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How much does Rumble cost?
Initial Investment Range
$509,640 to $1,141,016
Franchise Fee
$204,750 to $320,950
The franchise is the right to develop, own and operate, as part of the Rumble system, a fitness studio that provides a boxing-inspired, high-energy workout experience with the strategic fusion of boxing, HIIT, and strength training.
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Rumble April 8, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: August 19, 2025
DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
Medium Risk
Explanation
The financial statements for the guarantor, XPOF Assetco, LLC, show a recent shift to profitability. However, the guarantor is a relatively new entity (formed March 2023) within a complex affiliate structure. Furthermore, the parent organization has faced significant regulatory scrutiny, including a Consent Order with California regulators noted in Item 3. This may raise concerns about overall management stability and reliability, which could affect the support you receive.
Potential Mitigations
- An experienced franchise accountant should analyze the consolidated financial statements, including the footnotes on affiliate transactions and recent profitability.
- Your attorney should review the details of any regulatory actions in Item 3 to assess their potential impact on the franchisor's operations.
- A business advisor can help you investigate the stability of the broader Xponential portfolio, as your franchisor's health is tied to it.
High Franchisee Turnover
High Risk
Explanation
The franchisor directly warns of a high franchisee turnover rate. In the 'Special Risks' section, it notes that over 21% of outlets were terminated, reacquired, or ceased operations in the last three years. Item 20 data shows a particularly high number of exits in 2023, including 14 units reacquired by the franchisor relative to a small system size. This high turnover could indicate significant challenges within the system affecting franchisee success or satisfaction.
Potential Mitigations
- Engaging a business advisor to scrutinize the Item 20 tables and calculate annual turnover rates is essential for understanding system health.
- It is critical to contact a significant number of former franchisees from the list in Exhibit J to understand their reasons for leaving.
- Your accountant should help you assess the potential financial reasons for such high turnover before you make any investment.
Rapid System Growth
Medium Risk
Explanation
The franchise system experienced extremely rapid growth, more than doubling in size in both 2022 and 2023, before growth moderated in 2024. This fast expansion, which occurred alongside a corporate reorganization detailed in Item 1, could potentially strain the franchisor's ability to provide adequate and timely support, training, and resources to all franchisees. You should assess if the support infrastructure has kept pace with the system's growth.
Potential Mitigations
- Discussing the quality and responsiveness of franchisor support with a wide range of current franchisees is highly recommended.
- Your business advisor can help you question the franchisor about how they have scaled their support systems to manage this growth.
- An accountant should review the franchisor's investment in support infrastructure as reflected in their financial statements.
New/Unproven Franchise System
High Risk
Explanation
The franchisor explicitly warns in the 'Special Risks' section that it has a limited operating history and is in an early stage of development, making this a riskier investment. Franchising began in 2021 under a predecessor, with the current entity structure formed in 2023. An unproven system may present challenges such as underdeveloped support, evolving operational standards, and limited brand recognition, which could impact your business's performance and long-term viability.
Potential Mitigations
- A business advisor should help you perform extensive due diligence on the business model's long-term viability and the management team's experience.
- Speaking with the earliest franchisees on the list in Exhibit I is crucial to understand the system's evolution and the quality of support.
- Your accountant should carefully scrutinize the franchisor's financial statements for signs of stability and adequate capitalization.
Possible Fad Business
Low Risk
Explanation
The business operates in the competitive boutique fitness industry, which can be influenced by changing consumer trends. While boxing-inspired fitness is an established concept, the FDD notes you will face a crowded market. There is a risk that this specific model could be subject to shifts in consumer preferences over the 10-year agreement, potentially affecting long-term demand and profitability. The franchisor's ability to innovate and adapt will be key to mitigating this risk.
Potential Mitigations
- It is wise to conduct independent market research with a business advisor to assess the long-term sustainability of this specific fitness concept in your area.
- Evaluating the franchisor's plans for innovation and adapting the business model to stay competitive is a key discussion to have.
- Your financial advisor can help you model different scenarios for customer demand over the life of the franchise.
Inexperienced Management
Low Risk
Explanation
This risk was not identified in the FDD package. The management team detailed in Item 2 appears to have significant experience in franchising and business management, largely through their roles within the parent organization, Xponential Fitness, and other large companies. In franchising, an inexperienced management team can be a risk because they may lack the expertise to provide effective support, training, and strategic direction for the system.
Potential Mitigations
- A business advisor can still help you research the specific track records of the key executives listed in Item 2.
- Asking current franchisees about their direct experiences and the quality of leadership from the management team is always a valuable step.
- Your attorney can help you understand the management structure and how decisions are made within the broader corporate family.
Private Equity Ownership
Medium Risk
Explanation
The franchisor, Rumble Franchise SPV, LLC (Rumble SPV), is controlled by Xponential Fitness, Inc., a publicly traded company. This structure can create pressure to prioritize shareholder value and short-term financial performance, which may not always align with the long-term interests of individual franchisees. Decisions regarding fees, support levels, and system changes could be influenced by the need to meet quarterly earnings expectations, potentially impacting your operational costs and profitability.
Potential Mitigations
- Reviewing public filings of the parent company, Xponential Fitness, Inc. (XPOF), with your financial advisor can provide insight into its strategic priorities.
- Discussing any changes in support or strategy since the company went public with long-term franchisees of various Xponential brands is advisable.
- Your attorney should review the assignment clauses in the Franchise Agreement to understand your rights if the brand is sold.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk was not identified. The FDD in Item 1 clearly discloses the complex parent and affiliate corporate structure, including the ultimate parent company, Xponential Fitness, Inc. It also provides the required financial statements for the guarantor entity in Exhibit C. Failing to disclose a parent company can obscure the true financial backing and control structure of a franchise system, which is a significant risk for a franchisee.
Potential Mitigations
- Your attorney should review the corporate structure detailed in Item 1 to ensure you understand the relationships between the various entities.
- An accountant's review of the provided guarantor financials in Exhibit C is essential to assess the strength of the performance guarantee.
- Asking the franchisor to clarify the roles and responsibilities of each parent entity can provide additional clarity.
Predecessor History Issues
Low Risk
Explanation
This specific risk was not identified as a disclosure failure. Item 1 outlines the recent history of predecessors that have owned the franchise system since 2021. While the rapid series of ownership changes in a young system can be a concern, the FDD appears to disclose this lineage. It is important to assess if a franchisor is transparent about predecessor history, as past issues with litigation, bankruptcy, or franchisee failures could indicate unresolved systemic problems.
Potential Mitigations
- It is still valuable for your attorney to review the predecessor information in Items 1, 3, and 4 for any red flags.
- Discussing the transition between the various ownership entities with long-standing franchisees could provide useful context.
- A business advisor can help you research the reputation of the predecessor entities if you have concerns.
Pattern of Litigation
High Risk
Explanation
Item 3 discloses a significant pattern of litigation initiated by franchisees of affiliated Xponential brands (like AKT, Yoga Six, and Pure Barre) against the parent company and its affiliates. These lawsuits include serious allegations such as pre-sale disclosure violations, fraud, and breach of good faith. Additionally, the parent company is facing securities litigation and has entered into a Consent Order with California regulators. This pattern could indicate systemic issues within the broader organization.
Potential Mitigations
- A thorough review of all litigation details in Item 3 with your franchise attorney is absolutely critical to understand the nature and potential merit of these claims.
- Your attorney may be able to research the public court records for these cases to gather more information than is provided in the FDD summary.
- You should consider this pattern of disputes a significant red flag and discuss its implications for your investment with your legal and business advisors.
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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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
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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
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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.