Franchise QB

Episode 35: Todd Houghton, Brand President of Homewatch Caregivers and Authority Brands

• Mike Halpern

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In this episode of the Franchise QB Podcast, host Mike Halpern interviews Todd Houghton, Brand President of Homewatch Caregivers and Authority Brands. 

Todd shares insights into the franchise industry, the unique approach of Homewatch Caregivers, and the impact of their technology solutions. 

The conversation covers the franchise opportunity, revenue streams, ideal candidates, and the growth of Homewatch Caregivers.

Takeaways

Homewatch Caregivers offers a unique franchise opportunity with a focus on person-centered care and innovative technology solutions.

The ideal candidate for a Homewatch Caregivers franchise is mission-driven, passionate about caregiving, and willing to invest in a 24/7 business model.

The growth and success of Homewatch Caregivers demonstrate the potential for a profitable and impactful franchise ownership experience.

The use of technology, such as HomeWatch Connect, has revolutionized the caregiving industry and provided new revenue streams for franchise owners.

https://www.homewatchcaregivers.com/franchising/

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Mike Halpern, CAFC
mike@franchiseqb.com

This is the Franchise QB Podcast, where we empower entrepreneurs to win big in franchising. We huddle up weekly to educate our audience about the most successful small business model ever created. Franchise it! Welcome to the Franchise QB podcast. I'm your host, Mike Halpern, a 20 year industry veteran and entrepreneur. My mission is for listeners to achieve their American dreams of creating wealth and independence through franchise ownership. Every week we speak with franchisees, franchisors or vendors that support the industry. Thank you for joining us and let's get started. Joining us in the huddle today is Todd Houghton. Brand President with Homewatch Caregivers and Authority Brands. Welcome to the show. Thanks Mike, I appreciate you having me today. Absolutely. So let's talk a little bit about your background. You joined Homewatch Caregivers as brand president in November of 22. You have 20 plus years of franchise experience with franchise brands that are household names like Goddard School and Camp Bow Wow. You spent several years in the home care sector with Bright Star and Comfort Keepers. Now as Brand President with Homewatch, your focus is on brand growth, quality of care, and technological advancements, just to name a few. So let's, before we go into Homewatch, tell us a little bit about the Todd Houghton story. How did you get into franchising? Yeah. Well, I got into franchising with my family, literally in the seventh grade. We started buying into a chain of cookie stores at the time and growing that in the Midwest. And then when I got ready to graduate college, decision of, you know, where do I want to go? What do I want to do? I didn't want to do that. So I moved over to the franchise or side. And that's really where my career started on the franchise or side, dabbled back into the franchisee side here and there just to have that little entrepreneurship closeness that I like to have. But grew through, as you said, quite a few household name brands and then came into the home care space about 12 years ago. with Comfort Keepers initially and really saw the passion twofold. One is I'm all about the entrepreneurship side, as I said, and working with people that want to get into business ownership through franchising. Big proponent, that's the best way to do it. So that's my first priority in life, in my career. Second part is in home care, specifically what we do to change the quality of life for people is phenomenal. So when I got into it, I'm like, yes, this is it. And then - You found your place. about a year and a half ago, almost two years ago already, came over to Homewatch and really focusing on, we've been around for 42, 43 years. What are we gonna do to be around for another 42, 50, 60 years, right? So, and really making sure that we focus on how we are going to stand up against technology changes, how we're going to really focus on successful growth for our franchisees. Yeah, that sounds awesome. Not a lot of people I interviewed started, in franchising in the seventh grade. So that's really cool that your family was part of the business. And, you know, a lot of people find out about franchising in their twenties or thirties. So the fact that you were aware of it as a teenager is pretty, pretty great. It was phenomenal. I have to thank my father for that, but it was, it was a great experience, right? I mean, yeah, exactly. Yeah. And also it's kind of great that you guys are with Authority Brands because I'm very familiar with their model and their brands and all the support. that the brands within their portfolio receive. So that's really cool. So let's start at the beginning. What is HomeWatch Caregivers? It seems intuitive, but I'd like to hear from your perspective. What does HomeWatch Caregivers do? So we are a home care franchise provider. We run a full solution of service lines from early needs all the way through advanced care for people to age at home, wherever home might be for them. We have locations across the United States and throughout Central America. I'm sure we'll talk a little bit more about that in a few minutes. But we're really focused on how are we the leader in providing the best quality care through a franchising model. Very cool. So something that seems unique to the HomeWatch model is something that you guys call total care solutions approach. What is that approach to caregiving? Yeah. So... We really, we just evolved into this as I came onto the company and really looking out into the future, right? And we understand through our customer journey when people typically would come into care and how long they stay. So one of the things we needed to look at is how do we get them earlier? How do we keep them longer? Which is not only providing that quality, outstanding care to them and giving them what they need, but it also makes our franchisees more profitable because they have higher revenue growth through our items. So. The total care solutions umbrella was bringing all of our service lines into one place, focusing on that early care called active care and allowing that client to grow through their journey of aging, right? So they can move from active care, which is tech forward, to our wellness care, which is really focused on companionship, but getting them out to events, helping them to their silver sneakers class, things like that. Personal care where they may need a little more hands -on. and day -to -day assistance with activity of daily living, and then growing through specialized care, which focuses on chronic illnesses, COPD, diabetes, dementia, through skilled care and providing them some, maybe some needed skilled care to keep them at home. So that's where Total Care Solutions comes in to provide a different service line for every step of their journey that they're going through. Yeah, because a lot of people don't think about it as there's this huge... range of age that the service is needed. But, you know, for me personally, my mom is in her seventies and she just had knee replacement surgery. So someone has to help her. My brother and I did our part, but, you know, having in home care has been invaluable. So, you know, it's temporary, but it kind of got us in the game. And now we're like, okay, let's kind of keep our eye on the ball so that mom has, she's comfortable as she ages. Right. And I think that's what everybody wants for their family. And I will interject there too. And we are more than just the senior care scope too, right? So about two thirds of our business does come from that 65 plus. Another third comes from people under the age of 65 that may be living with a chronic illness or recouping from some sort of surgery or dealing with a mental health illness. So we do have a large spectrum of aged people that get our services. Yeah, thanks for the clarification. So I'm excited to talk about this new technology that you guys have launched. It's called HomeWatch Connect. So explain to us, what is HomeWatch Connect? How does it help families utilizing the technology? And how does the franchise owner provide a benefit from the service? Yeah, absolutely. Thanks for asking that. It's a very exciting piece that we've come into. So one of my passions over the last many years is how do we bring more technology into the point of care to focus on keeping people connected and engaged and the ability to monitor them as well. So we brought to market, we did our pilots last year brought to market earlier this year, our HomeWatch Connect. It's a, the first piece or first two pieces, one is a smart camera device that interacts through the television. So who doesn't know how to use their TV? Who doesn't know how to use a remote control? So it makes perfect sense to integrate it into the TV. If it, lives behind whatever they're watching on television. It's a secure closed network. So it's much safer than using a smartphone that has capabilities to connect that way or other sorts of apps that are out there, right? This is a mom and dad aren't going to get spam calls through your closed system. They are not. You're spot on, right? And we don't want to have to deal with that. So we set out to look at like what were some of the things we're trying to solve. One is, you know, Two thirds, I'm sorry, 50 % of the world suffers from loneliness and isolation. That's the biggest contribution to suicide. The numbers even go higher on people 65 or older. So we wanted to understand how do we get them engaged and keep them monitored and keep them at home. So the technology allows for that client to be connected with their family, with their friends, with their local HomeWatch caregiver office. with any of their providers, so their doctors or nurses, things like that, that they can be connected to on a day -to -day basis as they need. So that was the most critical component, right? That helps keep them at home in that safe environment. Another opportunity was that adult child, or we call it the care influencer, they live more than, the majority of them live more than 60 miles away, so they can't be there all the time. So they want peace of mind. So this provides that safe environment to keep them connected and be able to view mom or dad or understand what's going on in the life of mom and dad. And then that last piece, well not the last piece, but the third piece is we had to figure out how to improve our efficiencies of caregivers. We need about 2 .5 million more caregivers, not just at Homewatch, but in general in the next five years. So we had to figure out how to improve efficiencies. So what this allows for is the ability to be connected 24 seven. and provide opportunity for some services when a caregiver can't be in the home. So we can improve the efficiencies of caregiving that way as well. And at the end of the day, all of this helps to drive more profit for our franchise owners because it ends up being a higher margin item as we - Yeah, and I read, I watched the video to learn about and educate myself and it has a lot of really interesting applications such as - You know, distributing medications as to when that takes place with reminders, appointment reminders, wellness activities, you know, dashboards that monitor things in the home, like humidity, motion, temperature, just really cool stuff that I'm sure that the influencers and the, you know, the seniors really enjoy. Absolutely. You're spot on. It really does help with, you know, touching base on that, like the reminders that can be on there so they can get their. their daily reminders to pop up on the TV screen. Everything from take a medication or you have a lunch date today at this time. Like all of that can be integrated into the system as well. So they get those reminders right on the TV. It's pretty cool stuff to be able to do that for that aging population and they can really be connected and feeling like life is much easier for them. Yeah. And I was talking to Jenna Parisi who connected us and... She was mentioning the price point, which is really affordable. Cause when you think of the technology and the monitoring service, you think, well, is this cost prohibitive? And she kind of explained that it's pretty affordable. So I think that's very affordable. Important to make it scalable. It's very affordable. And so that does make it very scalable as well. And, and as we look at, as we look at home or care coming back to the home, it's a big component to, to help agent home safely and with dignity as well. So that's what we're excited about. Yeah, I think if it's executed properly, it's a game changer. It's a big differentiator for your brand and a crowded space. So that's really cool. So let's kind of switch gears. Now, go ahead. No, I was just going to add in there real quick, Mike. I just came off of a home care innovation conference last week as well. And so we're about 12 to 18 months ahead of a lot of other home care comes with the technology piece, but everybody's trying to work on something to figure it out. And I think like, you know, it's great that we're leading that path, if you will. and doing it because that's the way care is going to be delivered as we move into the future. Yeah, yeah. And I could see for the franchise owner to be able to rely on less caregiver labor is really beneficial and really helps. The care, the people receiving care don't necessarily want someone in their house 24 seven. So to be able to kind of defray some of that with the technology, I think is kind of a win win. So let's talk about. switch gears and talk about the franchise opportunity overall. You know, what makes Homewatch Caregiver is a great franchise opportunity in your view. I think, you know, first, let's look at how long we've been in business. So we've been around for 40 plus years at this point. Been franchising, been franchising for about 40 of the 40 plus years. We've got a proven model, you know, and that's what's important in franchising is you want something that's proven and that's, you know, been repeated over and over again. So I think that is one of the big things. The other thing is we take a different approach. So our total care solutions, our Home Much Connect is all part of our person-centered care approach that we have. Home care in general has always been dollars per hour per hour of service and people are unique. They don't all fit into that same box. So we're different in the fact that we want to be able to customize and create the appropriate care plans for each person that comes into care, but that also drives. different revenue levels for our franchisees that are part of our system. So that's one of the exciting things about that. We do uniquely have a proprietary practice management platform. Some people refer to it as an ERM as well, but we call that Care Plus. That's been developed for us, which really helps us collect data, which is critical for us to go to payers sources on behalf of our franchisees and talk about. our outcomes through the data that supports it and be able to get better reimbursement rates and things like that. The other piece is really around our technology advancements. So our, you know, obviously our HomeWatch Connect, with ABE behind us, we've really been afforded the opportunity to move quickly, to bring some of these technology solutions to market, which really differentiates us from others in the market and their ability to do that. We also have our own LMS platform, called the Homewatch Caregiver University, which we really put a big emphasis on the training of our caregivers, getting them certified in different specialties, chronic illnesses, things like that, that really can differentiate us as well. And then really just how we focus on our client acquisition and the time from inquire to getting them into service. So we can do that much quicker now as well with our technology. So they're in some sort of service almost upon the end of the call. Right. That's awesome. So those aren't just some of the points that really separate us from some of the other people out there. Yeah. Thanks for sharing that with us. So let's talk about revenue streams. How does a Homewatch caregivers franchise owner generate revenue? Like I'm sure there's a few different tentacles out there, but what's kind of the primary few that they rely on? Yeah. I think, you know, so in our model, the primary model is when there's direct care going on in the home. That's the good driver. That's one of our caregivers in there. We have our technology now that's part of another revenue driver. And then we do a virtual care as well through our technology. So that's another revenue driver as well. So those are the three big components that help drive revenue for our franchisees. Yeah, very cool. Yeah. And it's just a great model in that aspect. And the in -home, the direct care is the one that does cost the most for... our franchise owners because of the labor, right? And then as we look at our virtual care, our technology that really helps drive their margins. The unique thing that we do moving forward too is under Total Care Solutions is our franchisees bundle all of that into a person -centered price for a client. So as I mentioned earlier, as opposed to dollars per hour, it's really about these are the service offerings that you're going to get. So presenting that value to the client as well. Very cool. Thanks. So what does a new franchisee joins the Home Watch Caregiver system? What's their team look like when they launch the business? What are the number of people and what seats are they sitting in to kind of get this thing off the ground? Great question. So one thing that is unique with us is we are the franchise support center. We're not a corporate office. Everybody within the franchise support center has some sort of supportive role that they're giving to our franchisees. So that's That's just a critical component of how we operate. But from the day somebody signs a franchise agreement with us, they're assigned to an onboarding manager. The onboarding manager is their concierge, if you will, helps them through every step from where they need to get licenses, because a lot of states do require a licensure. They help them work through that. They help them with all their pre -opening requirements through all the systems processes that we have and through our, we call it our map. to some market action plan, their business implementation plan, different things that they have to go through, that onboarding team helps them with that. And as I mentioned, they're also the concierge. So if they need more support in marketing or looking how to hire, we have our marketing team. And we have probably about 80 people through our shared services that work on our marketing team for us. And we have our workforce solutions team, which really helps with that educating on. How do you establish your culture? How do you go to market to hire? How do you focus on retention? We have our growth team that really helps on the training and development of sales skills, how to go out and work with your referral sources, how to go into that hospital. Also, we have our care delivery and quality team that focuses on how do you start to develop the person -centered care plans, getting that comfort level to go into a home, do an in -home evaluation. I remember when I started in the business, one of the first days, like, here, you're going to go out and do this as part of your training. I'm like, if you're going into someone's home, I was scared to death. So we have a team that helps with that. We call it our vendor relations team, but really what that team does is focuses on those relationships with the third party payer sources. So like the VA, other third party lead generation companies that are out there, and backup care companies and insurance companies, all of that. is done through that. Then we have our, once they are open and they graduate from our onboarding team, they move over to our business operations team and then they're assigned a business operations manager. And the business operations managers, again, are their point of contact, really help them on a day -to -day basis, but also work with those additional companies within the, or companies, I'm sorry, people within the support center that they need for marketing or whatever it might be. But the business operations manager really focuses on doing financial reviews, making sure that they're doing well and they're being successful, meeting the goals they want to meet to just day -to -day pieces. And in franchising in general, a franchisee often feels like they're alone and we always want to make sure that they don't feel like they're alone. We have so many people on our team that can help them throughout the day and help be a mentor if that's what they need. Yeah, it sounds it sounds like there's like a ton of support, you know on the onboarding the training the launch If I'm an owner like what is my payroll look like to kind of get this going? Who do I need in the right seats to kind of? From the from the onset we do have a two-person FTE requirement In in the office and one is really focused on the the operations aspect The other one is focused on that community relations, the sales, building the referral sources. That's the intent from the early onset when franchise agreements signed. Once you get closer to opening, you're gonna start bringing in caregivers. So we have a best practice of having 15 caregivers lined up when you're ready to open. Now, caregivers aren't necessarily on payroll until you start servicing clients and then they come on to you, right? So do you have a recommendation for like, Is the owner better to be the sales and business development and referral builder or are they better to be the operations implementer customer service side or does it not matter as long as they fill one of those roles? I always have two parts on that, right? One is I would say higher to your shortcomings. So if you're better at operations, do operations. If you're better sales sales, but then on the other side of it, I always say on the sales side early on, it's your business. You're going to be the most passionate about being out there and being engaging in selling. So. I always prefer to see the owner on the sales side, but if you're not good at it, understand that and get somebody to do it for you. That's how you're going to be successful. Okay. That's good advice. So, who is the ideal candidate to become a Homewatch Caregivers franchise owner? I'm sure there's gotta be an element, like for me, when I'm presenting different concepts to candidates, and I hear someone say, I really want to give back to the community. I want to help people. My mind goes right to some type of caregiving. And it sounds like that works. Obviously you want business people that know how to run a business, but from your perspective, who's an ideal candidate to join the team? Yeah. I mean, you're spot on there, Mike, right? So the first thing is like, are they mission and passion driven? Right. Because we are, we're providing a very personal type of service and you have to be passionate about that and you have to be mission driven about it. We're not making sandwiches. I'm just in all honesty, you know, we're, we're changing lives. So, that's, that's the, the. Key element, second one is really having them understand it is a 24 seven business. Not to say that they're in an office 24 seven, but you know, things can go wrong in the middle of the night. If you have caregivers out in the home and you know, early on, typically it's the owner that is, is handling those things until you get to a certain point where you obviously you can have your staff, you grow your staff to do that. But early on, they just have to be aware of that. And then really like driven, right? You want somebody who has got. lofty goals who wants to have a better quality of life through franchising and franchise ownership and really understanding that it's going to be hard in the beginning, but the rewards that come if you follow the system and do the right thing are tremendous. I mean, uniquely in the home care space and home watch caregivers is that investment is relatively reasonable for the return that you're going to get in the long run as opposed to. I don't mean to pick on my sandwich friends, but you know, you're like, you know, half a million or a million dollars to get into a sandwich business. Right. And so, I was talking to a friend of mine earlier today who I haven't spoken with in a while. He's about to open his 12th Dunkin donuts in California. And we had the same conversation. I was saying, you know, there's a lot of really interesting, you know, service concepts where for one of those Dunkins, you can own a market. And he's like, yeah, with the cost of labor and minimum wage where it is, he's like, let's talk. Yeah. Yeah. It's true. So, you mentioned you guys have been around 40 plus years. So, you're pretty mature in the space. So, how many franchise owners are currently open or, you know, signed but onboarding? What's that look like in terms of the geographic reach and all that? Yeah. So, right now we're actually in 33 states across the United States with 230 plus locations. And then we're throughout Central America and a little bit into South America at this point. And we have... 14 locations operating down in Central and South America as well. So continue to focus on our growth. We have pulled back a little bit on our international growth. We want to really focus on the US and filling what we call the white space in the US because we have so many people that are aging turning 65 every day that the opportunity that exists just here in the States is phenomenal. And we want to be able to grow that. footprint and be able to service more people so they can live at home. But yeah, you mentioned. Yeah, you mentioned to me in the green room that you employ over 15 ,000 caregivers. I mean, that's an astronomical amount of caregivers in just your system. So you must have some pretty big businesses. I'm imagining that you come into this space and you have enough geography and you scale it. You can build a pretty big business. Is that the case with some of your owners that have been in it for a while? Absolutely. Absolutely is. I mean, you. You know, really, it's really you set your own destination in our business. The way we create our territories are such that we look at senior counts along with population and household income. But it's really about, you know, where do you want to go with your business when you come in? So, you know, right out of our item 19, last year we finished at 2 .2 million average revenue per unit, which is phenomenal growth from the year before. You know, this year we are experiencing tremendous growth again in our same store. unit growth, which is, which, you know, we're, we're exceeding the industry average by about four times right now for this year. Wow. That's impressive. Well, yeah. I mean, you jumped ahead to the FPRs, which is really great 2 .2. and the item seven, I might have numbers from the previous FDD, but I'm seeing a total investment between 92 and 154. Is that relatively consistent? It's, it's pretty consistent. It's more, we've got it listed now at 95 to 160, but. Okay. But still under 200K and you have an AUD of over 2 million. That's a pretty interesting. And that's for an owner operated as well. I was just to say that, right? In case somebody is ever looking for passive and be absentee, it's obviously going to be higher if they're looking at doing that just because they're going to. Yeah. And your item 19 also has a lot of interesting detail that some brands don't have. It shows average franchisee revenues, caregiver wage as a percentage of that revenue. average client service hours per month and a detailed snapshot of benchmark data. So that's a pretty robust item 19 that I think paints a picture. And then obviously when, you know, candidates talk to you owners, they'll be able to fill in the blanks. Absolutely. Yeah. Yeah. And you know, we're big on that. Like when candidates are looking like the validation process really is where it's going to uncover a lot of things as well. you know, they can, they, they have the item 19, if they're a candidate, they can look at it, but they're always free to ask any questions they want when they're validating. Yeah, absolutely. Well, this has been great, Todd. I appreciate you sharing all this information about Homewatch with us. Anything else you'd like to share today before we wrap up? I just appreciate you hosting me today, Mike, and for people that are out there looking for a passion, mission -driven business, Homewatch Caregivers is the one they should be looking at. Awesome. Well, I really appreciated it. Todd, if anyone listening would like to connect with Todd and his team to discuss Homewatch Caregivers, contact me at franchiseQB .com or on Twitter at QB franchiseQB. I'll get you guys connected. Thanks Todd so much for taking the time to get in the huddle and speak with us about Homewatch Caregivers. Yeah, thanks again, Mike. I appreciate it. Absolutely. Thank you for listening to the Franchise QB podcast where you're at the helm of your future as a franchise owner. If you enjoyed the content, please rate the show and recommend it to anyone that might be interested in franchising. Make sure to visit FranchiseQB.com to subscribe to my newsletter and for an actionable playbook to go from walk-on to legend in your new business. Follow us on Twitter @QBFranchiseQB and join us every week for a new episode. See you next time. Visit FranchiseQB.com to take the next step of your journey towards wealth, independence, and franchise ownership. And remember, when working for the man gets old, you must do something bold. Thank you for listening.