TechstarsFranchise Cost, Revenue & Review 2026
Data from FDD filing
FranchiseVerdict summary · 2026
A Techstars franchise requires a total initial investment of $250K – $1.5M, including a $250K franchise fee and an ongoing 30.0% royalty[2]. The 2025 FDD does not disclose unit-level revenue (no Item 19). Verdict grade: D. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2025 FDD issuance
Overview
- Investment
- $250K – $1.5M
- 50th pct Business Serv…
- Avg gross sales
- N/A
- 29th pct Business Serv…
- Royalty
- 30.0%
- 35th pct Business Serv…
- Units
- 1
- 3rd pct Business Serv…
- SBA default
- N/A
Quick verdict · Business Services · color = vs category peers
Green = >15% above Business Services avg · No shading = within ±15% · Red = >15% below avg · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Started franchising in 2024. Newer systems carry more uncertainty but may offer better territories.
Bottom line
- Total investment $250K – $1.5M including a $250K franchise fee, 30.0% ongoing royalty.
- No Item 19 financial performance data disclosed. The franchisor chose not to publish revenue figures.
- Verdict D (Below Average) with a risk score of 70/100.
- No Item 19 financial performance representation. Without franchisor-disclosed revenue data, you'll need to gather unit economics directly from existing franchisees.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Techstars Startup Communities LLC
- Parent company
- Techstars Central LLC
- Incorporated in
- CO
- HQ
- 1660 Wynkoop St, Ste 800, Denver, CO 80202
- Auditor
- REDPATH AND COMPANY, LLC
- Audited financials
- Franchisor revenue
- $0
- Most recent fiscal year
Overview
About
Techstars franchisees operate as accelerator program operators or investment fund managers, sourcing early-stage startups, providing mentorship and structured programming, and managing carried interest (profit-sharing from portfolio company exits). Day-to-day activities include founder recruitment, curriculum delivery, investor networking events, and portfolio company support.
- CEO
- David Cohen
- Headquarters
- CO
- Founded
- 2024
- FDD year
- 2025
- States available
- 0
FDD Item 7 · 2025 filing · 8 line items
Initial investment breakdown
| Line item | Low | High | |
|---|---|---|---|
| Initial Feenot refundable | $0 | $850K | |
| Rent, Utilities, Furniture and Leasehold Improvements | $0 | $250K | |
| Expenses for Initial Techstars Programs | $10K | $100K | |
| Insurance | $15K | $50K | |
| Licenses and Permits | $5K | $15K | |
| Professional Fees (lawyer, accountant) | $30K | $100K | |
| Techstars Expensesnot refundable | $0 | $20K | |
| Additional Funds (for first 3 months) | $0 | $150K | |
| Total initial investment | $60K | $1.5M |
Line items extracted from FDD Item 7. Ranges reflect the franchisor's stated low and high per line. Total is the sum of line-item lows / highs — actual costs may fall outside this range depending on market and build-out scope.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $250K – $1.5M
- Near category avg vs category
- Liquid capital req'd
- $0 – $150K
- Better than avg vs category
- Franchise fee
- $250K
- Near category avg vs category
- Royalty
- 30.0%
- Carried Interest and Sponsorship Revenue Share · typical 6–8%
- Ad fund
- 0.0%
- typical 3–5%
- Total fee load
- 50.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Royalty | 30.0% of gross sales |
| Marketing / ad fund | 0.0% of gross sales |
| Technology fee | $20 |
| Renewal fee | $150 |
| Total fee load | 50.0% of rev |
Financial Performance
This franchisor did not disclose financial performance representations in Item 19, or our extractor could not parse them.
vs Business Services averages
How Techstars Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 1
- Opened
- 0
- Last reporting year
- Closed
- 0
- Turnover rate
- 0.0%
- Company-owned
- 1
- Corporate units in the system
- % franchised
- 0%
- vs corporate-owned
3-year detail · Item 20
- Transfers (3yr)
- 0
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 3 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 contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
No SBA loan data available for this brand.
Risk analysis
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Techstars presents HIGH RISK due to active litigation involving executive misconduct, an inactive franchise system (1 unit), opaque unit economics, and a predatory royalty structure with no performance disclosure.
Litigation (Item 3)
1 case reference(s): 0 pending, 0 settled.
Largest disclosed settlement: $500,000
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · REDPATH AND COMPANY, LLC
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Must buy proprietary products: No
- Restricted to system-approved products: No
Score breakdown · what drove the 70 / 100 rating
- 01HIGHLitigation involving key executive (CIO Andrew Cleland) alleging breach of fiduciary duty and fraud raises governance and integrity concerns
- 02MEDExtreme royalty structure (30% of carried interest + 15-30% sponsorship revenue) creates unusually high cost burden with no disclosed average revenue to assess viability
- 03MINOROnly 1 franchisee unit with unknown growth trajectory suggests failed or stalled franchise system expansion
- 04MEDNo disclosed average revenue or net income makes it impossible to validate ROI on $250,000 franchise fee + $60,000-$1.535M investment
- 05MINOR4-year term is unusually short and suggests parent company uncertainty or high franchisee turnover
- 06MINORUnprotected territory means direct competition from other Techstars franchisees or corporate operations in same market
- 07MINORNo Item 19 financial performance representations indicates either no franchisees or unwillingness to disclose unit economics
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 4 years |
|---|---|
| Renewal term | 1 year |
| Allowed renewalsℹ | 6 |
| Territory type | Metropolitan areas or particular cities |
| Protected territory | No |
| Online sales rights | Granted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Right of first refusalℹ | No |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Colorado |
| Litigation count | 1 |
View Item 3 litigation summary
1 case reference(s): 0 pending, 0 settled.
Items 10, 11
Training & Operations
- Classroom training
- 18 hrs
- On-the-job training
- 0 hrs
- Training location
- On-site and corporate
- Franchisor financing
- Offered
- Item 10
- POS system
- Application Management System (AMS), Bizzabo, and Notion
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Application Management System (AMS), Bizzabo, and Notion
Item 20 · call current owners
Franchisee Contacts
14 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Techstars · FDD (2025) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Techstars franchise?
The total investment to open a Techstars franchise ranges from $250K – $1.5M, with an initial franchise fee of $250K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Techstars franchise owners earn?
Techstars does not disclose average franchise owner earnings in their FDD Item 19. Not all franchisors are required to make financial performance representations. We recommend asking existing franchisees directly about their financial experience.
What is Techstars's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Techstars (fewer than 10 loans on file). Charge-off rates are one way to gauge franchise risk, but not all franchise loans go through the SBA program. We recommend reviewing turnover and closure data in the FDD and speaking with current franchisees.
How many Techstars franchise locations are there?
As of their most recent FDD filing, Techstars has 1 total units in the United States, including 0 franchised units and 1 company-owned units.
Is Techstars a good franchise to buy?
FranchiseVerdict rates Techstars as a D-grade franchise with a risk score of 70 out of 100, based on our analysis of investment costs, revenue data, SBA loan performance, and growth trends. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.