In this FDD Talk post, you’ll learn the following:
- Section I – Background information on the Urban Air Adventure Park franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for an Urban Air Adventure Park franchise, based on Item 7 of the company’s 2021 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for an Urban Air Adventure Park franchise, based on Items 5 and 6 of the company’s 2021 FDD
- Section IV – Number of franchised and company-owned Urban Air Adventure Park outlets at the start of the year and the end of the year for 2018, 2019, and 2020, based on Item 20 of the company’s 2021 FDD
- Section V – Presentation and analysis of Urban Air Adventure Park’s financial performance representations, based on Item 19 of the company’s 2021 FDD, including information on the:
- 2020 average, median, maximum, and minimum gross sales for the 67 franchised “2.0 Adventure Parks” and the 6 franchised “2.5 Adventure Parks” that were open on January 1, 2020 and submitted data for inclusion in Item 19
- 2020 average, median, maximum, and minimum cost of goods sold, occupancy, advertising, payroll, insurance, other costs, and EBITDA for the 67 franchised “2.0 Adventure Parks” and the 6 franchised “2.5 Adventure Parks” that were open on January 1, 2020 and submitted data for inclusion in Item 19
- 2021 average, median, maximum, and minimum monthly gross sales from January 2021 through March 2021 for the 79 franchised “2.0 Adventure Parks” and the 11 franchised “2.5 Adventure Parks” that were open on January 1, 2020 and were operational for at least one full month in 2021
Section I – Background Information
23 Things You Need to Know About the Urban Air Adventure Park Franchise
Forms Unleashed Brands to Develop Portfolio of Brands Serving Families
1. In mid-July 2021, the team behind Urban Air Adventure Park announced the formation of Unleashed Brands – a new global growth-focused platform that will curate and expand a portfolio of brands to provide safe, fun, and enriching environments that help kids learn, play, and grow.
2. As part of this new venture, Unleashed Brands has acquired Snapology, the premier franchise brand offering STEAM programs for kids. Under the Unleashed Brands platform, Urban Air and Snapology will join forces to provide kids of all ages with fun ways to learn and play. Details of the transaction were not disclosed.
3. According to Michael Browning, president and CEO of Unleashed Brands and founder of Urban Air, “As we look for ways to strengthen our portfolio of brands, Snapology presented us a strong, strategic fit with programing that allows our founding company, Urban Air, to expand its offerings into STEAM education, something that is extremely important in the development of young minds. Urban Air and Snapology will join forces in an effort to create additional offerings for their Guests and revenue opportunities for Franchisees by offering Snapology classes, camps and birthday parties from within Urban Air locations. As a fast-growing, dynamic brand with a dedicated purpose, we are thrilled to welcome the like-minded Snapology team to the family and look forward to continue providing kids with the best-in-class learning experiences.”
4. Snapology provides kids with courses around STEAM (Science, Technology, Engineering, Arts, and Mathematics) learning, all of which are performed by Snapology-trained and experienced professionals. As part of Unleashed Brands, Snapology will leverage space throughout Urban Air Adventure Parks giving the Snapology brand a permanent home to deliver its world-class camps, birthday parties, and STEAM courses.
5. Laura Coe, co-founder of Snapology, said, “After learning about Michael’s vision for the portfolio brands, our decision to join the Unleashed Brands team was an easy one. Snapology’s alignment with Unleashed Brands will provide us access to other thought leaders in the children’s enrichment franchise space and the ability to leverage support and dedicated resources that will allow us to increase the value we bring to our franchisees and the families we serve.”
6. Unleashed Brands will function as the parent company supporting growth-oriented brands geared at furthering child and adolescent development in three core areas – Learning (Science, Technology, Engineering, Arts, and Mathematics), Playing (Celebrating, Escaping, and Connecting) and Growing (Music & Arts, Martial Arts, Swimming, and Sports). This new venture will look to continue acquiring, integrating, and scaling best-in-class experience-based consumer brands as they are identified.
7. Browning continued, “With the launch of Unleashed Brands, we have begun to realize our vision for a multi-branded, multi-sector portfolio of family-focused brands that consumers can truly trust. Now that we have launched Unleashed Brands and completed Snapology’s acquisition, we look forward to further building out the brand and sharing any future developments on the horizon with our customers – all while providing fun, engaging, and inspiring experiences that help kids become who they are destined to be.”
Expands Leadership Team with Two Key New Hires
8. In mid-December 2021, Unleashed Brands, a franchise growth-focused platform company that includes portfolio brands Urban Air, Snapology, and The Little Gym, announced two hires in newly-created positions to assist with the company’s rapid growth. Abby Fogel joins the team as vice president of marketing and brand relations, and Kristin Taylor has been named senior vice president of real estate, design, and construction.
9. Fogel has a marketing background with youth enrichment brands and started working in the franchise industry in 2015 for Soccer Shots, handling local marketing and brand level initiatives. She later joined FranNet in 2020 and spent the past year as their director of marketing. She will lead marketing for franchise lead generation for all Unleashed Brands, effectively helping each brand exceed its franchise development targets.
10. Fogel will also lead Unleashed Brands’ new Franchise Development Leadership Accelerator program, designed to help each brand and specifically selected outside brands grow their leadership and franchise competencies. Fogel serves on the International Franchise Association Women’s Franchise Committee and Annual Leadership Conference Taskforce.
11. Taylor has a real estate and asset management background with extensive experience managing large real estate development initiatives and strategies that enhance revenue growth and maximize return on investment. She previously served as executive vice president of real estate, design, and construction for G6 Hospitality, the owner, operator, and franchisor of more than 1,450 Motel 6 and Studio 6 economy lodging properties.
12. In addition to real estate development and contract negotiations, Kristin will lead the market planning strategy, site selection, real estate development, and the trajectory of new unit openings for all portfolio brands. She will also lead Unleashed’s internal and external teams to help efficiently open franchises.
13. Josh Wall, chief growth officer of Unleashed Brands, said, “As we move forward and continue to expand our reach, we feel lucky to add Kristin and Abby as vital additions to our leadership team. With Kristin’s impressive real estate background and Abby’s strong experience with marketing and franchise development in youth sports, they both address essential high-level needs that will elevate our team and diversify our capabilities as we transition to big things in 2022.”
Experiences Banner Year of Growth in 2021
14. In mid-January 2022, Urban Air Adventure Park stated that it had a record-breaking year with 63 franchise agreements signed and three new parks opened in 2021. The company posted nearly $440 million in systemwide revenue, representing more than $2.8 million per park, fueled by families looking to reconnect and celebrate special occasions with others after a year of social distancing and isolation during the pandemic. Driving a significant portion of that success were nearly 225,000 birthday parties booked at Urban Air parks, generating nearly $90 million, an all-time high for that revenue stream.
15. Jay Thomas, CEO of Urban Air Adventure Park, said, “We are extremely proud of how our dedicated franchisees and the brand have bounced back from the challenges of 2020 with a 2021 for the record books. With the family entertainment industry on an upward trajectory, and now being a part of Unleashed Brands, the Urban Air team is excited to open even more parks in 2022 and make the brand a household name for every family.”
16. Urban Air’s total number of open parks now stands at 153, and the recently secured franchise agreements bring the brand’s total number of locations in development to 112, dozens of which are expected to open in 2022. Company executives expect the demand for family entertainment services like that which Urban Air offers will continue to boom in the coming year as families look to resume a sense of normalcy and seek fun, enriching experiences for their kids to learn, play, and grow.
17. In July 2021, the team behind Urban Air announced the formation of Unleashed Brands, a new global growth-focused platform that aims to curate and expand a portfolio of brands to provide safe, fun, and enriching environments that help kids learn, play, and grow. The other brands under the Unleashed umbrella include Snapology, the premier franchise brand offering STEAM (Science, Technology, Engineering, Arts, and Mathematics) programs for kids; The Little Gym, the world’s premier enrichment and physical development center for children ages four months through 12; and the recently acquired Premier Martial Arts, a prominent franchise company that specializes in teaching karate, krav maga, and kickboxing for children and adults.
18. Ranked No. 46 overall and No. 1 among entertainment franchises on Entrepreneur Magazine’s 2022 Franchise 500 list, Urban Air continues to solidify itself as the first and leading indoor family adventure park franchise in the United States. To continue this momentum, Urban Air is currently seeking driven leaders that are looking for a higher purpose than just profits and motivated to engage in their local community through social interactions, exercise, and elevated play for each kid that walks through their doors.
19. With 50 percent of franchisees operating fully remotely, Urban Air offers a partnership flexible to the franchisee’s preferences including many facets of support to build better experiences and ultimately grow.
20. Urban Air Adventure Park was founded in 2011 by Michael Browning, Jr. with help from his father, wife, and mother, in Southlake, Texas. Before starting Urban Air, Browning was a marketing software developer and wasn’t really interested in starting his own business. However, after he visited his first trampoline park, Browning began to develop his own concept. While Browning and his family had never worked in the entertainment and attractions industry, the Urban Air Adventure Park concept was a success from the start.
21. Due to demand, the Brownings opened a second Urban Air in the Dallas-Fort Worth area. After meeting with Jay Thomas, who was vice president of international park development for Six Flags, Browning refined the concept for Urban Air. The park expanded its activities to include bowling, ropes courses, climbing walls, indoor coasters, skydiving, and go-karting.
22. Originally, Browning didn’t have intentions to franchise Urban Air Adventure Park, but demand for new locations kept growing. Browning began franchising Urban Air in 2014 and a few years later, in 2018, Urban Air received a strategic investment from MPK Equity Partners and AHR Growth Partners. The investment helped fuel Urban Air Adventure Park’s national growth and there are now locations around the United States.
Entrepreneur’s Franchise 500
23. Urban Air Adventure Park ranked No. 46 on Entrepreneur’s 2022 Franchise 500 list. The brand also ranked No. 1 in the entertainment franchises category.
Section II – Estimated Costs
- Detailed estimates of Urban Air Adventure Park franchise costs, based on Item 7 of the company’s 2021 FDD.
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Detailed information on Urban Air Adventure Park’s initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2021 FDD.
Section IV – Number of Franchised and Company-Owned Outlets
- Outlets at the Start of the Year: 32
- Outlets at the End of the Year: 61
- Net Change: +29
- Outlets at the Start of the Year: 61
- Outlets at the End of the Year: 115
- Net Change: +54
- Outlets at the Start of the Year: 115
- Outlets at the End of the Year: 149
- Net Change: +34
- Outlets at the Start of the Year: 5
- Outlets at the End of the Year: 5
- Net Change: 0
- Outlets at the Start of the Year: 5
- Outlets at the End of the Year: 2
- Net Change: -3
- Outlets at the Start of the Year: 2
- Outlets at the End of the Year: 1
- Net Change: -1
Section V – Financial Performance Representations (Item 19, 2021 FDD) and Analysis
Part 1 – 2020 Gross Sales of 2.0 and 2.5 Parks (Franchised Only) Open on January 1, 2020 That Submitted Data for Inclusion in This Report
- “Adventure Park” or “2.0 Park” includes the following grouping of Attractions: Action Cam, Sky Rider, ropes course, soft play, Adventure Hub, dodgeball course, trampolines, battle beam, basketball goals, Wipeout, warrior course, climbing walls, stairway to heaven, leap of faith, pro zone, runway trampoline, and dropzone (airbag). Urban Air’s minimum franchise offering is a 2.0 Park.
- Additional optional Attractions such as spin zone (bumper cars), virtual reality, bowling, laser tag, go-karts, and indoor sky diving may be developed by franchisees with eligible sites. Adventure Parks that include any such additional optional Attractions are referred to as a “2.5 Park.”
- Of the 90 Urban Air Adventure Parks that were open on January 1, 2020, 73 2.0 and 2.5 Parks were included in this Part 1 (67 were 2.0 Parks and 6 were 2.5 Parks). The 17 Parks were excluded because they did not provide Urban Air with their Unit Expenses and EBITDA which are reported in Part 2.
- Due to varying governmental orders and directives related to entertainment venues in the United States as a result of COVID-19, 100% of the Adventure Parks included in the data set described in Part 1 suspended operations on or about March 17, 2020 and remained closed to the public for at least 2.5 months (with 91% of the Adventure Parks in the data set remaining closed for at least 3 months).
- After 6 months, 31% of the Adventure Parks in the data set remained closed, and after 9 months, 15% remained closed. As of the end of Urban Air’s 2020 fiscal year, 3 of the Adventure Parks had not resumed operations.
- The financial performance representations in Part 1 do not reflect the cost of sales, operating expenses, rent/real estate, or other costs or expenses that must be deducted from the Gross Sales figures to obtain your net income or profit.
A. 2.0 Parks
- Average Gross Sales: $1,149,669
- Median Gross Sales: $1,062,622
- Minimum Gross Sales: $465,788
- Maximum Gross Sales: $3,130,223
- Number and Percentage Attaining or Surpassing Average Gross Sales: 26/39%
B. 2.5 Parks
- Average Gross Sales: $1,834,501
- Median Gross Sales: $1,603,629
- Minimum Gross Sales: $1,153,740
- Maximum Gross Sales: $2,970,923
- Number and Percentage Attaining or Surpassing Average Gross Sales: 2/33%
Part 2 – 2020 Unit Expenses and EBITDA of 2.0 and 2.5 Parks (Franchised Only) Open on January 1, 2020
- The information contained in this Part 2 was collected via self-report from the franchisees of the Adventure Parks described in Part 1.
A. 2.0 Parks
- Cost of Goods Sold: $125,172 (10.9%)
- Occupancy: $346,059 (30.1%)
- Advertising: $52,511 (4.6%)
- Payroll: $320,187 (27.9%)
- Insurance: $103,860 (9.0%)
- Other Costs: $186,876 (16.3%)
- EBITDA: $15,005 (1.3%)
- Cost of Goods Sold: $119,151
- Occupancy: $423,701
- Advertising: $48,323
- Payroll: $163,200
- Insurance: $93,690
- Other Costs: $122,916
- EBITDA: $91,641 (9%)
- Cost of Goods Sold: $34,241
- Occupancy: $368,560
- Advertising: $3,711
- Payroll: $252,156
- Insurance: $99,751
- Other Costs: $143,205
- EBITDA: $(435,836) (-94%)
- Cost of Goods Sold: $342,026
- Occupancy: $566,026
- Advertising: $238,275
- Payroll: $631,871
- Insurance: $268,459
- Other Costs: $361,687
- EBITDA: $721,880 (23%)
B. 2.5 Parks
- Cost of Goods Sold: $181,288 (9.9%)
- Occupancy: $561,345 (30.6%)
- Advertising: $54,958 (3.0%)
- Payroll: $566,767 (30.9%)
- Insurance: $160,281 (8.7%)
- Other Costs: $299,725 (16.3%)
- EBITDA: $10,136 (0.6%)
- Cost of Goods Sold: $153,107
- Occupancy: $619,406
- Advertising: $68,231
- Payroll: $401,467
- Insurance: $142,375
- Other Costs: $233,042
- EBITDA: $(13,998) (-1%)
- Cost of Goods Sold: $104,593
- Occupancy: $336,440
- Advertising: $53,804
- Payroll: $466,290
- Insurance: $160,167
- Other Costs: $186,906
- EBITDA: $(154,459) (-13%)
- Cost of Goods Sold: $316,015
- Occupancy: $433,880
- Advertising: $23,297
- Payroll: $862,563
- Insurance: $245,106
- Other Costs: $483,566
- EBITDA: $606,496 (20%)
- “Costs of Goods Sold” includes the total cost of all food, beverages, merchandise, and other costs related to products and services sold by the Adventure Parks, including distribution and delivery costs.
- “Occupancy” includes rent (including both minimum rents and percentage rents), utilities (e.g. electricity, gas, water, cable, internet, telephone), and any sales or other taxes imposed thereon and any pass-through expenses from the landlord. Common area expenses reflect charges for maintenance of parking lots and common use areas, landscaping design and maintenance, weather-related maintenance (e.g. removal of debris and snow), security staff, taxes and insurance for common areas, and such other charges customarily paid by tenants for services typically provided by landlords.
- “Advertising” includes advertising, promotional, and marketing expenses for the Adventure Parks in the Protected Area to satisfy the Local Marketing Expenditure requirement.
- “Payroll” includes personnel wages, management salaries, benefits, and payroll taxes but excludes bonuses, paid time off, severance payments, and fringe benefits. In addition, payroll excludes the cost of training any hourly or management personnel and any disbursements made to the owners of the franchisees.
- “Insurance” includes information related to commercial general liability insurance only.
- “Other Costs” includes royalty fees, office expenses (e.g. office and cleaning supplies), and processing fees (e.g. payroll, point of sale, and payment processing and other bank charges).
- “EBITDA” means the earnings before interest, taxes, depreciation, and amortization. As is customary, it excludes expenses related to debt services costs, whether principal or interest.
- “EBITDA %” means EBITDA as a percentage of Gross Sales.
Part 3 – 2021 Monthly Gross Sales of 2.0 and 2.5 Parks (Franchised Only) Open Full Year 2020
- Part 3 includes the monthly average Gross Sales for the 90 franchised Parks which were eligible for inclusion in Parts 1 and 2 and were operational during January 2021 through March 2021 (79 franchised 2.0 Parks and 11 franchised 2.5 Parks.) These Parks had to be open for at least one full month in 2021 to be included in this Part 3.
- The financial performance representations in Part 3 do not reflect the cost of sales, operating expenses, rent/real estate, or other costs or expenses that must be deducted from the Gross Sales figures to obtain your net income or profit.
A. 2.0 Parks
- Average Gross Sales: $172,344
- Median Gross Sales: $146,413
- Minimum Gross Sales: $74,046
- Maximum Gross Sales: $730,355
- Number and Percentage Attaining or Surpassing Average Gross Sales: 22/31.9%
- Average Gross Sales: $176,412
- Median Gross Sales: $151,831
- Minimum Gross Sales: $62,852
- Maximum Gross Sales: $756,889
- Number and Percentage Attaining or Surpassing Average Gross Sales: 28/35.9%
- Average Gross Sales: $293,878
- Median Gross Sales: $268,277
- Minimum Gross Sales: $122,375
- Maximum Gross Sales: $1,028,423
- Number and Percentage Attaining or Surpassing Average Gross Sales: 26/32.9%
Q1 2021 Total
- Average Gross Sales: $637,756
- Median Gross Sales: $541,445
- Minimum Gross Sales: $275,202
- Maximum Gross Sales: $2,515,667
- Number and Percentage Attaining or Surpassing Average Gross Sales: 22/31.9%
B. 2.5 Parks
- Average Gross Sales: $261,891
- Median Gross Sales: $259,617
- Minimum Gross Sales: $142,542
- Maximum Gross Sales: $496,274
- Number and Percentage Attaining or Surpassing Average Gross Sales: 5/45.59%
- Average Gross Sales: $272,569
- Median Gross Sales: $242,245
- Minimum Gross Sales: $155,845
- Maximum Gross Sales: $444,844
- Number and Percentage Attaining or Surpassing Average Gross Sales: 4/36.4%
- Average Gross Sales: $456,226
- Median Gross Sales: $423,584
- Minimum Gross Sales: $294,316
- Maximum Gross Sales: $701,851
- Number and Percentage Attaining or Surpassing Average Gross Sales: 5/45.5%
Q1 2021 Total
- Average Gross Sales: $990,686
- Median Gross Sales: $1,000,822
- Minimum Gross Sales: $675,774
- Maximum Gross Sales: $1,642,969
- Number and Percentage Attaining or Surpassing Average Gross Sales: 6/54.5%
- Urban Air’s management prepared this financial performance representation based on Gross Sales and cost data and other information submitted to Urban Air by franchisees in accordance with regular reporting requirements pursuant to the applicable Urban Air Franchise Agreements. Urban Air cannot verify the accuracy or completeness of the data supplied by the franchisees.
- This financial performance representation was prepared without an audit. Prospective franchisees or sellers of franchises should be advised that no certified public accountant has audited these figures or expressed his/her opinion with regard to their contents or form.