When Cade Griffis walked across the stage at D-BAT's annual franchise owners meeting, the CEO was overwhelmed at how many faces he saw in the crowd.
"Wow," he thought. "This has really, really grown. And next year, it will be even bigger."
Griffis started D-BAT in 1998 with his brother Kyle Griffis and Craig Penfold. D-BAT is an indoor baseball and softball training academy that offers private lessons and camps for young players looking to improve. While the average customer is 12 years old, D-BAT has many older customers that will just come in to hit balls like you would shoot hoops at the YMCA. The academy boasts several major leaguers as alums, including Dallas native and Los Angeles Dodgers ace Clayton Kershaw.
D-BAT is in the middle of extreme expansion, as Griffis projects 100 percent revenue growth this year. Last year, the company did $18 million in revenue across its U.S. sites. D-BAT has 38 locations with 41 territories sold, including the company's first international expansion.
"We just signed a deal with a group out of China," Griffis said. "They've already got commitments for three cities in China. They will have 10 locations open within two years."
Opening D-BAT locations in China will open up the door for expansion in the baseball-crazed market of Japan, Griffis projects. The company is also looking at venturing into Canada, Mexico and the Dominican Republic.
Griffis has been around baseball his whole life. A star in high school and college at Dallas Baptist University, Griffis played for a short time in the Kansas City Royals farm system. However, his body betrayed him and he couldn't endure the gruel of catching on a professional level, considering he had three knee surgeries before the age of 18.
D-BAT also manufactures and sells baseball equipment. That made up about $3 million of the company's revenue last year, Griffis said. At one point the manufacturing arm of the company was more robust — Rafael Palmeiro hit both his 500th homer and 3,000th hit with a D-BAT bat and at one time six of the Boston Red Sox starters used the bats — but that portion has shrunk as giant retailers have taken over the market from mom-and-pop equipment stores.
That's why focus has shifted back to the academies. The original goal was 50 locations, which will soon be achieved. Now, Griffis wants to get to 100 or 150. The franchise fee is $35,000 for a D-BAT location. He thinks the U.S. market is capped out at 350 locations, especially considering the increase in competition.
"Sitting here in this building," Griffis said in the Addison location, "I can name five different competitors that opened up within three miles of this building."
To talk more about his company, Griffis sat down with the Dallas Business Journal.
Why pick China for your first international expansion?
They found us. They were in California doing some research and someone told them about our new location in California. They drove up to it and, low and behold, my brother was there.
You're opening a lot of locations. How are you ensuring you scale effectively?
I worry about it every night. That's a huge concern of mine and why I didn't want to grow as fast as we really have. But, it's happened and I can't slow the train down. ... We've run this for 12 years. I think between Kyle and myself, we have a doctorate in baseball and softball academies. We're as good as it gets when it comes to this business. What we're having to do now is we're putting our systems together better. We're putting our spec booklets, our HR booklets together. Things that we've never had to do. We're being forced to do it. I've doubled the amount of employees in our corporate office.
Did you take outside capital to start?
Not a dime.
Will you going forward?
We've been approached by a couple venture capitalists groups. Right now I don't have any interest in going that route. At some point somebody will need to take it to the next level. I understand that. More money, bigger company, etc.
I see our next step as getting in with the real estate side. Buying land, building the buildings, becoming the landlord in some markets that the real estate market isn't there — that's our next step with the company. We've dabbled into it. We just purchased a piece of property in Sherman that we're partners in. We're going to build the building for the franchisee and do a lease back to him with an option to buy in five years from us. We may, at some point, go out and get investors for that side of the business.
Do you have an exit strategy?
No. A lot of people ask me that, and I don't. The reason for that is — what will I do? This is all I've ever done. I know nothing else. I've been in this business my whole life. I would not be a very good retired or out of work person. I'd get bored. You can only hunt and fish so much.