Russo’s New York Pizzeria
Bottom line
- Total investment $439K – $1.5M including a $35K franchise fee, 6.0% ongoing royalty.
- Average unit revenue of $882K/year (median $834K).
- Rated STRONG with a risk score of 44/100. SBA loan default rate of 0.0% across 21 loans (below the industry average).
- Auditor disclosed a going-concern note — flagged doubt about the franchisor's ability to continue operations. Verify against the latest FDD.
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 Russo’s New York Pizzeria 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 Russo’s New York Pizzeria units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$1.5M
on $7.5M purchase
Total debt
$6.0M
SBA $3.7M + senior + seller note
Overview
About
Russo's New York Pizzeria franchisees operate casual-dining pizza restaurants focused on New York-style pies and Italian cuisine. Day-to-day operations include managing staff, overseeing food preparation and quality, managing inventory and vendor relationships, handling point-of-sale operations, and driving local marketing and customer acquisition within 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 · 20 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
Russo's shows early-stage contraction with opaque profitability, regulatory compliance issues, and litigation concerns — suitable only for investors comfortable with higher risk and independent validation of franchisee economics.
Score breakdown · what drove the 44 / 100 rating
- 01MEDUnit count declined 3.4% YoY (36 units) indicating system contraction and potential market saturation or franchisee satisfaction issues
- 02MINORNo Item 19 (net income disclosure) provided despite average revenue of $882k — inability or unwillingness to disclose profitability is a major transparency concern
- 03MINORRegulatory penalty from California DFPI for unregistered marketing activity suggests compliance weaknesses at corporate level
- 04HIGHFranchisor litigation against former franchisee indicates potential disputes over arbitration enforcement and possible franchisee relationship deterioration
- 05MEDHigh investment range ($439k-$1.5M) combined with 6% royalty creates significant breakeven hurdle without disclosed net income benchmarks
- 06MINORSmall unit base (36 locations) limits brand recognition, marketing scale, and supply chain leverage compared to larger franchises
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
30 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Russo’s New York Pizzeria · FDD (2025) PDF