Barry Van Over, center photo, is the founder of Premier Martial Arts, which teaches young people martial arts as well as values such as discipline and respect. Unleashed Brands added the 560-unit franchise to its stable in January.
Barry Van Over spent the past couple of years pondering whether to take private equity investment in his franchise, Premier Martial Arts, as it grew to more than 560 units.
“They like to get you when you’re young. Especially when you’ve got 500 to open in five years, they’re getting you at a bargain,” he said, but he held out until he found the right partner. “And then I met Michael from Unleashed,” meaning CEO Michael Browning and his umbrella company, Unleashed Brands. “They have the same mission, to empower children’s lives.”
Premier Martial Arts, which coaches youth in martial arts and attendant values such as discipline and respect, inked a deal in January to join Dallas-based Unleashed Brands as that platform’s third, and largest, acquisition to date.
“One thing I’m good at is knowing what I don’t know,” Van Over said. “It’s just so important to me that these people, these legacy owners and the new franchisees, that they’re rewarded with success. I’m convinced now that they’re the right guys.”
Van Over and his martial arts business weren’t always so popular. He moved to Knoxville, Tennessee, right after college in 1990/91, and started a martial arts studio. “That was actually a big failure. I ended up sleeping on my couch in my office, taking a shower at the local Powerhouse gym, and I did that for a year. I was about to give up,” he said.
He was contacted by a consulting company that handled tasks like billing students and growing admissions, keeping a 10 percent commission and sending the rest to the studio owner. “In 24 months or so, I became that company’s largest client, in terms of number of students, around 600 students, and I became that company’s largest client in terms of gross revenue,” Van Over said. In time he became a VP at the company, consulting with client studio owners and doing live training and events.
Van Over eventually bought out his boss and started his own operation as a licensing play but then changed to the franchising model in 2018. “Not only did we convert every one of our owners to the franchise,” he said, but also “exploded” since then.
“It’s been pretty wild,” said Unleashed Brands’ Browning, who also has under the umbrella Urban Air, the kids’ adventure park brand he co-founded, plus Snapology and The Little Gym, acquired in 2021. Browning’s mission is to build out Unleashed Brands with franchises that fit into the “learn, play and grow” areas, and also help founders scale their companies.
“One of my board members became friends with Barry,” and Browning spent a year or so “just mentoring him and befriending him. Barry just has this tiger by the tail in Premier Martial Arts. We just started chatting about franchise development and all kinds of things about building a big franchise system,” Browning said. “He said ‘I never considered selling, but I could use the help,’ and the rest is history.”
When deciding to sell, Van Over followed advice from a mentor, who said: “Barry, here’s the key thing: Do you think you need help right now? Do you have this under control, because growth can be a double-edged sword,” Van Over recalled. “I think I have this under control today, but we have 132 to open this year and I think we need help.”
Cost of investment for a Premier Martial Arts franchise is about $200,000, Browning said. “It’s got a great turnkey system, everything from the onboarding, design and construction, and then the operating system.” Unleashed Brands is continuing to look for acquisitions.
“We do realize that when certain companies are ready to recapitalize or bring in new partners, we need to be a part of that conversation, if they fit into ‘learn, play and grow.’ Sometimes we’re put into an opportunity; however, we are absolutely out there looking for the best company and building relationships with these brands and amazing founders,” Browning said.
Browning is also launching an accelerator program in 2022, for brands that “maybe it’s too early, they’re too young” for an acquisition, “but they want to tap into our accelerator. When they’re ready to recapitalize and partner, we can step in.”