FDD Talk: i9 Sports 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 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 2019 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 2019 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 2016, 2017, and 2018, based on Item 20 of the company’s 2019 FDD

• Section V – Presentation and analysis of i9 Sports’ financial performance representations, based on Item 19 of the company’s 2019 FDD, including information on the:

• 2018 average, highest, and lowest revenue for the i9 Sports franchise units open and operating 7 or more venues, 5 to 6 venues, 3 to 4 venues, 1 to 2 venues, and all 123 i9 Sports franchise units open and operating for more than 12 months as of December 31, 2018

• 2018 average and median registration fee for the 123 full-time i9 Sports franchises that were open and operating for more than 12 months as of December 31, 2018 and operating an average of at least 1 venue for 3 seasons, as well as 2 core sports during the 2018 calendar year

• average and median registration revenue growth of “same franchise units” for those 123 full-time i9 Sports franchises that were open and operating for more than 12 months as of December 31, 2018 and operating an average of at least 1 venue for 3 seasons, as well as 2 core sports during the 2018 calendar year

• total registration revenue, team equipment, officiating costs, venue costs, site managers and paid instructors, liability insurance and background checks, total cost, and net registration income obtained from the franchisor’s Approved Supplier price lists as of December 31, 2018, and information as provided by the 1 company-owned location

Section I – Background Information

19 Things You Need to Know About the i9 Sports Franchise

Announces First Annual Veteran Franchise Giveaway

1.  In mid-November 2019, i9 Sports announced the launch of its exciting franchise giveaway opportunity specifically for veterans, a first for the unique sports concept brand. The giveaway serves i9 Sports’ mission of helping kids succeed in life through sports by connecting a qualified veteran with a meaningful business opportunity at the local community level. Valued at $45,000, the giveaway includes a five-year franchise agreement, a waived territory fee, and no repayment of the franchise fee.

2.  In an announcement made at the Arlington, Texas “Business Beyond the Battlefield” conference – before an audience of veteran participants – Nathan J. Fleming, an American army veteran of 15 active duty and four national guard years, and native of Van Vleck, Texas, was named as the recipient of his own new i9 Sports franchise. The franchise territory will cover the majority of Plymouth County, an area not far from Boston, Massachusetts.

3.  This was the first franchise giveaway organized by i9 Sports, but the company already has plans to continue offering the award to qualified veterans on an annual basis.

4.  Fleming said, “I’m excited that a company like i9 Sports wants to do their part to give back to the military veteran community. As a parent of three boys who have played i9 Sports for the past five years, I’ve been able to see for myself the positives of a sports experience that puts fun first. I was willing to make my own investment to become an i9 Sports franchisee, so the fact that they made it available in a giveaway says a lot about them as a company.”

5.  Over the course of Fleming’s active duty military career, he has been deployed overseas five times and held the position of commander of the United States Army Advanced Airborne School where he was responsible for the training and safety of a force of over 30,000 paratroopers to execute airborne missions in a combat environment.

6.  As a civilian, Fleming majored in kinesiology and is completing a master’s degree program in sports administration. He knew he wanted to find his own way in the sports realm of business after leaving the military.

7.  Receiving the i9 Sports franchise giveaway means Fleming will relocate with his family from their residence in North Carolina to be closer to his new territory in Massachusetts. “My wife is originally from Massachusetts and she’s moved around with me to countless Army postings over my Active Duty career,” said Fleming. “To be able to start a new chapter and a new business back in her home state makes us really excited for what’s to come.”

8.  According to Brian Sanders, president and CEO of i9 Sports, “It is an honor to give back to those who have given so much for our country. Nathan’s demonstrated ability to offer world-class training to American soldiers, a passion for sports and serving his local community convinced us he would be a perfect fit as an i9 Sports franchise owner. All of this fit squarely into Nate’s wheelhouse and is a recipe for success in our franchise system. Nate will benefit from our strong operational systems, continual support from our home office team, and our enviable work-life balance on his way to success. We want to show veterans that a transition from the battlefield to the ballfield with us can be fun, rewarding and profitable at the same time.”

Appoints New Vice President of Operations

9.  At the end of January 2019, i9 Sports announced that the company had expanded its senior leadership team to further aid in the expansion of the brand. Roger Ewart, CFE, was named the new vice president of operations for i9 Sports, bringing a wealth of industry knowledge to the team.

10.  With experience in both domestic and international settings, Ewart has been instrumental in working with both private and public companies. Prior to i9 Sports, Ewart was the vice president of operations for Signarama, the world’s largest sign franchise company with 800 units in 60 countries, and he co-founded multiple successful family businesses, to name a few of his roles.

11.  In his new role at i9 Sports, Ewart will oversee the franchise system’s operations, franchise development, and the company-owned proving ground location.

12.  Brian Sanders, president and CEO of i9 Sports, said, “We’re pleased to welcome Roger to the i9 Sports team and have no doubt that his experience will be a huge asset as we work to extend our track record of significant growth and industry leadership. We truly believe i9 Sports’ potential for success is limitless. We’re committed to our brand’s mission of helping kids succeed in life through sports and anticipate Roger will play a significant role in furthering our effort to revolutionize recreational youth sports.”

13.  According to Ewart, “I am truly honored to have been recruited to i9 Sports. It’s a great company with amazing people. The company’s tag line (The Way Youth Sports Should Be) really hit home with my 10- and 13-year-old boys. I believe the philosophy is spot on as it relates to putting fun first, healthy competition and teaching good sportsmanship. The model delivers exactly what a kid deserves to experience on the field and makes it so easy and convenient for the parents.”

14.  “Beyond what the brand does for kids and their families, I’m amazed at how powerful the economic model is for franchise owners. I look forward to working with the current and future franchise owners to help them reach their financial goals through i9 Sports. The brand is both operationally and financially strong, and I’m excited by the prospect of helping drive significant growth,” Ewart continued.

Company History

15.  i9 Sports was founded in 2003 by Frank Fiume in Tampa Bay, Florida. Fiume already had experience running a sports league, which he started in 1995 after leaving his job as a medical device sales rep. At the time, Fiume was living in Long Island, New York and participated in the local adult men’s softball league. Unsatisfied with how the league was run, Fiume started doing research and discovered that while the local leagues were disorganized and terribly run, they were still making a lot of money.

16.  Fiume knew he could do better and launched his own adult softball league. He built proprietary software to organize team rosters, schedules, stats, and scores; focused on clear and consistent communication; and hired dependable umpires. Despite being told it would never work, Frank’s start-up league grew to more than 1,000 teams within a couple short years.

17.  Although his business was booming, Fiume and his wife Nadine moved to Tampa, Florida in 1996 to raise their new family and Fiume began thinking about how he could apply what he had done in New York to youth sports. Again, Fiume conducted a lot of research and learned that there was a lot of room for improvement in the youth sports industry. From there, he developed the concept for i9 Sports.

18.  Initially, Fiume chose 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. Fiume began franchising i9 Sports immediately and there are now locations across the United States. In 2016, Fiume sold his company to his employees, but remains a director on the company’s board.

Entrepreneur’s Franchise 500

19.  i9 Sports ranked No. 457 on Entrepreneur’s 2020 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 2019 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 2019 FDD.

Section IV – Number of Franchised and Company-Owned Outlets

Franchised

2016

• Outlets at the Start of the Year:  126
• Outlets at the End of the Year:  132
• Net Change:  +6

2017

• Outlets at the Start of the Year:  132
• Outlets at the End of the Year:  129
• Net Change:  -3

2018

• Outlets at the Start of the Year:  129
• Outlets at the End of the Year:  142
• Net Change:  +13

Company-Owned

2016

• Outlets at the Start of the Year:  16
• Outlets at the End of the Year:  1
• Net Change:  -15

2017

• Outlets at the Start of the Year:  1
• Outlets at the End of the Year:  1
• Net Change:  0

2018

• 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, 2019 FDD) and Analysis

• As of December 31, 2018, there were 142 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’ 123 full-time franchise units that were (i) open and operating for more than 12 months as of December 31, 2018; and (ii) operating an average of at least 1 venue for 3 seasons, as well as 2 core sports during the 2018 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, 2018 through December 31, 2018 (the “Measurement Period”).

Franchise Units Open and Operating 7 or More Venues as of December 31, 2018 (9 Franchise Units)