Rush Cycle

Mitch, president of Rush Cycle Canada, based in Brossard, Quebec, sought $250,000 for 15% equity. The business is the Canadian master franchise of a US fitness studio chain offering spin, yoga, strength, and barre classes under one roof for an unlimited membership fee of $149 per month, with two locations opened in the past year and new franchise partners paying between $450,000 and $500,000 to open a location. Mitch paid $250,000 US as a one-time fee for exclusive Canadian rights to the US franchise, which has over 70 locations, and pays only a 2% royalty on his two studios; one studio does about $850,000 in revenue and another about $600,000, though he could not clearly state total revenue or profit when asked.

All five Dragons declined to invest. Michele Romanow was not confident in the numbers presented, Brian Scudamore could not see enough profit in the model, Wes Hall questioned the unusually low 2% royalty arrangement, Manjit Minhas saw nothing proprietary about the business, and Drew Scott and Arlene Dickinson both cited disorganization and lack of clarity about what was being sold. No deal was made.

Rush Cycle is still operating and sells through its website.