16 Handles Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
16 Handles is a self-serve frozen yogurt franchise where guests fill cups and choose toppings priced by weight. Franchisees run the shops, managing equipment, product inventory, and quick-service operations.
FranchiseVerdict summary · 2026
A 16 Handles franchise requires a total initial investment of $250K – $657K, including a $30K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $805K[2]. SBA 7(a) loans show a 0.0% charge-off rate across 13 loans[1]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2025 FDD issuance
Overview
- Investment
- $250K – $657K
- 38th pct Service Resta…
- Avg gross sales
- $805K
- 11th pct Service Resta…
- Royalty
- 6.0%
- 46th pct Service Resta…
- Units
- 31
- 56th pct Service Resta…
- SBA charge-off
- 0.0%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Quick-Service Restaurants · color = vs category peers
Green = favorable by >10% vs Quick-Service Restaurants avg · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $250K – $657K including a $30K franchise fee, 6.0% ongoing royalty.
- RETURNSAverage unit revenue of $805K/year (median $750K).
- RISKVerdict A (Strongest tier), verdict score 78/100 (higher is better). SBA loan charge-off rate of 0.0% across 13 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- 16 Handles Franchising LLC
- Predecessor
- Yo Fresh Inc.
- Prior franchisor entity
- CEO title
- Chief Executive Officer and Managing Member
- Neil Hershman
- Incorporated in
- Delaware
- HQ
- 450 Park Avenue South, Floor 3, New York, NY 10016
- Auditor
- Muhammad Zubairy, CPA
- Audited financials
- Franchisor revenue
- $1.9M
- vs $1.7M prior year
Overview
About
- CEO
- Neil Hershman
- Headquarters
- NY
- Founded
- 2022
- FDD year
- 2025
- States available
- 5
Can you afford it, and what does the money buy?
Entry cost runs 31% below the typical quick-service restaurants franchise.
Source: FDD 2025 · Items 5–7
Full Item 7 breakdown17 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Feenot refundable | $30K | $30K | |
| Rent and Security Depositnot refundable | $5K | $30K | |
| Utility and Other Depositsnot refundable | $0 | $3K | |
| Architect and Design Feesnot refundable | $8K | $20K | |
| Leasehold Improvementsnot refundable | $60K | $180K | |
| Exterior Signagenot refundable | $5K | $12K | |
| Furniture, Fixtures and Equipment (Including Soft Serve Machines)not refundable | $110K | $310K | |
| Smallwaresnot refundable | $5K | $10K | |
| POS System; License Feenot refundable | $1K | $2K | |
| Back-Office Computer, Office Equipment and Suppliesnot refundable | $500 | $2K | |
| Business Licenses & Permitsnot refundable | $500 | $2K | |
| Professional Feesnot refundable | $500 | $5K | |
| Initial Inventory of Food and Paper Suppliesnot refundable | $8K | $15K | |
| Insurance (Initial 3 Months)not refundable | $1K | $3K | |
| Training Expenses (Travel and Accommodation)not refundable | $500 | $3K | |
| Grand Opening Marketingnot refundable | $10K | $10K | |
| Additional Funds (for initial period of operations)not refundable | $5K | $20K | |
| Total initial investment | $250K | $657K |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $250K – $657K
- Top 40% of category vs category
- Liquid capital req'd
- $5K – $20K
- Top 40% of category vs category
- Franchise fee
- $30K – $30K
- Top 40% of category vs category
- Royalty
- 6.0%
- percentage · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $95 |
| Training fee | $150 |
| Transfer fee | $15K |
| Renewal fee | $10K |
| Inventory (initial) | $8K – $15K |
| Total fee load | 8.0% of rev |
What do units actually make?
Average unit sales run 33% below the quick-service restaurants norm.
Source: FDD 2025 · Item 19
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$113K
14.0% margin
Unlevered ROIC
24%
EBITDA / total invested capital
Payback
4.1 yrs
cash-on-cash, unlevered
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
What one unit earns on your invested capital
Model A · Single-Unit Return
Computes unlevered return on invested capital (ROIC) for a single franchise unit. The target band for an attractive franchise is 30–60% ROIC. Below that and a passive index fund likely outperforms; above that and the franchisor has pricing power you're subsidizing.
Note: Item 19 revenue is what the franchisor discloses. It's the top line only. Operating costs below are category estimates. Override them to match your real lease quote, labor market, and build-out budget.
Returns model · single-unit ROIC
What would one 16 Handles unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
24%
Below the 30–60% attractive-franchise band
What 25 units return when you use SBA financing
Model B · Return on Equity: Debt-Financed Acquisition
Models a 25-unit portfolio acquisition financed with an SBA 7(a) loan. Shows equity IRR (your return on cash invested), DSCR (how safely the cash flow covers debt service), and the capital stack (SBA + seller + equity breakdown).
This is the “search fund” or “entrepreneurship through acquisition” scenario: you buy an existing multi-unit operator, use leverage to amplify returns, and either operate or hire management. The 25-unit size is the typical minimum for an SBA-backed franchise portfolio acquisition to pencil as a full-time income.
What “return on equity” means here: if you put in $500K of your own cash and the business generates enough EBITDA to pay down debt and grow, your equity IRR is the annual return on that $500K, including the value created when you eventually sell. Target IRR for a search fund is typically 25–35%.
Levered LBO scenario · Yale Crease Capital framing
What would 25 16 Handles units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.1M
on $5.6M purchase
Total debt
$4.5M
SBA $2.8M + senior + seller note
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2025 FDD
Financial Performance
- Avg gross sales
- $805K
- Per unit, per year
- Median gross sales
- $750K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- gross sales
- Sample size
- 24 outlets
- vs category median 20
- Range (low → high)
- $431K→$2.1M
- Cohort dispersion (min → max)
- Quartile band
- $547K→$1.2M
- Bottom 25% → top 25%
- Reporting year
- 2024
- Fiscal year the figures cover
- Source filing
- FDD 2025
- Disclosed in the 2025 filing, covering 2024
- Transparency
- 6 / 10
- vs category median 4 / 10 · above
Compared against 782 Quick-Service Restaurants brands
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Unit economics
Average unit generates $805K/year in gross sales. Revenue-to-investment ratio: 1.8x.
Fee burden
Total ongoing fee load of 8.0% (near the Quick-Service Restaurants average).
Disclosure
Transparency score 6/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 6.9% CAGR over 3 years across 31 units — operators are staying and new ones are joining.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Quick-Service Restaurants averages
How 16 Handles Compares
Is the system healthy?
Source: FDD 2025 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 31
- Opened
- 4
- Last reporting year
- Closed
- 2
- Turnover rate
- 6.5%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- +6.9%
- Net unit change over 3 years
- 3-yr CAGR
- +6.9%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 4
- Closed (3yr)
- 2
- Terminated (3yr)
- 0
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 2
- Reacquired (3yr)
- 0
- Franchisor bought back
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 5 states reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
5
states with franchisees (per FDD Item 12)
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 13
- Loan volume
- $6.2M
- Median loan
- $225K
- 50th percentile
- Charge-off rate
- 0.0%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 100.0%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 9
- Defaults
- 0
- Typical loan rate
- 8.6%
- avg rate to borrowers
- Franchised industry avg
- 10.6%
- brand beats franchise avg ↓
- Jobs supported
- 92
- 1.5 per loan
- Lender concentration
- 23%
- top lender's share
Borrower mix: 50% went to startups / new businesses, 50% to established operators
Franchise vs independent — in snack and nonalcoholic beverage bars, franchised businesses charge off at 10.6% vs 8.9% for independents — franchising is associated with 19% higher SBA default risk in this category.
Top lenders financing 16 Handles franchisees
Showing 3 of 9 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into 16 Handles's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 9 lenders with concentration factor
- Per-state charge-off rates across 6 states
- Startup risk premium and job creation velocity
- 7-year lending trend
Instant access. No subscription.
With a 0.0% charge-off rate across 13 loans, banks have historically viewed this brand favorably for lending.
What could kill this investment?
SBA loans charge off at 0.0% — 100% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
16 Handles presents caution-level risk: meaningful profitability gaps, slow growth trajectory, and lack of transparent earnings disclosure despite high capital requirements warrant careful due diligence before commitment.
Litigation (Item 3)
No litigation is required to be disclosed in this Item.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Muhammad Zubairy, CPA
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Must buy proprietary products: No
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 78 / 100 verdict
- 01MEDNo Item 19 (Average Unit Volume) disclosed despite $804,648 average revenue claim — unable to verify profitability or validate earnings claims
- 02MEDSlow unit growth of 6.9% YoY with only 31 total units suggests limited brand momentum and potential market saturation concerns
- 03MEDHigh investment range ($249,500–$656,500) combined with undisclosed net income creates uncertainty about ROI timeline and break-even point
- 04MINORBroad territory protection language without specifics (radius, population density) may create disputes or inadequate market exclusivity
- 05MINOR6% royalty on gross sales (not net) means franchisees pay royalties even in loss-making months, increasing financial pressure
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 8.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2025 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 2 |
| Territory type | protected |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 25 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | No |
| Arbitration location | New York, NY |
| Jury trial waiver | Yes |
| Governing law | Delaware |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation is required to be disclosed in this Item.
Items 10, 11
Training & Operations
- Classroom training
- 28 hrs
- On-the-job training
- 81 hrs
- Training location
- New York City, Fairfield CT or other designated location (plus remote video conference)
- Ongoing training
- Required
- Time to open
- 9 mo
- From signing to launch
- Site selection
- franchisee with franchisor approval
- Franchisor financing
- Not offered
- Item 10
- POS system
- Toast
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Toast
Item 20 · call current owners
Franchisee Contacts
50 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
16 Handles · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a 16 Handles franchise?
The total investment to open a 16 Handles franchise ranges from $250K – $657K, with an initial franchise fee of $30K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do 16 Handles franchise owners earn?
According to Item 19 of the 16 Handles FDD, the average gross sales per unit is $805K. The median is $750K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the 16 Handles FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the 16 Handles FDD and qualifies whose outlets they describe.
What is 16 Handles's franchise failure rate?
Based on SBA 7(a) loan data, 16 Handles has a charge-off rate of 0.0% across 13 loans, meaning 0.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many 16 Handles franchise locations are there?
As of their most recent FDD filing, 16 Handles has 31 total units in the United States, including 31 franchised units and 0 company-owned units. 4 new units were opened in the latest reporting year.
Is 16 Handles a good franchise to buy?
FranchiseVerdict rates 16 Handles as a A-grade franchise with a verdict score of 78 out of 100 (higher is better), based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
Are you the franchisor?
If you represent 16 Handles, you can request corrections or provide updated information.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.