Back in 2008, U.S. competitive swimmer Chris DeJong missed qualifying for the Beijing Olympics by a mere three-tenths of a second—finishing just behind Michael Phelps. Instead of taking the loss to heart, DeJong redirected his momentum and co-founded a swim instruction brand, Big Blue Swim School, in 2009. Now, a decade later, Big Blue Swim School has emerged as a leader in the $20 billion swim school industry thanks to a superior curriculum premised on proprietary technology, an innovative curriculum and data-based real estate strategy, to name just a few differentiators.
The best-in-class and highly-scalable model caught the eye of private equity company Level 5 Capital Partners. Founded in 2009 with an initial focus on yoga concepts, Level 5 Capital became the third-largest national yoga studio operator—and largest CorePower Yoga franchisee—in less than a decade, now with 27 locations in four states and growing. After learning about the unique proposition offered by Big Blue Swim School, the executive leadership team at Level 5 Capital knew the firm had found its next investment.
“Level 5 is focused in the ‘Consumer Services, Locally Delivered’ sector,” explained Managing Partner of Level 5 Capital, Chris Kenny. “We specifically love brands in health, wellness, and family services that are ‘passion brands’—brands that people tell their friends about and that people defend because of their passion for them. We join these brands with a mission-driven, values-based management philosophy to deliver excellent value for consumers, our employees and our partners.”
Kenny explained that he was first introduced to Big Blue almost six years ago, when his niece began swim lessons.
“My older brother had mentioned the swim school industry as a potential area of expansion for us due to the need and ‘chaos’ at the operator they were getting lessons from,” said Kenny. “We really liked the fundamentals of the industry and began to seek out the right opportunity to partner with. Big Blue was very differentiated in many ways and we continue to build on that today.”
Chief Development Officer of both Big Blue Swim School and Level 5 Capital Partners, Scott Thompson, explained that after zeroing in on Big Blue, Level 5 assessed the industry and thought strategically.
“We went through a diligent process when researching Big Blue, extensively researching the financials, the locations, the management team, consumer studies, and the technology,” said Thompson. “We considered the size of the industry and looked at the players already in the space; there wasn’t really a dominant player who was removing pain points for parents and maximizing franchisee success. We knew we had the franchising expertise to become that and today, that player is Big Blue Swim School.”
Asked what makes Big Blue distinct from other swim school brands, Thompson was clear: “Data.”
“Everything we do is data-driven,” said Thompson. “Big Blue has 10 years of customer data to inform their decision making process. Most early-stage franchises can’t claim that.”
Extensive real estate research driven by a team of developers is just one way in which the emerging industry leader utilizes data. Additionally, Big Blue leverages proprietary technology via its scheduling and tracking software LessonBuddy™ to better understand customer behavior, which leads to optimized capacity planning.. Finally, Big Blue builds state-of-the-art pools designed to meet the demographic needs based on market research.
“Parents will always invest in their children,” Kenny explained. “That means that Big Blue serves a very durable consumer need that can only be delivered locally, and which, again, connects with L5’s strategy of investing in ‘passion brands’ that impact the lives and wellness of their consumers.”
When asked if Level 5 Capital Partners’ desire for passionate brand partners translates to functioning as a passionate franchisor on behalf of Big Blue’s franchisees, Kenny was emphatic.
“Our strategy as a franchisor for Big Blue is to absolutely provide a very high level of franchisor support, such that the franchise partner is focused on service delivery to the customer and on hiring, retaining and training the best employees possible to deliver those services.” Kenny said. “Because of our depth of leadership and franchising experience with CorePower Yoga, we know the importance of a supportive franchisor relationship.”
Ultimately, said Kenny, Big Blue Swim School franchise partners should let their passion for exceptional service shine through in their ownership approach.
“We will focus on strategy so that our owners can stay invested in their business and in the community they serve, greeting parents and learners with a smile and delivering the best swim instruction experience possible.”
The total investment necessary to begin operation of a new Big Blue Swim School is $1,825,500 to $3,687,000 (including real estate costs). To learn more or inquire about Big Blue Swim School, visit https://diveinwithbigblue.com/.