Young Rembrandts

## Executive Summary

Young Rembrandts is a children art education franchise founded in 1988 that teaches drawing fundamentals to children ages 3.5 to 12 using a proprietary step-by-step curriculum. With over 75 locations across the U.S., Canada, and internationally, the franchise offers one of the lowest investment points in education franchising at $46,000-$54,000. The home-based business model allows franchisees flexibility by operating classes at host locations like schools and community centers, though prospective owners should note the 36% three-year failure rate requires careful due diligence.

## The Business

Young Rembrandts franchisees operate home-based businesses that deliver art education programs at host venues such as elementary schools, park districts, community centers, and private facilities. The proprietary curriculum developed by founder Bette Fetter, an artist and educator, uses a unique step-by-step teaching method that does not require franchisees to have art or teaching credentials. Franchisees hire part-time instructors to teach classes, allowing for scalable operations and flexible scheduling.

## The Numbers

**Investment Range:** - Total Initial Investment: $46,000 - $54,000 (company website: $45,605 - $53,235) - Alternative estimate: $51,000 - $59,000

**Fees:** - Initial Franchise Fee: $39,500 - $44,500 - Royalty Fee: 10% on first $75,000 gross revenue, 8% thereafter (or 9% flat rate per some sources) - National Marketing Fee: 1% of gross revenues - Veteran Discount: $2,500 off franchise fee

**Financial Requirements:** - Minimum Net Worth: $100,000 - Liquid Capital: $25,000 - $40,000

**Performance Indicators:** - Median Gross Sales: $150,442 annually - Owner-Operator Earnings: Approximately $27,000 - Three-Year Failure Rate: 36% (significant concern)

## System Health

**Unit Count:** 44-75+ franchise locations plus 1 company-owned (totaling approximately 45-100 territories across U.S. and Canada)

**Geographic Reach:** - Over 20 U.S. states - 3 Canadian provinces - Select international locations - Reaches tens of thousands of children weekly

**Company Background:** - Founded: 1988 by Bette Fetter - Franchising Since: 1997-2001 (sources vary) - Headquarters: Elgin, Illinois - Global expansion plans in development

**Franchise Renewals:** - Many franchisees renewing contracts for additional 10-year terms

## Franchisee Experience

**Training and Support:** - Comprehensive initial training program - Ongoing support for marketing, sales, curriculum development, and teacher training - All teaching materials and curriculum provided - No art degree or teaching certification required

**Franchisee Testimonials:**

- Marcela Riano (El Paso/Las Cruces, 7 years): I feel so happy to be able to bring the joy of art to kids who wouldnt otherwise have that opportunity. Young Rembrandts has changed my life completely.

- Cecilia and Federico Pena (North Houston, former psychologist and oil/gas professional): Experiencing work-life balance like never before. They are able to make their own schedules and control their own destiny.

- Linda Freedman (Mt. Arlington, NJ): Young Rembrandts is especially unique because its inclusive of children with all different behavioral and physical abilities. Running my business means that I have flexibility.

- Tom Dempsey (Boise, ID, former high school teacher): What I enjoy most is the independence and ability to make my own decisions. I have the ability to be at home when my kids come home from school which is extremely important to me.

**Business Model Benefits:** - Home-based operation reduces overhead - Flexible scheduling for work-life balance - Mission-driven work in child development - Low barriers to entry (no specialized credentials)

## Risk Assessment

**Potential Concerns:** - High 36% three-year franchise failure rate is significant red flag - Low median gross sales ($150K) and owner earnings ($27K) - Dependent on school and community center partnerships - Seasonal fluctuations tied to school calendar - Part-time instructor recruitment and retention challenges - Limited growth in overall unit count suggests market saturation or challenges

**Risk Mitigators:** - Very low initial investment reduces financial exposure - Home-based model minimizes overhead costs - 35+ year track record demonstrates concept viability - Strong franchisee testimonials indicate satisfaction for successful operators - Growing demand for after-school enrichment programs - Curriculum and materials provided reduce operational complexity

## Competitive Position

Young Rembrandts competes in the children enrichment education space against Abrakadoodle, Art by You, local art studios, and in-school art programs.

**Advantages:** - Proprietary curriculum developed over 35+ years - Low investment barrier compared to brick-and-mortar competitors - Home-based flexibility appeals to lifestyle entrepreneurs - Inclusive approach serves diverse student populations - No specialized credentials required to operate

**Challenges:** - High failure rate suggests business model challenges - Low revenue and earnings potential limits growth - Dependent on host venue partnerships - Competition from free or subsidized school art programs - Limited brand awareness outside existing markets

## Validation Questions for Franchisees

1. What is your actual gross revenue and net income after all expenses? 2. How long did it take to build your class schedule to a sustainable level? 3. What challenges have you faced with instructor recruitment and retention? 4. How do you secure and maintain relationships with host venues? 5. What is your experience with seasonal revenue fluctuations? 6. Why did you choose to renew your franchise agreement (for long-term owners)? 7. What would you do differently if starting over?

## Data Gaps

- Detailed financial performance data beyond median sales - Reasons behind high three-year failure rate - Average number of classes/students per territory - Instructor compensation structures and turnover rates - Franchisee satisfaction survey data - Specific growth plans and new territory availability - International expansion details and timeline