Bottom line
- Total investment $211K – $580K including a $35K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $617K/year. Estimated payback in 3.1 years.
- Rated AVOID with a risk score of 80/100.
- Emerging franchise — only 1 year of franchising with 1 units. Early-stage systems carry higher risk but may offer better territory availability.
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 Chaiwale & Co. unit return on the cash you put in?
Unlevered ROIC · per unit
14%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Chaiwale & Co. units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$370K
on $1.8M purchase
Total debt
$1.5M
SBA $0.9M + senior + seller note
Overview
About
Chaiwale & Co. franchisees operate tea-focused café concepts serving specialty chai and related beverages. Day-to-day operations involve inventory management, barista training, customer service, and local marketing to drive foot traffic in a protected territory. The model emphasizes premium tea sourcing and craft beverage preparation.
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 · 10 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.
No SBA loan data available for this brand.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Chaiwale & Co. presents extreme risk: a non-going-concern franchisor with pending fraud/breach litigation, only one operating unit, and unverified financial claims — avoid unless corporate restructuring and litigation resolution are documented.
Score breakdown · what drove the 80 / 100 rating
- 01HIGHGoing concern status is FALSE — indicates potential insolvency or financial distress at corporate level
- 02HIGHTwo active lawsuits involving founders (fraud allegations related to Pie Hole dissolution + breach of contract/trademark dilution) suggest governance and legal exposure
- 03MINOROnly 1 unit in system with unknown growth trajectory — no track record of scalability or franchisee success replication
- 04HIGHHigh investment range ($211K-$579.5K) coupled with single unit and litigation creates severe risk asymmetry
- 05HIGHFraud allegations in litigation directly undermine franchisee trust and corporate credibility
- 06MINORNo Item 19 financial performance representation available to validate $616K avg revenue claim
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
16 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Chaiwale & Co. · FDD (2025) PDF