Bottom line
- Total investment $241K – $527K including a $40K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $313K/year (median $300K).
- Rated STRONG with a risk score of 49/100. SBA loan default rate of 0.0% across 106 loans (below the industry average).
- System growing at 26.2% CAGR over 3 years with 83 total units — strong expansion trajectory.
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 Cinnaholic unit return on the cash you put in?
Unlevered ROIC · per unit
8%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Cinnaholic units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$251K
on $1.3M purchase
Total debt
$1.0M
SBA $0.6M + senior + seller note
Overview
About
Cinnaholic franchisees operate quick-service cinnamon roll bakery cafes, primarily focused on customizable baked goods and specialty beverages. Day-to-day operations involve food preparation, customer service, inventory management, and point-of-sale transactions in small-format retail locations.
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 · 28 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
Cinnaholic presents CAUTION-level risk due to false going concern status, anemic unit growth, active litigation, undisclosed profitability, and leadership credibility issues that obscure true return potential on a $241k-$526k investment.
Score breakdown · what drove the 49 / 100 rating
- 01HIGHGoing Concern status is FALSE — franchisor may have material financial/operational uncertainty
- 02MINORStagnant unit growth at 2.5% YoY with only 83 units indicates struggling system expansion
- 03HIGHActive franchisor-initiated litigation against POS vendor and franchisee suggests operational/contractual conflicts
- 04MINORNo Item 19 (Average Net Income) disclosure limits ability to validate $241k-$526k investment ROI
- 05HIGHPrior CEO litigation involving bankruptcy trustee raises governance and fiduciary credibility concerns
- 06MINORHigh franchise fee ($40k) relative to thin average revenue ($313.5k) creates margin pressure
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
93 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Cinnaholic · FDD (2025) PDF