Bottom line
- Total investment $1.0M – $1.4M including a $45K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $2.3M/year (median $2.0M).
- Rated MODERATE with a risk score of 63/100. SBA loan default rate of 0.0% across 4 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 Riko’s Pizza unit return on the cash you put in?
Unlevered ROIC · per unit
28%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Riko’s Pizza units return on equity?
Equity IRR · 5-yr
29.9%
3.70× MOIC
Year-1 DSCR
2.70×
EBITDA ÷ debt service
Equity required
$8.6M
on $19.4M purchase
Total debt
$10.8M
SBA $5.0M + senior + seller note
Overview
About
Franchisees operate quick-service or casual pizza restaurants under the Riko's brand, managing daily operations including food preparation, inventory control, staffing, and customer service. Daily responsibilities involve managing kitchen production, point-of-sale operations, delivery coordination (if applicable), and local marketing to drive repeat customer traffic.
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 · 15 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
Micro-scale pizza franchise with non-disclosure of profitability metrics and franchisor going concern issues presents elevated risk despite claimed average revenues.
Score breakdown · what drove the 63 / 100 rating
- 01MEDNo Item 19 (Average Unit Volume) disclosed despite $2.29M average revenue claim — inability or unwillingness to substantiate earnings
- 02HIGHGoing Concern status is FALSE, suggesting potential financial viability issues at franchisor level
- 03MINOROnly 8 units system-wide is extremely small; 33.3% YoY growth could mean growing from 6 to 8 units — minimal scale and unproven model
- 04MEDHigh investment range ($1.0M–$1.4M) paired with undisclosed net income creates severe ROI opacity
- 05HIGHNo litigation disclosed is notable given franchisor's apparent financial stress
- 06MINOR6% royalty is standard but high initial franchise fee ($45K) plus massive capex suggests long breakeven period
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
25 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Riko’s Pizza · FDD (2024) PDF