Bottom line
- Total investment $147K – $560K including a $25K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $512K/year.
- Rated MODERATE with a risk score of 57/100. SBA loan default rate of 0.0% across 4 loans (below the industry average).
- System growing at 86.7% CAGR over 3 years with 28 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 Kokee Tea 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 Kokee Tea units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$512K
on $2.6M purchase
Total debt
$2.0M
SBA $1.3M + senior + seller note
Overview
About
Kokee Tea franchisees operate quick-service beverage retail locations specializing in tea-based drinks. Daily operations include preparing and serving specialty teas, managing point-of-sale transactions, inventory control, and customer service in leased retail spaces. Franchisees are responsible for staffing, local marketing, and maintaining brand standards across a protected territory.
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 · 4 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
Kokee Tea presents caution-level risk due to undisclosed profitability metrics, going concern status, and modest unit growth that obscures the true financial viability of franchise investment.
Score breakdown · what drove the 57 / 100 rating
- 01MEDNo Item 19 (Average Unit Volume) disclosed despite $512K avg revenue claim — cannot verify actual profitability or ROI
- 02HIGHGoing Concern status is FALSE — indicates potential franchisor financial instability or undisclosed operational challenges
- 03MINORHigh investment range ($147K-$559K) with opaque net income creates unclear path to break-even and ROI timeline
- 04MEDOnly 28 units with 21.7% YoY growth is modest for a tea franchise — limited scale and market validation
- 05MINOR5% royalty on gross revenues (not net) means franchisees pay royalties even during unprofitable months
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
4 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Kokee Tea · FDD (2024) PDF