Sauna House Is Franchising the Nordic Bathhouse. The Numbers Back It Up.

Sauna House, the North Carolina-based communal bathhouse brand founded by Andrew Lachlan, posted 276% two-year revenue growth, landed at #838 on the 2024 Inc. 5000, and has built a franchise system that includes an affiliated company supplying every franchisee’s saunas. Sauna House dates its founding to 2019; its 2024 franchise disclosure document says an affiliate had run the original Asheville bathhouse since February 2018.

The question is whether that system holds as the brand expands beyond the Carolinas.

It started with a cold water challenge

Lachlan built Sauna House out of personal necessity. While living in the San Francisco Bay Area, he took on a 30-day cold water challenge from a friend who used cold water to manage chronic pain, then paired it with a run-down sauna in his apartment building, he has written. The experience led him to treat bathing as something practiced communally, as Scandinavians have done for centuries, rather than a service delivered to one person in a private room.

The concept Lachlan brought to Asheville is called the Hot-Cold-Relax cycle, a two-hour communal session rotating between traditional sauna, cold plunge, and rest. Phones are banned inside the bathhouse, a rule the brand treats as central to its identity and meant to force a psychological reset.

We are thrilled that the hard work and dedication of our team have been recognized. More importantly, we believe that with growth comes the opportunity to give back to causes we are passionate about in significant ways. (Andrew Lachlan, CEO, Sauna House)

A business built for volume

The Sauna House model layers several revenue streams on top of the base session. Two-hour thermal cycle passes are the primary driver. Monthly memberships convert that session demand into recurring revenue. Private Hot-Cold-Relax suites command a premium for guests who want the experience without the communal element. Deep tissue massage, bundled with bathhouse access, rounds out a higher-margin add-on channel. Retail and e-commerce add another stream: the brand sells apparel and bathing supplies, and its online shop has carried home sauna equipment including Auroom modular saunas and HUUM electric heaters from Estonia.

The economics work in part because of labor efficiency. A communal sauna session requires far less staff per guest-hour than a treatment-room spa. Once the facilities are built and the water is chilled, the marginal cost of adding one more body to the sauna is close to zero. High fixed costs, low variable costs, recurring membership revenue: that is a business model that rewards scale.

A $49,500 fee and a 7% royalty

Sauna House said in February 2024 that it sold ten franchise locations in 2023 and hoped to add ten more by the end of that year. The initial franchise fee is $49,500. Total investment to open a location runs about $1.55 million to $3.83 million, a wide spread driven mostly by build-out, which the 2024 disclosure document puts at $650,000 to about $2.14 million. The bathhouses are infrastructure-heavy: the Durham location covers 6,993 square feet, and installing its cold pools in the 1940s building meant pouring new concrete and steel footings. Ongoing royalty is 7% of gross sales, per the franchise disclosure document Sauna House filed in Minnesota in 2025.

Unlike most wellness franchisors, Sauna House controls the sauna supply for the network, in line with the wider move toward factory-built modular saunas for commercial spaces. Its franchise page lists a “Custom Sauna Factory” among its selling points. The disclosure document names an affiliate, Bathing Goodies, as the exclusive supplier of franchisees’ traditional saunas (including wood and lighting), sauna heaters, and heated furniture, and says the affiliates buy those goods from third parties and resell them. That gives the brand control over the equipment in every franchised bathhouse.

Between sauna sets, guests rest on heated seating from Galanter & Jones. Locker rooms use soaps from Dr. Bronner’s and Everyone (EO Products), both B Corps. Facilities use no single-use plastics, compost cups, lids, and tea, and skip paper towels and electric hand dryers, steps Sauna House pitches against the energy and water consumption that a commercial bathhouse inevitably produces.

The cold plunge hardware

Sauna House does not use pod-style personal cold plunge units. Its communal cold plunges are in-ground stainless steel pools 4.5 feet deep with continuously circulating water, and Durham has two custom-built plunges that each hold 15 people. That has regulatory consequences: Sauna House says its plunges must meet North Carolina’s rules for public bathing facilities, including permits, inspections, continuous disinfection, and daily records. It is a harder operational lift than an infrared studio with a single-person cold tub, and it creates a barrier to entry for anyone trying to replicate the concept cheaply.

Where they are building

The corporate footprint anchors in the Carolinas. The original Asheville location, on Short Coxe Avenue, was the flagship; it closed in July 2026, and Sauna House says it intends to return to Asheville in a new location. Durham, Charlotte, and Raleigh are open in North Carolina, as are bathhouses in Greenville, South Carolina, Knoxville, Tennessee, and Bonita Springs, Florida.

In Austin, the company opened an interim concept in North Austin in November 2025 called the Sauna Garden, an indoor-outdoor experience built around wood-burning saunas, while the local ownership team builds a permanent bathhouse on the adjacent property. Summerville, South Carolina, is also in the immediate pipeline.

Bigger rivals: Bathhouse, Othership, SweatHouz

Sauna House is not the biggest social sauna brand in America. Bathhouse in New York, which had two locations at the time, told CNBC in March that it expects about $120 million in run-rate revenue by the end of 2026. Othership raised about $8.5 million in 2025 to fund its US expansion. SweatHouz had more than 78 studios open in 25 states in December 2025, according to Athletech News. QC Terme is bringing European thermal spa hospitality to the US market.

Sauna House is arguably building the most replicable version of the concept, one that can reach mid-sized American cities without a Bathhouse or an Othership. Independents like White Mountain Sauna Haus in North Conway, NH run the communal sauna model without a franchise system, in a renovated barn with a walk-in policy.