Complacency is the entrepreneur’s biggest enemy, says the founder of trampoline park franchise FlipOut, Brent Grundy, who says “paranoia” and “double-checking everything” have allowed him to build a business that turned over $11.7 million in 2013/14 after starting in December 2012.
The bungled sale of his first business, an electrical safety consultancy, has coloured Grundy’s outlook.
“I signed it over before I’d got all the money, and they never paid up. I went back to reclaim the office and because I’d been away longer than 90 days, I didn’t have a leg to stand on,” he says.
“I learnt that ‘she’ll be right’ will get you killed.”
Without the money for a protracted court battle, Grundy went back to driving trucks for his father’s industrial waste business in Sydney’s Blue Mountains. Saving every dollar, he got the idea for FlipOut while visiting a play centre with his son, and observing that many of the older children were too big to be allowed on the equipment.
“It hit me that trampolines are for everyone. Put a toddler on a trampoline and they’ll never want to come off, say the word ‘trampoline’ to a 50 year old and you’ll get a smile,” Grundy says.
Leasing a Penrith car park, Grundy recalls having about $300 to his name once he was assembling his first trampolines on the site. Not willing to entrust his fate to others again, Grundy didn’t seek local council approval before he began operating, and ignored demands from council officers that he cease trading.
“Unless it was the police or Workcover telling me to close, I was just going to keep going,” he says.
Day in court
FlipOut ended up spending $90,000 in court on the matter, but Grundy says if he hadn’t, he wouldn’t have a franchise network that employs 450 people and a holding company forecast to turn over $42.1 million in 2014/15.
Grundy has extended his self-determined streak into other aspects of FlipOut’s business. An admirer of the 7-Eleven franchise, Grundy has implemented its system whereby franchisees (as per their agreement) agree to have rent, marketing royalties, GST and PAYG tax liabilities automatically deducted from their takings.
He’s also trialling the Nightlife music system at the Penrith site – one of approximately 8 out of 26 in Australia that FlipOut owns itself – which will eventually allow him to control the tunes played at all the centres.
“I’ve made quite a few of my franchisees millionaires within their first 12 months, so they’re happy” Grundy says. Disco theme nights and parties have become a mainstay of Flipout’s business – 40 per cent of those shelling out $14 for an hour’s jumping are over 18.
Grundy ultimately only wants to own the foundation Penrith centre (it did have to relocate from that carpark) but is happy to micromanage to ensure it’s the best in the Australian network.
“You have to lead your franchisees by example. I don’t want people to think of Flipout as ‘trampoline park’, it has to be on another level to sustain the success” he says.
“We’ve got a double-storey glow-in-the-dark trampoline at Penrith, and I’ve just hired a guy to do a laser and lights show that’s pre-programmed to whatever song is playing. I saw his work in a nightclub in Singapore on my way back from visiting one of our Malaysian sites – it was amazing, and because it uses a lot of LED, not that expensive.”
Malaysia is one of several countries where Flipout is expanding, with most of these beachheads funded directly by Grundy (although he’s working with a franchisee in the UK).
“It’s the same everywhere, potential franchisees look at it, then dawdle,” Grundy says. “I tell them, this is the date we’re opening, either you do it or I’ll do it, but if you want in once I’ve established it, the price is doubling.”
You can find the original article on BRW HERE.