Western Washington residents mindful of their personal fitness and beauty regimens might be familiar with one of Scott Swerland’s many enterprises.
Fifteen years ago, Swerland opened Seattle Sun Tan in Bellevue, expanded the business to nearly three dozen locations amid the Great Recession of 2008, and later acquired rival Desert Sun Tanning. Today, Swerland’s Kirkland-based SST Group either outright owns or has franchised, combined, more than 80 Washington state tanning salons, which employ more than 400 people.
Six years ago, Swerland and his business partner, Joe Beaudry, co-founded Urban Float in Seattle’s Fremont neighborhood. The therapy spa specializes in sensory-deprivation floating and aims to relieve anxiety, pain, and stress, and has grown to include nine locations (some corporate-owned, some franchised) in the United States, including spots in Kirkland, Renton, and Seattle. Locally, the company employs nearly two dozen people.
Urban Float made local headlines this spring, when Swerland and Beaudry appeared on an episode of ABC’s Shark Tank. Though the pair initially inked a half-million-dollar deal with “shark” Matt Higgins, the agreement didn’t materialize following the post-show due diligence process (though Higgins still offers business advice).
Swerland’s latest venture, TruFusion, is a fitness studio offering 65 styles of high-temperature, high-energy workouts that tap into yoga, barre, boxing, battle-ropes, and more, and up to 240 classes per week. The company’s investors include Seattle Seahawks quarterback Russell Wilson and former Seattle Mariner turned ESPN baseball analyst Alex Rodriguez. The first TruFusion opened in Bellevue’s Lincoln Square South in March.
Swerland is the company’s CEO, and his business partner, Taryn Naidu, is the president. The pair, along with an owernship group of local executives, acquired the exclusive rights to open TruFusion locations throughout Washington state.
Swerland glimpsed the entrepreneurial life at an early age. His grandfather, Jay Jacobs, was the eponymous founder of a clothing store that started in Seattle in 1941, expanded to include nearly 300 stores in the Western United States by the late 1980s, but eventually declared bankruptcy and closed its last store a decade later. Jacobs died in 2012 at age 101.
Swerland, 48, spoke with 425 Business about the ins and outs of appearing on prime-time television, doubling down on business opportunities during a historic economic downturn, and the influence his late grandfather had on his business career.
Urban Float appeared on ‘Shark Tank’ in March. Did you watch the episode?
I did. I wanted to be in my bedroom with the door locked and watching it by myself. But friends and family were like, that’s not happening.
A good buddy of mine invited 70 people over to watch it. I didn’t like watching it (on TV because) I was nervous, I blinked too much, and I could see all those imperfections. But everyone was super-supportive.
What was it like to film the episode?
We were there for 50 minutes, and the producers cut it down to 10 minutes. Our pitch was only 90 seconds, and it was super-nerve-wracking.
We filmed that in June of 2018, but I could not say a word. I had a gag order. For me, that was really hard. No one knew we were on the show until two weeks prior to airing.
Also, you never know if you are going to air. It goes from 46,000 contestants or applications to 124 filmed, to 96 aired. We were just hoping we weren’t among the contestants who were cut.
What’s more valuable to a business entrepreneur: Making a deal with one of the sharks? Or just the exposure of being on the show?
If you were to pay to be in front of 8 million to 10 million viewers during primetime, it would be millions of dollars.
Our thing really wasn’t about getting a deal.
We wanted to share all the positive physical health benefits of floating in 200 gallons of water with 1,200 pounds of Epsom salt. That’s really why we went on the show — to share with the world that there are other alternatives. If you are anxious, go take a float. Professional athletes, emergency room doctors, CEOs, line workers, you name it — those are our customers, and most all of them are doing it for pain, anxiety, and stress relief.
You expanded the number of tanning salons during the recession of 2008. You didn’t see that as a period when people would try to save money and forgo tanning salons?
A: I saw it as people still want to look good and feel good. More people were going to staycation. Maybe they couldn’t go spend $5,000 on a vacation in Hawaii. They might go tanning instead. People did that in droves. I just thought, “Let’s turn the lemons into lemonade.”
Did your grandfather, Jay Jacobs, influence your career?
A: Absolutely. I started working for him when I was 8 years old — sweeping the sidewalk (outside the store) on Fifth Avenue and Pine Street (in downtown Seattle). When I was 12, I put tickets on the clothing. When I was 16, I loaded a 24-foot Ryder truck and took off for Kalispell, Montana, by myself to build a Jay Jacobs store that summer.
He was a hell of a guy who would always challenge me. My grandpa told me, “If you want to make more than minimum wage, start your own business. You are never going to make more than minimum wage working for me. You aren’t going to get any handouts. No way, no how.” He was teaching me all the skills that I have today.
After more than 50 years in operation, Jay Jacobs retail clothing stores went out of business in 1999. Did your grandfather’s experience serve as a cautionary tale for you?
A: His sole asset was Jay Jacobs. I learned to spread my risk into different asset classes and different businesses. But I don’t know if that’s necessarily because I’ve got to spread the risk, or because I love the action and the energy of starting (new businesses). But something I learned from him, definitely, was to spread your risk into different asset classes.
The first local TruFusion location opened in Bellevue this spring. It’s my understanding it cost $3.5 million to build out THE space. True?
A: We did not expect that our build-out was going to be $3.5 million. The most expensive TruFusion ever built was, like, $1.6 million. But we said, “Let’s do it. We are in. Let’s go.”
Bellevue is begging for this product. We already had hundreds of paying members signed up before we opened the doors. We hope to have three-, four-, five-thousand members pretty quickly.
Retail is tough, and there’s a lot of space out there left by the Toys ‘R’ Us stores of the world. We bring constant users in this great demographic, and landlords love it.
What’s next for you and TruFusion?
A: Our goal is to have three locations — Lincoln Square South, Totem Lake Village, and Ballard Blocks — by the end of 2019. And then we are going to take a nap, a breather, I hope, because it’s a lot of work.