How 6 hotshots aim to change the world
Galen Welsch is a passionate 28-year-old whose career is already on course to create social gains far greater than profits listed on the quarterly report of his Uganda-based clean water franchise, called Jibu.
After growing up in Colorado and attending college in Illinois, Welsch left the U.S. in 2009 to work in the Peace Corps as a health educator in the Moroccan desert. He now finds himself 8,500 miles from home in Uganda’s capital city, Kampala, running a fast-growing franchise that provides drinking water and business opportunities in a continent where both are in tragically short supply.
He is one of six young franchise entrepreneurs changing the global face of an industry often called the domain of aging business executives. He is also part of the NextGen initiative at the International Franchise Association (see sidebar), headed by a dynamic advocate named Jennifer Kushell. “I think they’re about to completely debunk all of the myths about young people in business and franchising,” she says.
Here are a half-dozen inspiring young franchisors who will change established views about the future of franchising, applying their efforts in diverse fields ranging from comfort food and clean water to facilities maintenance and childcare.
Jibu CEO Galen Welsch, at right, moved to Kampala, Uganda, to start a franchise that provides sustainable clean water and business opportunities in a land where both are rare commodities.
#1 Solving a water crisis
After graduating from Wheaton College with a focus on international development, Galen Welsch left on a two-year term with the Peace Corps in Morocco. His goal was to lay the foundation for a career he imagined would be in the United States.
Coming face to face with development work as a health educator in Morocco, some of which he calls “a little too soft and mushy” and lacking long-term sustainability, he came away from the Corps wanting to do business using the for-profit model because it offered built-in sustainability.
“When there’s profit and economic viability, something can self-sustain and grow beyond the time when whoever introduced the idea leaves,” he said.
Upon returning home to Colorado and speaking with his recently retired father, the pair picked up a previously abandoned business idea and started Jibu, a franchise designed to solve the African water crisis one franchisee at a time.
His company provides seed financing for its franchisees to create their own drinking water company designed for the underserved (read: not wealthy) people in any variety of African communities.
With sub-par water treatment, crumbling pipes, weak building codes and widespread industrial contamination, providing clean water in many African villages is a persistent, Herculean task.
Jibu places drinking water franchises approximately one mile apart, drawing water from any neighborhood source and filtering it on the spot using advanced water filtration equipment. The company acts as a fair-lending bank that offers affordable financing to its franchisees. No middleman. No dependency on donations that could dry up. Low prices. New jobs.
Welsch moved to Kampala, Uganda, to start the company, and says governmental red tape and “absurd rules” have been his biggest challenges, although cultural differences have also played a part.
With seven franchises, some making more than USD$85,000 per year, Jibu’s network has distributed more than 1 million gallons of water and reached more than 10,000 people with safe, clean water.
The company is on track to launch two franchises per month throughout 2015, and has raised more than $2.4 million through private equity and grants to support its future growth—a promising record for a socially aware and ambitious entrepreneur, as well as his franchisees and their customers.
Tot Squad’s Jennifer Beall
#2 Down and Dirty
Jennifer Beall, founder and CEO of Tot Squad, knew at 10 years old that she wanted to start her own company. Twenty-two years later, at 32, she has a franchised company with plenty of potential.
Her chosen field? Cleaning car seats, strollers and high chairs, as well as educating parents on how to properly install those car seats. Profitable and promising, yes, but not what Beall would have imagined even just a few years ago.
“In a million years, I never would have thought I would grow up to clean baby poop—that’s not what I thought I would be passionate about,” she said. “What I’m passionate about is building a company.”
As a business student, Beall never felt like the ideas person, and imagined she would find somebody with one she could help execute. After enough people suggested finding her own passion, her gears started turning.
“I saw all these women turning 30, trying to make partner at a firm and starting a family at the same time,” she said. “Every single one of them left for family.”
That spark led her to start following blogs about work-life balance. Seeing so many millennials focused on the subject, she focused on improving that balance for busy moms.
She faced passive resistance, often in the form of “Oh that’s so cute, that’s such a niche idea,” she said, but those detractors failed to realize the potential. Beall raised $50,000 to get up and running and four months later Tot Squad was cash-flow positive.
Demand didn’t just come from moms eager to have somebody else de-gross their baby gear, but stores like Nordstrom that purchased cleanings for its VIP customers to get them back into the store.
Baby boutiques also wanted in, and had Tot Squad set up on the sidewalk or parking lot to drive traffic. As Beall and her partners soon realized, Tot Squad was the perfect antidote for online competitors like Amazon.
“From there, we ended up in a situation where we had more retailers contacting us and wanting to do events with us than we had vans or staff to be able to meet that demand,” she said.
Modeling her business after Geek Squad, a tech-repair company that was once independent but later scooped up by electronics giant Best Buy, Beall would like to ink a formal partnership with a big-box kids retailer like Toys/Babies R Us or Molly Maid.
“I would love to have at least 300 franchises,” she said. “And there’s no reason we can’t have this service in Canada and Mexico, and many other countries that use car seats and strollers, as well.”
#3 Growing Young Guns
John Evans, 27, admits parking lot sweeping and painting isn’t something many people care about—but it has to be done once a year, sometimes twice, in parking lots everywhere.
On the heels of a successful stint with College Pro Painters, Evans’ second foray in franchising was starting his own Calgary, Alberta-based company to spruce up parking lots of all shapes and sizes.
“I wanted to go out on my own, so I was toying with different businesses, looking into employment and the realization that working for somebody was going to be terrible,” Evans said. “This whole industry lacked strong leadership, strong professionalism, branding, all that kind of stuff, so I started EverLine with that in mind.”
Three years in, the numbers are impressive: sales grew from $163,000 in 2012 to a projected $1 million in 2015. Staff swelled from two crewmembers and himself to 15.
Significantly for its future, the company has also invested heavily in research and development, and now has exclusive access to a unique method of applying a paint-like material called TBL Durables, which is a spray-able liquid that cures in less than 10 minutes, is more resistant to wear than standard paint, provides greater reflectivity and is much cleaner than water- or oil-based paints.
He looks at EverLine as a vehicle to develop himself and his employees as entrepreneurs, and focuses the company on presentation, efficiency and professionalism to set the stage for an aggressive franchisee-powered growth.
After expanding to Edmonton, British Columbia, and then Saskatchewan, Evans hopes to begin franchising the company.
“Once we can get those units up to a profitable point, I’m going to feel very comfortable selling franchises and selling the opportunities to budding entrepreneurs and millennials that all want to run their own business,” he said.
With a kiosk and a food truck, Le Mime founders Eduardo Navarro (left), Cynthia Chavez (center) and Marco Chavez (right) are in negotiations to open three new locations in Guadalajara, Mexico, with expansion outside of Mexico to follow.
#4 Mimes serving ice cream
Mexico’s second city, Guadalajara is a fast-growing metro area with modern skyscrapers and more than 4 million residents. It’s a city with a charming historic center and colonial relics, fashionable restaurants and folk-art markets—and also a pair of mime-themed ice cream stands.
Yes, the idea behind Le Mime Gelato is unusual, but it’s extremely creative and undoubtedly unique.
Rolled-up ice cream, made fresh, flash frozen on cold plates and smothered in toppings looks delicious enough to succeed on its own, yet the soon-to-be-franchised concept is based on an intriguing statistic: Americans eat 10 times more ice cream per person than Mexicans.
Le Mime co-founder Eduardo Navarro sees this gulf as a significant business opportunity for the Mexican market, and he and his three-person team have set out to change those numbers.
“We love ice cream and we wanted to create something different,” Navarro said. “We wanted a formal business and to create a strong brand to make it grow and be replicable for other countries.”
Their rolled-up ice cream is handmade, the ice cream is rolled up in front of the customer, and it’s engineered to avoid producing crystals as it freezes, for a unique texture that’s softer than traditional ice cream.
Even more, its proprietary production process means that 90 percent of the material requires no refrigeration, so Le Mime kiosks or food trucks use 70 percent less power compared with traditional ice cream shops.
Le Mime’s servers don the typical striped shirts and red suspenders for the figurative cherry on top of the mime-themed ice cream stand.
Navarro said his trip to the International Franchise Association’s NextGen Summit dramatically changed his company’s trajectory, from solely looking to expand further within Guadalajara, to now exploring how to take their concept international.
“When you talk about franchise in Mexico you talk small, but when you talk about franchising in the IFA you talk big,” he said. “We want to learn from the experts.”
#5 Reviving expired bread
Food waste is a sad fact of modern life. In the U.S. alone, the United Nations claims that 30 to 40 percent of the food supply is wasted—more than 20 pounds of food per person each month.
Seeking to address one part of the problem, U.K.-based Alexander Walzl is in the early stages of setting up a business that repurposes high-quality bakery breads that are typically thrown away every day.
“It’s a social franchise concept that’s firstly about collecting leftovers from local bakeries,” he said, noting that most bakeries discard a quarter of their bread. “It’s basically about transporting that bread to the franchisee who transforms it into bread snacks.”
The challenge is reselling a food product that’s passed its expiration date, which has involved copious amounts of paperwork to legally transform post-date bread into a new food product with a longer shelf life.
“It’s not really a complicated process,” Walzl added. “It’s all about slicing up the bread and baking it together with spices and then packaging it.”
The resulting breadsticks can be sold to restaurants or bars, giving them a low-cost snack to offer their patrons or resell. Artisan bakeries—particularly those in Italy and Austria—pay to dispose of unsold bread, which encourages their participation in the model.
While it’s still just a concept, its creator envisions low startup costs, only a “moderate” time commitment and an easily scalable model.
His NextGen connections helped Walzl learn lessons he hopes will help him avoid preventable mistakes.
“The key takeaway was that, even with a brilliant business idea, it’s still likely that you fail initially,” he said. “It’s all about failing cheaply initially and, hopefully, finding something which eventually takes off.”
Croatia’s Andrija Colak is bringing healthier fries and American-style burgers to an international franchise audience.
#6 Creating healthy fries
American concept takes off stateside and expands to Europe and beyond—it’s a timeworn idea, and the exact opposite of Croatian Andrija Colak’s business model for his fast-growing burger-and-fries chain.
At 33, Colak is the co-founder and CEO of the company, which he founded when he was 27. He’s based in Rijeka, a city on the coast of the Adriatic Sea. He and his business partner, Denis Polić, were brainstorming QSR concepts when they settled on french fries after reminiscing about a popular french fry shop serving Belgian-style fries in a paper cone and topped with mayonnaise.
His first store was tiny, with only one size of fries, 15 different sauces and soda. Its fries are organic and made without oil, which he says is a major differentiator for the concept.
“People were laughing at me when I told them about the concept—they thought I went crazy! They would say, ‘Why would you sell fries? Everyone sells fries,” Colak said. “It turned out they were very wrong. In our first year that little shop averaged 1,000 portions per day and a half-million euros in revenue.”
Now, Surf’n’Fries has 40 inline and kiosk restaurants in 11 countries, with most locations in Europe and a new store in Hanoi, Vietnam. Its menu has since expanded to include chicken hot dogs, nuggets, sandwiches and wings—all served in easily transportable cones designed to bring the “freedom one has on the beach to urban areas.”
Although Colak wasn’t one of the top five finalists in the NextGen program, his recent growth was notable among the 50 winners for its rapid cross-border expansion.
“I got a chance to talk about Surf’n’Fries and got interest from a few people and companies to franchise in the U.S.,” during the summit, he said. “It could just happen that the IFA NextGen opened the doors to bring Surf’n’Fries to the U.S.”
With years of concern over the aging of the franchising industry, one wouldn’t necessarily have expected the international flavor that materialized at the 2015 International Franchise Association (IFA) Annual Convention in Las Vegas. People of all ages, genders and nationalities crowded the halls of the MGM Grand in Las Vegas.
This diversity was no accident, as the World Franchise Council was in town, as well as a large group of young business people from all over the globe who came for the first-ever NextGen in Franchising Summit.
Jibu’s Galen Welsch was the grand prize winner of the Young Entrepreneurs in Franchising Global Competition portion of the event—one of 50 winners from 400 applications from applicants in 44 countries.
The runner-up was Jennifer Beall of Los Angeles, founder and CEO of Tot Squad, and the remaining top-five included John Evans of Canada, president of EverLine Coatings; Eduardo Navarro of Mexico, co-founder of Le Mime Gelato; and Alexander Walzl from the UK, who is hatching an idea called Panarium.
Each received a free trip to Las Vegas—full access to the IFA show, $1,500 in travel expenses, and grand prize awards from the IFA Education Foundation that ranged from $2,000 to $4,000.
Jennifer Kushell, CEO of Young & Successful Media, Your Success Now (YSN) and organizer of the event, kicked off the seminar with an impassioned speech about the gravity of this program for the franchising world as a whole.
“They’ve come from Malawi, they’ve come from Croatia, they’ve come from Guadalajara, Mexico, from Nigeria,” she told the crowd. “It’s amazing the amount of travel that they’ve done, the work that they’ve done, and how I think they’re about to completely debunk all of the myths about young people in business and franchising.”
As the conduit between IFA and its NextGen applicants, Kushell focused the program on the 18-to-35 demographic with a three-pronged approach that included a website (NextGenFranchising.org), global competition and the summit.
Because franchising has long struggled to connect with young adults, Kushell said the importance of the NextGen program is demonstrating the power of the franchise model to a new generation, while connecting them with established players to create cross-generational, cross-cultural and mutually beneficial relationships.
“Everyone’s talking about youth employment and youth entrepreneurship, but the real magic happens when you connect the dots and really focus on the connective tissue, and that’s what we’ve always tried to focus on as an organization,” she said. “How do you connect the young people with the actual opportunities, with the actual companies and insight? That completely reframes how they approach their career and their opportunities.”
Registration for this year’s NextGen contest opens in September and runs through the end of October. The age range has been increased to 21-35, and the list of winners will be reduced from 50 to 20, with a more robust prize package including a full year of mentoring for all winners. Visit nextgenfranchising.org to apply.