Ellie Mental Health Franchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
Ellie Mental Health is a healthcare franchise operating outpatient mental-health and teletherapy clinics. Franchisees run a clinic managing a network of licensed therapists, patient intake, scheduling, and insurance billing.
FranchiseVerdict summary · 2026
A Ellie Mental Health franchise requires a total initial investment of $392K – $680K, including a $60K franchise fee and an ongoing 7.5% royalty[2]. Per the 2026 FDD, average unit revenue was $818K[2]. SBA 7(a) loans show a 0.9% charge-off rate across 113 loans[1]. FranchiseVerdict grade: C (Average), an editorial assessment, not investment advice. Run a live ROI scan →
Data last verified · figures per the 2026 FDD issuance
Overview
- Investment
- $392K – $680K
- 64th pct Healthcare
- Avg gross sales
- $818K
- 13th pct Healthcare
- Royalty
- 7.5%
- 44th pct Healthcare
- Units
- 249
- 73rd pct Healthcare
- SBA charge-off
- 0.9%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Healthcare · color = vs category peers
Green = favorable by >10% vs Healthcare 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 $392K – $680K including a $60K franchise fee, 7.5% ongoing royalty.
- RETURNSAverage unit revenue of $818K/year (median $765K).
- RISKVerdict C (Average), verdict score 60/100 (higher is better). SBA loan charge-off rate of 0.9% across 113 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- FLAGAuditor disclosed a going-concern note, which flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- Ellie Fam LLC
- Parent company
- EMH PEP Holdco, LLC
- Ultimate parent
- Princeton Equity Group, LLC
- Predecessor
- Ellie Family Services, PLLP (EFS); Ellie MSO, LLC
- Prior franchisor entity
- CEO title
- Chief Executive Officer
- Michael DiMarco
- Incorporated in
- MN
- HQ
- 1345 Mendota Heights Road, Suite 800, Mendota Heights, Minnesota 55120
- Auditor
- Boyum & Barenscheer, PLLP
- Audited financials
- Franchisor revenue
- $28.5M
- vs $21.5M prior year
- ⚠ Going-concern note
- Disclosed in FDD 2026
- Auditor flagged doubt about continued operations. Verify against the latest FDD before deciding.
Overview
About
- CEO
- Michael DiMarco
- Headquarters
- MN
- Founded
- 2019
- FDD year
- 2026
- States available
- 38
Can you afford it, and what does the money buy?
Entry cost runs 29% above the typical healthcare franchise.
Source: FDD 2026 · Items 5–7
FDD Item 7 · 2026 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $60K | $60K |
| Working capital (3–6 mo) | $177K | $231K |
| Equipment, build-out, other | $155K | $389K |
| Total initial investment | $392K | $680K |
Source: Ellie Mental Health 2026 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $392K – $680K
- Middle of category vs category
- Liquid capital req'd
- $177K – $231K
- Bottom third — review vs category
- Franchise fee
- $60K – $60K
- Middle of category vs category
- Royalty
- 7.5%
- formula · typical 6–8%
- Ad fund
- $100 per month per Qualified Clinician and Qualified Pres…
- Total fee load
- 7.5%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 7.5% of gross sales |
| Technology fee | $365 |
| Training fee | $3K |
| Transfer fee | $10K |
| Renewal fee | $10K |
| Total fee load | 7.5% of rev |
What do units actually make?
Average unit sales run 42% below the healthcare norm.
Source: FDD 2026 · 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
$119K
14.5% margin
Unlevered ROIC
16%
EBITDA / total invested capital
Payback
6.2 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 Ellie Mental Health unit return on the cash you put in?
Unlevered ROIC · per unit
Estimated return on your total franchise investment, before any debt financing.
16%
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 Ellie Mental Health units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.2M
on $6.1M purchase
Total debt
$4.9M
SBA $3.1M + 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: 2026 FDD
Financial Performance
- Avg gross sales
- $818K
- Per unit, per year
- Median gross sales
- $765K
Gross sales are revenue before expenses — not profit. Actual owner earnings depend on rent, labor, royalties, marketing fees, and debt service.
- Item 19 type
- collected revenue actual by cohort
- Sample size
- 188
- vs category median 20 · large
- Range (low → high)
- $46K→$2.9M
- Cohort dispersion (min → max)
- Reporting year
- 2025
- Fiscal year the figures cover
- Source filing
- FDD 2026
- Disclosed in the 2026 filing, covering 2025
- Transparency
- 4 / 10
- vs category median 3 / 10 · above
Compared against 162 Healthcare 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 $818K/year in gross sales. Revenue-to-investment ratio: 1.5x.
Fee burden
Total ongoing fee load of 7.5% (near the Healthcare average).
Disclosure
Transparency score 4/10 — this franchisor discloses detailed breakdowns (quartiles, segments, or cohort data). Buyers can model unit economics with higher confidence.
Operator retention
System expanding at 36.1% CAGR over 3 years across 249 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 Healthcare averages
How Ellie Mental Health Compares
Is the system healthy?
Source: FDD 2026 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 249
- Opened
- 18
- Last reporting year
- Closed
- 0
- Terminated
- 3
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 7.5%
- Company-owned
- 0
- Corporate units in the system
- % franchised
- 100%
- vs corporate-owned
- Net growth (3-yr)
- +36.1%
- Net unit change over 3 years
- 3-yr CAGR
- +36.1%
- Compounded over last 3 years
3-year detail · Item 20
- Opened (3yr)
- 75
- Closed (3yr)
- 1
- Terminated (3yr)
- 17
- Non-renewed (3yr)
- 0
- Transfers (3yr)
- 14
- Reacquired (3yr)
- 0
- Franchisor bought back
- Transfer rate
- 2.3%
- Owners selling to other franchisees
- Continuity rate
- 98.8%
- Units that stayed open
- Termination rate
- 1.2%
- Franchisor-initiated terminations
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 12 · 38 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.
38
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
- 113
- Loan volume
- $21.8M
- Median loan
- $223K
- 50th percentile
- Charge-off rate
- 0.9%
- 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)
- 99.1%
- 5-yr charge-off
- 9.1%
- Loans approved 2021+
- Active lenders
- 12
- Defaults
- 1
- Typical loan rate
- 9.7%
- avg rate to borrowers
- vs industry
- 1.4%
- brand is below its industry ↓
- Jobs supported
- 2,345
- 10.8 per loan
- Lender concentration
- 86%
- top lender's share
Borrower mix: 96% went to startups / new businesses, 4% to established operators
Top lenders financing Ellie Mental Health franchisees
Showing 3 of 12 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 Ellie Mental Health's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 10 lenders with concentration factor
- Per-state charge-off rates across 15 states
- Startup risk premium and job creation velocity
- 5-year lending trend
Instant access. No subscription.
With a 0.9% charge-off rate across 113 loans, banks have historically viewed this brand favorably for lending.
What could kill this investment?
The auditor flagged going-concern doubt (Item 21) — the single biggest risk here.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
⚠ Grade capped at C: the auditor disclosed a going-concern note (FDD Item 21). The verdict score reflects the underlying financials before that cap.
Growing but litigation-plagued mental health franchise with undisclosed profitability, misrepresentation claims around core business infrastructure, and franchisor-initiated legal action indicating deteriorating franchisee relationships.
Litigation (Item 3)
Five pending civil actions as franchisor-defendant (former/current franchisees alleging misrepresentation re EHR, billing, credentialing services); two pending franchisor-initiated actions (noncompete enforcement with counterclaims); one concluded bankruptcy/noncompete action against former franchisee.
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Boyum & Barenscheer, PLLP⚠ Going-concern note flagged
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: Yes
- Kickbacks from required suppliers: Yes
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
- Can negotiate own supplier terms: No
Score breakdown · what drove the 60 / 100 verdict
- 01HIGHActive litigation from franchisees alleging misrepresentation of critical backend services (EHR, billing, credentialing) — core to operations
- 02MINORFranchisor pursuing aggressive non-compete enforcement suggests franchisee dissatisfaction and potential exit disputes
- 03MINORHigh unit growth rate (31.1% YoY) may mask underlying churn; 255 units is still small system vulnerable to reputation damage
- 04MINORInitial investment spread ($392K-$680K) with 7.5% royalty on collected (not gross) revenue creates cash flow pressure for slow-paying practices
- 05MINORHealthcare compliance exposure: mental health licensing, telehealth regulations, HIPAA liability not clearly addressed
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 7.5% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2026 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| Territory type | protected |
| Protected territory | No |
| Exclusive territoryℹ | No |
| Territory radius | 3 mi |
| Territory population | 75,000 |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Optional |
| Non-compete (years)ℹ | 2 years |
| Non-compete (miles)ℹ | 10 mi |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Termination groundsℹ | 9 |
| Mandatory arbitration | Yes |
| Arbitration location | Minnesota |
| Jury trial waiver | Yes |
| Governing law | MN |
| Litigation count | 8 |
View Item 3 litigation summary
Five pending civil actions as franchisor-defendant (former/current franchisees alleging misrepresentation re EHR, billing, credentialing services); two pending franchisor-initiated actions (noncompete enforcement with counterclaims); one concluded bankruptcy/noncompete action against former franchisee.
Items 10, 11
Training & Operations
- Classroom training
- 27 hrs
- On-the-job training
- 0 hrs
- Training location
- Minnesota (corporate headquarters or affiliate location) or virtual
- Ongoing training
- Required
- Field support
- 0 hrs/yr
- On-site visits per year
- Time to open
- 9 mo
- From signing to launch
- Site selection
- franchisee
- Franchisor financing
- Not offered
- Item 10
- POS system
- EHR Systems
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: EHR Systems
Item 20 · call current owners
Franchisee Contacts
214 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Ellie Mental Health · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Ellie Mental Health franchise?
The total investment to open a Ellie Mental Health franchise ranges from $392K – $680K, with an initial franchise fee of $60K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Ellie Mental Health franchise owners earn?
According to Item 19 of the Ellie Mental Health FDD, the average gross sales per unit is $818K. The median is $765K. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Item 19 in the Ellie Mental Health 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 Ellie Mental Health FDD and qualifies whose outlets they describe.
What is Ellie Mental Health's franchise failure rate?
Based on SBA 7(a) loan data, Ellie Mental Health has a charge-off rate of 0.9% across 113 loans, meaning 0.9% 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 Ellie Mental Health franchise locations are there?
As of their most recent FDD filing, Ellie Mental Health has 249 total units in the United States, including 249 franchised units and 0 company-owned units. 18 new units were opened in the latest reporting year.
Is Ellie Mental Health a good franchise to buy?
FranchiseVerdict rates Ellie Mental Health as a C-grade franchise with a verdict score of 60 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
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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.