Why you're going to see more swimming pools in strip malls

Goldfish Swim School helped pioneer a new type of swim school: tropical, warm, and in a strip mall.

The black line from the bottom of the pool is ingrained in Jenny McCuiston’s mind. She’d stare at it for hours every day as she trained to become an All-American swimmer in the 1990s and 2000s.

She’d often tell people, “You don’t play swimming. You do swimming.”

Decades later, McCuiston is still doing swimming, but she and her husband, Chris McCuiston, have developed a business out of doing it differently. They’re the co-founders of Goldfish Swim School, a children’s swim school franchise that has grown from a single Michigan location in 2006 to 187 earlier this year, becoming one of the largest chains in an industry that has been valued at ~$2B-$3B and been flooded with investment groups.

Instead of selling control to outside investors, they’ve kept the business family-run. Instead of settling for black lines and gray walls, they’ve stood out by injecting their business with color.

And instead of using backyard pools or renting community spaces, Goldfish franchisees have found a surprising place for building new pools: strip malls.

The demand for swim schools

McCuiston started swimming lessons at three years old in her hometown of Birmingham, Michigan. By the time she was five, she was competing, and she set an age 11-12 national record before swimming at the University of Arizona and participating in the 1996 and 2000 Olympic Trials.

In high school, she also caught the attention of Chris McCuiston, an athlete and classmate who asked her out one summer.

The relationship has endured since then (they’re married and have four kids). And so has Jenny McCuiston’s relationship with swimming.

Goldfish Swim School co-founders Chris and Jenny McCuiston. (Courtesy of Goldfish Swim School)

Exhausted by years of training — four hours in the pool and two hours on land were routine — she didn’t think she’d build a post-competition career around the sport. But, as a preschool teacher in Michigan, McCuiston found herself missing the water and began to teach lessons at a summer swim club where demand was so high she had a wait list.

Even as a top swimmer, McCuiston had few options for lessons growing up. She’d learned at a YMCA, where the water was cold and her teacher was strict.

Realizing little had changed in Michigan, she thought about a college teammate whose parents operated a swim school and told Chris she wanted to start one in Birmingham, perhaps in their backyard. Chris suggested they tour a few swim schools around the country to make sure there’d be a market.

While looking at schools in Arizona, they made a few key observations: 

• Most were family-owned, often by couples who led competitive swim teams and used the lessons as a way to fund their teams.
• Most pools were in backyards or leased. The standalone pools that existed solely for lessons and swim teams tended to have white walls and a drab atmosphere.
• Classes were typically full, suggesting significant demand.

Chris, who’s the CEO of Goldfish, believed they could try to start a larger business that brought the same swimming school concept to multiple locations in the state.

And Jenny believed they could stand out by making their pools inviting and colorful: “We actually went to Hawaii on our honeymoon, and we loved the tropical, bright colors and that feel. And so we're like, ‘What if we just brought that tropical feel inside?’”

They also decided to keep the pool temperature at 90 degrees and the temperature on deck at 92 degrees to create an atmosphere that would be more welcoming to children and difficult to replicate at outdoor or rented pools.

They put together a business plan and started with a $1m loan, backed by their parents, who put liens on their own businesses. Their first school opened in 2006 in an industrial area of Birmingham.

To advertise, the McCuistons lit tiki torches in their front yard on Halloween and handed out Goldfish crackers with their business cards stapled to the packet. They posted messages on any bulletin boards they could find. Jenny met with local preschools to ask if she could hand out water safety information cards.

The Hustle

The business opened with ~500 kids and, months later, grew to ~800, far more than they’d anticipated.

“It was something [parents in Michigan] had never seen before, and they wanted to latch onto it,” Chris says.

With high demand in Birmingham, a Michigan couple suggested franchising their own location. Thus began a franchising business, mostly in strip malls, at a time when they badly needed something like Goldfish swim schools.

Are there enough strip malls?

When the financial crisis hit in 2008, strip malls suffered. Vacancy rates surpassed 8%, the highest level in over a decade. The struggles presented an opportunity for Goldfish, which believed strip malls provided greater visibility than it would get at traditional malls or many standalone locations.

And turning a vacant building in a strip mall into a pool isn’t as complicated as you might think. Franchisees, who get access to company-wide construction strategies, typically take over two spaces, enough for between 6k-9k square feet (roughly the size of four Jimmy John’s but a fraction of a strip mall anchor like a grocery store).

They knock down either the front or back facade of the structure and bring in shovels and backhoes to dig out a four-foot pool. The franchisees, who range from medical device sales reps to former Olympic swimmers, spend upwards of $1.5m-$2m to build out a new location.

The swim schools are part of an activity trend that has since become common in strip malls across the United States. Paulina Rojas Schmidt, head of strip center research for the retail analysis company Green Street, says Goldfish and other activity-based businesses broaden strip malls’ client bases and drive traffic to other retailers.

Strip mall locations have also made Goldfish schools convenient for parents, who can drop off their kids for lessons and shop at grocery stores and other businesses.

• By the early 2010s, Goldfish had five locations in Michigan and another 10 around the country.
• The store count reached 63 in early 2018 and has since swelled to nearly 200 in 38 states.

Goldfish takes a $50k fee from each startup franchisee and 6% of revenues (another 2% of revenues go toward a national brand marketing fund). Franchisees that have been open for at least a year average ~$2m in annual revenues.

A Goldfish Swim School at a strip mall in Bergen County, New Jersey. (Google Maps)

Goldfish has recently expanded to markets in Southern California, and a franchisee opened a location on the Upper East Side of Manhattan in 2023 (a rare location not in a strip mall).

But challenges exist, too. Vacancy rates at strip malls are now below 5%, according to Rojas Schmidt, and construction of new strip malls is minimal. Businesses like Goldfish, however, are still coveted for their ability to drive consistent traffic — so long as landlords are willing to take on a tenant whose building can’t be as easily repurposed as, say, a restaurant.

On top of that, when Goldfish first began building its national presence more than a decade ago, nationwide swim school chains were nearly nonexistent. There are now several with sizable footprints, some spurred on by private equity.

• Streamline Brands, which was purchased by Quad Partners and then acquired by Youth Enrichment Brands (which itself is backed by Roark Capital), owns schools like SafeSplash, Saf-T Swim, and Swimtastic, and claims to be the largest swim school franchisor in the world, with 250 locations.
• Aqua-Tots, invested in by Mansour Companies, has ~167 locations, nearly as many as Goldfish.
• Swim schools Emler, Big Blue, and Foss have either been acquired or backed by private equity and have expanded to dozens of locations.

The Hustle reached out to some longtime independent swim school operators who hold board positions with the US Swim School Association to ask for their opinions on the influx of chains like Goldfish and others. They didn’t respond.

Goldfish swimmers. (Courtesy of Goldfish Swim School)

Chris McCuiston says he’s indifferent about private equity’s entry into the space, noting he’s heard some good stories about it. He and Jenny see the independent, family-run style of Goldfish — Chris’ brother Andrew McCuiston is the company president — as a benefit.

For example, Goldfish originally refused makeup lessons for swimmers. Then Chris, Jenny, and Andrew experienced parenthood themselves and saw how kids, whether they were asleep or crying, could blow up a schedule, leading them to change the policy.

“I think at the end of the day it’s like we make decisions based on how it would help us and what we would want it to be if we were the franchisee and the operator, versus just looking at pure data and spreadsheets,” Chris says.

For now, he says, the McCuistons intend to continue leading Goldfish, although they often think about who will run the company in the future. They want to expand to 200 locations by the end of this year and to 400 by 2033 — enough to make Goldfish a strip-mall staple.