Conversations With Coffey

Building A Wellness Franchise with Katie Gillberg

• Guy Coffey • Season 2 • Episode 7

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In this episode I chat with Katie Gillberg, founder and CEO of Hydrate IV Bar, a wellness spa specializing in IV therapy and NAD Vitamin Injections. 

Katie shares her entrepreneurial journey, starting her business in Denver in 2016, expanding to multiple locations, and becoming a franchisor. 

We discuss the challenges and successes of franchising, the importance of maintaining high standards and customer trust, and the shift towards wellness and preventative health. 

Katie also talks about overcoming the hurdles posed by the pandemic and her commitment to continuous improvement. 

This episode provides valuable insights for aspiring entrepreneurs and current business owners looking to expand their ventures.

To find out more about Katie and Hydrate IV Bar click here:

https://linktr.ee/KatieWaferGillberg


Connect with Guy Coffey:
LinkedIn: www.linkedin.com/in/guycoffey
Website: www.guycoffey.com
Instagram: @guycoffey
YouTube: @guycoffey

 Welcome to Conversations With Coffey With me Guy Coffey. I've owned independent businesses. I've been a franchisee of a global brand for over 17 years, and I co-founded and successfully exited our own franchise brand. This podcast is dedicated to growing the lives and businesses of entrepreneurs everywhere.

By sharing conversations with successful owners and some of my own experiences and insights. So please grab a cup of coffee and let's just dive right into today's episode.  Hello and welcome to another episode of Conversations with Coffey With me Guy, Coffey. And today I have a very special guest. Katie Gillberg of Hydrate IV and really looking forward to hearing about her journey.

She's not in the very beginning, but still closer to the beginning than the end for sure. And just wanted to share her knowledge, her experience, and uh, what she's learned along the way. And just hear a little bit about Katie herself. So I'm gonna hand it over to you, Katie. 

Thank you so much. I appreciate you doing this.

And yeah, like you mentioned, I'm Katie. I'm the founder and CEO of Hydrate IV Bar. We are a wellness. SPA specializing in IV therapy and NAD Vitamin Injections. Started the first location in 2016 in the Bonnie Bray neighborhood of Denver. That's where I'm a, I'm a native, born and raised here, and at the time had no idea.

I would have multiple locations. I have five corporate spas to date and definitely had no idea I would become a franchisor. So looking back, even in, you know, in the eight years, it's. I am super proud of our team and even myself, and we're really still just scratching the surface as soon as we started committing to franchising.

It's a whole other ball game, as you know. 

Absolutely. Yeah. 

But yeah, that's, that's what we've, where we're at in, in the eight years. This was a passion project that I started and still a passion project. I love it, but kind of wild to. To look back and reflect. 

Sure. From, you know, signing that lease for location number one and thinking like, are people really gonna come for this?

Like, am I gonna be able to grow this? And then obviously you had success there and kept on growing it. And then, um, so where are your locations right now? Yeah, 

so we are, um, we have 19 spas open throughout Colorado, Texas, Utah, and Arizona. And then we have another. 18 to 20, call it. We have some franchise agreements out right now that haven't been signed, but we're teeter tottering right there with basically another 20 that are sold, unopened, and super excited to be expanding into some other states.

So we are committed in Atlanta. Uh, we're committed in South Carolina, and then we have some, we're committed in New Jersey. Um, and then we have some other. Uh, agreements out just maybe next week if we touch base, I'll have a few more in some other markets that are coming soon. 

Wow, very good, exciting times.

You know, and just all these people coming into your world that are leaving in your concept. I, I know, you know, just from my experience with it is it's, I. It's an honor and, and it's also like, man, we better be good. You know, like, like a lot of people are counting on us and more and more are coming like every week, you know, like discovery days and things like that.

Yeah. And um, just thinking back on it, I envy you from a lot of different perspectives. Yeah. Just enjoy every step of the way and sounds like you're taking all the right steps. So if you don't mind me asking, just real quick, how did you decide to do hydration services and wellness services? 

Yeah, absolutely.

I have a business degree and started working in medical sales right after college. So that was my foot in the door into the medical industry, you know, entrepreneurism in, in general. I, I have always been in sales and I guess had the entrepreneurial spirit, so that was in the back of my mind. Um, I saw an area of opportunity to create a brand.

I saw IV therapy becoming hugely popular, but. Denver at the time had traditional medical practices where you could get these services, or we were just scratching the surface with like mobile hangover focused Sure. Uh, concierge services. And I thought, man, there's. There's so many benefits to the wellness component side of this.

You know, hydrate ID bar was a passion project of mine. I really focused on what I would want as the customer, so an elevated experience, everything from the design and as aesthetic of the actual space to. The professionals and nurses who are providing the service. You know, we have soft touches like blankets and tea and it's, it's just very cozy.

I, I wanted it to be a different experience that than you were used to. Um, at a traditional medical practice, I. We're not cutting corners on the medical side. So we have amazing experience, trustworthy medical professionals. We have, you know, high quality products and, and services. And a big focus for us on the business side was, you know, we wanted to be open seven days a week.

You could walk in, you didn't need an appointment. Ease of booking through an app. We have a membership model. So on the business end and, and what our franchise owners really love is that recurring membership model. But then it's also, you know, a great discount that's carried over to clients where cash pay versus billing insurance.

So we just kind of took. You know, a service that's nothing new. IVs is not new, but we made it elevated. 

Yeah. Well, I would say also in Denver being a very health-minded market, you know, compared to, I'm from the Midwest  when I go back there, no offense to all of Midwest people, but like, you know, Colorado's like the skinniest state in the nation or some, something crazy like that.

So, you know, like back in the day, like if you heard someone got iv, they're like, oh my gosh, what's wrong? You know, like, yeah, yeah. You know, like if someone got super sick, they might go to a, an urgent care and get an iv. Probably the coasts in Colorado are where people are like, no, no, we're, we're not just trying to be average.

We're trying to optimize our health and feel better all the time. You know, or Vegas where it's hangovers, right. Like, 

to your point, there's still so much education that goes into.  This business And eight years ago, people were really a little bit more skeptical and, you know, we're, we're having the conversations of why drinking water was important and why eating organic produce was important. And so we do recognize, you know, these services in this setting  are likely not for everyone.

And, and there's certainly different markets that are responding to it better, but even a shift.  Post pandemic. You know, the wellness industry is really booming and people are investing in their health and they're committing to.  Preventative medicine or just preventative modalities, so infrared sauna and cryotherapy and all of these biohacking services.

So that's what's really exciting is we've had the success that we've had pre and now we're. Seeing people that, you know, they're knocking on our doors a lot faster and, and they're becoming a lot more receptive to the services. And you know, we always tell people that the hardest part is just getting people in the door.

We're educating on the benefits. There's certainly a level of earning their trust because this is a personal service and it's a medical service. And I think that's so important. And what I tell a lot of our owners is, please do not expect to just. Open your door and expect people to start flooding in.

You know, we're not a sandwich shop. This is something that you need to be in your community. Grassroots, leaning on the education for sure, but building your team of people that are passionate about this as well. We always say tell, don't sell. And you know that that component of it is so important.

Absolutely. And I imagine you have a whole client experience cycle around the whole process so that it's, it's welcoming, educational, and people are getting the value of it Right, right. From the get go and especially after they feel the benefits of it. I, I imagine. 

Exactly, and that's what I'm grateful that we're in this space because it is a feel good space.

Once people are there, once they're committed to trying this, the results are amazing. They do feel, you know, much better. And you mentioned this earlier, we kind of have the ill to baseline, so people that are coming in because they have a headache, a stomach ache, overindulgence altitude, sickness. That those are the people that are coming in reactively.

They need to feel better fast and we can help them with that.  Majority of our clientele though, is baseline. So these are healthy individuals who don't necessarily have this big problem, but they're hoping to optimize. And a lot of our clients don't realize, or a lot of the population I would argue, doesn't realize how good.

Their body could feel, you know, if they were managing their stress and having proper sleep and just giving their body these, you know, nutrients that it needs. So that's what's really exciting for us is being in this space of kind of the ill to optimize. Those are the clients that are coming in regularly and they're happy to be there.

They keep coming back. Our nurses are happy. We're happy, like it's, it is a feel good space that we're in. 

Yeah, it's always good to be in health and wellness and fitness. We've been in fitness for like 17 years and it's the easiest thing to twist someone's arm to do because you know it's good for 'em. You know, it's not, yeah, absolutely.

It's like, not that you have to twist arms, but like, if you have to get a little bit more like, you know, it's for their best interest. 

Well, the hardest part's always just getting in the door. Like you, you never regret a workout after you've done it. It's just getting there. So yeah, it's. Same mentality.  

If you like this show, would you do me a huge favor and share it with one more person?

It's super quick and easy to do, and it will help me impact more people in a positive way. Thanks. Now back to the episode. So let's switch over to the business side. For people that are thinking about getting a franchising or people that are going down the path with, with you and your team, you know the story.

Of the founder. You started it, it obviously went well. If you can run five corporate studios, you've, you've got a lot of systems and processes in place that work because Katie can't do it all, I'm sure. As great as you are, 

as hard as I try, no, no, no. 

Right. You gotta build a machine that builds the machine.

Right. So yeah. Tell me about like the inception point of like, okay, I've got this great business, it's going well.  I would like to give this opportunity to other people, like, how can I do this? Is it gonna be growing corporate stores? Is it gonna be taking on investors and doing some spas? Or someone says, well, hey, you can grow the brand a lot faster and get more people involved, um, if you franchise.

So who had the idea and how did it start? And then what was the first step you took after that? 

So again, I started, you know, I, I went with one and was just praying that one would work. And I think because I've been so intentional from the beginning and the passion has been there, like it wasn't an option for me not to, not to succeed.

And I.  You know, at the time I was in my twenties, I was definitely naive. My parents laugh at it now because I, I understand their level of concern of like, do you realize what you're like, what you're about to do? And ignorance is bliss in that case, because it was like, I just went for it. And thank goodness that.

I could take those big risks and it worked. So for me, I never took on debt to open a spa. I waited until we one was profitable and then picked a new market and picked and went into another market. And so I personally had success building one corporate unit. A year for four years. And once I saw that and really understood, okay, the economies of scale with this thing, like we've, I've tested it in different markets.

I've, I've been able to grow this myself with very little capital. Just a lot of hard and hustle. But this is very doable. And I had clients at the time, I had a few different clients that kept saying, you know, have you considered franchising? This is, we see this model. And they would see our volume and.

You know, people can make assumptions on the profitability. And it was one client in particular of mine and, and I'll name drop him 'cause I'm super proud of it, but his name's Brendan and he's now my, he was my very first franchisee. Oh  nice. And he is now about to open his fourth unit, which is amazing.

That is. But Brendan had experience in franchising. He was a client of ours. He.  Patiently and graciously kept saying, you know, let's go grab coffee. You really need to consider this. And in 2020, I, I decided to take that leap of faith and go for it. And until then I was a little bit skeptical. I thought I didn't wanna share, which is not a very nice, but I just thought like, who's, I love this so much, this is my baby.

Who's gonna love it like I do, they're gonna mess up the brand or this or that. And I just didn't really understand. Stand franchising and I'm so happy that I took that leap of faith with Brendan and and his business partners because Franchising's been an incredible avenue and incredible business model for us to be able to take a business and scale it.

I personally would not have been able to, you know, with my own capital or just operational. Resources I would not have been able to get to the units I have otherwise. So it's been really exciting. It's also made sense going into different states because the, the corporate practice of medicine is different in every state.

So having medical professionals who are licensed in those states, we've been able to scale quicker because of that. So franchising hasn't, it's not. Easy as a franchisor, I'm learning every day and, and there's definitely a little bit of that, like not tug of war, but just like the ebbs and flows of, of learning, and I know it works really well for us.

Are we able to, you know, repeat that or train others on those systems? So it's still very much learning every single day. I don't regret that we decided to grow in this capacity. 

Right. It is a, a really smart way to grow. And you mentioned a word sharing, you know that you're a little bit hesitant to do that and then Yeah.

You know what you've probably found in franchising, you know, we were talking about how many years you've gone to the IFA convention and, and things like that. Is it is. I, I've said this a a million times and people that listen, well have heard me say this before, franchising is, it's unbelievable how much people will share.

Yeah. And I thought in the beginning it was just 'cause an Anytime fitness owner in Georgia doesn't really care about me putting best practices in my clubs in Colorado. Then as we went down the path in beauty, I, I had other people in beauty that we were kind of competitors with being like, you should probably consider this.

And you know, like having these things. I'm like, okay, you know, thanks. It was just like this abundance mentality where people actually share. And then one of the things that I think founders, including myself, don't realize in the beginnings, 'cause it's like your baby, right? You know, like your practices and.

You want it to be run the way you want it to be and things like that, but what you find out later, as you're probably finding out, is then you get these rockstar franchisees, and some of them are great. They're better than you to be honest at marketing, or they're better than you at data analysis, or they're better than you at evaluating things.

It's like, oh, we have all, we have this community of people, and if we put 'em all together and they're all trying to grow the brand, it just gets better and better and better like exponentially, as long as you're open and willing. Right? 

I mean, I couldn't agree with that more, and that's probably. Part of even just like the evolution of my own personal development and looking at myself as a leader now compared to eight years ago, it's very much like Blue Ocean strategy.

There is plenty of business and the value that these franchisees have brought. To me and my team and our spas, we are for sure stronger and better and more efficient. So that's what's really exciting and I, I didn't see it back then, so kind of getting out of my own, like ego and, and mentality, I. Has been just eyeopening and you know, I'm, I'm the first to admit to even franchise leads or candidates that we have come to the table.

We are very collaborative. I am not gonna sit here and pretend that I am the expert in everything, nor do I wanna be. I want to hire people smarter than me and more experienced than me that are going to grow and evolve in this brand and even just this industry. It's. It's ever changing. And so if someone, if that makes someone feel uncomfortable, if they want like black and white, this is how it's been for a hundred years and it won't change.

Franchising probably isn't for you, nor is, you know, this medical industry. But the owners that are a part of our team, I know that they really appreciate that we have very open communication and dialogue. We started a franchise advisory council very early on. Nice. We have a medical committee. I'm also, I'm.

The founder and the CEO, but I'm not one of our clinicians. I'm not our medical director, and the medical decision should never be coming from me. So leaning on our medical team and you know, being very like transparent and vulnerable in that sense, I think they really appreciate and  I. I'm happy that we're getting these structures in place and kind of identifying those needs ahead of time so that we can have a really strong foundation because you know, it's only going to help Propel and I'd rather get it in place now with the 20 units that we have.

Absolutely. So super smart move about getting a, a franchise advisory council together earlier rather than later. I think a lot of systems wait. Until they have X number of units or X number of franchisees or territories. And one of our mentors is always like, uh, always act like you're a big system even when you're not a big system. 

The other thing was starting conferences. Have you guys had conferences already? 

Yes. All right. And that's I think a lot of it too was our original. Five or six franchise groups are friends, family, clients, former employee. So I think it was very natural from the beginning that, and this comes with pros and cons.

I mean, I love it and I wouldn't trade it, but also challenging when we all had such personal relationships from the beginning. And so even learning how to,  you know, when is it business and when is it?  Family time and setting some of those boundaries on both sides, and I am really proud and impressed with how we've all been able to navigate those relationships 'cause. 

It could end badly. I mean it, I don't foresee that, but you know, some people like have warned us. Do you realize? But because we all have had those personal relationships, like having an annual summit was the first year we're like, we wanna be together. We wanna hang out. We, so we are getting ready to have our.

Forth and now we definitely have, you know, more structure in place. We bring on outside thought leaders and our vendors, and it's becoming a little bit more formal and structured each time. But I do think that's something that, you know, from day one, we've, we've made it a priority too. Get together and continue to build on our own relationships.

Yeah, it's, it's huge for the culture and the engagement and things like that. Being able to communicate with the whole system in person face-to-face. And that's another thing you're, you're doing really well is a lot of systems wait until they're big enough to do this. It's like our, our first one, literally, we had.

It was like an anter room off of a suite in a hotel in Minnesota. There was like five of us there.  Yeah, so like started out, 

our first was at the St. Julian in Boulder. Okay. Mostly because we all just wanted like spa services and some nice dinners together and we're like, we need to treat ourselves. This has been a, you know, a year and we rented a WeWork across the street and just.

You know, but it was awesome. And yeah, we'll continue to grow as as we see fit.  

If you are interested in learning more or from our guest today, please check out the links in the show notes. If you wanna learn more about me, please check out my LinkedIn at Gee coffee. That's G-U-Y-C-O-F-F-E-Y. Or for more personal and behind the scenes info, check me out on Instagram, which is at the same handle at gee, coffee.

Now let's get back to the episode. So you, you mentioned a a, a key year in our recent history, starting in 2020 is that's not an easy year to start out. In  the in-service business. So tell me how I like, well, it depends on what months you started, I guess, right? So was, what month did you start in 2020?

Formed the franchisor entity in January. Pulled money, resources, everything together. It's the, it was self-funded from the, the three partners. I have two partners in the franchisor entity.  So we committed, we hired the consultants to do our operations manuals. We hired the FDD attorneys. This was all January, February.

I. And in March all of my corporate units were closed for the inevitable, foreseeable for future. And it was like, I mean, I kind of get chills thinking about it. I can laugh because it's like, holy shit, did that really happen? 

Yes it did.  

Yeah. I'm like, we just invested this money and this time and we committed and mentally we are like in this mindset of our business is so amazing and everyone needs to be a part of it. 

And we just got the rug totally, you know, pulled from underneath us. Like, I don't know if my business is even going to succeed again. I don't know when I'm opening my doors. So wild times. And even through that, we just said, okay, we're one day at a time. We're gonna push through and keep going. And our word of that year was pivot.

Amy and I would, whether it was.  PPP applications or this or that, or relief or, I mean, we just, you know, clients and everyone just coming to us with like, so many unknowns, so many uncon, you know, things we couldn't control. And we just kept saying,  we're just gonna pivot. Like, we're just gonna keep going and pivot.

And the, the silver lining.  Is that we had all this time that we didn't have and we didn't wanna furlough our managers. We wanted to keep them on, but we wanted to keep working. And so. Those like six weeks that our, that we weren't servicing any clients. We went through every single training and we rebuilt our LMS and we re, we, we combed through every single process.

I mean, we looked at all of our vendors and our marketing and advertising and just everything. We had time that we never had time before and. We completed our FDD and all of our processes in July, which was probably, it was expedited compared to what we thought we would do. 

Mm-hmm. 

Filed and sold our first unit in July and they were open by September.

Wow. And that was Brendan, right? 

That was Brendan. And you know, they were, our first franchise was in Colorado. It was in Fort Collins. So. Even just our training, we were able to expedite a lot because we could, you know, we could host their team with our corporate team and we could travel to them very easily.

Fortunately for them, unfortunately for the business, before it was a business that went outta business because of Covid  smoke and deal on the rent. Didn't need all this, you know, didn't really need construction at all. They were just ready to move in. And so that was our first experience of, you know, signing and, and being operational and. 

Three months. 

That's amazing. 

Yeah. And you know, we wouldn't, not that we ru we, it was rushed for sure. It was rushed, but we were just able to be a part of it a lot more than, you know, we can in another city or state. And I. So the timeline is  closer to about the seven month mark right now. We'd love, um, some cities permitting, construction, we're just like, you know, it is what it is and you try and be as patient as possible, but even if they're open within, you know, nine months, we're, we're counting that as a win.

Yeah, absolutely. And I imagine you're, you're building up, you know, the suppliers and the vendors are, are something that changes over time, depending on. Performance and your maturity level, where you guys are at and what you're looking for. But obviously you have a Fran dev team, you have your own corporate team for operations.

You mentioned a learning management system, and obviously franchise business coaches, I, you know Yeah. In place. And then real estate and construction and all those things are dialed in and you guys are just ready to grow. 

Yeah. And the last few years have been a little bit of a dance on. What can we do internally versus what do we need to outsource and building our tech stack is like the name of the game right now and which technologies work and some we've committed to, and then we don't like 'em and we change it.

And it's, right now it's very much, you know, how do we build a system that is scalable? I laugh with, you know, our inventory management system that we're on right now. It's a huge improvement and it really is great. Is it perfect?   You know, part of me wants to tell our nurses or our franchisees, nurses, like, you have no idea how good you have it.

We used to do inventory on post-it notes, and we would text it and then all the inventory would be like, stored in my garage and we'd, we'd drive it. And so looking back at like how much we truly have evolved in, in the short amount of time now. Completely always, you know, areas of opportunity to improve.

But that has been just getting the technologies and the support people in place, and I'm so proud that all of our original franchisees that have come into the system, I. Whether they knew it or not at that time, they're all multi-unit owners now. Some of 'em,  our very first franchise group is opening their fourth.

Our second franchise group is opening their fifth.  So that is like rapid growth in, um, the short amount of time. So now that we've been able to really support them and get them to profitability, we're ready to kind of put the foot on the gas with franchise development and be a little bit more.

Aggressive. We're still gonna be very intentional, but we know we're onto something good. 

Yeah. Congratulations. That's, thank you. It sounds like all the ducks in a row and they, they will change over time for sure. Right. But you know, anybody coming into the system right now is in good hands. And, um, you know, sounds like the, you know, the multi-unit owners are, in case anybody's that's listening isn't familiar with franchising yet.

Like, the fact that there's multi-unit owners says a ton about a system. Thank you. Um, because, so congratulations. Thank you. Um, I'm super excited to watch your journey. I hope to get to see you. Like at, uh, Kevin Hines, you know, Akerman event in July and some other things around Denver and I'll, we'll have all the ways that people can contact you or your team for if they have an interest in Hydrate iv. 

And, um, any follow-up questions. But thank you so much for taking the time, sharing your journey. I know you're really busy. You got two tiny little babies.  This is fun though. And businesses. No, 

I love this. And, and thank you because I. I really, it's fun telling my story. I feel even just like motivated and energetic thinking about it and even leaving with a smile just.

Thinking about, you know, these original franchisees and kind of where we're at and so I really appreciate it. Thank you. Happy to answer any questions and excited to see where we're at in just a year from now. 

Exactly. Maybe we'll come revisit and see where you're at from 19. Next time we have to do 

it getting IVs in the spot, we're gonna hook you up and we'll All right.

That's how we'll do the next one. 

I like that. I need that sounds good. Thanks so much, Katie. Thank you. Take good care