Q&A: Studio 20 CEO Mugur Frunzetti Talks Growth

LOS ANGELES—The Studio 20 live-cam studio franchise network has announced one of its best quarters yet. Studio 20 reported more than 100-percent increase in sales compared with the same period of 2017, new franchises opened and a significant growth in hourly income per model in what it called an "amazing start of the year." Mugur Frunzetti, Studio 20’s CEO, discussed the health of the operation and his plans for the future in this exclusive Q&A. The first trimester of 2018 had 100% growth compared to last year’s first trimester. What did you change since last year? MF: We have a long-term strategy and roadmap so is not what we changed, is what we kept doing the same that helped us continue to grow so fast. Tell us a bit about the 20 Excellence App. We know that if we want to stay the best, we need to continuously help all our teams and models grow themselves. Knowledge is power and we must provide our teams with the best knowledge we have. Therefore, we developed a mobile app where they can find a lot of information needed to help our models be successful. It's like our own internal Academy with courses, lesson, and exams. How would you pitch the live-cam franchise idea to someone that doesn’t know anything about it? If you are a hard-working entrepreneur and you want to have a successful business with minimum risks and excellent ROI, a Studio 20 franchise is your best choice. You don’t have to know anything about live cam—it's our job to teach and help—you only need to be able to motivate and lead the people in your team. How did the idea of starting a franchise came to mind? I first thought about developing a live-cam franchise back in 2008, 10 years ago. The market told me it's time to really do it in 2012 and, after a year of hard work in 2014, creating the plan around it, building the idea piece by piece, we opened the first franchise in 2015, two more in 2016, five in 2017 and now in 2018 we have reached six even before the first half of the year. Did your prior experience help or hinder your business operation? My previous business experience was a major factor for success. I have been an entrepreneur for 24 years, so since I was 18. I was involved in food distribution, music production, insurance brokerage, e-commerce, software development. Each business added significant value to my personal knowledge that now served the franchise network. What financial goals are realistic as a single-unit franchise owner? A single-unit franchise owner will make, at the studio's "maturity," which is 24 months after opening, between $10,000 and $50,000 profit per month. The range depends on the studio size and of course investment (10 rooms, a $150,000 investment to 50 rooms, a $500,000 investment). The turnover of a mature Studio 20 location is constant during the year with changes below 10% from one month to the other. Some of our first franchises are now, after 2-3 years of business, looking into opening a second location in the same city, even open in a second city, a studio dedicated to male models or grow the original location (7-10 rooms) to a much bigger studio (20-50 rooms). We know that for every franchise that you’ve opened, you have dedicated people from your original team helping at the start but also after, whenever the franchise needs them. What are your plans for the future? You just mentioned the plan in your question. We provide very close help and guidance to all our franchises, not only when they open but permanently. Our support is constant. Studio 20 is our biggest asset; we need to make sure all locations around the world provide the same quality. Plans for 2019? Anything special? After the success of our pilot locations in US, Colombia, and Hungary, we plan to accelerate franchises opening in these countries—mostly US and Colombia—where tens of cities can become homes to a Studio 20 location. In the same time, we are looking for franchisees to open new markets: Brazil, Czech Republic, Mexico, Moldova, Russia, Serbia, Spain, Ukraine are our main targets for 2019, but we are open to other countries also. The most important for us is the franchisors, the people we partner with. It's not enough to have money. We need good leaders and managers, people with the right profile to run a successful studio. We received over 1000 requests in the last four years and we accepted only 15 of them. This shows we are not in a hurry to sell to just anyone. We want to build long-term, strong and successful partnerships.