back and said, you

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know what? We have a we have a pipeline of of

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eager and hungry people that wanna expand the brand anyways, which was our

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employees and the people that work for us. And we also had a clientele

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base that were affluent enough that loved what they experienced from a

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service perspective. And so what happened was naturally,

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we wanted a vested interest on the ground to build a community. We

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had a pipeline of of aspiring entrepreneurs, which is our trainers and

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our employees. And uniquely enough, our customers, because

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of the customer experience and service that they were provided, they wanted to

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invest in the brand. And so a lot of times what happened was that franchisees

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were born out of, people that moved within our system, and then

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they ended up partnering with the clientele that actually had the,

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you know, had the positive impact. And so those clientele fueled

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their their franchise, funding. Yeah. It's it's interesting

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because there are many, trainers that have start up studios or start

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up their own business. And sometimes they come and they say to us, you know,

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where should I find this capital? I'm like, why don't you find the capital from

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someone you saved their life training? Yeah. And and to them, it's

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almost like, a thank you. And then there are studio operators that don't wanna talk

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to their members because they think it's like an uncomfortable conversation. I think it's a

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very comfortable conversation because, you know, a a

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studio is a community. It's a cult. If you do it right, it's a cult.

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And the cult tested to to make money, and the the members of the

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cult should fund that. So I'm glad that happened and it evolved that way,

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and that and that relationship going forward, obviously, is

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very strong and and, you know, almost like, you know, unbreakable.

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When you set up the franchise business and you've operated

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multiunit before, you you end up doing that, What are some of the things

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that you put in for and if there are entrepreneurs that are listening here? Because

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a lot of people's franchise they franchise before they're ready to franchise.

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They don't realize that your client is the franchisee. And I

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have to change my perspective on what I'm doing just with consumers, but now

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I'm kind of responsible for somebody else's p and l. And that's a

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big, daunting responsibility. So what are some of the things that

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you did to say, look, I'm not giving you a location until, you know, you

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got a relationship on the billing side. You've got ops manual training.

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Give us a little pepper us with, like, what you did in order to say,

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okay. I'm cool with with doing this. Yeah. I I mean, I

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think it starts with your brand and your name. I think so many people, they

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they build a a brand around themselves. So Peet Fitness, Curtis

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Fitness, you name it. It's like, first off, you know, we didn't we made the

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brand not about ourselves, but about, you know, a a greater, you know,

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brand. And so that enabled us to to franchise it more effectively.

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So Innovative Fitness is not, you know, named after, you know, Matt, Jeff,

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Curtis, whoever. And that's number 1. Number 2, we

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needed to operationalize a a cuss a personal service. And

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so everything from the scripts of how you answer the phone all the

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way to, you know, all the operational

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efficiencies that had to be documented. So our operational manual is, you

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know, 300 pages deep, and we needed to make sure that that was

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locked and loaded and and really, enabled the

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franchisee to follow but also scale our current

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model outwardly. So that's number you know, probably the second

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thing. A part of that is, you know, giving them the tools to, you know,

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hire the right people. So how do you recruit, hire, onboard, and then,

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you know, essentially empower them to scale the service? It's a

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personal service. So if our if our potential franchisees

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or our current franchisees didn't have those tools, I think that was

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imperative as well. Brand partners. So who are we

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partners with? Like, whether it's insurance all the way to equipment. How do we

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provide additional value to the potential franchisee

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around brand partnerships that we could leverage and give them

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either, a, good rates, or just seamlessly, you know, attach

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them and and connect them with the the partners that we had that create an

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efficiency in in opening up a location. So those are the types of

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things that we looked at. And then obviously on top of that was the training.

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So when we recruited or had an applicant that

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was interested in a franchisee, what process did we go through? And once

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we qualified that that candidate, how do we actually

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work with them to ensure that they are ready to actually open up and and

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successfully deliver on our brand promises? Gotcha. Now one thing

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that's going on right now in the US is that there is a,

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a movement and actually a, a law that just got passed

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to eliminate noncompete clauses,

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because each one of these states wanna have, like, a free market.

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In franchising, like, I I I hope to build that membership base. Like, that's

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my brand. You know, so have you had any situations

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where an instructor kinda goes rogue and tries to open up and

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basically pull their client base and you have to enforce the franchise agreement?

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Or have you been, you know, lucky or so selective that, you know,

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that trust factor and that that has never happened, if you could disclose that?

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Yeah. Well, I mean, we've had 25 years of people coming into our

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system, learning the system, building up the clientele, and then trying to compete with

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us. In fact, the Vancouver market, if you look at all of our

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competition today, most of them are are ex innovative fitness,

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employees before we had the franchise solution created. And that's another reason

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what motivated us. It's like, now you can grow and go. If you wanna grow

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within the system and open your own, you can do that under the the brand

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that you already know. So that's number 1. Number 2, yeah, we've had

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franchisees, you know, over the years. 2 of them

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tried to do that. They were, you know, unsuccessful not because we

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came after them, but because they think it's easy to do. You

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know? And they think it's easy to establish a brand, you know, create

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their own moat, and it's not. And so, you know, for

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us, we've had those challenges, but we've we've been able to over overcome

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them just based on, you know, the strength of our brand and experience we have.

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This is Pete Moore. I wanna let you in on a little secret. There's this

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company called Promotion Vault, and what they do is they give out rewards

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from retailers that allow you to incentivize your

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members without having to do 0 down and 1 month

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free or giving away shakes or giving away T shirts. What

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you wanna do is build a rewards program that lasts, that

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people value, and that doesn't discount your own products and services.

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So here's the deal. There's something called rewards vault. The rewards

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vault is going to allow a member to set up their own profile.

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They are going to answer questions. You are gonna get those answers. You're gonna be

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able to target those members, and you're gonna reward them inside your

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club, inside your spa, and outside of the club and outside

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of the spa to get them to become loyal, to get them to pay

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their monthly dues, and to be rewarded properly for

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the actions. A lot of companies are cutting back on rewards. You shouldn't

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be. Promotion Vault's your answer. Trust me. This is real.

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You know, a question related to how you set up the franchise. I did read

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your franchise disclosure document before, we got on here,

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but, do you look at it as a percentage of revenue, or are you on

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a fixed fee, per month per location? Yeah.

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Percentage of revenue. So 6% of gross revenue plus

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1% contribution to ad fund. Gotcha. Yeah. We

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we we went over the CrossFit case in our Halo Academy,

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and we were, you know, educating our our students, which are all, you

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know, it's like an executive boot camp that, you know, if the franchisor or

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licensor is not at a percentage of revenue, they're really not

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aligned or motivated to help you grow them because they're just getting their their fixed

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fee per month. And, also, Crossroads doesn't have any exclusivity,

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so somebody can open up right across the street, which is which is troubling.

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So what kind of territories have you sold, and are you looking to continue to

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grow the franchise side, or are you looking to grow the corporate side or both?

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Yes. We have we we have 10 franchise partners in in that

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span from Vancouver to Toronto, and we're continuing to grow.

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In fact, post COVID, we've actually opened up, 4 locations in

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in the Toronto region, through a lot of franchise expansion. And and

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we're gonna continue to grow the Ontario market, and we're actually, you know, getting ready

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to to expand in the US market. So specifically down in the West

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Coast first, but we are, you know, getting ready for that. Gotcha.

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And when you go into the US, what do you how are you going in

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there? Are you selling area development agreements? Were you selling

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territories and multisite, or are you doing one off locations?

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Yeah. We'll start with, corporate expansion. So we'll see the

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market with, corporately run locations in certain regions, and then

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we'll we'll like, a hub and spoke model. So we'll set up corporate

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locations, establish the brand, establish the system, establish the

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experience, and then what we'll do is we'll either, a

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combination of, selling one off locations

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also to multiunit, franchisees. Got

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it. And then let's talk in, you know, about who your

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partners are on the operation side or on the billing side,

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of the franchise, and how important is that to basically leverage what they're doing.

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So who does your billing and and and, membership management

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system? Yeah. That's just recently changed, actually. So we just combined

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forces with, ABC Trainerize and Glofox. And so

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we we operate, you know, with with ABC in mind, and and they

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have a, you know, obviously, a a wide platform with,

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multiple options now now that they've been unified over under the ABC

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umbrella. Gotcha. And and talk about what you built now on on the

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software side with Workout, which, for those of you who wanna Google

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it while we're on here, it's Workout without the, without the first

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o, and how that platform evolved and why you

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spent time doing it, and then some of the things that have evolved since then,

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which we'll we'll key it on. Yeah. Over the

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last 25 years, we've realized that there's a level of prescriptive influence that happens

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between the service provider and the customer, trainers being the service

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provider. And they they have a level of influence on around prescription,

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whether it's, you know, what someone eats all the way to what they buy, to

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what equipment they use, to the supplements they, you know, they they get

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encouraged to to consume. And what happens, you

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know, so many times is that either the trainer, you know, points to

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Amazon or points to local supplement store or, you know, directs

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them around buying a certain pair of shoes. And what we found is

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that that trust, has been built with,

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you know, over time. Like, what I always say is that trust doesn't scale fast,

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and it's built based on, you know, repetitive,

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communication or or nurturing. And and so,

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in today's world, the only people that get rewarded for a level of

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influence is usually social influencers. It's not the influence that's on the grassroot

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level. And so what we did is we built a recommendation platform, and that

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recommendation platform enables, you know, all

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wellness professionals to prescribe and recommend products and earn

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rewards. In that platform, we partner with over a 120

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brands. We have over 2,000 SKUs, everything from

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High Price, TRX, Thorne Supplements, Momentous. You

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name it, we we typically have it, and it enables,

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all these wellness professionals and fitness professionals to now

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finally get either rewarded or provide a discount to their

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customer, you know, and and make it easy for them to, point them

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in the right direction. And so it's it's essentially a digital digital

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dispensary, and we are now launching a studio product

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that now studios, just like Innovative Fitness, no longer have

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to carry inventory, no longer have to have, you know,

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significant retail space, and they can sell a wide range

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of products and holistically impact the customer, the,

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the consumer, effectively by not pointing them anywhere else but

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themselves. Gotcha. 2 follow-up items on that. 1 is

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we're investing in a company called Higher Dose, which is a

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infrared workout recovery and beauty products company in the US.

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We have distribution in Canada, so it's infrared sauna blankets,

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PMF mats, face masks, and a litany of

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other products and services, mostly geared towards towards the women's

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market. So we should definitely connect you with them to expand their their

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distribution and your presence. Second is we work with

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a company called Promotion Vault, which, started in the gift

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card business to have clubs not be doing, you

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know, zero down and, you know, 1st month free type of nonsense.

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And they've set up a employee engagement and reward system. It's kinda

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like a private label Venmo. So that might be another opportunity.

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They've got 35 100 studios and clubs that they work with currently.

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So infusing your, you know, recommendation platform behind that

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might actually be a nice way to instantly push, you know,

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what they're trying to incent into a into a purchase. So that

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that's that's great. So you've got a partnership with

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ABC. And for people who don't know ABC, he's probably dropped from the

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podcast now. No. Just kidding. Stay on the podcast. 1 of the largest billing

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companies, and member management systems, in the industry. You

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know, we're very close with Bill Davis and and love what they've done

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and Paul Scheller from back in the day. And, Curtis, you'll like this. We had

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Paul Scheller on, and, we said, tell tell us what ABC is. He's like, ABC

301
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is a 34 year overnight success. So they

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they were they were, you know, hands on the ground, boots on the ground, you

303
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know, picking up 1 club at a time and and convincing people to, you

304
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know, allow them to collect all their money, for them out of, you

305
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know, Little Rock, Arkansas, which, you know, a lot of clubs said, like, I don't

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wanna let anybody else touch these credit cards or bank accounts. So kudos

307
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to them. Now the question is, ABC is owned by Toba Bravo,

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which is one of the largest, you know, tech software growth equity firms in the

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world. They make acquisitions of Trainerize,

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of gym sales, and of several and was the

311
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one in, in the one in

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the UK, and and Blue Lofotox. Lofotox. Thank you. Thank you,

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Curtis. They can obviously build what you have. It might take them

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years to do it. So when you enter in a conversation like that as an

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entrepreneur, obviously, you own 17 clubs. You've been around studios. You've been around for

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25 years. But you gotta have a lot of bravado and say,

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like, look. I can build this. It's already done. Like, don't take your time. Let's

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do partnership, and don't try to reverse engineer what I have.

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So can you give us a little bit of insight into that? And if I'm

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overstepping my bounds, I apologize, and I apologize after it launches.

321
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Yeah. I mean, Bill Bill Davis will tell you. I mean, he has 3

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philosophies. It's either you build it, you partner, or you buy. And

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usually, most companies would partner. They're they're gonna try it

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before they buy it, and so they're gonna partner before they acquire it. And so

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for us, you know, we were doing something different than they weren't doing. They didn't

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want to get in the business of of working with, you know, brands and partners

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and and ecom. But they found that, you know, our feature

328
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would provide a ton of opportunity for, you know, their Trainerize

329
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users, which are a bunch of independent users, and then eventually, Glofox

330
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users, which are studios. And so it unlocks a huge opportunity for

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them to assess and evaluate. And currently right now where they're

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at in their life cycle, you know, we believed it was, you know, a win

333
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win for everybody because their road map is deep. They

334
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have, you know, 5 or 6 platforms that they're trying to consolidate right

335
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now, and focusing on a new tool or feature around

336
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ecom wasn't really in the road map. And so, you know, and and, you

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know, what's unique that we've found so far, we've already launched with Trainerize.

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We have thousands of users that are are are trying our our product. And

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what's unique is that the average trainer, average

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order earns a trainer $8 per

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order. And what's a Trainerize subscription fee for t

342
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z pay? $7. So think about that. Every time

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a Trainerize user gets an order, it pays for their subscription. So why would a

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free user not not uplevel to a to a a a paid version of

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their app? And and, you know, same with GloFox. We launched a pilot product.

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Just one transaction. That's one transaction. Yeah. You know,

347
00:21:30,905 --> 00:21:34,410
it's interesting. We just got off another podcast without naming names.

348
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And I said, like, how much does does does the counterparty make on this? Like,

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is it material? Yeah. You know? So having those kind

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of metrics to say, you know, how how many transactions I don't know. If you

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could do 20 transactions, you know, it's basically, like, you know, 2:2

352
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to 4 hours of of work that you didn't have to do. Yeah. Right? Awesome.

353
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And then let's talk about, you know, why we got time left here. You've got

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these these PT studios. You know where the industry is

355
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going. You know, it used to be a lot of equipment. Now it's, you know,

356
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more free weights and, you know, and functional training. You've got a lot of

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workout recovery that, you know, we've been preaching to to clubs and studios

358
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that, like, that's your member. Every time somebody posts up in

359
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your studio, in your strip center, or post up inside somewhere that

360
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that your members are parking, they're basically there because they're poaching your

361
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members. And they're typically charging for workout recovery and wellness

362
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modalities more than what you're charging for your monthly membership.

363
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So the reason why you need to get in there is because you if you're

364
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an authority on workouts, you have to be an authority on workout recovery

365
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because it's a holistic approach and it's it's 360. So talk for a

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minute about how you guys view that and what role you

367
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wanna play in that, and do you wanna become the authority and and devote

368
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part of that 4,000 square feet to say, look, we're gonna take care of everything

369
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you need, and I'm gonna repurpose this as I need to.

370
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Yeah. I mean, me and you both have seen the the, evolution of the

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industry, and you said it, like, first was machines, second was, you know, functional

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fitness, and and where are things going right now? Well, there's massive massive

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tailwinds around, you know, longevity, antiaging, metabolic

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health. And I think the reason why is because baby boomers are are, you know,

375
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getting older. They're at a tipping point right now. You know, they wanna live longer.

376
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We have access to data like we've never had before with thanks to

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wearables. And, at the same time, you know,

378
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if you look post pandemic, I think people looked down the gun barrel and

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looked at their life a little bit differently, more holistically, and said, hey. I wanna

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live longer, and I wanna, you know, age, I guess, beautifully. And

381
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so, you know, for for us, we believe that the

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the future of of fitness is more holistic than

383
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ever, and it is actually the consumer is finally ready to

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actually assess and evaluate and look at, you know,

385
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antiaging and metabolic health, you know,

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services. And so how we look at it is, you know, to your point,

387
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it's not just about, you know, movement anymore. It's about movement,

388
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nutrition, sleep, and then a bunch of other layers, like hormone health as an

389
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example, metabolic health. And so how we're positioning our 17

390
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locations and future expansion plans is around, you know, that

391
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longevity. And and speaking to the consumer, we're not gonna be everything to

392
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everyone, but what we are gonna do is we're gonna really

393
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dial in the accountability around movement, nutrition, sleep, and

394
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some, you know, metabolic health biomarkers, like, you know, v o

395
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two max is another one. And how can we actually, you

396
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know, provide not only the the data collection and the health

397
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assessments, but how can we actually, provide the accountability that you can't

398
00:24:40,425 --> 00:24:44,025
get in most places? Because as much as big boxes are diving into

399
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this, they don't got the high touch experience that really provide the

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accountability to see the results that people are looking for.

401
00:24:53,720 --> 00:24:57,260
This is Pete Moore. Here's the last tip for you of the podcast.

402
00:24:57,755 --> 00:25:01,455
We are partnered up with a company called Higher Dose. Higherdose.com.

403
00:25:02,555 --> 00:25:06,095
They are the leader in workout recovery products,

404
00:25:06,395 --> 00:25:10,169
infrared technology, LED light masks, neck

405
00:25:10,169 --> 00:25:13,950
enhancers, and other products such as PMF

406
00:25:14,169 --> 00:25:17,690
mats and sauna blankets. If you have not gotten

407
00:25:17,690 --> 00:25:21,450
on the workout recovery train yet, your time

408
00:25:21,450 --> 00:25:25,275
and your stop is now. You gotta get these products in there before

409
00:25:25,275 --> 00:25:28,875
these workout recovery and spas end up saturating your

410
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market, having your members walk out of the club and going into one of their

411
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locations for $200 per month where they're paid

412
00:25:35,995 --> 00:25:39,360
39 to you. Let's become an expert in workout

413
00:25:39,360 --> 00:25:42,419
recovery if we are already an authority in workouts.

414
00:25:43,120 --> 00:25:46,740
Higher dose, check it out. There's a wholesale code,

415
00:25:47,120 --> 00:25:50,960
and we look forward to helping you augment your products and

416
00:25:50,960 --> 00:25:54,655
services to meet the demands of your members. And, hey,

417
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let's get people happy, healthy, and sweating, and the recovery

418
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should be just as good as the workout.

419
00:26:03,850 --> 00:26:07,610
We seem very methodical about how you think about the the unit

420
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economics and and the support related to it. It reminds me of a

421
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there was a a a really strong club operator, and I said, well, you gotta

422
00:26:15,450 --> 00:26:17,529
look out for this. You gotta look out for that. I was like, look. We're

423
00:26:17,529 --> 00:26:21,365
researching it. Okay? They basically had somebody that would look at all the different

424
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studios that were opening up in their area. And they said, we're not gonna repurpose

425
00:26:25,125 --> 00:26:28,745
any space until I know that what they have

426
00:26:28,805 --> 00:26:32,645
is real and and it provides results, you know, such as, like, you

427
00:26:32,645 --> 00:26:36,140
know, CrossFit or high intensity training. Like, we're gonna get to that.

428
00:26:36,140 --> 00:26:39,980
Okay? And and but I'm not gonna wait until, like, the market like,

429
00:26:39,980 --> 00:26:43,340
let them spend the money on evangelizing it and getting people to talk about it.

430
00:26:43,340 --> 00:26:46,355
Once they do it, I'll I'll I'll I'll I'll take it from there. You know?

431
00:26:46,355 --> 00:26:49,075
So I I really love that. That that's how I think that I feel like

432
00:26:49,075 --> 00:26:52,115
that's how you think about it. Like, it's not ready yet. It's cool. I'll I'll

433
00:26:52,115 --> 00:26:54,355
get to it, but I don't need to be a first mover in it. Let

434
00:26:54,355 --> 00:26:57,415
people figure it out, and I'll I'll I'll I'll figure how to do it right.

435
00:26:58,610 --> 00:27:02,290
January of 2020, I had a 27 page deck that that I

436
00:27:02,290 --> 00:27:05,990
pitched to all my stakeholders, franchise partners, managers, and it was about

437
00:27:06,130 --> 00:27:09,570
how we had to shift our brand into longevity and antiaging. And I I swear

438
00:27:09,570 --> 00:27:13,010
to god, people looked at me going, there is no way. What are what is

439
00:27:13,010 --> 00:27:16,745
he talking about? Fast forward 4 years later, thanks to

440
00:27:16,745 --> 00:27:20,425
guys like Andrew Huberman, Mark Hyman, Peter Attia, you know,

441
00:27:20,425 --> 00:27:24,265
all these thought leaders talking about metabolic health and longevity, the consumer

442
00:27:24,265 --> 00:27:27,625
is ready. And I think the consumer is I think everybody is trying to chase

443
00:27:27,625 --> 00:27:31,140
it right now, and are are quickly shifting their model

444
00:27:31,140 --> 00:27:34,520
without the thought process and and, you know,

445
00:27:34,980 --> 00:27:38,740
just really being methodical about it. And I think we we have a platform to

446
00:27:38,740 --> 00:27:42,419
really jump into this and be leaders at it. So Yep. That's great. And just

447
00:27:42,419 --> 00:27:45,995
to kind of, like, point out some of my personal mistakes, I started an

448
00:27:45,995 --> 00:27:49,755
Internet company in in, April of 2000. There was no

449
00:27:49,755 --> 00:27:53,515
Wi Fi. There was no broadband. There were no smartphones. But I knew

450
00:27:53,515 --> 00:27:56,875
that it was gonna be a big deal. And, basically, I spent pretty much all

451
00:27:56,875 --> 00:28:00,539
my savings and and leveraged up credit cards, because I'm like, the

452
00:28:00,539 --> 00:28:04,140
1st mover wins. And not the 1st mover always wins. The 1st

453
00:28:04,140 --> 00:28:07,440
mover proves the market, educates people, and then

454
00:28:08,059 --> 00:28:11,740
the people that have capital, you know, actually affect it.

455
00:28:11,980 --> 00:28:15,774
And I kinda ran out of capital because I spent it all on educating people,

456
00:28:15,774 --> 00:28:19,134
and then I could survive, you know, the next the next run when actually

457
00:28:19,134 --> 00:28:22,975
technology caught up with the distribution, of it. So I feel like being

458
00:28:22,975 --> 00:28:26,815
a franchisee of yours is like, hey. Look. These guys aren't gonna make mistakes. They're

459
00:28:26,815 --> 00:28:30,110
gonna roll things out when they know that there's demand

460
00:28:30,730 --> 00:28:34,370
and Yeah. Figure out the economics because they have their own locations as well. So

461
00:28:34,370 --> 00:28:36,890
they're not gonna put something in unless they know it's gonna make money for them

462
00:28:36,890 --> 00:28:40,250
and make money for me. So I didn't know about you before, so it's awesome

463
00:28:40,250 --> 00:28:43,835
that we finally met. So thank you, Eric, from Swerve for introducing us.

464
00:28:43,835 --> 00:28:47,435
And, you know, just in closing here, as you

465
00:28:47,435 --> 00:28:51,275
built out the franchisor, could you

466
00:28:51,275 --> 00:28:55,115
give us a little bit of insight into how you thought about

467
00:28:55,115 --> 00:28:58,950
what types of people you needed to support the franchisees and

468
00:28:58,950 --> 00:29:02,789
maybe just a, a heads up to people that wanna franchise their

469
00:29:02,789 --> 00:29:05,750
business. Like, you have to do it a certain way and you have to spend

470
00:29:05,750 --> 00:29:09,130
a certain amount of money on overhead or you're in a lot of trouble.

471
00:29:10,549 --> 00:29:13,770
Yeah. Yeah. I I I think at the end of the day, like, you

472
00:29:14,684 --> 00:29:18,284
you need definitely someone that is gonna recruit, onboard, and train,

473
00:29:18,524 --> 00:29:22,365
the franchisees. You need support around, you know, when you do a

474
00:29:22,365 --> 00:29:25,965
site selection and building it out. Like, these, you know, new franchisees don't know how

475
00:29:25,965 --> 00:29:29,810
to do that, so you need someone that's actually hands on and and can assist

476
00:29:29,810 --> 00:29:33,650
and and, you know, really, help save them costs instead of

477
00:29:33,650 --> 00:29:37,490
making mistakes when you build out their locations. Marketing is a big one.

478
00:29:37,490 --> 00:29:40,930
Right? Like, at the end of the day, if you don't provide they're buying into

479
00:29:40,930 --> 00:29:44,685
our brand, and you gotta help them bring that brand to life in new regions.

480
00:29:44,685 --> 00:29:48,065
And so marketing support is significantly, you know, important

481
00:29:48,685 --> 00:29:52,525
on on supporting franchisees. And then operations, you know,

482
00:29:52,525 --> 00:29:56,125
they as much as you can, you know, develop a 300 page manual, at the

483
00:29:56,125 --> 00:29:59,940
end of the day, how do they execute and implement and and,

484
00:30:00,340 --> 00:30:04,179
apply what's in that manual day to day, and how can you be there and

485
00:30:04,179 --> 00:30:08,020
their support operationally so when they're running into snags or troubles or

486
00:30:08,020 --> 00:30:11,620
they have an employee leave and and, you know, is is impactful to the

487
00:30:11,620 --> 00:30:15,265
business, how can you be there to support them during the tough times? So all

488
00:30:15,265 --> 00:30:18,945
of those things, everything from the front end to the back end, all the way

489
00:30:18,945 --> 00:30:22,705
from, you know, leading up to opening up the location to while they're operating,

490
00:30:22,705 --> 00:30:26,545
you need the support, you know, for the franchisees to ensure that they're

491
00:30:26,545 --> 00:30:29,960
successful. And to your point, Pete, if if the incentive is

492
00:30:29,960 --> 00:30:33,659
aligned, I e, if the royalties are there, then that means that

493
00:30:33,799 --> 00:30:37,000
we only win when they win. And, you know, the last thing we wanna do

494
00:30:37,000 --> 00:30:40,759
is shut down a location. And so for for us, you know, not

495
00:30:40,759 --> 00:30:44,534
only is our incentive aligned, but, but at the same time, you

496
00:30:44,534 --> 00:30:48,375
know, we're there to support them, you know, all the way through. Awesome. Well, great

497
00:30:48,375 --> 00:30:51,174
to have you on Halo Talks. Feel free to use the acronym as much as

498
00:30:51,174 --> 00:30:54,774
you like. It's royalty free. And, love what you're doing. We should

499
00:30:54,774 --> 00:30:58,455
definitely meet. I'm out in California and and, love going up to Vancouver. I've been

500
00:30:58,455 --> 00:31:02,190
there several times. And as you come into the US, please, you know, hit

501
00:31:02,190 --> 00:31:05,950
us up for, you know, relationships of where to to to go and who

502
00:31:05,950 --> 00:31:09,390
to talk to, because I think a lot of people are gonna resonate, you know,

503
00:31:09,390 --> 00:31:12,645
with this model. And, you know, congrats on

504
00:31:12,805 --> 00:31:16,485
methodically building a a real business. So good to meet you.

505
00:31:16,485 --> 00:31:17,785
Awesome. Thanks, Pete.