Harlem ShakeFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Harlem Shake franchise requires a total initial investment of $412K – $849K, including a $40K franchise fee and an ongoing 6.0% royalty[2]. Per the 2025 FDD, average unit revenue was $3.0M[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $412K – $849K
- 28th pct Service Resta…
- Avg gross sales
- $3.0M
- 25th pct Service Resta…
- Royalty
- 6.0%
- 26th pct Service Resta…
- Units
- 2
- 6th pct Service Resta…
- SBA default
- N/A
Quick verdict · Full-Service Restaurants · color = vs category peers
Green = >15% above Full-Service Restaurants avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Each dollar invested generates 4.8x in gross revenue, well above the typical 1.5-2.5x range.
The franchisor's auditor raised doubt about continued operations. This is a serious risk signal.
108% cash-on-cash return (based on P&L Bottom Line). Above the 20% threshold most investors target.
Bottom line
- Total investment $412K – $849K including a $40K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $3.0M/year, with an estimated 108% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 46/100.
- Auditor 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
- Legal entity
- Harlem Shake Franchise LLC
- Ultimate parent
- Harlem Shake IPHC LLC
- CEO title
- Founder and Managing Member
- Jelena Pasic
- CEO experience
- 20 yrs
- Years in role or industry
- Founder active
- Yes
- Original founder still leading the business
- Incorporated in
- DE
- HQ
- 171 Valley Rd, River Edge, NJ 07661
- Auditor
- Citrin Cooperman & Company, LLP
- Audited financials
- Franchisor revenue
- $0
- vs $0 prior year
- ⚠ Going-concern note
- Disclosed in FDD 2025
- Auditor flagged doubt about continued operations. Verify against the latest FDD before deciding.
Overview
About
Harlem Shake franchisees operate food/beverage or entertainment venues using the Harlem Shake brand identity. Day-to-day operations likely involve inventory management, staff supervision, customer service, marketing, and compliance with franchisor standards. Without more specifics, the exact service model (quick-service, full-service, bar, dessert shop, etc.) remains unclear from available data.
- CEO
- Jelena Pasic
- Headquarters
- NJ
- Founded
- 2021
- FDD year
- 2025
- States available
- 1
FDD Item 7 · 2025 filing · 19 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Franchise Fee | $40K | $40K | |
| Your Training Expenses | $7K | $20K | |
| Premises Deposits | $10K | $35K | |
| Utilities Deposits | $1K | $5K | |
| Design and Architect Fees | $10K | $15K | |
| Leasehold Improvements, Construction and/or Remodeling | $150K | $450K | |
| Furniture, Fixtures, Equipment and Supplies | $125K | $150K | |
| Exterior Signage | $8K | $15K | |
| Business Licenses and Permits | $3K | $5K | |
| Computer Systems | $10K | $20K | |
| Security System | $8K | $15K | |
| Initial Inventory to Begin Operating | $10K | $15K | |
| Office Equipment and Supplies | $1K | $2K | |
| Professional Fees | $2K | $3K | |
| Grand Opening Advertising | $10K | $10K | |
| Insurance | $1K | $2K | |
| Accounting Service | $650 | $2K | |
| Operating Expenses / Additional Funds - 3 months | $15K | $45K | |
| Development Fee (Multi-Unit) | $57K | $57K | |
| Total initial investment | $469K | $906K |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
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
$303K
10.0% margin
Unlevered ROIC
46%
EBITDA / total invested capital
Payback
26 mo
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $412K – $849K
- Better than avg vs category
- Liquid capital req'd
- $15K – $45K
- Better than avg vs category
- Franchise fee
- $40K – $40K
- Better than avg vs category
- Royalty
- 6.0%
- Gross Revenue · typical 6–8%
- Ad fund
- 2.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
- Payback period
- 0.9 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 6.0% of gross sales |
| Marketing / ad fund | 2.0% of gross sales |
| Technology fee | $1K |
| Transfer fee | $20K |
| Renewal fee | $10K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $3.0M
- Per unit, per year
- Median gross sales
- N/A
- Avg p&l bottom line
- $680K
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 108.0%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- Profit and Loss Statements
- Sample size
- 2 units
- vs category median 13 · small
- Range (low → high)
- $2.2M→$3.9M
- Cohort dispersion (min → max)
- Transparency
- 9 / 5
- vs category median 4 / 5 · above
Compared against 1264 Full-Service Restaurants brands
Revenue is 4.8x the investment midpoint. At typical franchise margins, this suggests a payback under 3 years.
vs Full-Service Restaurants averages
How Harlem Shake Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 2
- Opened
- 0
- Last reporting year
- Closed
- 0
- Terminated
- 0
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 0.0%
- Company-owned
- 2
- Corporate units in the system
- % franchised
- 0%
- vs corporate-owned
- Multi-unit owners
- 1.0%
3-year detail · Item 20
- Transfers (3yr)
- 0
- Projected new
- 4
- Franchisor's next-year forecast
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 contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 1 7(a) loan on file; statistical reliability is limited below 10 loans.
- Total loans
- 1
- Loan volume
- $565K
- Median loan
- $565K
- 50th percentile
- Charge-off rate
- N/A
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 1
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Harlem Shake's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 1 lenders with concentration factor
- Per-state charge-off rates across 1 states
- Startup risk premium and job creation velocity
- 1-year lending trend
Instant access. No subscription.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Harlem Shake is a micro-franchise with only 2 units, no disclosed growth, missing financial disclosures, and unproven systemization — investor should treat as pre-revenue stage venture rather than established franchise.
Litigation (Item 3)
No litigation required to be disclosed
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Citrin Cooperman & Company, LLP⚠ Going-concern note flagged
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- 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 46 / 100 rating
- 01MEDOnly 2 existing units — extremely limited system size raises questions about scalability, support infrastructure, and franchisor viability
- 02MEDNo disclosed unit growth trajectory — unknown whether system is expanding, stagnant, or contracting; no Item 19 financial performance representation
- 03MINORWide investment range ($411k-$849k, 106% spread) suggests inconsistent unit economics or unclear cost structure
- 04MINORItem 19 appears absent — franchisor not publishing average unit volumes, which is a major transparency red flag in franchise disclosure
- 05MINORHigh royalty burden (6% weekly) combined with operational costs may compress margins if actual revenue underperforms the $3M average
- 06MINOROnly 10-year term is relatively short; renewal risk after initial period unclear
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 5 years |
| Allowed renewalsℹ | 1 |
| Territory type | zip codes, city blocks, or area |
| Protected territory | Yes |
| Territory radius | 0.5 mi |
| Online sales rights | 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 |
| RoFR response window | 30 days |
| Transfer requires consent | Yes |
| Termination notice | 5 days |
| Mandatory arbitration | No |
| Jury trial waiver | Yes |
| Governing law | New Jersey |
| Litigation count | 0 |
View Item 3 litigation summary
No litigation required to be disclosed
Items 10, 11
Training & Operations
- Classroom training
- 33 hrs
- On-the-job training
- 67 hrs
- Training location
- headquarters and/or affiliate-owned outlet, then on-site
- Ongoing training
- Required
- Field support
- 56 hrs/yr
- On-site visits per year
- Time to open
- 9 mo
- From signing to launch
- POS system
- Toast POS
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Toast POS
Item 20 · call current owners
Franchisee Contacts
17 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Harlem Shake · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Harlem Shake franchise?
The total investment to open a Harlem Shake franchise ranges from $412K – $849K, with an initial franchise fee of $40K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Harlem Shake franchise owners earn?
According to Item 19 of the Harlem Shake FDD, the average gross sales per unit is $3.0M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Harlem Shake's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Harlem Shake (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Harlem Shake franchise locations are there?
As of their most recent FDD filing, Harlem Shake has 2 total units in the United States, including 0 franchised units and 2 company-owned units.
Is Harlem Shake a good franchise to buy?
FranchiseVerdict rates Harlem Shake as a A-grade franchise with a risk score of 46 out of 100, 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
Are you the franchisor?
If you represent Harlem Shake, you can request corrections or provide updated information.
Claim this brandOther Full-Service Restaurants franchises
Compare similar franchise opportunities in the Full-Service Restaurants category
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.