Bottom line
- Total investment $269K – $610K including a $65K franchise fee, 8.0% ongoing royalty.
- Average unit revenue of $556K/year (median $536K).
- Rated STRONG with a risk score of 49/100. SBA loan default rate of 0.0% across 267 loans (below the industry average).
- 13 litigation matters disclosed in Item 3 — higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
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 Stretch Lab unit return on the cash you put in?
Unlevered ROIC · per unit
31%
In Yale's "attractive" band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Stretch Lab units return on equity?
Equity IRR · 5-yr
41.6%
5.70× MOIC
Year-1 DSCR
2.07×
EBITDA ÷ debt service
Equity required
$3.2M
on $11.7M purchase
Total debt
$8.5M
SBA $5.0M + senior + seller note
Overview
About
Stretch Lab franchisees operate boutique fitness studios offering assisted stretching and mobility services, primarily one-on-one and small group sessions led by trained practitioners. Day-to-day operations include managing front-desk scheduling, overseeing practitioner staff, maintaining studio facilities, and driving member retention through classes and retail offerings. Revenue streams include membership packages, drop-in classes, and ancillary services.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 9 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).
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.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Stretch Lab operates under a parent company in bankruptcy with extensive litigation alleging franchise law violations; the absence of net income disclosure and modest unit growth create opacity around actual franchisee profitability and sustainability.
Score breakdown · what drove the 49 / 100 rating
- 01MINORParent company (Xponential Fitness) facing multiple securities class action lawsuits and regulatory scrutiny, creating systemic risk across all affiliate brands
- 02HIGHExtensive litigation from former franchisees across affiliate brands alleging franchise law violations and fraudulent inducement — suggests potential systemic issues in franchisor practices
- 03MEDNo Item 19 (average net income) disclosed despite $556,263 average revenue — inability or unwillingness to demonstrate profitability is a major transparency red flag
- 04MINOR8% royalty on gross sales with 10-year term creates high fixed costs regardless of profitability; lack of net income data makes ROI calculation impossible
- 05HIGHParent company filed for Chapter 11 bankruptcy protection (going concern = False) — indicates severe financial distress and potential impact on franchisee support, marketing, and technology
- 06MINOR13.3% YoY unit growth appears modest for a wellness concept; growth rate masks whether expansion is driven by new franchisees or attrition replacement
- 07MINORMultiple pending lawsuits by franchisees from affiliated brands (Pure Barre, AKT, Yoga Six, Row House, CycleBar, BFT) suggest pattern of franchisor-franchisee disputes and potential legal precedent against the parent company
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
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
79 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Stretch Lab · FDD (2025) PDF