Casa de Corazon
Bottom line
- Total investment $916K – $4.3M including a $70K franchise fee, 7.0% ongoing royalty.
- Average unit revenue of $2.4M/year (median $2.7M). Estimated payback in 5.7 years.
- Rated MODERATE with a risk score of 57/100. SBA loan default rate of 0.0% across 23 loans (below the industry average).
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Casa de Corazon unit return on the cash you put in?
Unlevered ROIC · per unit
12%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Casa de Corazon units return on equity?
Equity IRR · 5-yr
32.0%
4.00× MOIC
Year-1 DSCR
2.52×
EBITDA ÷ debt service
Equity required
$6.8M
on $16.9M purchase
Total debt
$10.1M
SBA $5.0M + senior + seller note
Overview
About
Casa de Corazon franchisees operate what appears to be a restaurant, hospitality, or consumer-facing service business generating ~$2.4M in annual revenue per unit. Day-to-day operations likely involve staff management, customer service, inventory/supply chain, compliance with brand standards, and local marketing. Franchisees remit 7% of gross revenue as ongoing royalties to corporate.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 29 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator — not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Caution-to-High Risk: Undercapitalized brand (8 units) with active litigation, unverified financial claims, and no Item 19 substantiation creates material uncertainty around unit viability and franchisor reliability.
Score breakdown · what drove the 57 / 100 rating
- 01HIGHActive litigation by former franchisee alleging defamation, duress, and Franchise Act violations creates legal and reputational risk
- 02MINORHigh investment range ($916K-$4.2M) with only 8 units systemwide indicates unproven unit economics and scaling challenges
- 03MINOR33.3% YoY unit growth from extremely small base (8 units) is not statistically meaningful and suggests inconsistent franchisee recruitment
- 04HIGHNo Item 19 financial performance representations (Going Concern = False) prevents validation of claimed $453K average net income
- 05MINOR7% royalty on $2.4M average revenue extracts $168K annually; combined with overhead, franchisee profitability claims are unverifiable
- 06MINORLawsuit alleging settlement agreement nullification and CEO misconduct suggests potential franchisor credibility and governance issues
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
32 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Casa de Corazon · FDD (2025) PDF