Little Art House
Bottom line
- Total investment $106K – $192K including a $40K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $146K/year. Estimated payback in 5.5 years.
- Rated MODERATE with a risk score of 65/100.
- Emerging franchise — only 2 years of franchising with 3 units. Early-stage systems carry higher risk but may offer better territory availability.
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 Little Art House unit return on the cash you put in?
Unlevered ROIC · per unit
12%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Little Art House units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$234K
on $1.2M purchase
Total debt
$935K
SBA $0.6M + senior + seller note
Overview
About
Little Art House franchisees operate art education and creative studio spaces serving children and adults. Day-to-day activities include teaching art classes, managing student enrollment, scheduling instructors, maintaining studio facilities, and handling retail sales of art supplies. Franchisees manage both direct instruction and administrative responsibilities to grow their local student base.
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 · 21 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.
No SBA loan data available for this brand.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Little Art House presents caution-level risk due to corporate going concern issues, minimal franchisee base, unverified financial claims, and heavy fee structure relative to profitability.
Score breakdown · what drove the 65 / 100 rating
- 01HIGHGoing Concern status indicates financial instability or viability questions at corporate level
- 02MINOROnly 3 units with unknown growth trajectory suggests stalled or declining system expansion
- 03MINORNo Item 19 financial performance representation limits ability to validate the $26,902 average net income claim
- 04MINORHigh initial investment ($106,050–$191,500) relative to reported net income creates 4–7 year payback period
- 05MINOR6% royalty on gross revenue (not net) compounds financial pressure during low-margin 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
21 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Little Art House · FDD (2025) PDF