Bottom line
- Total investment $411K – $1.1M including a $60K franchise fee, 7.0% ongoing royalty.
- Average unit revenue of $425K/year (median $407K).
- Rated MODERATE with a risk score of 63/100. SBA loan default rate of 0.0% across 191 loans (below the industry average).
- 12 litigation matters disclosed in Item 3 — higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
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 CycleBar unit return on the cash you put in?
Unlevered ROIC · per unit
7%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 CycleBar units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$595K
on $3.0M purchase
Total debt
$2.4M
SBA $1.5M + senior + seller note
Overview
About
CycleBar franchisees operate indoor cycling studios offering high-energy stationary bike classes in a group fitness setting. Daily operations include managing instructors, scheduling classes, managing memberships and retail sales, maintaining equipment, and creating branded fitness experiences with music-synchronized cycling workouts.
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 · 17 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
CycleBar presents HIGH RISK due to accelerating unit decline, material litigation involving franchisor compliance violations, undisclosed net profitability, and regulatory enforcement actions — typical indicators of a struggling franchise system.
Score breakdown · what drove the 63 / 100 rating
- 01MINORDeclining unit count of 12.5% YoY indicates system contraction and potential franchisee dissatisfaction
- 02HIGHMultiple pending and completed litigation actions involving franchisor, including pre-sale disclosure violations and securities claims, suggesting compliance issues
- 03MEDNo average net income disclosed despite $425k average revenue — lack of transparency on actual profitability
- 04MINORHigh initial investment ($410k-$1.1M) with 7% royalty on gross sales creates significant financial risk in contracting system
- 05MINORCalifornia Consent Order and administrative penalty indicates regulatory enforcement action by state authorities
- 06HIGHGoing Concern status = False suggests potential financial instability at franchisor level
- 07MED10-year term commitment in declining market segment (indoor cycling) with limited exit clarity
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
81 numbers
One-time purchase · CSV download · Validation questions included
FDD download
CycleBar · FDD (2025) PDF