Bottom line
- Total investment $213K – $465K including a $50K franchise fee.
- Average unit revenue of $519K/year. Estimated payback in 4.0 years.
- Rated STRONG with a risk score of 48/100. SBA loan default rate of 0.0% across 3 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 The Coven® unit return on the cash you put in?
Unlevered ROIC · per unit
22%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 The Coven® units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$831K
on $4.2M purchase
Total debt
$3.3M
SBA $2.1M + senior + seller note
Overview
About
The Coven® franchisees operate what appears to be a specialized retail or wellness/lifestyle concept. Day-to-day operations likely involve direct customer service, inventory management, staff supervision, and marketing activities within a protected territory. Franchisees are responsible for achieving approximately $519k in annual revenue while maintaining operations under corporate standards.
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 12 · 2 states reported
The Territory Map
FDD Item 12 reports the state count, but the specific list isn't in our current data. The map will appear once we re-extract from the FDD or enough franchisee contacts are available.
2
states with franchisees (per FDD Item 12)
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
Early-stage franchise with unproven unit economics, minimal system stability, and aggressive royalty structure that could strain profitability in variable revenue months.
Score breakdown · what drove the 48 / 100 rating
- 01MEDExtremely small franchise system (only 6 units) indicates unproven scalability and limited peer support network
- 02MINOR100% YoY unit growth from 3 to 6 units is mathematically volatile and statistically unreliable for projecting future performance
- 03MINORHigh royalty floor ($800/month minimum = $9,600 annually) creates cash flow burden even in slow months, representing 11.4% of average net income
- 04MINORNo Item 19 financial performance representations provided despite claiming $519k average revenue — franchisor may lack confidence in numbers
- 05MINORSignificant investment range ($213k-$465k spread) suggests unclear initial costs and inconsistent 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
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
5 numbers
One-time purchase · CSV download · Validation questions included