Bottom line
- Total investment $275K – $472K including a $50K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $701K/year.
- Rated MODERATE with a risk score of 57/100. SBA loan default rate of 0.0% across 22 loans (below the industry average).
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 Krak Boba unit return on the cash you put in?
Unlevered ROIC · per unit
27%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Krak Boba units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.1M
on $5.6M purchase
Total debt
$4.5M
SBA $2.8M + senior + seller note
Overview
About
Franchisees operate quick-service boba tea shops, managing POS systems, preparing specialty tea and tapioca beverages, handling inventory, and managing 2-6 employees. Day-to-day operations involve customer service, quality control, scheduling, and local marketing to drive foot traffic in a location-dependent beverage retail model.
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
Krak Boba is a pre-growth stage franchise with undisclosed profitability, uncertain unit economics, and franchisor going concern issues that make this a speculative, high-risk investment.
Score breakdown · what drove the 57 / 100 rating
- 01MINOROnly 7 units in system with unknown growth trajectory suggests minimal brand traction and unproven scalability
- 02MEDNet income not disclosed in FDD Item 19 — unable to validate $700,879 average revenue translates to actual profitability
- 03HIGHGoing Concern status is FALSE, indicating potential financial instability at franchisor level
- 04MINORHigh initial investment ($275k-$471k) relative to micro-franchise system size creates elevated risk if brand fails
- 05MINOR6% royalty on gross revenue (not net) means franchisees pay 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
31 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Krak Boba · FDD (2023) PDF