Gravity Vault tries for toehold in fledgling rock-climbing niche
Tim Walsh, left, and Lucas Kovalcik turned their passion for rock climbing into a business.
Spinning climbing metaphors comes easily to the founders of Gravity Vault. Attracting prospects to their new brand may be tougher.
Lucas Kovalcik and Tim Walsh are ready to scale new peaks with The Gravity Vault, an indoor rock-climbing gym the pair is betting will prosper from the sport’s fast-growing popularity.
Avid climbers and friends since high school, the founders use rock-climbing puns to describe their business aspirations. Kovalcik and Walsh are beginning to franchise the concept to those with a similar passion. They contend they have a proven business model and are getting some interest from potential franchisees.
The business owners and a team of 45 climbing enthusiasts offer classes, parties, memberships and corporate events. They cater to people from ages five to 60 and over, including beginners learning the activity for the first time, regulars honing skills and hardcore climbers prepping for competition.
“The timing for franchising is right because the market is calling for it and more people are climbing now than have ever climbed,” Walsh says.
Evidence for growing demand includes 40 new climbing-specific facilities built in 2012, says Drew Eakins, membership marketing manager at the Climbing Wall Association, a Boulder, Colorado-based trade group that offers services to 400 companies in the industry.
Sam Wright, the first franchisee of The Gravity Vault, inside his new gym being built in Middletown, New Jersey.
The Gravity Vault founders will be trailblazers in selling franchises in the niche. So what challenges will they face?
The CWA’s Eakins says there is no precedent for a climbing gym franchise, although many have opened multiple locations. He listed capital costs and the specialized knowledge needed for operators and employees as the primary barriers to entry. The CWA reports there are now roughly 450 climbing facilities in North America. That’s five times more than reported 19 years ago.
“Some franchise fitness chains and retail establishments have had success with climbing walls; however, franchising has not yet extended to climbing-specific facilities,” Eakins says.
Kovalcik and Walsh opened the first Gravity Vault in Upper Saddle River, New Jersey, in 2005 and another 40 miles away in Chatham in 2009. The total investment to open a gym is $746,400 to $1.2 million, including a $40,000 franchise fee, the company’s Franchise Disclosure Document states. The entrepreneurs used U.S. Small Business Administration loans and savings for financing.
A typical Gravity Vault has 13,000 square feet of climbing space, including overhangs and arches, as well as climbing walls 35 feet or higher. The FDD asserts franchisees pay royalties of 6.5 percent of weekly gross revenue.
Plans call for an additional three to five Gravity Vault franchise locations within the next year in New Jersey, New York, Pennsylvania, Delaware and Connecticut. Sam Wright, who has a background in accounting, signed on as the first franchisee. He is investing about $900,000 to open a Gravity Vault in Middletown, New Jersey, this month.
Though he has long desired to run his own business, it was his high school daughter’s interest in rock climbing that led Wright to Gravity Vault. Wright likes the support Kovalcik and Walsh offered to get the business started. On the marketing front, he says the pair discussed what did and did not work for them.
Wright received training and other hands-on assistance to learn the operation. “They have had eight years or so to perfect things, so hopefully I can leverage what they’ve learned along the way,” he says.
Trailblazers face obstacles
Educating people about rock climbing, including detailing its safety aspects and physical workout benefits, is contributing to the sport’s growth. Still, some obstacles remain for Gravity Vault.
Kovalcik says a big challenge is finding the right franchise partners to grow the brand. “We’re looking for like-minded people that are willing to share our vision,” he says.
Being the first in a niche presents both an opportunity and challenge, according to another trailblazer. Jeff Platt is CEO of Sky Zone Indoor Trampoline Park, which his father created in 2004. Now based in Los Angeles, Sky Zone has two corporate-owned and 46 franchised locations in 22 states and two Canadian provinces. The company plans to add up to 50 franchises in the United States, Canada, Mexico and Australia in 2014. It recently announced a master franchise license agreement with Strike Entertainment to build 10 parks in Australia and future parks in New Zealand.
Platt talked about the hurdles a new franchise concept like Gravity Vault could face. He says a new concept must find a way to provide value to the franchise owner. Unlike established brands in the franchise marketplace, a new franchise has to build brand recognition.
He says it’s essential Gravity Vault hires individuals who understand the franchise industry, including its marketing and operations aspects, especially when introducing a new concept.
Kovalcik and Walsh hired SMB Franchise Advisors, a Philadelphia-based consulting firm with industry knowledge. Gravity Vault has been working with the firm since launching the franchise opportunity.
One thing that won’t be difficult is coining apt phrases. “We haven’t reached our own summit yet in this business, and we’re continuing to climb,” Kovalcik says.