Tierra EncantadaFranchise Cost, Revenue & Review 2026
Data from FDD filing + SBA 7(a) records
FranchiseVerdict summary · 2026
A Tierra Encantada franchise requires a total initial investment of $1.6M – $4.5M, including a $60K franchise fee. Per the 2026 FDD, average unit revenue was $2.4M[2]. Verdict grade: A. Run a live ROI scan →
Data last verified June 18, 2026 · figures per the 2026 FDD issuance
Overview
- Investment
- $1.6M – $4.5M
- 68th pct Education
- Avg gross sales
- $2.4M
- 42nd pct Education
- Royalty
- N/A
- Units
- 16
- 33rd pct Education
- SBA default
- 0.0%
- system-wide median varies by category
Quick verdict · Education · color = vs category peers
Green = >15% above Education 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
At 0.8x revenue per dollar invested, this system underperforms the typical 1.5-2.5x range.
Franchised units fell from 9 to 4 over 3 years. Investigate why operators are leaving.
Bottom line
- Total investment $1.6M – $4.5M including a $60K franchise fee.
- Average unit revenue of $2.4M/year (median $2.2M), with an estimated 14% cash-on-cash return (based on P&L Bottom Line).
- Verdict A (Top Quintile) with a risk score of 49/100.
Item 1 · who you're contracting with
The Franchisor
- Legal entity
- Tierra Encantada Franchising LLC
- Parent company
- Tierra Encantada LLC
- Incorporated in
- MN
- HQ
- 2700 30th Avenue, Minneapolis, MN 55406
- Auditor
- Eide Bailly LLP
- Audited financials
- Franchisor revenue
- $518K
- vs $682K prior year
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.
- CEO
- Kristen Denzer
- Headquarters
- MN
- Founded
- 2018
- FDD year
- 2026
- States available
- 2
FDD Item 7 · 2026 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $60K | $60K |
| Working capital (3–6 mo) | $150K | $300K |
| Equipment, build-out, other | $1.3M | $4.1M |
| Total initial investment | $1.6M | $4.5M |
Source: Tierra Encantada 2026 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Single-unit · estimated
Returns at a glance
Indicative numbers using FDD Item 7 / Item 19 inputs and category-benchmarked cost ratios. Full single-unit, 25-unit portfolio, and LBO models (with every input editable to stress-test your own scenario) live on the financials page.
Store EBITDA · annual
$382K
16.0% margin
Unlevered ROIC
12%
EBITDA / total invested capital
Payback
8.5 yrs
cash-on-cash, unlevered
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $1.6M – $4.5M
- Below avg, review vs category
- Liquid capital req'd
- $150K – $300K
- Near category avg vs category
- Franchise fee
- $48K – $60K
- Near category avg vs category
- Royalty
- Greater of (i) 7% of Gross Sales or (ii) $500 per week
- Ad fund
- 1.0%
- typical 3–5%
- Total fee load
- 8.0%
- vs 9–13% typical
- Payback period
- 7.1 yrs
- From FDD / Item 19
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Marketing / ad fund | 1.0% of gross sales |
| Technology fee | $398 |
| Transfer fee | $30K |
| Renewal fee | $5K |
| Total fee load | 8.0% of rev |
Financial Performance
- Avg gross sales
- $2.4M
- Per unit, per year
- Median gross sales
- $2.2M
- Avg p&l bottom line
- $426K
- Reported as P&L Bottom Line in FDD Item 19
- Cash-on-cash
- 14.1%
- Based on P&L Bottom Line / investment midpoint
- Item 19 type
- Historical
- Sample size
- 12 units
- vs category median 14
- Range (low → high)
- $914K→$4.4M
- Cohort dispersion (min → max)
- Transparency
- 7 / 5
- vs category median 4 / 5 · above
Compared against 237 Education brands
Revenue is only 0.8x the investment. This means each unit may take 5+ years to recoup the initial outlay at typical margins.
vs Education averages
How Tierra Encantada Compares
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 16
- Opened
- 3
- Last reporting year
- Closed
- 0
- Turnover rate
- 0.0%
- Company-owned
- 12
- Corporate units in the system
- % franchised
- 25%
- vs corporate-owned
- Net growth (yr3)
- +100.0%
- Net unit change last year
- 3-yr CAGR
- +100.0%
- Compounded over last 3 years
3-year detail · Item 20
- Transfers (3yr)
- 0
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 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.
Fast growth in a small system. Newer franchisors expanding quickly may not yet have the support infrastructure of larger systems.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA loan disclosures. This brand has only 2 7(a) loans on file; statistical reliability is limited below 10 loans.
- Total loans
- 2
- Loan volume
- $3.0M
- Median loan
- $1.5M
- 50th percentile
- Charge-off rate
- 0.0%
- rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- N/A
- 5-yr charge-off
- N/A
- Loans approved 2021+
- Active lenders
- 1
- Defaults
- 0
Explore lender portfolios on Bank Reports or regional data on State Reports.
Premium insight
SBA Lending Report
Deep-dive into Tierra Encantada's SBA lending history: lender network, geographic footprint, interest rates, and more.
SBA Lending Report
- Principal loss rate and NAICS industry benchmark
- 1 lenders with concentration factor
- Per-state charge-off rates across 1 states
- Startup risk premium and job creation velocity
- 2-year lending trend
Instant access. No subscription.
Risk analysis
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.
Audited financials (Item 21)
Yes · Eide Bailly LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Score breakdown · what drove the 49 / 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
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| Territory type | Population |
| Protected territory | Yes |
| Online sales rights | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Non-compete (years)ℹ | 2 years |
| Right of first refusalℹ | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Jury trial waiver | Yes |
| Governing law | Minnesota |
| Litigation count | 0 |
Items 10, 11
Training & Operations
- Classroom training
- 84 hrs
- On-the-job training
- 20 hrs
- POS system
- Lineleader
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: Lineleader
Item 20 · call current owners
Franchisee Contacts
25 owners to call
Name · phone · city · state. Extracted from FDD Item 20
FDD download
Tierra Encantada · FDD (2026) PDF
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a Tierra Encantada franchise?
The total investment to open a Tierra Encantada franchise ranges from $1.6M – $4.5M, with an initial franchise fee of $60K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do Tierra Encantada franchise owners earn?
According to Item 19 of the Tierra Encantada FDD, the average gross sales per unit is $2.4M. The median is $2.2M. Note: this is gross revenue, not profit. Actual owner earnings vary based on location, operating costs, and management.
What is Tierra Encantada's franchise failure rate?
SBA 7(a) loan charge-off data is not available for Tierra Encantada (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 Tierra Encantada franchise locations are there?
As of their most recent FDD filing, Tierra Encantada has 16 total units in the United States, including 9 franchised units and 12 company-owned units. 3 new units were opened in the latest reporting year.
Is Tierra Encantada a good franchise to buy?
FranchiseVerdict rates Tierra Encantada as a A-grade franchise with a risk score of 49 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.