The Picklr seeks Chapter 11 restructure, citing leases

Over the weekend, indoor pickleball facility franchisor The Picklr announced via its official LinkedIn page that the brand will seek to restructure under Chapter 11 of the bankruptcy code. To facilitate that reorganization, Picklr franchisee Tom Neale has organized an investment group that’s committed a reported $4.5 to $4.8M to get the brand back on its feet.

In a statement provided to The Sports Business Journal, Picklr founder and CEO Jorge Barragan said, “We signed, unfortunately, too many corporate guarantees that landed on the holding company. And that’s on us. I own it. Utilizing [Chapter 11 bankruptcy] is going to allow all of us to work with these landlords to figure out how to create profitable businesses. … I think this is going to open up doors for a lot of people to renegotiate with the landlords and give people more success moving forward.”

The Picklr landed itself in financial trouble with a program that was intended to be franchisee-friendly and encourage growth. When the brand launched its franchise offering in 2023, it guaranteed lease payments for many of its early-stage owners, ending up with heavy financial commitments to around 40 locations. The weight of those leases ultimately became too much for the company, whose network includes more than 75 clubs worldwide, with more than 70 of them located in the United States.

The proposed restructuring would result in Dynamus Alliance, the group piloted by Tom Neal, taking charge as The Picklr’s lead investor. While the brand has already reduced headcount at its corporate offices in anticipation of the Chapter 11 filing, additional changes to the company’s leadership team are possible as Neal and team guide The Picklr back toward solvency.

“While everyone’s opinion is not completely the same, there are a good many franchisees within the system, like me and our group that we’ve put together, who believe in the brand, who believe in the business and believe there’s a viable future going forward,” Neale told Chris Smith of The Sports Business Journal. “We’re convinced that the model works. It’s a matter of looking at some business realities and some headwinds that we collectively have faced and address those head on.

And what this restructuring allows us is to have some meaningful conversations with landlords and franchisees, and hopefully those conversations provide positive outcomes.”

Of note, the bankruptcy proceedings will not impact operations across The Picklr’s network of pickleball clubs. Their locations’ doors remain open, and members will enjoy continuity throughout the restructuring process.