Bottom line
- Total investment $167K – $233K including a $60K franchise fee, 7.0% ongoing royalty.
- Average unit revenue of $1.8M/year (median $1.6M). Estimated payback in 0.5 years.
- Rated MODERATE with a risk score of 60/100. 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 Square Cow unit return on the cash you put in?
Unlevered ROIC · per unit
111%
Above typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Square Cow units return on equity?
Equity IRR · 5-yr
35.0%
4.49× MOIC
Year-1 DSCR
2.33×
EBITDA ÷ debt service
Equity required
$5.1M
on $14.5M purchase
Total debt
$9.3M
SBA $5.0M + senior + seller note
Overview
About
Square Cow franchisees operate quick-service dairy/beverage-focused restaurants featuring milk-based products and related food offerings. Day-to-day responsibilities include managing a small storefront team, preparing fresh products, handling POS systems, inventory management, and executing the franchisor's operational standards across limited real estate footprints.
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 · 12 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
Square Cow presents a paradox of strong unit-level financials masked by franchisor distress, explosive unproven growth, and unverified earnings claims in a micro-franchise system.
Score breakdown · what drove the 60 / 100 rating
- 01HIGHGoing Concern warning indicates franchisor financial distress despite positive unit-level economics
- 02MINORExplosive 200% YoY unit growth (9 units) suggests rapid expansion with unproven sustainability and possible quality control issues
- 03MINORHigh franchise fee ($59,500) plus $167k-$233k total investment creates significant financial barrier relative to only 9 operating units for validation
- 04MEDNo Item 19 (Earnings Claims) disclosed — cannot independently verify the $1.8M average revenue and $395k net income figures across system
- 05MINOR7% royalty on gross sales (not net) is aggressive and reduces franchisee flexibility during downturns
- 06MINORExtremely small sample size (9 units) makes financial projections unreliable and vulnerable to outlier performance skewing averages
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
12 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Square Cow · FDD (2025) PDF