Water Babies
Bottom line
- Total investment $108K – $153K including a $55K franchise fee, 10.0% ongoing royalty.
- Average unit revenue of $995K/year. Estimated payback in 0.4 years.
- Rated MODERATE with a risk score of 60/100.
- Emerging franchise — only 1 year of franchising with 2 units. Early-stage systems carry higher risk but may offer better territory availability.
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 Water Babies unit return on the cash you put in?
Unlevered ROIC · per unit
71%
Above typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Water Babies units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$796K
on $4.0M purchase
Total debt
$3.2M
SBA $2.0M + senior + seller note
Overview
About
Water Babies franchisees operate infant and toddler swim instruction centers, offering swimming lessons, water safety training, and aquatic classes to young children. Day-to-day operations include managing instructors, scheduling classes, facility maintenance, customer acquisition, and managing parent relationships while maintaining strict safety protocols for vulnerable populations.
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 · 30 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.
No SBA loan data available for this brand.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Extremely early-stage franchise with minimal operating units, undisclosed financials, and unproven scalability creates substantial risk despite reasonable per-unit profitability claims.
Score breakdown · what drove the 60 / 100 rating
- 01MEDOnly 2 existing units suggests extremely limited franchise system with unknown growth trajectory and minimal peer support network
- 02HIGHNo Item 19 financial disclosure (Going Concern = False) prevents validation of claimed $994,984.50 average revenue across entire system
- 03MINORTiered royalty structure (10%-8%) implies franchisor revenue heavily dependent on franchisee sales success, creating potential misalignment if units underperform
- 04MINORSignificant capital investment range ($107,710-$153,242) relative to only 2 operating units raises questions about unit economics and franchisee profitability claims
- 05MEDUnknown unit growth rate signals potential stagnation; no disclosed expansion pipeline or franchisee recruitment success metrics
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
34 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Water Babies · FDD (2025) PDF