DILL DINKERS DC

Confidential Investment Memorandum

Flagship Indoor Pickleball Facility | Target Capacity: 11 Regulation Courts

Prime Location

Fort Totten / Upper Northeast D.C. Submarket

Strategic Site

Site Under Negotiation (NDA Required)

Investment Ask

$1.5 Million Seed Capital

Executive Summary


The Opportunity

We are launching the premier Dill Dinkers facility in an underserved, high-density corridor of Washington, D.C. This investment represents the intersection of America's fastest-growing sport and a disciplined, site-driven development strategy.

We hold the exclusive franchise rights to open Dill Dinkers locations in Washington, D.C., elevating this beyond a single-site operating opportunity.

The Brand

Proven Scale

  • 27 Dill Dinkers locations currently operating across the U.S., one of the fastest-growing franchise networks in the sport. Notably, 7 of those locations operate in the DMV market, which means we benefit from locally proven operational playbooks, not just national ones.

Strategic Advantage

  • Reduces market-entry risk through existing brand awareness
  • Supports faster customer adoption vs. independent launch
  • Improves execution certainty with a proven, scalable concept

The Operators

This opportunity is led by two partners with complementary skill sets, deep roots in the Washington, D.C. market, and the exclusive Regional Developer rights for the District, a franchise designation that grants them the sole authority to develop and operate Dill Dinkers locations across Washington, D.C.

Jonathan Boateng — Co-Founder

Jonathan holds a B.S. in Computer Engineering from Georgia Tech and has built his career in cybersecurity, business analysis, and project management for federal agencies. He leads site selection and operational strategy for Dill Dinkers DC, applying the same analytical rigor his technical background demands.

Travis Andrews — Co-Founder

Travis is the CEO of Init One Solutions, a DMV-based firm specializing in AI-powered digital intelligence and cloud solutions, where he has developed deep expertise in project management and organizational scaling. At Dill Dinkers DC, he leads the Regional Developer operations and franchise support infrastructure across Washington, D.C.

Beyond their roles as Regional Developers, Jonathan and Travis are also direct equity investors in Dill Dinkers at the corporate level, a position that reflects their conviction in the brand's long-term trajectory and ensures their interests are fully aligned with both the franchisor and the investors in this facility.

The Investment Thesis

$1.5 million in seed capital funds the build-out and working capital for an 11-court regulation facility in the Fort Totten / Upper Northeast D.C. submarket.

Investors receive a tiered return structure designed to prioritize rapid capital payback followed by a perpetual high-yield equity stake.

Dill Dinkers DC holds the exclusive franchise development rights for 3–5 locations across Washington, D.C. Founding investors in this facility receive Priority Access Rights to participate in every subsequent location before any public capital raise, creating a compounding opportunity for those who invest early in the platform.

Conservative Financial Modeling

Our modeling methodology deliberately excludes high-margin revenue streams and caps utilization assumptions well below industry benchmarks, creating multiple layers of financial cushion.

Base Case

Stabilized net income of $758K per year

Bull Case

Potential net income of $1.5M per year

Capital Payback

Approximately 3.2–5 years depending on scenario

The Market

Washington, D.C.'s dense residential population, combined with limited indoor recreational competition, creates an unusually attractive risk-adjusted opportunity. A specific Target Site has been identified that meets strict operational criteria, with advanced lease negotiations underway.

Site details and financial model available upon execution of NDA. This memorandum contains forward-looking statements subject to material risks and uncertainties.

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The "Target Site" Profile

To protect the integrity of ongoing negotiations, the specific location remains confidential pending NDA execution. However, we are actively underwriting a specific property that fits our strict operational model. Our site selection strategy prioritizes demographic density, competitive positioning, and structural suitability over opportunistic pricing.

Court Capacity

The target facility accommodates 11 Regulation Courts (including one champion court) with proper spacing for tournament-grade play and spectator areas.

Structural Specifications

18ft+ clear span ceiling height ensuring optimal playability and regulatory compliance for competitive events.

Demographic Targeting

High-density residential zone with limited indoor recreational competition and favorable household income profiles.

Economic Viability

Lease terms structured to ensure profitability at conservative 40-50% utilization rates, well below operational targets.

"The 'Green Light' Criteria: We have identified the specific site and are currently negotiating terms. Specific address and detailed site plans available upon execution of NDA."

Conservative Modeling Methodology

Built on "Worst-Case" Baselines

Our financial model incorporates multiple conservative assumptions designed to stress-test the business under adverse conditions. This approach provides sophisticated investors with confidence that projected returns reflect genuine operational capability rather than optimistic scenario planning.

Revenue Cushion Strategy: High-margin alcohol sales have been excluded entirely from these projections, despite representing 15-20% of revenue at comparable facilities. This deliberate omission creates substantial upside optionality while ensuring baseline projections remain achievable through core operations alone.

Utilization Cap Philosophy: Utilization ramps from 47.5% at launch to 55% by Year 2 and 60% by Year 3, materially below the 70-80% observed in top-tier markets. This conservative threshold accounts for seasonality, competitive entry, and demand variability while maintaining profitability.

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Year 1 Launch Strategy

Assumes 9 Months of Free Rent (not including NNN) through negotiated abatement. We treat this as a one-time "Launch Subsidy" to build cash reserves, not recurring income.

02

Year 2 Reality Test

Assumes full market rent load plus annual escalations. The model proves viability without the subsidy, demonstrating sustainable economics.

03

Ongoing Escalation Planning

All expense projections include annual increases for rent, labor, and operating costs to ensure multi-year accuracy.

Financial Projections Overview

47.5%

Year 1 Utilization

Launch phase with conservative ramp-up assumptions

55%

Year 2 Utilization

Stabilized operations well below market potential

60%

Year 3 Utilization

Mature facility approaching top-tier performance

Year 1: Launch Dynamics

Net Income: $769k | Margin: 47%

Year 1 Net Income is stabilized by the negotiated rent abatement. This 'Launch Subsidy' offsets lower initial utilization (47.5%), allowing the facility to match its stabilized Year 2 profitability immediately. This protects cash flow while the member base ramps up.

Year 2: The Reality Test

Net Income: $758k | Margin: 35%

Even with conservative 55% utilization and full market rent, the business generates approximately $758k in annual profit. Our stabilized Year 2 assumption of 55% utilization is not a guess. A comparable Dill Dinkers franchise facility in Maryland is operating at 65% today. We're building your downside case around a number the brand has already surpassed. This represents the true operational capability of the facility under normalized conditions without subsidies or optimistic assumptions.

Year 3: Mature Operations

Net Income: $990k | Margin: 40%

As utilization increases to 60% (still below peak capacity), profitability expands dramatically. This demonstrates the substantial operating leverage inherent in the fixed-cost structure once the facility achieves market acceptance.

Critical Insight: The Year 2 performance validates the investment thesis. With full rent load and conservative utilization, the facility generates substantial profit, proving the business model without reliance on favorable temporary conditions.

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Understanding the Revenue Model

This is a "Facility Rental" model, not a hospitality model. We sell time on courts. Our conservative base case deliberately excludes alcohol sales to demonstrate raw operational viability.

The Core Principle: Utilization Drives Profitability

This sports facility operates on a fundamental economic principle: fixed costs are constant, regardless of court occupancy. Investments in courts, lighting, and infrastructure generate the same daily expenses. Unlike retail, every additional booked court hour contributes almost directly to the bottom line, after minimal incremental expenses.

Success hinges on membership engagement and visitor traffic. Members provide a reliable revenue base. However, the real impact comes from members filling courts and attracting others. Drop-in visitors pay premium rates, often representing the highest-margin revenue stream.

The strategic imperative is clear: maximize court occupancy across all available hours. Every time slot represents an opportunity to convert unused capacity into revenue. An empty court is lost revenue, a missed chance to build community, and a failure to attract new members.

86%

Court Access

Primary revenue driver

13%

Membership Dues

Recurring revenue foundation

1%

Retail & Sponsors

Non-court income

Projected Revenue Breakdown (Year 2)

This analysis presents a realistic second-year projection based on achieving 55% average court utilization. This scenario excludes alcohol sales for a conservative baseline, though beverage sales can be a meaningful supplementary stream, and projects the revenue split as follows: Court Access (86%), Memberships (13%), and Retail/Sponsors (1%).

Court Access Revenue

$1,842,000

86% of Total Revenue

This dominant category includes all court usage, broken into five distinct booking types. This diversity provides resilience, allowing various booking types to compensate for each other's performance.

Membership Revenue

$287,000

13% of Total Revenue

Annual and monthly dues provide predictable, recurring revenue, stabilizing cash flow. Members often become brand ambassadors, driving organic growth. (Based on 500 members in base case)

Retail & Sponsorship

$30,000

1% of Total Revenue

Modest, passive income with minimal overhead. Equipment, merchandise, and sponsorships contribute margin without consuming court time or staff.

Deep Dive: Court Access Revenue Components

The $1.84 million in court access revenue deserves closer examination. Understanding the mix reveals strategic opportunities. Each booking type attracts different customers, occurs at different times, and requires unique operational support.

Open Play Sessions

54% of Court Access | Highest Volume

Social, drop-in sessions maximize court utilization during peak hours and foster community. They serve as the primary customer acquisition funnel, with many members starting here.

Private Reservations

18% of Court Access | Premium Pricing

Individuals or groups book entire courts for exclusive use, typically at $25-40/hour. These fill shoulder hours and attract serious players or corporate groups.

League Play

11% of Court Access | Recurring Weekly

Structured leagues run for 6-12 weeks. Players pay upfront, providing advance cash flow and guaranteed bookings. Leagues also boost concession sales.

Contract Time Blocks

9% of Court Access | Bulk Bookings

Coaches, corporate clients, or organizations purchase court blocks at discounted rates. These ensure utilization during slow periods and reduce marketing costs.

Events & Clinics

8% of Court Access | High-Touch Service

Birthday parties, corporate events, and clinics generate premium rates and word-of-mouth marketing. They require more staff but justify higher pricing through added services.

Strategic Implications for Operators

Revenue Concentration Risk

With 86% of revenue from court access, any utilization reduction poses significant risk. Diversification through memberships, retail, Food & Beverage, and alternative programming can mitigate this.

The Membership Paradox

Memberships, though only 13% of revenue, are strategically vital. Members use the facility more, creating a vibrant atmosphere. They are forgiving, provide feedback, and recruit others. Their value extends beyond the $287,000 line item, enabling other revenue streams.

Pricing Power & Elasticity

Success depends on pricing optimization. Open play needs volume-encouraging prices, while reservations command premiums without deterring bookings. Membership pricing balances committed revenue with accessibility. Ongoing analysis of booking patterns and feedback informs price adjustments.

The Utilization Challenge

Achieving 55% average utilization is demanding. Facilities with 10-16 courts open 14-16 hours daily mean 140-256 court-hours available. Reaching 55% requires filling 77-141 hours daily, year-round, despite fluctuations. This demands sophisticated demand generation and operational excellence.

Attract & Convert

Marketing drives awareness and first visits. Digital ads, partnerships, and events bring new players. Cleanliness, staff, and ease of participation determine return visits.

Engage & Retain

Converting visitors to regulars requires community building: social events, skill programs, leagues, and recognition. Communication via email, text, and app keeps the facility top-of-mind.

Optimize & Scale

Data reveals patterns: which hours need stimulation, which formats are highest margin, and which segments can expand. Dynamic pricing, targeted promotions, and innovation drive utilization gains and significant profit growth.

"Every hour a court sits empty represents not just lost revenue, but a missed opportunity to create the community atmosphere that makes a facility thrive. The most successful operators obsess over filling courts with the right mix of members and visitors at the right prices throughout the day."

Total Projected Revenue: Year 2

Based on 55% average court utilization without alcohol sales, the facility projects $2,166,000 in total annual revenue. This provides a strong foundation for profitability, assuming disciplined cost management. Third-year revenue growth of 15-25% is achievable through improved utilization (60-65%) and complementary streams like premium memberships and expanded retail.

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The Investment Structure: Safety First, Acceleration Second

Our capital structure reflects a sophisticated understanding of investor priorities: capital preservation during uncertainty, rapid payback during stability, and perpetual yield post-recovery. This tiered approach aligns management incentives with investor returns while maintaining operational flexibility.

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Phase 1: Capital Preservation (Year 1)

Split: 10% to Investors / 90% Retained

We utilize the rent abatement period to build a "War Chest" of cash reserves. Instead of distributing this one-time subsidy, we retain it to protect the site against operational volatility, construction delays, or market softness. This conservative approach prioritizes business stability over immediate returns, with a projected investor share of ~$76,900 in Year 1.

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Phase 2: The Payback Accelerator (Year 2+)

Split: 45% to Investors / 55% Retained

Once full rent obligations commence and the business stabilizes, we aggressively increase distributions to accelerate the return of capital. This elevated distribution rate (45%) continues until investors have received 100% of their principal investment, typically achieved by the end of Year 4 or early Year 5 under base-case assumptions.

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Phase 3: The Perpetual Yield (Post-Payback)

Split: 20% Equity Stake (Permanent)

After full capital return, investors retain a 20% equity position in perpetuity. This structure provides ongoing participation in distributions without any additional capital contributions. The perpetual equity interest allows investors to benefit from long-term facility operating performance and continued operational improvements.

Growth Bonus: The "Empire" Clause

Exclusive Priority Access for Founding Investors

Founding investors in this facility will be granted Priority Access Rights to invest in the subsequent facilities planned under our 3–5 Unit Franchise Development Agreement for Washington D.C., prior to any public capital calls. This secures your position in our future expansion.

Projected ROI & Capital Payback Timeline

A risk-adjusted return profile. Investors receive steady cash flow with a target 100% principal return in under 5 years, followed by a perpetual equity yield.

Year 1: Capital Preservation

Investor Share: ~$77K

Focus on building reserves and operational stability

Year 2-4: Accelerated Payback

Cumulative Investor Share: ~$1.4M (includes Y1-Y4)

Aggressive 45% distribution rate drives rapid capital return

End of Year 4 / Early Year 5: 100% Principal Returned

Target for full principal recovery.

3.2–5 year range depending on performance

Year 6+: Perpetual Yield

Annual Return: ~$242K (~16.1% Cash-on-Cash)

Cash flow income with no capital at risk

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The Upside Case: Realizing the DC Premium

Bull Case Scenario – Metropolitan Standard Performance

Our Base Case is priced for safety, but the site is built for scale. By achieving 'Metropolitan Standard' utilization and capping membership at 1,000 (approx. 90/court), the facility generates nearly 2x the profit.

BASE CASE (SAFETY):

  • 55% Utilization
  • No Alcohol Sales
  • 500 Members
  • Result: $758k Net Income
  • Payback: ~4.4 Years

BULL CASE (POTENTIAL):

  • 65% Utilization
  • Alcohol Sales ($120k revenue)
  • 1,000 Members
  • Result: $1.5 Million Net Income
  • Payback: ~3.2 Years

Drivers of the Bull Case

Membership Density

Increasing from 500 to 1,000 members (90 per court) adds ~$270k in high-margin revenue while maintaining court availability.

Utilization Boost

Moving from 55% to 65% (Metropolitan Standard) adds ~$335k in revenue.

Revenue Expansion

Activating the alcohol license adds ~$84k in profit.

Risk-Adjusted Return Profile & Scenario Analysis

Risk-Adjusted Return Profile & Scenario Analysis

The projected 100% principal return by the end of Year 4 / early Year 5 (a 3.2–5-year range) represents a compelling risk-adjusted return driven by conservative underwriting and durable unit-level economics.

Base Case (Conservative): Assumes $758k stabilized net income, leading to approximately a 4.4-year payback period.

Bull Case (High-Performance): Assumes $1.5M net income, potentially achieving a ~3.2-year payback period.

This two-scenario approach provides clarity on potential outcomes. Unlike pure equity plays, returns are driven by durable unit-level economics, demonstrated comparable performance, and conservative underwriting.

Upside Optionality

Base projections exclude high-margin alcohol sales and cap utilization at 55%, whereas the Bull Case demonstrates the significant upside potential of achieving 65% utilization and implementing a full beverage program.

Additional Upside Vectors: While standard leagues and retail are included in the base model, significant upside exists through alcohol sales (excluded from Base), high-stakes regional tournaments, and corporate buyouts—revenue streams that typically command premium margins well above standard court rental rates.

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How a $100,000 Investment Pays You Over Time

Assumes 60% steady-state utilization (Year 3+). · 5% annual pricing growth · 3% annual expense growth · 10-year hold period · Illustrative sale in Year 10 at 5× annual profit · Investor receives 10% in Year 1, 45% until capital repaid, 20% permanent ownership thereafter.

The Investment

Initial Investment

$100,000

Ownership Stake

~1.33% of the company

Capital Returned

Early Year 5

How Your Cash Flows Back to You

Year 0

–$100,000 invested

Years 1–5

≈ $112,000 received

Your full $100,000 returned

Years 6–9

≈ $17,000–$22,000 per year

Year 10

≈ $23,000 annual income

If the Business Is Sold in Year 10

Optional Sale Scenario — Additional Proceeds

Projected Profit

Year 10 annual profit ≈ $1.7 million

Valuation

5× annual profit ≈ $8.7 million

Your Ownership

~1.33% of the company

This amount would be received in addition to the $213,000 already collected from operations.

Cash Already Received

≈ $213,000

Plus Exit Proceeds

≈ $116,000

Total If Sold in Year 10

≈ $329,000

Total Outcome (If Sold)

$329K

Total cash received

3.29×

Multiple on original investment

Estimated IRR ≈ ~20.9%

How This Differs From the S&P 500

S&P 500 at 9% Annually

After 10 years ≈ $237,000

This Opportunity

  • Your capital is returned around Year 5
  • You continue receiving income
  • You retain ownership
  • You can reinvest your returned capital elsewhere
  • Revenue additional upside potential from improved court utilization, pricing power and gradual activation of higher margin offerings like beverage sales and corporate events

The exit is not required to achieve strong returns — it represents additional upside.

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Forward-Looking Statements & Disclaimer

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Summary & Next Steps

The Market Imperative

Pickleball is the fastest-growing sport in America, with participation increasing 159% over three years. Yet Washington D.C. remains severely underserved relative to comparable metropolitan markets. This facility will be the premier indoor destination in the Fort Totten / Upper Northeast D.C. Submarket, capturing pent-up demand from a dense residential population.

Competitive Moat: The combination of location, capacity (11 courts), and operational expertise creates substantial barriers to competitive entry. High-quality indoor facilities require significant capital, favorable real estate, and operational know-how—creating significant barriers to entry in this submarket.

Investment Ask

$1.5 Million Seed Capital to fund buildout, courts and working capital

Target Capacity

11 Regulation Courts for leagues, tournaments, and open play

Stabilized NOI (Year 2)

$758k (Base Case) / $1.5M (Bull Case)

Payback Period

3.2 - 5 Years (depending on performance scenario)

The Process: Soft Circle Participation

We are currently accepting non-binding soft commitments to finalize our lease negotiation position. This "soft circle" process allows sophisticated investors to signal interest and secure allocation priority without immediate capital deployment. Final terms and operating agreement structure will be provided upon lease execution. Detailed lease economics, construction budgets, and downside sensitivity scenarios are available under NDA following an introductory call.

Step 1: Introductory Call & EOI

Carefully review this Investment Memorandum and accompanying financial projections. Assess alignment with your investment thesis and risk tolerance. Schedule a Founder Call to discuss the vision and timeline. Submit a non-binding Expression of Interest (EOI) to signal allocation intent.

Step 2: NDA & Data Room

Execute the NDA to unlock the full Investment Package, including the live financial model, lease abstract, and franchise disclosure documents.

Step 3: Closing & Capital Deployment

Review final Operating Agreement. A capital call is issued prior to lease execution to fund the security deposit and secure the site. Funds are held in escrow and released only upon successful lease signature.

Next Steps

Soft Circling Now – Schedule Introductory Call

Ready to signal your interest or learn more? Submit a confidential expression of interest below. A member of our team will follow up within 48 hours.

👉 invest.dilldinkersdc.com





Confidential – For Illustrative Purposes Only |

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