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Beem Light Sauna
How much does Beem Light Sauna cost?
Initial Investment Range
$392,047 to $951,947
Franchise Fee
$225,500 to $578,500
We offer franchises for the operation of a membership-based, state-of-the-art studio featuring consumer-grade infrared, red light, and chromotherapy solutions, and offering related services and products, in a private spa-like setting.
Enjoy our partial free risk analysis below
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Beem Light Sauna May 6, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: August 21, 2025
DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
High Risk
Explanation
The franchisor relies on a guarantee from its parent, Sequel Brands Holdings, LLC. However, the provided audited financial statements for the guarantor are for a period of less than one month since its inception. This provides virtually no operating history to assess its long-term financial stability or its ability to support the franchise system. This lack of a meaningful financial track record presents a significant risk to you.
Potential Mitigations
- Your accountant must carefully review the guarantor's financial statements and the guarantee itself to assess the real financial backing for the franchisor.
- Inquiring about the parent company's capitalization and future funding plans is a critical step to discuss with your business advisor.
- Your attorney should analyze the legal enforceability and practical value of the guarantee from such a new entity.
High Franchisee Turnover
High Risk
Explanation
Data in Exhibit F reveals that eight franchisees terminated their agreements in 2024 before their studios even opened. This represents a very high rate of pre-opening turnover, which could indicate significant problems with the site selection process, pre-opening support, or franchisee expectations set during the sales process. This pattern suggests a substantial risk that you might not be able to successfully open your studio.
Potential Mitigations
- Speaking with the former franchisees listed in Exhibit F is essential; your attorney can help you formulate appropriate questions about their departure.
- A business advisor can help you scrutinize the franchisor's site selection and pre-opening support systems based on this turnover data.
- Your accountant should help you budget for potential delays and unforeseen challenges during the pre-opening phase.
Rapid System Growth
High Risk
Explanation
The franchise system is undergoing extremely rapid expansion, growing from 3 to 38 franchised units in a single year, with 33 more projected to open soon. Such explosive growth, as shown in Item 20, can strain a franchisor's resources, potentially leading to inadequate site selection support, training, and ongoing operational assistance for new franchisees like you.
Potential Mitigations
- Engaging a business advisor to question the franchisor about their plans to scale support infrastructure is crucial.
- It is important to ask recent franchisees about the quality and timeliness of the support they are currently receiving.
- A thorough review of the franchisor's support obligations in the Franchise Agreement with your attorney is recommended.
New/Unproven Franchise System
High Risk
Explanation
The franchisor entity is very new, formed in late 2024 and acquiring the system from a predecessor in 2025. The ultimate parent company and guarantor was also just recently formed. While management has experience from other brands, this specific franchise system under its current ownership structure is new and relatively unproven, which increases your investment risk.
Potential Mitigations
- Your business advisor should help you conduct extensive due diligence on the viability of the business model itself.
- Speaking with the earliest franchisees listed in Item 20 is critical to understand the system's evolution and challenges.
- Having your accountant carefully assess the parent company's capitalization is important given the newness of the entire structure.
Possible Fad Business
Medium Risk
Explanation
The business focuses on specific wellness trends like infrared and red light therapy. While the wellness market is large, the long-term, mainstream consumer demand for these specific services is not as established as more traditional business models. You should consider the risk that the concept's popularity could be tied to current trends that may fade over time, potentially impacting future revenue.
Potential Mitigations
- Engage a business advisor to conduct independent market research on the long-term viability and consumer demand for these specific wellness services.
- Question the franchisor on their plans for innovation and adapting the service offerings to stay ahead of market trends.
- Careful evaluation of the local competitive landscape for similar and alternative wellness services is necessary.
Inexperienced Management
Low Risk
Explanation
This risk was not identified. The executives detailed in Item 2 have extensive prior experience in the franchising industry, particularly in the boutique fitness and wellness sector. In general, inexperienced management can pose a risk by lacking the knowledge to provide effective support, training, and strategic direction to franchisees.
Potential Mitigations
- It is wise to research the backgrounds of the key management team members with the help of a business advisor.
- When speaking with existing franchisees, asking about their direct experiences with the management team can provide valuable insight.
- An attorney can help you understand the employment history and any disclosed litigation involving the management team.
Private Equity Ownership
Medium Risk
Explanation
The franchisor is part of a larger holding company structure that owns multiple franchise brands. This structure can sometimes lead to a focus on rapid growth and returns for parent-company investors, which may not always align with the long-term profitability and support needs of individual franchisees. The Franchise Agreement gives the franchisor broad rights to sell the system, which could change ownership and philosophy.
Potential Mitigations
- In discussion with your business advisor, you should research the ownership structure and track record of the parent company, Sequel Brands.
- Ask current franchisees about any changes in support, fees, or system direction under the current ownership.
- Your attorney should review the franchisor's rights to assign the agreement and explain the potential implications if the system is sold.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk was not identified, as the franchisor clearly discloses its parent and guarantor companies in Item 1 and provides financial statements for the guarantor. Generally, it is a risk if a franchisor is a thinly capitalized subsidiary and fails to disclose information about a controlling parent company, as this can hide financial instability or other material facts from a potential franchisee.
Potential Mitigations
- Your attorney can help verify the corporate structure disclosed in Item 1 to ensure all relevant parent and affiliate entities are listed.
- An accountant should always review the provided financial statements, including any for a parent or guarantor entity.
- It is good practice to discuss the role and influence of any parent company with your business advisor.
Predecessor History Issues
High Risk
Explanation
The FDD discloses a predecessor entity, Get Lit Concepts, LLC. Item 3 reveals this predecessor was sued by a former franchisee for fraud and misrepresentation regarding initial investment costs, a case which the predecessor settled by paying the franchisee. Furthermore, Item 19 notes that financial data received from the predecessor was "incomplete." This history raises concerns about the system's past practices and the reliability of historical information.
Potential Mitigations
- Your attorney must carefully review the details of the disclosed litigation involving the predecessor entity.
- Discussing the predecessor's history with the earliest franchisees in the system is a crucial due diligence step.
- A business advisor can help you assess how the transition from the predecessor may impact the current system's operations and culture.
Pattern of Litigation
High Risk
Explanation
Item 3 discloses that key executives, including the CEO of the parent company and the CEO of the franchisor, are currently named as defendants in multiple franchisee and securities lawsuits related to their prior executive roles at another large franchise company. The allegations include fraud and violating franchise disclosure laws. This pattern of serious litigation involving the current management team represents a significant risk regarding their business practices and litigation history.
Potential Mitigations
- A thorough review of all disclosed litigation with your franchise attorney is absolutely critical to understand the nature and potential implications of these claims.
- Consider engaging your attorney to conduct independent research on the public records of these cases for additional context.
- Discussing the potential impact of this litigation history on the franchisor's culture with your business advisor is highly recommended.
Disclosure & Representation Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Financial & Fee Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Purchase the complete risk review to see all 102 risks across all 10 categories.
Legal & Contract Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Territory & Competition Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Regulatory & Compliance Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Franchisor Support Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Operational Control Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Term & Exit Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Miscellaneous Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
