Discovery Point franchise complaints include a high number of failures that the company effectively hides.
Other complaints include the use of a fixed franchise royalty (rather than a royalty calculated as a percentage of sales) and allegations of franchise churning.
Franchise Churning is an industry term that describes a practice wherein a franchisor allows or causes a franchisee to fail so that they can re-sell the territory over and over to new franchisees, collecting new fees each time.
UnhappyFranchisee.Com has not verified the accuracy or veracity of these allegations. We invite those familiar with Discovery Point to share their views in the comment section below.
We also invite Discovery Point Franchising, Inc. and its associates to provide rebuttals, clarifications, refutations or explanations to UnhappyFranchisee.Com for publication, as it is our preference to provide both sides and let our readers decide.
In response to our post DEADLY FRANCHISE MYTHS: The Hot New Franchise Myth by Sean Kelly, DiscoveryPointFraud wrote:
These deadly combinations were effectively used by the childcare franchise “Discovery Point”.
Look up other resources before buying into this.
Franchisees have been ruined and those were not disclosed. Not sure why employees continue to work in the corporate.
They have seen how one after the other families have been destroyed by this child less couple mercilessly.
Discovery Point uses a fixed royalty and not a percentage. Therefore, has no interest in improving your business.
Actually they benefit if you fail.
They have effectively churned the same location to make more Millions for themselves at the cost of the franchisees and the SBA guarantees.
They are well known to take over running franchised businesses for free, be careful.
Earlier this year, allegations of multiple Discovery Point failures and bankruptcies were posted on BlueMauMau.org.
On January 29, 2013, Guest wrote:
The latest victims of Discovery Point Franchising are the Vahids of DP #36 and the Duttas of DP #57.
They were preceded by DP #11 and DP #22. All these Discovery Point franchises were located in North East suburbs of Atlanta, GA.
All of these franchisees were families with children and lost everything they had. They now have the stigma of bankruptcy on their records, but the people responsible to make that bankruptcy are enjoying vacations in their private jet.
These are hard working people, who saved to open their own businesses but fell prey to the perfected fraud of franchising.
Vahids and Duttas are willing to share their story to prospective franchisees, if they desire to contact them. Their contact information are available with the existing franchisees of that area.
On May 28, 2013, Guest wrote:
Two more bankruptcies for Discovery Point
Discovery Point #50 at Dawsonville and #55 at Fayetteville, GA went out of business last week. These were multi-million dollar loans guaranteed by SBA but SBA logs did not show that the loans were franchise related. The franchise corporate injected imaginary money from the profit to make the loans happen. There were perhaps overseas money transfers from these transactions. Each closing of these centers also had a parallel cash transfer among business entities owned by the Franchise owners and it happened in the closing attorneys office at the same time as the closing. Hopefully these discussions come up in search results so that future franchisees can make an informed decision. Bluemaumau has been blocked in primary search by this franchise. For example, if you Google “Discovery Point”, these discussions will not show up.
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If you are looking for a franchised childcare and you are a family with children, be careful because you are targeted for destruction. The owners of Discovery Point Franchise are childless but are in child related business (go figure!). They have no clue what it takes to raise a child but understand that the effort makes these families vulnerable and easy to prey upon. Past records indicate that they were after happy families with children – Craigs, Padins, Vahids, Duttas, Schuchmanns to name a few. All these franchisees were personally bankrupt under the supervision of the Discovery Point corporate.
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An exception: One franchisee was a Police Officer, who bought the Mall of GA location, and promptly rescinded the contract but did not bring these near criminals to court. The police officer should have done that to stop the destruction of so many franchisee families. Franchisees lost home, got divorced, lost retirement savings, could not support kids’ colleges because all was sucked in by the franchise and the bank. Most of these loans were made possible by Jackie Hart, who worked with the franchise to increase the center price by a Million in a few years and simultaneously helped to increased the sale volume. She also allowed false cash injection from the franchise’s profits.
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These center failures are not reported in the Disclosure document and one cannot do a thing if there are lies in the FDD. FTC does not monitor each of these FDDs, GA does not have any regulations, and one cannot sue a franchise for lies in FDD. Rogue people like these use Franchise as a license to commit financial fraud with government protection.
Discovery Point child development center was founded in 1988 by Cliff and Diane Clark, and franchised in 1990.
According to its franchise listing on Entrepreneur.Com, the number of Discovery Point franchises has fallen from a high of 58 in 2010 to 53 in 2012.
The total initial investment is listed as $2.67M – 3.34M, with a $60,000 franchise fee and an ongoing royalty of $3800 per month.
Discovery Point Franchising, Inc. is headquartered in Duluth, GA.
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TAGS: Discovery Point franchise, Discovery Point franchise complaints, Discovery Point complaints, Discovery Point childcare franchise, childcare franchise, Cliff Clark, Diane Clark, SBA franchise loans, franchise failures
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Jack the ripper. This impostor is now posing as a health care provider and may be a threat to the society.
Discovery Point provides training and operating manuals. Ask any franchisee when is the last time they have opened their manuals. The manual copies stuff from websites and state and federal childcare rules. Clean the floor, clean the toilet, lock the store before leaving are in the operating manual and there are many volumes - it is made to promote and legalize fraud. Because legally they are providing operating manual, even if it is all trash.
The training is included with the $60K franchise fee. Note that a 4 year undergraduate tuition cost less than that in most Universities and Colleges. The training is ridiculous and shows you how to say hello and divide numbers and round off student to teacher ratios. The ratio is already provided by the state and there is no new or proprietary information there. This training setup is made to satisfy the legal aspects so that fraud cannot be contested.
This is a well orchestrated fraud setup. If the business succeeds, it is good for the franchise, and if it fails, either it is churned, or not mentioned to the future franchisees. Just try to find the centers they were operating in the sate of South Carolina, no mention anywhere. Each new franchisee provides a profit of nearly half a Million to the Cliff on the day of closing, so continuation of existing franchisees is not important as they have already paid him all they had and nothing left in them.
Oh my goodness! Atlanta based fraud is spreading to Houston. http://www.discoverypointhouston.com/ - Stay away unless you have done a thorough research. This con man will sell you one Million Dollar unit for three Millions. No one cares if the new franchisee is successful or not because the big money is made on the day of the closing. The franchisee also releases the demon from all liabilities on that day. The franchise fee is fixed, so why bother helping them? Once you pay the franchise fee, you are hooked, cannot get out till you financially die or con another franchisee as a resale.
Do not buy misfortune with your own money.
One more thing. This sudden growth activity after many failures is after Diane's death. Is this her life insurance at play? Was it intentional? Amen!!
Discovery Point at Alpharetta is for sale- 4015 Discovery Point Drive, Alpharetta, GA 30004. Based on previous experiences, do not go there. They claim to be profitable. Most re-sellers are more dishonest than the franchiser himself. They lie in every aspect of the business.
The bright example is the Discovery Point at Laurel Springs. Owners Gail and Paul Burris were heading to bankruptcy, and so they misrepresented income statements and sold that center to Kimberly Craig. Craigs found the center to be a total financial disaster and were advised to lie for a resale. But Craigs were honest and refused to lie like the Burrises and went bankrupt themselves in about three years.
Are you ready to lie. If so, go ahead and evaluate a Discovery Point Center. There is no room for good honest people in this franchise. You will be robbed and skinned alive. If you have kids, the fun for the franchiser is even more as you cannot give any resistance due to the family burden and responsibilities.
The franchise loan package included more than $100K in starting operating funds. Most franchises do not do that but this did. The reason behind that is the business then took several years before going bankrupt. That avoided any red flags with SBA even if the startup fund was also mostly SBA guaranteed. Needless to say all of that went to the franchisor as royalty and other payments like second mortgage. This college drop out (may be rusticated) Cliff is a very corrupt and immoral person. Stay away. His appearance will tell you how similar he is with infamous Bernard Madoff.
The SBA loan officer, Jackie Hart, sold her 4500 sq ft mansion with swimming pool and 2000 sq ft basement in January 2014 and fled. She is most likely hiding in Florida with a changed name.
From what we can see, the Bank made the franchisees take a mortgage loan, which was not serviceable. There was not enough income to sustain that burden and bank knew it. They knew it so well that they could pin point which one will make it and which will not. The ones that would make had the franchise name associated and other loans did not show as franchised loan. Bank (all loans from the same bank- Fidelity) made the franchisees take insurance as SBA guarantees. The project price was increased from $1.9M in 2006 to $2.8M in 2008. The same loan officer serviced them and was aware that franchisees were doomed. She also allowed seller financing, where the seller (Cliff Clark) put part of the profit, not real money, back in the project as down payment with extremely high interest rates to the franchisees.
These franchisees are bankrupt. Any lawyer out there to consider this Multi-Million Dollar mortgage fraud in contingency? Please post your contacts here. Unfortunately you cannot post your phone number, but name and city should be able to locate you.
No lawyers come forward to help you. It happens only in stories and movies. Franchisees and prospective franchisees, hope you get the point. There is no help even if you have been deceived and there are documents. You will go bankrupt and nothing will happen to the franchiser, they will find next victim, it is surprising how many of them are there. Either you become a franchiser yourself, if you can handle fraud that US government and law supports, or just hide your tail between legs and run away. This is a country built on slavery and continues to do so.
During 2007/08 my family completed the initial screening process to be eligible for the childcare franchise. Jack Gutkin was our representative. We paid the $50,000 application fee however the center for whatever reason passed us by for prime location in the Alpharetta Ga, area. The company wanted us to take over failing centers. After refusing, they just kinda pushed us to the side and later refused to continue doing business, and offered no explanation. We tried unsuccessfully to get our money back. Please stop those guys...don't do business with that franchise.
Jackie Hart is now Vice President and SBA Loan officer with South Crest Bank. Only Discovery Point franchisees got hurt and SBA does not care as it was tax payers' money. She is issuing SBA guaranteed loans again. Fraudulent people win and have a good life- lesson from this episode.
Discovery Point Heritage at NC is now open. It is bigger than existing centers and in an untested market. It is more expensive and perhaps more difficult to sustain, unless the new owners have put large cash down to reduce loan payments. Hope SBA considered the prior fraudulent transactions before approving this center. The same pattern exists - Cliff Clark does not get too much involved before opening. He sends his marketing goons and they fill the new owners with lies and verbal promises. After the documents are signed and Cliff has money in his pocket, he refuses to support the center and claims to not have made any promises. The new owners are now in it for good and have no way out. Hope they survive.
Only franchisee who could get out was a Police Officer, who detected the lies within a month for the DP center located near Mall of GA and rescinded successfully. You will not be able to find any info on that rescission. It has been carefully swept under the rug.