FDD Talk: Visiting Angels Franchise Review (Financial Performance Analysis, Costs, Fees, and More)

In this FDD Talk post, you’ll learn the following:

• Section I – Background information on the Visiting Angels franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for a Visiting Angels franchise, based on Item 7 of the company’s 2019 FDD

• Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Visiting Angels franchise, based on Items 5 and 6 of the company’s 2019 FDD

• Section IV – Number of franchised and company-owned Visiting Angels outlets at the start of the year and the end of the year for 2016, 2017, and 2018, based on Item 20 of the company’s 2019 FDD

• Section V – Presentation and analysis of Visiting Angels’ financial performance representations, based on Item 19 of the company’s 2019 FDD, including information on the:

• number of Visiting Angels franchisees that generated 2018 annual revenues of $0 to $10,000; $10,001 to $20,000; $20,001 to $50,000; $50,001 to $100,000; $100,001 to $200,000; $200,001 to $300,000; $300,001 to $400,000; $400,001 to $500,000; $500,001 to $600,000; $600,001 to $700,000; $700,001 to $800,000; $800,001 to $900,000; $900,001 to $1,000,000; $1,000,000 to $1,500,000; $1,500,000 to $2,000,000; $2,000,000 to $2,500,000; $2,500,000 to $3,000,000; $3,000,000 to $4,000,000; $4,000,000 to $5,000,000; $5,000,000 to $7,000,000; and over $8,000,000, respectively

Section I – Background Information

20 Things You Need to Know About the Visiting Angels Franchise

Installs AI Assistants in Clients’ Homes

1.  In late September 2019, Visiting Angels announced that it was the first in the senior home care industry to install voice-activated artificial intelligence from Amazon’s Alexa into the homes of clients. The technology helps keep older adults safe with a round-the-clock voice assistant, with a fun personality, that keeps them connected with family, friends, and caregivers.

2.  This purpose-built solution is called Constant Companion, a first-of-its-kind personal emergency and companion system that works hands-free with Amazon’s Alexa. According to Visiting Angels, Constant Companion is a revolutionary gamechanger for the caregiving industry and for families who need to monitor and communicate with loved ones that might be more vulnerable.

3.  Larry Meigs, president and CEO of Visiting Angels, said, “We are very excited to join forces with the voice technology experts at Constant Companion to put this amazing product in the homes of seniors across the country. The team at Constant Companion invented a system that puts a modernized spin on the ‘Help, I’ve fallen, and I can’t get up’ medical alert technology. They’ve created a companion tool for Alexa that provides services specifically tailored to seniors that they can use without technical skills of any type or even home Wi-Fi. By adding this device to our list of caregiving tools, we are enhancing the services we already provide to thousands of American families, especially when it comes to emergency calls for help and keeping relatives informed and involved in the lives of their elderly loved ones.”

4.  Mark Gray, founder and president of Constant Companion, added, “We are honored and humbled to be invited into the homes of the families who Visiting Angels serves across the nation. We hope our platform, specifically designed for those living alone, creates a safer environment and moments of joy. Constant Companion helps seniors respond to Alexa in a physical and emotional way, by exercising their mind, body and spirit, each and every day. Our system is really making an impact on their quality of life.”

5.  Visiting Angels caregivers are trained to help families program the system with their clients’ favorite activities and teach them how it can improve their daily life. Constant Companion features the following:

• Plug and Play: Constant Companion is programmed to work on any Amazon Alexa enabled device including with Echo Dot speakers. The speakers look just like what millions of other people have in their homes today. The difference is that Constant Companion’s technology team provides a concierge experience; customizing every system to fit the unique needs of each senior. The speakers work just like other Alexa devices, seniors can play games, get weather reports, and listen to music. However, online shopping is not available. High-speed Wi-Fi service and battery back-up are included from Constant Companion.

• Constant Companion operates on an independent, secure network, totally separate than what Amazon uses for its operations. Each user is 100% anonymous, and a senior’s identity is locked down behind HIPAA compliant encryption and security. Constant Companion further protects its users with a one million dollar cybersecurity, privacy protection guarantee, backed by Lloyds of London.

• Lightning Fast: When a senior says “Alexa, call for help,” they’re connected to a Constant Companion emergency response operator within ten seconds. That’s three times faster than competitors on average. Operators are located at 5-Diamond rated, US-based urgent response centers. They immediately recognize the user and their address and can alert local first responders if a senior needs help.

• Daily Care Calls: Seniors can schedule a daily check-in call with Constant Companion. A live operator will contact the user at a certain time to make sure they are okay and to see if there is anything they need.

• Customized Calling: The team at Constant Companion adds family telephone numbers to the system ahead of time, so seniors can just speak up when they want to call their son or grandchild, simply by saying, “Alexa, call John” or “Alexa, call Susie.”

• Never forget: Users can tell Alexa when they need to take medication, and she will speak out and remind them at that time. A few minutes later, she will even ask, “Did you take your medicine?” just to make sure.

• Room-to-Room Communication: Seniors can use the speakers as an intercom system inside their home. It’s a great way for caregivers and seniors to talk to each other if they are in separate rooms, like the kitchen and bedroom.

• Engage and Entertain: Alexa will never leave seniors bored or lonely. Users can ask her to play music from their favorite genre, ask her the day’s news, or even to play interactive games such as Jeopardy and Who Wants to be a Millionaire?

6.  Visiting Angels franchisee Connie Nelson was one of the first to test Constant Companion for the company. “We installed our first Constant Companion caregiving system in the home of a man who is confined to his bed, so his daily activities are quite limited,” Nelson explained. “We knew about his love for music, and we programmed the system to play his favorite barbershop quartets. When we said ‘Alexa, play a barbershop quartet,’ and it played his favorite song, his face lit up like a toddler opening a Christmas gift! It was one of the most amazing reactions I have ever seen during my time working with seniors.”

7.  At the time of the announcement, more than 100 Visiting Angels agencies across the nation were using Constant Companion in the homes of seniors, and caregivers are seeing benefits, too.

8.  Mark Gray, a veteran federal government cybersecurity expert, recognized the need for a better senior monitoring solution after caring for his own mother. When asked to wear one of those push-button medical alert necklaces, and like many people, she said, “I love you son, but I am never going to wear one of those things.”

9.  “After doing a little digging, I found out that the majority of seniors who subscribe to these alert buttons forget or refuse to wear them, making them useless when they need them most, so I started searching for an alternative.” Gray’s search helped him to create a platform that combined artificial intelligence, voice technology, and automation that he named Constant Companion. Visiting Angels is the first in-home care company in the nation to launch the system nationwide.

Endorses CareAcademy for Online Caregiver Training

10.  In mid-July 2019, CareAcademy, the home care industry’s first mobile-friendly caregiver training platform, announced that it had been endorsed by Visiting Angels and is a new vendor option for Visiting Angels’ franchisees as of June 2019.

11.  CareAcademy’s training helps home care agencies become efficient industry leaders through an easy-to-use proprietary technology platform and online classes that can be completed on a smartphone, tablet, or computer without the hassle of downloading an app. CareAcademy’s classes also help home care agencies meet orientation and annual training compliance requirements.

12.  Dave Plank, national director of business development for Visiting Angels, said, “Visiting Angels is excited to work with CareAcademy in the incredibly important market segment of training. With multiple companies available in the industry, we are quite pleased to have found CareAcademy, which shares Visiting Angels’ vision for quality training.”

13.  With CareAcademy, caregivers are able to take their training with them, even when they move on to another location within the franchise. CareAcademy is the first-ever company to offer caregivers an easy way to access their training records after they leave their employer. This means that the next person who hires the caregiver doesn’t need to pay or dedicate time to training them again.

14.  CareAcademy’s video-based training incorporates real-world scenarios that build critical thinking skills and set caregivers up for success. Ongoing education through CareAcademy ensures that seniors and their families receive professional and consistent quality care.

15.  According to Helen Adeosun, co-founder and CEO of CareAcademy, “Visiting Angels is a highly trusted home care agency for thousands of clients and their families. They understand that home care must deliver the highest quality care to clients. We know that CareAcademy gives caregivers the continuing education to build on their current skills, upskill by learning how to manage client-specific chronic health conditions, and ultimately provide excellent care. We’re proud to be working with Dave and his team.”

Company History

16.  Visiting Angels began sometime around 1989 when Jeffrey Johnson, who was working as the director of social work at a nursing home in Baltimore, Maryland, became disillusioned with the lack of resources and “indifferent” attitude that some people had toward the residents of the nursing home. Johnson also didn’t like the fact that there weren’t many options for living arrangements outside of a nursing home for seniors. So, Johnson decided to create more choices for families and more options for seniors.

17.  Over the next few years, Johnson built a very successful business providing for the needs of seniors by offering top quality, experienced caregivers (and giving families a choice in caregivers).

18.  After continuing to run his agency on his own for many years, Johnson met Larry Meigs, a franchise developer from Philadelphia, Pennsylvania, in 1998. Meigs wanted to help Johnson turn Visiting Angels into a national franchise.

19.  Since then, Visiting Angels has opened locations across the United States. There are also some international locations. Meigs currently serves as president and CEO of Visiting Angels.

Entrepreneur’s Franchise 500

20.  Visiting Angels ranked No. 191 on Entrepreneur’s 2020 Franchise 500 list.

Section II – Estimated Costs

• Please click here for detailed estimates of Visiting Angels franchise costs, based on Item 7 of the company’s 2019 FDD.

Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees

• Please click here for detailed information on Visiting Angels’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2019 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2016

• Outlets at the Start of the Year:  508
• Outlets at the End of the Year:  528
• Net Change:  +20

2017

• Outlets at the Start of the Year:  528
• Outlets at the End of the Year:  563
• Net Change:  +35

2018

• Outlets at the Start of the Year:  563
• Outlets at the End of the Year:  576
• Net Change:  +13

Company-Owned

2016

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2017

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

2018

• Outlets at the Start of the Year:  0
• Outlets at the End of the Year:  0
• Net Change:  0

Section V – Financial Performance Representations (Item 19, 2019 FDD) and Analysis

• The Revenue vs. Longevity Chart below is based on the actual, annual revenues reported by 576 franchisees that operated in calendar year 2018.

• Yearly Revenues means all sums (paid/collected receipts), property, or other value which you receive whether in cash or in kind without deductions of any type, resulting directly or indirectly from services rendered to clients in the normal operation of your Franchised Business.

• Gross Revenues includes all revenues received by the Franchised Business to be paid to caregivers as wages and total compensation and includes compensation paid directly to caregivers by clients. Gross Revenues does not include sales taxes or discounts.

• The annual revenues in the chart represent, in increasing dollar ranges, the Gross Revenues received in calendar year 2018 only, by the franchisee for providing non-medical home care services to clients.

• These revenue reports are required by the Franchise Agreement for the calculation of royalties owed by the franchisee to Visiting Angels. The annual royalty revenue amounts are grouped into dollar ranges for the purpose of the chart.

• The months represent the number of months since the franchisee had attended Visiting Angels’ training class.

• There were 11 franchisees under contract that were not yet active in 2018 that are not represented on this chart.

• This chart represents a factual, historical financial performance representation of Visiting Angels’ franchise system. Some franchisees have sold this amount. Your individual results may differ. There is no assurance that you will sell as much.

2018 Revenue vs. Longevity Chart

• Longevity as of December 31, 2018, by number of months since training.

1-6 Months

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