Tierra Encantada
Bottom line
- Total investment $1.6M – $4.5M including a $60K franchise fee.
- Average unit revenue of $2.4M/year (median $2.2M). Estimated payback in 7.1 years.
- Rated STRONG with a risk score of 47/100. 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 Tierra Encantada unit return on the cash you put in?
Unlevered ROIC · per unit
12%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Tierra Encantada units return on equity?
Equity IRR · 5-yr
28.7%
3.53× MOIC
Year-1 DSCR
2.82×
EBITDA ÷ debt service
Equity required
$10.1M
on $21.5M purchase
Total debt
$11.5M
SBA $5.0M + senior + seller note
Overview
About
Tierra Encantada franchisees operate interactive entertainment venues (likely theme park, trampoline park, or family entertainment center based on brand name meaning 'Enchanted Land'). Daily operations involve managing customer experiences, supervising staff, maintaining equipment/facilities, handling food/beverage sales, and managing safety compliance across a capital-intensive physical location.
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
Early-stage entertainment franchise with high capital requirements, unverified financial claims, and limited operational history presents moderate-to-significant risk without transparent unit-level performance data.
Score breakdown · what drove the 47 / 100 rating
- 01MINORHigh initial investment range ($1.5M-$4.5M) creates significant capital requirement and breakeven pressure
- 02MEDNo Item 19 (Financial Performance Representations) disclosed — cannot verify if average revenues of $2.39M and net income of $425K are achievable or typical
- 03MINORRoyalty structure with $500/week minimum ($26K annually) creates fixed cost burden even during slow periods
- 04MEDModest unit growth (16 units, 100% YoY) suggests early-stage franchise with limited track record and market validation
- 05MINORHigh investment-to-net-income ratio (3.6-10.6x) indicates slow payback period and elevated financial risk
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
Tierra Encantada · FDD (2026) PDF