Bottom line
- Total investment $115K – $216K including a $48K franchise fee, 5.0% ongoing royalty.
- Average unit revenue of $260K/year (median $260K).
- Rated STRONG with a risk score of 42/100. SBA loan default rate of 0.0% across 14 loans (below the industry average).
- System growing at 72.2% CAGR over 3 years with 97 total units — strong expansion trajectory.
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 Tutu School unit return on the cash you put in?
Unlevered ROIC · per unit
24%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Tutu School units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$519K
on $2.6M purchase
Total debt
$2.1M
SBA $1.3M + senior + seller note
Overview
About
Tutu School franchisees operate dance and movement education studios primarily serving young children (ages 18 months–8 years) with proprietary ballet, hip-hop, and creative movement programming. Revenue comes from recurring class tuition (programming) and retail sales of dancewear/accessories. Franchisees manage instructor hiring, scheduling, parent communication, and facility operations while licensing branded curriculum and marketing materials from corporate.
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
Tutu School presents moderate-to-high risk due to undisclosed profitability, unprotected territory enabling cannibalization, corporate going concern status, and aggressive expansion with unclear unit economics.
Score breakdown · what drove the 42 / 100 rating
- 01MEDNo average net income disclosed despite $259K avg revenue — prevents ROI calculation and suggests profitability concerns
- 02MINORUnprotected territory creates direct competition risk; with 32.9% YoY growth, saturation is likely
- 03HIGHGoing Concern status is FALSE — indicates financial instability or operational uncertainty at corporate level
- 04MEDHigh total investment ($115K–$216K) relative to disclosed average revenue with unknown margins
- 05MINORRapid expansion (32.9% YoY) without protected territory suggests unsustainable growth or desperation for cash
- 06HIGHNo litigation disclosed but 'going concern' status suggests hidden financial distress
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
87 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Tutu School · FDD (2025) PDF