#4 :: To Parent Is To Pivot, with Devina Bhojwani - IDEA Lab Kids

Hands up if your job description during COVID-19 suddenly expanded to include assistant teacher and daytime entertainer for your children? As most families found themselves all together at home in the springtime, the big question became, how are we going to make this work? IDEA Lab Kids co-owner and president, Devina Bhojwani talks about what this time has been like as not only a parent, but also as the franchisor of one of the fastest growing educational enrichment companies in North America. 

IDEA Lab Kids: https://www.idealabkids.com/

Recorded on 11.5.2020

TRANSCRIPT

[Music & Intro] 

Laurie Pillow: Welcome to the 100 CEO Project Podcast

We're super excited to be talking with Devina Bhojwani today. She is the former CEO of IDEA Lab Kids. She's the co-owner and now president. For those of you who don't know -and for those of you who are parents you need to know- we're talking about IDEA Lab Kids. It's an educational enrichment franchise founded in 2011. In 2017, it started franchising and now has globally 87 campuses. The cool part is that it offers learning opportunities in science, technology, engineering, arts, and mathematics, otherwise known as STEAM activities. Devina, thank you so much for sharing your time with us today.

Devina Bhojwani: Thank you for that great introduction, Laurie. You said it so well, about, you know, our journey with IDEA Lab and a little history on our company so I'm excited to be here with both of you.

LP: Cool. So as I understand you've come to IDEA Lab Kids, honestly, if you will, with a background in leadership, an MBA from Rice. 

2:20

DB: Also, having been a leader with the play and music centers, so you have a lot of experience and passion around education. What we’re interested in today, just to start it off, is the pivot that you were able to make quickly around COVID when everybody got stuck at home with their children, to be able to provide opportunities for parents who are basically desperate, wondering, how do I keep my child in an environment where they're both having fun and learning? Can you talk to us real quick about that pivot that you made?

DB: Yeah, yeah, absolutely. So on March 13, all of a sudden, we were all thrown into this frenzy where everybody had stay home orders, right? I live here locally in Texas. And literally overnight, we were home with our kids. I ended up working from home, my husband ended up working from home, and all our franchisees, who were having a great start to the year suddenly were not able to see any of their kids. So the first thing I will tell you is that, you know, it did pause everybody, where people were at different stages of grief, it almost felt like where they were like, how do I get out of this? Like, what do I do to open my centers? So one thing that did help us is we are licensed as a daycare because we do provide after-school care at our centers. So we have that licensing. So we were allowed to be open even during the pandemic. And we could offer care to families of essential workers at that time. So that was really, you know, one, silver lining, if you will, even though our locations, were seeing two or three kids on, you know, any given week, which was very, very little, but at least they were helping out the community, you know, they were able to step in and offer care to the workers who had to go into work, who didn’t have choices like me and my husband to stay home and work from home. Right. So that was one first pivot. 

Our second pivot was we suddenly realized that all of our lessons, which are mostly like science experiments, engineering classes, that we've done at our brick and mortar stores, we could take these experiments and offer it to families sitting at home. So just like you said, you know, you were sitting at home with your child, and you're like, What do I do? So we went on Facebook, we did Facebook Live videos, we did Instagram videos, and in our little world, they went viral for us. So we got 5000 views, we had families sharing them on. And these were experiments with things that you could find around the house: baking soda, little cups, we made a robot out of cardboard, you know, but Amazon boxes which we all have sitting around at home. So that really showed us that you know, there is a need and demand for families who are at home and stuck and looking for creative things to do with their child. 

And lastly, you know, when schools did start thinking about being open, they offered - in different states it varied - but in some states they were offering face to face or virtual or a hybrid schedule, you know, which is what we've seen in these last several months. So we also rolled out a program called IDEA Lab Plus, which is essentially a small mini learning pod for these children. So families who were not yet ready to send their child to school could come to an IDEA Lab center, and they can even today. And we put, we have six rooms at our facility. So we converted each room to a learning pod. And we put the children in small groups of six to eight children per room, temperatures at the door, masks at the facility, you know, all the new things that have become ‘new normal’ for all of us. And this program, I will tell you is something that has really helped the franchisees and the communities, you know, I was just talking to a franchisee last week, who's at capacity, they've got 45 kids in their facility. And they were like, we wish we had another center, because there's so much demand, and then in the Charlotte market, and there's so much demand there that they that, you know, they were all honestly wishing they had the rights to open a second location. And they were saying we wish we would have opened it last year. So that's that's kind of been, you know, from a franchisee's perspective, that's, that's kind of been the big pivot for us. The introduction of this IDEA Lab Plus program, which has taken us out of a need, you know, it's taken us to a level that we would not have thought or imagined.

6:23

Andrea Spirov: I can't even imagine what it would be like to start receiving all these calls from my franchisees saying, We have no money coming in. What were those conversations like? How did you deal with that in the moment when that first happened? 

DB: Yeah, great question. You know, we, initially we empathized with them. And our first question was, what can we do to help them? So we rolled out a webinar, we almost were doing a webinar on a weekly basis, where we offered them support in terms of the PPP loan, you know, the little information that we could get from our CPAs, or from our own network of families, you know, we would get people coming into these webinars to talk about that. We did a webinar on how to renegotiate with your landlord, you know, where you are in that brick and mortar facility, you're paying that rent, regardless of whether you've seen zero kids, or you've seen 40 kids and you know, to be honest with you, that is a fixed cost in any brick and mortar business. So that really helped a lot of franchisees in varying market, they negotiated in different ways. Some got rent abatement, some got complete waivers of rent, some got time added to the end of their lease, which franchisees took. They said, ok, if you give me three months, and then add it to the end of my five year term with my landlord, I totally will take that. And then the other last thing that we did from our side was we offered them a waiver of royalty as well for a few months. So that kind of really, you know, helped them and they were really amazed and appreciative of that. We waived the technology fee and the royalties, it was the least we could do to help everyone sustain through these tough times.

AS: You mentioned you had some silver linings that came out of this, and how were you rewarded by those actions that you took that really sound, I mean, remarkably wonderful for franchisees?

DB: The one thing I'll share with the two of you is a little bit of history on where our company was before COVID. Last year, we started looking for investment in our firm, and we reached the stage where we were growing. We had a lot of organic growth. You know, you mentioned earlier, we have about 87 locations right now. And we grew really fast in a short time of three years, we kind of hit these milestones that we were not expecting to. We've been receiving calls, oh, I went to an IDEA Lab location. I love this brand. Like how do I bring it to my market. So all the right steps, but what came with that on the franchisor end was we needed funding. So we said, okay, let's go fundraise. And we started that journey internally for us last year in December. And when COVID hit, we were in the process of talking to our top three prospects who were looking at putting an investment into the firm. Of course, needless to say, you know, a couple of them just got cold feet given the environment and they saw that the franchisees for a few months there we're not we're not even making any revenue at all, you know, they were just really doing a community give back by just being open for the families that were essential care workers. So we lost a couple of those people but one of our huge silver linings was in July of this year we did get a majority investor out of California, Cynthia made a large significant investment in our firm and, to me, that was the one big silver lining that came out of this. Because who would have thought, you know, you enter COVID, recession and all sorts of other craziness that's happening in 2020. And you know, we ended up getting a large investor in the firm. 

Our second thing that I mentioned earlier was the launch of this IDEA Lab Plus program. It took a while to explain to franchisees how this program would work. Because typically in the past, we've been such a heavily after school driven type of facility, our centers have bus vans or buses that go into the schools and pick up children and bring them to the facility. And our usual hours of operation are from two to seven in the evening. And we have those enrichment, classes, coding, cooking, you know, robotics, things like that. So we had never been a program that was open in the daytime. So this was, firstly something new, which we had to train our franchisees on, okay, we're going to be open in the morning hours, we're going to offer remote learning support so that kids that come to your facility will come in with their laptops, will log into their classes, and you know, you will need to have somebody there who's going to be able to coach them or guide them through those lessons. Some of our centers, the one that I mentioned that has about 40 kids, they've got rooms broken out by grades. So they have a kindergarten room, they have a first grade room, third grade room, sixth, all the way through sixth grade. And the reason I mentioned that is because the support that's needed for a kindergartner is way different than the support that's needed for a sixth grader. And what they do after their lessons or during their enrichment time is that they then get a chance to do IDEA Lab activities so that we will do a science project with them. The kids that come to us, you know, we had one story that we had a franchisee share with us recently, over Halloween, we did STEAM-o-ween, which was just a small Halloween, indoor Halloween parade and a party for the kids. So one child who was attending this party told the other “I come here every day. And this child goes to the owner and says, “Why is he saying he comes here every day?” And she's like, “Well, that's because he does” so then he goes back and tells the child, “Do you go to IDEA Lab school?” It's these little stories that warm our hearts that you know, we rolled out something to help the communities. And now these little kids are calling it IDEA Lab School, which is amazing. 

12:36

AS: It's really fun. My son had it with his old school, I think I was sharing with you last time we talked. And he did science lab and he did it two years in a row because he had so much fun. So I can definitely, definitely see kids wanting to do those activities all the time. And I'm interested in, owning a franchise is kind of a special type of entrepreneurship. And you've been on both sides of it. You've been a franchise owner at Play and Music, and now you're on the franchisor side. What do you see as some of the differences between becoming a franchisee or starting from scratch as an entrepreneur? And what are the positives and negatives of that?

DB: Yeah, great question. So I ran my own Gymboree Play and Music center for eight years. And in those eight years, I operated four locations here locally in Houston, Texas. I grew one of my centers to be the top performing in the nation. For me, it was a big leap of faith. When I went into franchise ownership, I'd never owned the business. I worked for 10 years in corporate America, done the financial planning, forecasting, you know, all the checkboxes after your MBA, all those roles. And then I had my first child in 2010. And that made me take a step back and kind of think about where I really wanted to go with my own career. And that launched the journey into small business ownership. But as a franchisee you know, you wear multiple hats, because even though it's a franchise, you really are the marketing person, you're using the tools given to you from franchisor and doing marketing in your local areas. You end up being the operations person because you're trying to figure out the customer has to get the best experience from the moment they walk in the door to attend the classes. And then lastly, you also are responsible for all the numbers, right, at the end of the day, the financial performance of that center falls on you. So as a franchisee I think that that was one key for me was you know, wearing these multiple hats and being comfortable switching and pivoting myself to all these different roles. I didn't have experience in marketing, but suddenly I became a marketer. And then as a franchisor I think the big thing for me is I am able to empathize with what our franchisees feel and what they go through. And that empathy has really helped me in this role. IDEA Lab for me came onto my plate in 2017 as a passive investment. It was a franchise that was growing, you know, and there was an opportunity to invest in the firm. And at that point, I thought, Okay, this will be great. I've done franchising, I still owned my own centers at that point. And then as I sold my centers in 2019, that's when I stepped in here to IDEA Lab into a more active role. And honestly, I've loved it, you know, I wouldn't change a thing, you know, as they say, you go through things in your journey for a reason. And that's kind of what I feel - I did franchising for eight years, I was kind of prepping myself for this role, because this is a bigger role. And, you know, going from four locations to almost hitting on 90 to 100 soon, you know, is definitely a whole different challenge.

16:00

LP: You're also an angel investor. So considering all the changes that have occurred in 2020, how has the landscape for seed funding for various companies changed?

DB: Yeah. So, you know, I think I got exposed to angel investing three or four years ago. And I mention that because a lot of people ask me, How did you become an angel investor? Like, how does one get that coveted title? There are so many organizations here locally in Houston; there’s the Houston Angel Network. And then there are other organizations where you could learn about angel investing. And I've, I've kind of seen that space change, where this year, there's actually a lot more funding available. And people are trying to figure out where, where do I invest my dollars, and then a prime example of that is IDEA Lab, right, we were able to close our funding round in July of this year, right in the middle of a pandemic. And one thing I will say is that, you know, supporting women entrepreneurs is really big and key, and in my little world, and I don't see enough of that, unfortunately, you know, I do go to a lot of funding events, and I see women entrepreneurs pitch, but there is a lack of funding that's available in that space. And I don't exactly know why that is, I think, you know, maybe as people get more confidence, especially if it's your first venture, you know, you just have to prove yourself even more on, you know, yes, I can do this and I got it. And so that would be my answer on that.

17:30

AS: Females and getting invested. That’s a whole other episode. We've been talking about that the last few weeks. So segueing back to the school districts, because I know you do a lot of work with schools and afterschool programs, what kind of changes are you seeing within the school and school districts at the moment? 

DB: Sure. So the school districts are not allowing third party vendors to come in or any after school pickups, you know, one of the main key reasons we're hearing from them is they want to curtail their germs. So they want to have their own staff there. They are following a whole bunch of different protocols. You know, of course, kids are all wearing masks throughout the entire day, even a kindergartener or a pre-k child, even if your child is four years old, you are mandated to wear masks, even outside on the playground. And, you know, when we first started hearing about this, even as a parent myself, I was like, wow, you know, would children do that? And interestingly enough, kids are comfortable with it. And the other thing that we're hearing a lot of is this whole school districts are really facing a challenge with in terms of staffing, the teachers, whether they have to decide if they're going to be face to face teachers, or if they're going to be virtual teachers. And, you know, I think really this year the education sector is hit the hardest, you know, they're working harder than they've ever worked before. And, you know, unfortunately, probably getting a lot of, not backlash, but, you know, parents are struggling with, Is my child falling behind? You know, they are in virtual school. They're not, they're not learning as well as they did face to face. And a six year old is not meant to be in front of a screen all day, you know, six, eight hours of the day. So I definitely feel like school districts are faced with the challenge that they're trying to figure out how to overcome. 

And unfortunately in 2021, I don't see this changing. You know, it's still going to be the same. In our school district here in Houston, Texas, we opted to go back in person face to face for my kids. It's a personal choice that we made. Fifty percent of our school opted to go back. And, and honestly, it's the best decision that we made. We haven't looked back at all. Every six to eight weeks, you get the choice to decide again, and I was just having that conversation on the drive to school this morning: would you change it? Would you go back to virtual? And all the way around I got answers of No.

AS: I agree, mine, we're in the same. I'm in Dunlap, Illinois, but we're in the same situation. My son's going to school in person. And then a lot of kids are coming back. And I guess they were getting concerned about how many kids are going to be coming back. They're doing a great job up here. 

DB: Yes. Are you comfortable with their protocols that they have at the school? 

AS: I think they've been doing an excellent job. And they give us a case report every week, and we haven't had- the high school and middle school have had more cases than, say, the elementary schools, but I think that's to be expected with the older children. 

DB: Yeah. 

26:15

LP: Devina, one last question. We'd like to know what your top tips are for CEOs with kids who are stuck at home during the pandemic?

DB: Yeah, oh, my goodness, where do I start? So, you know, I think, top let's break it down to top three. The first step would be, you know, keeping your child engaged in different activities, even if it is, you know, for 15 minutes in the day, just going to the backyard and running around or going to your front yard and doing something physical. Because that is one thing that I'm realizing as a parent myself is the physical movement of children is restricted. And if you let them be - my nine year old, you know, he loves gaming - so if you let him be and he's off in between classes off playing Minecraft, or Roblox or working on coding something. So, that would be my first you know, first suggestion is definitely keep the physical movement going. 

A second one would be enrichment, looking at some sort of enrichment class or, you know, even socialization. Kids in the neighborhood, or if you want, look at programs that are following good protocols, you know, IDEA Lab definitely is... we have this this option where a family could sign up for one class a week, you know, a membership model, where you could just attend on a Monday and, you know, socialize with the little children in that class. Or we offer STEAM workshops on the weekends, where you could come in and do a little workshop. That is key right now, given that our kids have not socialized with each other since March. You know, they've been home and yes, of course, we all want to play it safe. And we all have our little COVID bubbles. You know, we've got families that we interact with in the neighborhood. We maintain social distance, we wear masks and we let the kids interact with each other. You have to bring back some sense of normalcy back, right, socialization at this age for the kids is such a big deal. Such a biggie and, you know, I can't emphasize that enough, because I remember when school was starting in September for us, my kids were so excited. They were going to virtual school. They were so excited. They were getting the supplies ready, the laptop setup, and things like that. And they were holding up these signs that said first day of virtual school, you know, and what they really missed the most was being able to talk to their friends. So yeah, that would be my, you know, big, big key is socialization.

23:07

AS: So have you been able to open new franchises during this time, allowing you to grow IDEA Lab Kids? 

DB: Last year, we sold about 50 assigned territories in 2019. And we were kind of following that same trend January, February. All of a sudden, in March, you know, pandemic hit, we all took a pause. Intentionally as a brand we actually have, we've paused our selling of new franchises. We really focused internally and we wanted to figure out what is our business model to get through the pandemic? You know, and the one thing I will tell you, I kept hearing things like, Oh, I can't wait for the pandemic to be over. For weeks weeks, or, you know, a month or two months or three months, we're going on, you know, six, eight months now and the pandemic’s not over so I think that was a big factor for us as a brand is, you know, to be able to stop selling franchises, strengthen our core, rollout programs like IDEA Lab Plus, we also rolled out tutoring, because that's something we saw that our families were asking a lot about. My child is falling behind in school, how can I do something to help them so we rolled out tutoring. The kids come to us anyways. We rolled out a partnership in the coding space as well. The reason for all these innovative partnerships was to really make the existing franchise locations strong so that we can survive this storm. And then when we get back to 2021 we can start looking at selling more locations for next year.

AS: Awesome. So where can we find you, Devina? Where can we find IDEA Lab?

DB: Look for us on our website, idealabkids.com. And if there isn't one in your state or territory, definitely give us a call. We would love to talk to you about franchising. 

LP: Super. Devina Bhojwani, thank you so much for taking the time to talk with us. Again guys, she is the president and co-owner of IDEA Lab Kids. You know you guys are all out there with kids at home and you need a little help and a little fun so this is the place to go.

DB: Thank you both so much for having me. This has been super fun for me.

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Hosted by: Laurie Pillow, Andrea Spirov

Writing and research: Laurie Pillow, Andrea Spirov

Edited by: Laurie Pillow

Produced by: Laurie Pillow, Andrea Spirov