Lately, juice and smoothies are all the rage. Beginning in NYC, Pure Green Franchise has five retail locations where you can get delicious smoothies, cold-pressed juices, and acai bowls. Not to mention the team’s impressive wholesale entity. The Deal to Watch impressed us with its traction, support from an in-house distributor, and low-friction franchise model.
We sat down with founder Ross Franklin to learn more about how Pure Green came to be, their franchise structure, and more-
For those who don’t know, what is the genesis story of pure green franchise?
After owning, operating and consulting for high-end health clubs and fitness brands, I came to two major points of realization:
- I realized that 80% of optimal health comes from nutrition while only 20% comes from fitness.
- I experienced all the challenges of operating a 40,000 square foot health clubs and saw the massive potential for scalability of the 500 square foot juice bar model.
My passion has always been focused on making people healthier but the points above drove me to create Pure Green.
I founded the first Pure Green retail location in October of 2014 in New York City with the mission of Pure Green is to build healthier communities around the world by connecting people with superfoods.
In 2016, I started Pure Green’s wholesale division which now services thousands of accounts through dozens of distributors, hundreds of high-end hotels and dozens of professional sports teams.
With five locations open in New York City, one of the most competitive cities in the world, 3 locations in construction in Florida, 3 locations in construction in Chicago, Pure Green is on pace to have 50 signed franchises by the end of this year.
How do you plan on allocating funds raised in this round to scale the business?
The use of funds from our equity crowdfunding campaign will mainly be used on marketing to attract new franchisees into our pipeline. The marketing use of funds consists of building organic SEO for puregreenfranchise.com, sponsored ads on social media, retargeting and marketing funnels to ensure we are attracting highly qualified franchisees.
With the aftermath of the coronavirus, we foresee there will be a high availability of commercial real estate which we allow for favorable terms for our corporately owned locations and for our franchisees. We also plan to use funds to build 3 to 6 new corporately owned locations.
Besides smoothies, what can be found on the pure green menu?
Aside from our handcrafted and made-to-order superfood smoothies, our menu includes made-to-order acai bowls, pitaya bowls, cold-pressed juice, and cold-pressed shots.
Can you explain the relationship between pure green’s distribution business and franchise business?
Pure Green has two separate divisions:
- Our Retail / Franchise Division which owns our corporately owned locations in New York City and includes our entire franchise business. We have a master franchise structure with 100+ franchise unit operators set-up as sub-franchisors for rapid growth.
- Our Wholesale Division has a presence in over 30 states with thousands of accounts and sells the cold-pressed juice and shots to Pure Green franchisees.
Do you have any competition, if so, how do you differentiate?
There are other juice bar franchises that have very high start-up costs for franchisees averaging $400,000 to $500,000 for a single franchise unit. It only costs on average $150,000 to open a Pure Green franchise location.
We achieve such a low start-up cost by leveraging our wholesale division which sells the cold-pressed juice and shots to our franchisees for less than it would cost them to manufacture it themselves. This avoids the need for our franchisees to purchase expensive juicing equipment and building out production facilities and also lowers the cost of labor.
What are the biggest risks associated with your business?
Like most other businesses, a global pandemic is always the biggest risk. With the onset of the coronavirus and state mandates put in place with businesses, continuing to operate during this time has presented a unique set of challenges including creating a safe environment for both guests and team members.
Pure Green is considered an essential business and we are fortunate that we have been able to continue to operate by staying open for delivery and takeout. We have been able to double our delivery business during this time and our immunity cold-pressed juice shots business has increased by 1000x since March 1st.
How is your team uniquely positioned to win out in this market?
We are one of the only juice bar franchises that has a master franchise structure for rapid growth and wholesale business with national distribution. We believe that these factors are our secret weapon.
We formulate all of our products to have an unparalleled taste and high-performance nutrition. We believe that our combination of taste and nutrition is unrivaled.
What does your business model look like?
The economics of our franchise structure is as follows.
Pure Green franchisees pay us:
We collect a one-time franchise fee of $30,000 per unit
We collect a 6% royalty of gross revenue
We collect a 2% of gross revenue for our national marketing fee
As you think about the business 5-10 years down the road, what do you see exit opportunities looking like?
Our goal is to get to 500mm in revenue with 25% EBITDA as quickly as possible. We have been approached by several VC and private equity groups that are health and wellness-focused that have their eye on us and will most likely make offers well before we get to that point. We may choose to IPO along the way. With our exit in mind, we are strategically building an influential board of advisors that will help to steer us in the right direction. We believe that after things settle back to normal post-coronavirus there will be a massive opportunity for us to expand.
We at KingsCrowd are excited to see where Ross and his team take the company. Pure Green Franchise is currently raising funds on the Republic portal.
About: Olivia Strobl
Olivia comes to KingsCrowd with a background in venture capital and technology. She spent time at Glasswing Ventures, an AI-focused venture fund in Boston, before joining the KingsCrowd team. There she helped develop machine learning algorithms for the opportunity qualification of preseed and seed-stage startup companies. Prior to her time at Glasswing, Olivia worked in a lab studying the neural correlates of attention. She holds a degree in Neuroscience from Wellesley College.