Gen Z Franchise Preferences: Why Young Entrepreneurs Choose Experience-Based Businesses

| By Franchise MatchMakers,Inc

Summary: Gen Z is redefining the franchise industry with their preference for social, experiential, and tech-driven businesses. From fitness and entertainment to immersive dining and co-working spaces, their choices are shaping the future of franchising. This article explores why the Gen Z franchise trend is growing, the sectors they find most appealing, and how potential investors can identify the best franchises to own in today’s evolving market.

By 2030, Gen Z will make up 30% of the U.S. workforce, and many aren’t waiting until mid-career to pursue business ownership. What’s interesting is their focus: while Baby Boomers leaned toward tried-and-true models like fast food or convenience retail, Gen Z franchise owners are seeking businesses that deliver experiences.

From boutique fitness studios to immersive gaming lounges, young investors aren’t just chasing profits; they’re chasing purpose. They want franchises that create community, align with their personal values, and connect with people on an emotional level.

So, why is the Gen Z franchise market booming around experience-based businesses? Let’s break it down.

What Sets Gen Z Franchise Owners Apart

Gen Z approaches franchising differently from Millennials, Gen X, or Boomers. Here are some defining traits:

Digital-first mindset: This generation grew up with technology. They favor franchises that leverage apps, digital booking, and social media engagement.
Purpose-driven: Profit matters, but impact matters more. Gen Z invests in franchises that promote wellness, sustainability, or social connection.
Community-focused: They see franchises as hubs where people come together—whether through fitness, gaming, or dining with a twist.
Experience over things: For Gen Z, the memory of doing outweighs the value of owning. Businesses that deliver memorable moments rise to the top.

This unique outlook is why many traditional franchises may not hold the same appeal, while experience-based concepts thrive.

Why Experience-Based Businesses Appeal to Gen Z

So, what makes these franchises stand out? Several factors are driving Gen Z’s shift toward immersive, interactive, and socially engaging businesses:

1. Shared Experiences Drive Loyalty

Gen Z values being part of something larger than themselves. Fitness studios with group classes, escape rooms, and e-sports centers give them that collective bond.

2. Health and Wellness Is a Priority

Fitness franchises, yoga studios, and healthy lifestyle centers match Gen Z’s strong focus on wellness. For them, a business that helps others live healthier lives is more than a job; it’s a mission.

3. Social Media-Friendly Businesses

An Instagrammable café, glow-in-the-dark mini-golf course, or boutique cycling studio doesn’t just sell a service, it sells content. Gen Z entrepreneurs know that businesses tied to shareable experiences market themselves.

4. Values Alignment Matters

Franchises that emphasize sustainability, inclusivity, or mental well-being resonate strongly. Gen Z is quick to reject businesses that feel outdated, corporate, or disconnected from cultural values.

Sectors Where Gen Z Franchises Grow

Entertainment-Based Franchises

Gaming lounges, virtual reality arcades, and escape rooms are booming. These businesses thrive on repeat visits, group experiences, and strong community engagement values that Gen Z franchise owners prioritize.

Fitness and Wellness Franchises

From boutique spin studios to specialized gyms like boxing or pilates, fitness franchises offer purpose-driven ownership. Many also emphasize mental health and social connection, key factors for younger entrepreneurs.

Food and Beverage with a Twist

Instead of traditional quick-service restaurants, Gen Z gravitates toward cafés with unique themes, bubble tea shops, or health-conscious eateries. The draw isn’t just food; it’s the ambiance, community, and brand identity.

Specialty Services

Pet care services, sustainable fashion outlets, and lifestyle-focused businesses appeal because they align with Gen Z’s mission-driven approach. They want the best franchises to own to reflect both profit potential and personal passion.

Key Features Gen Z Looks for in the Best Franchises to Own

When asking, “What are the best franchises to own for Gen Z investors?”, here’s the formula they prioritize:

Low startup cost + High return potential
Recurring revenue streams (subscriptions, memberships, tiered services)
Strong digital presence (SEO, TikTok videos, Instagram campaigns)
Flexible work culture (semi-passive, self-managed locations)
Unique experiences that tell a story

This is a major departure from older franchise categories like auto-repair or fast-food chains, which may have profit potential but lack the social value and shareability that today’s young entrepreneurs demand.

Technology as a Decision-Maker

Technology isn’t just a bonus; it’s a requirement for Gen Z-driven businesses. Franchises that integrate tech solutions stand out.

Mobile-first approach: Online booking, app-based check-ins, and memberships.
Gamification: Fitness tracking rewards, AR/VR customer interactions.
Contactless Payments: Convenience is key.
Data-Driven Marketing: Location-based targeting, personalized promotions.

To Gen Z investors, a franchise without tech feels outdated and harder to scale.

Quick Tips for Young Franchise Investors

If you’re part of Gen Z and considering franchise ownership, here are some steps to take:

Research beyond revenue: Look at community impact, social relevance, and future demand.
Seek mentorship: Partner with an experienced franchise consultant who can help match your values with the right brand.
Prioritize scalability: Choose models with room to expand as trends evolve.
Focus on engagement: The more interactive the customer experience, the stronger your business foundation.

Gen Z entrepreneurs are proving that franchise ownership doesn’t have to follow old rules. By focusing on experience-based businesses in fitness, entertainment, and social spaces, they’re redefining what it means to be successful.

If you’re curious about finding the right opportunity, remember: the best franchises to own aren’t always the most obvious; they’re the ones that align with your values, passions, and the experiences you want to create for others.

Ready to explore which Gen Z franchise opportunities could be your perfect fit? Visit Franchise MatchMakers and find your franchise match today.