In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the i9 Sports franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for an i9 Sports franchise, based on Item 7 of the company’s 2018 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for an i9 Sports franchise, based on Items 5 and 6 of the company’s 2018 FDD
- Section IV – Number of franchised and company-owned i9 Sports outlets at the start of the year and the end of the year for 2015, 2016, and 2017, based on Item 20 of the company’s 2018 FDD
- Section V – Presentation and analysis of i9 Sports’ financial performance representations, based on Item 19 of the company’s 2018 FDD, including information on the:
- 2017 average, highest, and lowest revenue for the 119 full-time i9 Sports franchises that were open for more than 60 months, between 49 and 60 months, between 37 and 48 months, between 25 and 36 months, and between 13 and 24 months, respectively, as of December 31, 2017; and operating an average of at least 1 venue for three seasons, as well as 2 core sports during the 2017 calendar year
- 2017 average registration fee for the 119 full-time i9 Sports franchises that were open and operating for over 12 months as of December 31, 2017 and operating an average of at least 1 venue for three seasons, as well as 2 core sports during the 2017 calendar year
- registration revenue growth of “same franchise units” for those 119 full-time i9 Sports franchises that were open and operating for more than 12 months as of December 31, 2017 and operating an average of at least 1 venue for three seasons, as well as 2 core sports during the 2017 calendar year
- average owner’s discretionary profit margin for the period from April 1, 2016 to March 31, 2017, based on data provided by 91 full-time i9 Sports franchises that were open and operating for at least 12 months as of April 1, 2016
- median team equipment, officiating costs, venue costs, site managers and paid instructors, liability insurance and background checks, and total cost per registration for the period from April 1, 2016 to March 31, 2017, based on data provided by 91 full-time i9 Sports franchises that were open and operating for at least 12 months as of April 1, 2016 (except for the team equipment percentage, which was derived from the franchisor’s Approved Supplier price list as of December 31, 2017)
Section I – Background Information
19 Things You Need to Know About the i9 Sports Franchise
Announces Expansive Franchise Growth Initiative
1. In early May 2018, i9 Sports announced a widespread growth initiative. The strategy positions the brand for expansion in communities across the United States, while providing motivated entrepreneurs with the opportunity to provide organized competitive sports in their neighborhoods for children to pursue their athletic aspirations in a fun, rewarding environment.
2. Brian Sanders, chairman and CEO of i9 Sports, said, “This has all the makings of a rewarding lifestyle business for professionals who have dreams of making a positive impact locally. You align closely with your community and neighboring towns, impact the lives of families and their kids; and you get to call the shots taking control of your income, lifestyle and future. i9 Sports proves that transitioning into entrepreneurship can be gratifying and lucrative at the same time.”
3. The announcement came on the heels of the significant momentum that is driving the enhanced franchising initiative, including a fourteenth year of record revenue for the brand. Demonstrating the brand equity behind i9 Sports and the value that is created within the business, nine new locations had been added to the i9 Sports roster in the last 18 months (at the time of the announcement). Also, in 2017, 10 locations were sold to second-generation owners to continue the brand’s legacy in the markets served.
4. Throughout the three remaining quarters of 2018, i9 Sports had plans to add 20 new franchisees to the system. Attractive territories are available for expansion in priority markets including Chicago, Northern and Southern California, New Jersey, New York, Philadelphia, Salt Lake City, Detroit, Minneapolis, Seattle, Northern Virginia, and Virginia Beach.
5. Sanders added, “The popularity of i9 Sports comes from the sports experiences we create, where kids can compete in a fun environment and a well organized league. Parents love it because their sons and daughters can sense the passion we have and they feed off of it. Kids and parents alike get tremendous satisfaction from being part of the program and it stays with them for the rest of their lives. It’s easy for us to see why there is so much interest in joining our franchise family.”
Getting Ready for Another Year of Growth in 2019
6. At the beginning of December 2018, i9 Sports released an interview with the company’s chairman and CEO Brian Sanders to discuss i9 Sports’ goals and plans for the upcoming year. According to Sanders, “We are looking at a huge year ahead. From a very high level, we’re looking to build on our 15 consecutive years of record revenue for the brand. Specifically, we are looking to add 15 to 20 new franchise locations in priority markets such as Chicago, Northern/Southern California and the Northeastern corridor — Philadelphia up through New Jersey and New York. We’re also looking at Salt Lake City, Utah and Minneapolis among our key priority markets. We have already sold out of certain markets across the country, so territories are moving quickly.”
7. Sanders added that the sold out markets included Atlanta, Dallas, Houston, Phoenix, and Denver. He also said that i9 Sports was expected to end 2018 with 143 total franchise units.
8. Sanders highlighted that i9 Sports launched its version of lacrosse, ZIP Lacrosse, in the second half of 2018. Based on results so far, i9 Sports expects to see more franchisees pick up the lacrosse program. In the first quarter of 2019, i9 Sports will be piloting a new sport, which Sanders did not name in the interview. Sanders did say that this new sport is something that most other youth sports organizations were not currently offering.
9. Also in 2019, i9 Sports plans to completely redesign its customer website as well as the proprietary software that supports it. According to Sanders, “The enhancements will allow us to present all the sport offerings and programs that we offer our customers in a way that is much more customer-friendly and allows the franchise owners enhanced reporting behind the scenes to see exactly where their business is growing most rapidly and where their biggest opportunities are.”
10. Additionally, i9 Sports will be introducing new financial planning and benchmarking software that will allow franchise owners to better track their financial results and to see how their financials stack up against averages across the network. Sanders said, “As a business owner, one of the key reasons people buy an i9 Sports franchise is to support our mission of helping kids succeed in life through sports. But our franchisees also want the financial independence associated with owning their own business. This new service is going to make it easier to see profit opportunities so each owner can get the maximum reward for their effort.”
11. Lastly, Sanders said, “In 2019, one of our other new initiatives at the field level will be to enhance the tools and training we provide the volunteers who coach our young players. The field is where the i9 Sports Experience is delivered, so we want to help each volunteer coach better understand our culture and how to properly coach youth in each sport. These new tools will also be delivered using technology.”
Recognized as Project Play Champion
12. In mid-December 2018, i9 Sports announced that the franchise had been recognized for its contribution to sports by being designated as Project Play Champion by The Aspen Institute, a nonpartisan think tank dedicated to addressing some of the world’s most complex problems. The Institute devotes some of its resources to studying the impact of sports.
13. Organized activities like those offered by i9 Sports are widely recognized for their positive benefits on health, families, communities, and the world at large. The award as well as the mission of the Project Play initiative fits with i9 Sports’ mission of helping children succeed in life through sports.
14. According to its own website, the Project Play initiative “develops, applies and shares knowledge that helps build healthy communities through sports. We produce reports that take measure of the state of play at the national, regional and city levels, with exclusive data and insights. We create frameworks and tools that stakeholders can use to grow access to quality sport. Then each fall, we pump new ideas into the bloodstream and push the movement forward at the Project Play Summit, the nation’s premier annual gathering of leaders at the intersection of youth, sport and health.”
15. i9 Sports was founded in 2003 by Frank Fiume in Florida. The idea behind the youth sports franchise began years earlier when Fiume left his career as a medical device sales rep in 1995 to pursue a career organizing his own adult softball league. Fiume built proprietary software to organize team rosters, schedules, stats, and scores; focused on clear and consistent communication; and hired dependable umpires. Within a few years, the league had grown to over 1,000 teams.
16. Around 1996, Fiume and his family moved from New York to Tampa, Florida and Fiume felt that he could apply his concept to youth sports. After doing extensive research into the youth sports industry, Fiume felt that he could provide a superior experience for both parents and kids and he created a model for a youth sports business opportunity.
17. Fiume settled on flag football as the first sport to offer because competition was limited, football had broad appeal, and flag football is safe for both boys and girls to play. Two years later, in 1998, Fiume made his move into youth sports and his new business venture was a success.
18. Not long after, Fiume teamed up with franchise-industry experts to launch a national youth sports franchise company, which led to i9 Sports. Since then, i9 Sports has grown across the United States and franchisees now operate local youth sports leagues, camps, and clinics for flag football, basketball, soccer, cheer, lacrosse, and baseball/softball.
Entrepreneur’s Franchise 500
19. i9 Sports ranked No. 470 on Entrepreneur’s 2019 Franchise 500 list.
Section II – Estimated Costs
- Please click here for detailed estimates of i9 Sports franchise costs, based on Item 7 of the company’s 2018 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on i9 Sports’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2018 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 122
- Outlets at the End of the Year: 126
- Net Change: +4
- Outlets at the Start of the Year: 126
- Outlets at the End of the Year: 132
- Net Change: +6
- Outlets at the Start of the Year: 132
- Outlets at the End of the Year: 129
- Net Change: +3
- Outlets at the Start of the Year: 16
- Outlets at the End of the Year: 16
- Net Change: 0
- Outlets at the Start of the Year: 16
- Outlets at the End of the Year: 1
- Net Change: -15
- Outlets at the Start of the Year: 1
- Outlets at the End of the Year: 1
- Net Change: 0
Section V – Financial Performance Representations (Item 19, 2018 FDD) and Analysis
- As of December 31, 2017, there were 129 i9 Sports franchises and 1 company-owned location.
Part 1 – Average Revenue of Franchise Units
- The following Charts in Part 1 set forth information reported by i9 Sports’ 119 full-time franchise units that were (i) open and operating for more than 12 months as of December 31, 2017; and (ii) operating an average of at least 1 venue for three seasons, as well as 2 core sports during the 2017 calendar year (a season is defined as a distinct period of time during which one or more separate programs or leagues are operated).
- The information presented is for the period January 1, 2017 through December 31, 2017 (the “Measurement Period”).
Franchise Units Open and Operating for More Than 60 Months as of December 31, 2017 (85 Franchise Units)