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This story appears in the December 2017 issue of Entrepreneur. Subscribe »
Jon Charlton might be a hatchet-throwing prodigy. On the helicopter pilot’s second-ever throw, the hatchet swings one perfect rotation, handle over blade and sinks into a target 12 feet away. On his third throw, he hits the bull’s-eye. Thunk! The sound is deeply satisfying.
His wife, JoyAnn Charlton, is a different story. Her hatchets bounce off the target at unpredictable angles and clatter to the concrete floor. She gives up quickly. No matter. She and Jon didn’t really come to Stumpy’s Hatchet House to throw hatchets. They came here, to this otherwise sleepy industrial part of Eatontown, N.J., because they’re in the market for a turnkey business that will make them money while allowing them the free time they need to raise two kids. And they believe a hatchet-throwing franchise may be just the thing.
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“Jon and I have been exploring the franchise route,” says JoyAnn, who also happens to be a franchising attorney. “We live all the way out in Bucks County, Penn., and we had two friends on two separate occasions talk about getting a group together to make a trip here.” The buzz piqued their interest, so they came to meet the owners on a “discovery day.”
This is an unusual referral. But Stumpy’s is an unusual business, to say the least. Its customers show up in groups — birthday and bachelor parties are most common, but the business hosts company retreats, baby showers and even divorce parties. Each group rents a stall lined with steel fencing, and everybody takes turns hurling hatchets at targets. It’s not unlike darts, or even bowling, except that almost everybody who shows up is a virgin to the sport. Customers are welcome to bring their own food and beer — nearly everybody drinks during play. Stumpy’s profits come primarily from renting out the pits and selling T-shirts in the lobby.
The business began as a second-act career move for the two founding couples: Trish and Mark Oliphant, and Kelly and Stuart Josberger. Previously, Trish worked in merchandise sales for Ralph Lauren, and Mark was a union carpenter; Kelly had been an elementary school principal, and Stuart an IT administrator in the same school district. The two couples docked their boats — named Nauty and Nice — at the same yacht club. Through sailing and drinking, they forged a bond.
One summer night in 2015, after a somewhat boozy grill session at the Josbergers’ house, Mark and Stuart started throwing a hatchet at a stump in the backyard. It looked like fun, so the ladies joined. Then the neighbors did, too. It was good, drunken high jinks, but nothing that seemed especially life changing.
A month later, while drinking a cranberry beer at a local brewery, Trish turned to Mark. “We should open a microbrewery,” she said. Mark laughed. “I only know how to drink beer,” he said.
Trish thought for a moment. “Well, why don’t we do the thing with the hatchets, but do it inside?”
Bull’s-eye. Mark and Trish scribbled a rudimentary business plan on a cocktail napkin and ran it straight to the Josbergers’ house. “What do yous think?” asked Trish, in her thick Jersey accent. They thought it sounded great.
Image Credit: Courtesy of Stumpy’s Hatchet House
Things moved quickly after that. The founding four named the new company after their first target: the stump in the Josbergers’ backyard. They decided they’d keep the rent low by finding an industrial warehouse space off the beaten path — a challenge that proved tricky. The partners looked at eight locations before finding a properly zoned, 4,880-square-foot former boxing studio with a landlord who was amenable to an unholy marriage of booze and flying weapons. They talked to him for two hours before he was convinced that the idea was legit and, more important, that it was less dangerous than boxing.
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Then came the hatchets. They tested about 12 before finding one they loved. Trish used her marketing experience to design apparel, while Mark loaded the bed of his F-150 with lumber and set to building an environment that captured the essence of a tree-lined backyard. He hung New Jersey cedar on the walls and replaced door handles with old axes. He erected throwing pits and fashioned a raw-edge cherry countertop in the lobby. In the meantime, Kelly and Trish pitched the idea to servers and bartenders just to gauge their reactions. “Picture this: a place where you can go and throw hatchets,” they’d say. People loved it.
In April 2016, Stumpy’s Hatchet House opened. Six months after that, it was hosting 400 to 500 customers a week. Another year later, here they are, courting franchise partners. Which is an uncommonly bold strategy for any startup, much less one that started off as a bit of a lark. But they’re committed. “We think this is going to be the next wave in indoor recreation,” says Trish. That might well be true. But like any franchisor with a buzzy idea, they’re going to have to move fast. Because no matter the concept, competition is never far behind.
After Jon and JoyAnn’s private facility tour, they settle around a 12-foot-long table that Mark built to fit the conference room. Out in the pits, the din of success and failure grows louder. For every hatchet that sinks into wood, another crashes to the ground. There are battle cries and taunts, applause and frustrated expletives.
“Franchising was never our intention,” Trish says to JoyAnn, when the latter points out how quickly Stumpy’s is moving. Her bubbly energy makes her a natural spokesperson, and indeed, she takes the lead on most conversations. “But we had so many people asking that we thought, Maybe we should consider this.”
Still, the prospect seemed too daunting. At least until Trish’s sister met a man named Chris Conner at a restaurant trade show in Houston. She was there selling honey; he was representing his firm, Franchise Marketing Systems, a soup-to-nuts consultancy out of Atlanta. But the two wound up talking about Stumpy’s. A hatchet house? What the hell is that? Conner didn’t expect much, but he was curious enough to reach out. “If I’d called and they’d been off-the-wall bonkers, I wouldn’t have been surprised,” he says. “But I’ve met so many crazy entrepreneurs in my life that now I try to withhold judgment until I’ve had a chance to look at the business.”
A phone call to Trish established her sanity, and Conner booked a flight to New Jersey. He drove out to Eatontown hoping to see two things: profits and replicability.
On profits, Stumpy’s was gold. The company was all but printing cash. Each of the eight hatchet-throwing pits accommodates up to 10 customers. The fee to throw is $20 per hour, and most people book two. After factoring in $20 T-shirts and $3 beer coozies, Stumpy’s reports an average spend of $61.64 from its customers. And with no food or expensive merchandise, the company’s overhead is remarkably low. In August, after 16 months in business, it hit $1 million in gross sales.
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But can the business be replicated? That’s harder to assess, and something Conner admits to occasionally getting wrong. His rough yardstick is this: “There should be a pretty good chance that you could teach a regular dude off the street how to run the business.” The best franchises require no technical processes and no specialized workers, he says. “You don’t have to be a chef to open a McDonald’s, nor do you have to be a landscape architect to run a U.S. Lawns franchise. [The corporate office has] made it easy.”
This is perhaps Stumpy’s greatest advantage. The business is nothing if not simple. It literally started on a cocktail napkin, and the founders have stuck to the original plan. They could have installed a kitchen, but instead they tossed some delivery menus on a counter. They could have built a bar, but instead they bought an ice machine so customers could chill whatever beverages they came in with. The business is so easy to run that when the founders interview new hires, they don’t even ask about special skills. They certainly don’t care if you can throw a hatchet. They look at charisma. As Trish likes to say: “You can teach someone to throw a hatchet, but you can’t teach them to have a personality.”
Conner liked what he saw, and the Stumpy’s founders liked him. They began a four-month process of preparing to sell the first franchise. Under Conner’s guidance, Stumpy’s filed all the necessary paperwork and developed business plans, marketing material and training manuals that could be passed on to new buyers. The original website, designed by Kelly, was replaced with a polished professional site that directs budding hatchet enthusiasts to their nearest location.
Surprisingly, Stumpy’s faced no regulatory hurdles. There’s no law against throwing hatchets indoors. But as they wound their way through the process, the founders had to look hard at every program, policy and protocol that defined its daily operations. To franchise is to clone a company, so the underlying DNA must be strong. “A small mistake in franchising gets magnified over and over again,” says Mark Siebert, CEO of iFranchise Group. “It’s growth on steroids.”
Stumpy’s, for instance, had a problem with its targets, which, as you would expect, consistently lose the battle against flying hatchets. Each target is made from seven two-by-sixes, and each week, Stumpy’s goes through 150 to 200. Early on, they were handmade. Mark was cutting and painting boards before customers came in for the day, right in the middle of the hatchet house, and then swapping some of them out between reservations. Each target was a 15-minute job that required an electric drill and serious upper-body strength. Mark, a carpenter, was essentially the only one who could do it. “We’d have people waiting to throw, and I’m over here drilling in screws,” he says. “It was always a rush.”
To make it as a franchise, the system would need to be faster, easier, and scalable. Stumpy’s needed targets that anyone could swap out, first day on the job.
The solution came in two parts. First Mark invented a patent-pending “quick-change target system.” In place of screws, it relies on a set of clamps that pin the boards together at the top and bottom. To demo it to Jon and JoyAnn, he unscrews the clamps with his fingers. All seven boards loosen at once, and in less than 60 seconds, he’s swapped out three planks and retightened the target. “Anybody can do this,” he says. “It requires no special skill, it makes no noise and it accelerates our turnaround time.”
“But where do you manufacture the boards?” JoyAnn asks.
“We bought a warehouse,” says Mark.
That was step two: Stumpy’s built a target factory half an hour away, in Toms River. With the help of four part-time employees, a sound system and a refrigerator full of beer, Mark’s crew can churn out targets by the truckload. “You email us to say you need boards, and we’ll send them,” he says. “They’ll show up at your door on a tractor-trailer, painted and cut.”
They’re not free, of course. The boards will cost each franchisee $5.25 each, plus shipping. But what Stumpy’s is selling here is logistical ease. They’ve simplified the challenges of running the business. What started as a cocktail-napkin idea is starting to look like a scalable turnkey operation — as long as these early partnerships pay off.
For his part, Conner is betting on explosive growth in the coming months. He says a typical franchisor, assuming it starts with a healthy profit strategy and a replicable model, will likely sell somewhere between two and six franchises in its first year. Stumpy’s has already sold three — one in New Jersey and two in Texas. At the rate it’s going, Conner estimates that it will sell a dozen.
“This is such a new concept that I was hesitant about expectations at first,” says Conner. “But I’ve gone from skeptical to really pumped.”
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Image Credit: Courtesy of Stumpy’s Hatchet House
Discovery day’s main event is a PowerPoint presentation that outlines the details of finding real estate, training a staff and preparing to open a new hatchet house. The emphasis is on ease of operation. Stumpy’s corporate will supply the targets, signage, administrative tools like software-loaded tablets and hatchets, which the company buys in bulk at a discount from Home Depot. (It’s still working on a deal with Estwing, the hatchet manufacturer.) Mark will build the custom decor, and Trish is designing a look book to provide a selection of couches, rugs and artwork.
The meeting progresses to the hard sell. “Say you decide to sign a franchise agreement today and give us a check,” says John Naylor, the franchise broker who sat quietly during the presentation. “We’re saying roughly a month to find a location, and as soon as we get that building, we’re going to book training. You guys want January? Let’s plan for January. Let’s plan for December.”
Jon and JoyAnn exchange glances. Naylor continues: “As soon as you guys sign up, you can lock in your territory. We have no one looking at [your area] right now, but at the same time, we have some things coming up with Stumpy’s. It’s busy now, but I just can’t imagine the next couple of months.”
It’s the day’s only hint at what the founders know but can’t share: that they’ve filmed an episode of Shark Tank, which will air a few weeks later (they got the money). It’s clear that the national attention will give the brand a boost, but until the episode is public, the Josbergers and Oliphants are bound to silence about it.
There’s another reason for Naylor’s haste. The hatchet-throwing industry is heating up. Unbeknownst to the founders when they launched Stumpy’s, hatchet throwing has already grown into something of a cottage sport in Canada. The Backyard Axe Throwing League (BATL) launched in Toronto in 2011, and it now boasts 11 locations. “The beginning of 2015 is when we started to see competition popping up,” says Matt Wilson, founder of BATL. “And the past two years have been pretty aggressive.”
In the 18 months since Stumpy’s opened, hatchet-throwing facilities have begun cropping up all over the United States. Some of them focus on league play, others on parties. At least one company, Axe Monkeys, in Las Vegas, which takes a family approach by permitting children and forbidding booze, is also trying to franchise.
“With imitators popping up, it’s about getting to the area first and setting the standard,” says Armando DiRienzo, a Stumpy’s buyer who wrote his purchase check three weeks after meeting the founders last summer. “Stumpy’s provides exactly what you want from these kinds of places.”
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Jon and JoyAnn agree, but three weeks after their discovery day, they’re still weighing the numbers. It’s understandable: In addition to the $30,000 franchise fee, they’d need roughly $350,000 for the build-out, hatchets and targets, marketing and other expenses leading up to opening day, and for the first six months of operation. They’re looking into small-business loans and, since Jon was a military pilot, veteran programs. They’re also waiting on quotes from insurers and researching their local rental market.
What’s more, the first three franchises have yet to secure locations. Two of them spent more than three months searching. Zoning is proving to be a sticking point. Local districts don’t have clear spots for BYOB hatchet houses, so early buyers are finding that they have to appeal to zoning commissioners, which takes time, in an arena where time is of the essence.
“The kiss of death for a new franchise is that you sell to a couple of people and they don’t make money,” says Conner. “That will sink you faster than anything, because now nobody else is going to buy from you.”
For now, though, Stumpy’s is barreling ahead. Including Jon and JoyAnn, they’re courting an investor and a dozen potential franchisees. The Oliphants and Josbergers have the first-mover advantage, and they’re not about to waste it. “We were the first in the space, and also the first to franchise,” Trish Oliphant says. “That’s huge.”