Water Babies Franchise Cost, Revenue & Review 2026
Data from FDD filing
Analysis by FranchiseVerdict Research · Methodology
Water Babies is a children's education franchise offering swim lessons and water safety for infants and toddlers. Franchisees run local operations, managing instructors, scheduling, and enrollment.
FranchiseVerdict summary · 2026
A Water Babies franchise requires a total initial investment of $108K – $153K, including a $55K franchise fee and an ongoing 10.0% royalty[2]. The 2025 FDD does not disclose unit-level revenue (no Item 19). FranchiseVerdict grade: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $108K – $153K
- 34th pct Education
- Avg gross sales
- N/A
- Company-owned only2 territories
- Royalty
- 10.0%
- 55th pct Education
- Units
- 2
- 8th pct Education
- SBA charge-off
- N/A
Quick verdict · Education · color = vs category peers
Green = favorable by >10% vs Education avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $108K – $153K including a $55K franchise fee, 10.0% ongoing royalty.
- RETURNSItem 19 is an INCOME STATEMENT with NORMALISED expenses and a Net Operating Income line - profit, not sales - for two company/affiliate territories reporting $340,596 and $1,649,374. An earlier version of this note quoted a '$995K average'; that figure is a FABRICATED MIDPOINT ($1,989,969 / 2), printed nowhere, averaging two territories that differ 4.8x. avg_gross_sales is correctly NULL and must stay NULL.
- RISKVerdict C (Average), verdict score 45/100 (higher is better).
- DATAItem 19 reports Financial Performance of company-owned territories rather than annual gross sales, so unit revenue is not directly comparable. Ask franchisees directly for full unit-level revenue.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Water Babies US Franchise LLC
- Parent company
- Water Babies US TopCo LLC
- Ultimate parent
- Water Babies Holdings Inc.
- Predecessor
- Water Babies Group Limited (Water Babies UK)
- Prior franchisor entity
- CEO title
- CEO
- Howard Harrison
- Incorporated in
- Delaware
- HQ
- 115 E Pennsylvania Ave, Suite 16, Southern Pines, NC 28387
- Auditor
- Plante & Moran, PLLC
- Audited financials
Overview
About
- CEO
- Howard Harrison
- Headquarters
- NC
- Founded
- 1997
- FDD year
- 2025
- States available
- 1
Can you afford it, and what does the money buy?
Entry cost runs 80% below the typical education franchise.
Source: FDD 2025 · Items 5–7
FDD Item 7 · 2025 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $55K | $55K |
| Working capital (3–6 mo) | $15K | $31K |
| Equipment, build-out, other | $38K | $68K |
| Total initial investment | $108K | $153K |
Source: Water Babies 2025 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $108K – $153K
- Top 40% of category vs category
- Liquid capital req'd
- $15K – $31K
- Middle of category vs category
- Franchise fee
- $55K – $55K
- Middle of category vs category
- Royalty
- 10.0%
- Gross Revenue · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 12.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 10.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $500 |
| Transfer fee | $15K |
| Renewal fee | $6K |
| Total fee load | 12.0% of rev |
What do units actually make?
Source: FDD 2025 · Item 19
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
Water Babies did not disclose financial performance in FDD Item 19. The ROIC and return models require Item 19 revenue. Without it all inputs are estimates. You can still run the calculator with your own assumptions by entering an expected revenue figure.
Returns model · single-unit ROIC
What would one Water Babies unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
54%
Within the 30–60% "attractive franchise" band
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2025 FDD
Financial Performance
Item 19 is an INCOME STATEMENT with NORMALISED expenses and a Net Operating Income line - profit, not sales - for two company/affiliate territories reporting $340,596 and $1,649,374. An earlier version of this note quoted a '$995K average'; that figure is a FABRICATED MIDPOINT ($1,989,969 / 2), printed nowhere, averaging two territories that differ 4.8x. avg_gross_sales is correctly NULL and must stay NULL.
Company-owned outlets only - not franchisee performance
Based on only 2 territories
- Item 19 type
- Financial Performance of company-owned territories
- Sample size
- 2 territories
- vs category median 17 · small
- Source filing
- FDD 2025
- The FDD edition these figures were read from
- Transparency
- 6 / 10
- vs category median 4 / 10 · above
Compared against 204 Education brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Fee burden
Total ongoing fee load of 12.0% (near the Education average).
Disclosure
Item 19 reports Financial Performance of company-owned territories rather than annual gross sales, so unit revenue is not directly comparable.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Education averages
How Water Babies Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 2
- Opened
- 0
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 2
- Corporate units in the system
- % franchised
- 0%
- vs corporate-owned
3-year detail · Item 20
- Opened (3yr)
- 0
- Closed (3yr)
- 0
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 0
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 1 state reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
1
states with franchisees (per FDD Item 12)
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
What could kill this investment?
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
Pre-opening child swim franchisor (began franchising 2025) with 2 company-owned units and 0 franchised, net worth $330,000. No litigation, bankruptcy, or going-concern; audited financials and Item 19 disclosed. Limited history is the only concern.
Audited financials (Item 21)
Yes · Plante & Moran, PLLC
Score breakdown · what drove the 45 / 100 verdict
- 01MINORPre-opening (is_pre_opening=true), 2 units, 0 franchised
- 02MINORBegan franchising 2025
- 03MEDItem 19 disclosed, audited, net worth $330,000
- 04HIGH0 litigation, no bankruptcy, no going-concern
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 12.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | Population-based |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | North Carolina |
| Litigation count | 0 |
Items 10, 11
Training & Operations
- Classroom training
- 55 hrs
- On-the-job training
- 56 hrs
- POS system
- Ada
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Ada
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Water Babies franchise?
The total investment to open a Water Babies franchise ranges from $108K – $153K, with an initial franchise fee of $55K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Water Babies franchise owners earn?
Water Babies does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is Item 19 in the Water Babies FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the Water Babies FDD and qualifies whose outlets they describe.
What is Water Babies's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Water Babies (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Water Babies franchise locations are there?
As of their most recent FDD filing, Water Babies has 2 total units in the United States, including 0 franchised units and 2 company-owned units.
Is Water Babies a good franchise to buy?
FranchiseVerdict rates Water Babies as a C-grade franchise with a verdict score of 45 out of 100 (higher is better), based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
Are you the franchisor?
If you represent Water Babies, you can request corrections or provide updated information.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.