FranchiseVerdict
OsteoStrong logo
FV-01849·MODERATEExcellent86

OsteoStrong

Health & FitnessFranchising since 2012Website
Investment
$276K – $616K
53rd pct Health & Fitn…
Avg revenue
58th pct Health & Fitn…
Royalty
7.0%
27th pct Health & Fitn…
Units
153
84th pct Health & Fitn…
SBA default
0.0%
vs <3% typical

Bottom line

  • Total investment $276K – $616K including a $35K franchise fee, 7.0% ongoing royalty.
  • No Item 19 financial performance data disclosed — the franchisor chose not to publish revenue figures.
  • Rated MODERATE with a risk score of 56/100. SBA loan default rate of 0.0% across 86 loans (below the industry average).
  • System growing at 15.9% CAGR over 3 years with 153 total units — strong expansion trajectory.

Item 1 · who you're contracting with

The Franchisor

Legal entity
OsteoStrong Franchising, Inc.
Parent company
Blue Ocean International, Inc. (“BOI”)
Incorporated in
Delaware
HQ
8524 Highway 6 North, # 310, Houston, Texas 77095
Auditor
A&G LLP
Audited financials
Franchisor revenue
$8.7M
vs $11.3M prior year

Yale framework · single-unit ROIC

Returns Analysis

Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.

The model · Yale framework

What would one OsteoStrong unit return on the cash you put in?

Revenue · per unit, per year
$
Item 19 not disclosed — typing your own estimate
Franchisor take · royalty + ad fund
Royaltytyp 68%
%
Ad fundtyp 35%
%
Operating costs · category default: fitness
COGS
%
Labor
%
Rent / occupancy
%
Other operating
%
Total invested capital · what you actually put in
Initial investment
$
FDD Item 7: $276K–$616K
Working capital
$
FDD reports $34K–$54K

Unlevered ROIC · per unit

46%

In Yale's "attractive" band (30–60%)

0%30–60% Yale band80%

Store EBITDA · annual
$225K
EBITDA margin
30.0%
Total invested
$489K
Payback
26 mo
Unit-level only. A multi-unit portfolio gives up roughly 5–15% of this to shared services (corporate G&A) before reaching the ~10-unit break-even Yale describes.

Overview

About

OsteoStrong franchisees operate boutique fitness studios offering specialized strength-training workouts (primarily leveraging bone density and muscle development through high-intensity, low-impact exercise). Day-to-day operations include managing class schedules, member enrollment and retention, personal training delivery, facility maintenance, and local marketing to build membership base in protected territories.

CEO
Kyle Zagrodzky
Founded
2012
FDD year
2025
States available
36

Item 7 · what it costs

The Vitals

Total investment
$276K – $616K
All-in to open one unit
Liquid capital
$34K – $54K
Cash you must have on hand
Franchise fee
$35K
Royalty
7.0%
Gross Revenues · typical 6–8%
Ad fund
1.0%
typical 3–5%
Total fee load
8.0%
vs 9–13% typical

Item 19

Financial Performance

This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.

Item 20 · unit dynamics

The Growth Chart

Total units
153
Opened
13
Last reporting year
Closed
3
Turnover rate
2.0%
Company-owned
0
Corporate units in the system
% franchised
100%
vs corporate-owned
Net growth (yr3)
+7.0%
Net unit change last year
3-yr CAGR
+15.9%
Compounded over last 3 years
2023
153+10
Franchised units
2024
143
Franchised units
2025
132
Franchised units

Year-over-year franchised unit counts and net change. Source: FDD Item 20.

Item 20 · 7 states with active franchisees

The Territory Map

Derived from franchisee contact records. Shows states with at least one current operator — not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).

AK
ME
VT
NH
MA
RI
CT
NY
NJ
PA
DE
MD
DC
WA
OR
CA
NV
ID
MT
WY
UT
CO
AZ
NM
ND
SD
NE
KS
OK
TX
MN
IA
MO
AR
LA
WI
IL
MS
TN
MI
IN
KY
AL
OH
WV
GA
VA
NC
SC
FL
HI
Registered · 7 states
Not registered

States derived from franchisee phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.

Government records

SBA Loan Data

Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.

Total loans
86
Loan volume
Avg loan
Default rate
0.0%
vs <3% typical · system-wide
5-yr default

FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17

Risk & Legal

56
Risk · 0-100
MODERATE56 / 100

OsteoStrong presents elevated investment risk due to active multi-party litigation, regulatory compliance issues, opaque financial performance data, and slow system growth in a niche market segment.

Score breakdown · what drove the 56 / 100 rating

  1. 01HIGHMultiple active litigation cases involving misrepresentation and breach of contract allegations from former franchisees and regional developers
  2. 02MINORCalifornia regulatory consent order regarding failure to register franchise broker agreements, indicating compliance lapses
  3. 03MEDHigh initial investment ($275k–$615k) with no disclosed average revenue or net income data (Item 19) prevents ROI validation
  4. 04MEDSlow unit growth (7.0% YoY) on small base (153 units) suggests limited system momentum and market traction
  5. 05MINORRoyalty structure floor of $1,500/month ($18k annually) creates significant breakeven threshold for low-revenue locations
  6. 06MINOR10-year term locks franchisee into relationship with company facing active legal disputes

Severity inferred from the FDD text · not a regulatory classification

FDD Items 5, 6, 12, 17 · continued from Risk & Legal

Contract & Territory Detail

Territory
Pre-determined geographic area
Protected territory
Yes
Initial term
10 years
Renewal term
5 years
Online sales rights
Restricted
Franchisor can compete
Yes
Hire a manager?
Allowed
Litigation count
6
Right of first refusal
Yes
Franchisor can buy back on resale
Mandatory arbitration
Yes
Jury trial waiver
Yes
Non-compete
2 yrs
Post-termination restriction
Owner-operator
Optional
Governing law
Texas

Item 11

Training & Operations

Classroom training
48 hrs
On-the-job training
26 hrs
POS system
iGo Figure
Operating tech stack

Item 20

Franchisee Contacts

Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.

Franchisee contacts

96 numbers

Locked
(239) 350-••••
CO
(561) 598-••••
CO
(941) 210-••••
CO

One-time purchase · CSV download · Validation questions included