Passive Franchise Investing for Accredited Investors

By enabling regular people to participate in fractional shares of franchises, FranShares is revolutionizing the concept of franchise investing. With this novel strategy, you can avoid the drawbacks of conventional franchise investment while generating passive income.

Even better, anyone can use the platform, regardless of rank. But are FranShares a trustworthy substitute for outright franchise ownership?

If you are an accredited investor looking to diversify your portfolio and generate passive income, FranShares may be for you. FranShares is a platform that enables approved investors to invest in proven franchise businesses without having to manage them directly.

The article below will examine FranShares in-depth, going into its background, method of investing, and potential advantages. We'll also discuss any potential downsides and things investors should think about before making a decision. This will enable us to do a thorough analysis of the trading platform.

Learn About the Benefits of Investing in Franchises

For a variety of reasons, franchises are a highly sought-after asset type. After all, franchises are trustworthy, tried-and-true enterprises. Because of these features, they have an advantage over almost every other asset category.

However, it is prudent to carefully analyze why everyone should have the opportunity to invest in legitimate, money-making assets.

Even though franchises are everywhere, investing in them is not so simple. Getting in touch with the franchisor directly is the first option. This typically requires the investor to conduct in-depth research and perform manual labor.

The second method is using a franchise broker. Like a stockbroker, a franchise broker would conduct extensive due diligence on your behalf and provide recommendations regarding which franchises to pursue.

In either case, this would call for a substantial sum of money (perhaps over $1,000,000) as well as experience in franchise administration.

So far, though, there has not been an effective way to indirectly invest in franchises other than through syndicates (becoming a partner who raises capital for the franchise investment). This is where FranShares comes in.

What is Franshares?

FranShares is a privately held investment company that provides certified investors with passive investments in well-established franchise businesses. Don Johnson and Steve Beagelman, both with extensive experience in the franchise industry, co-founded the company in 2015.

FranShares works with successful franchise companies looking to develop and grow their operations. On behalf of its investors, the firm invests in these franchises. This benefits them by allowing them to collect passive income from the franchise's continued operations.

The team behind Franshares prides itself in being the first all-inclusive passive franchise investment platform. Their main goal is to give their clients the opportunity to achieve diversification and passive income through franchise investments.

Who Is the Owner of Franshares?

Kenny Rose, a former Merrill Lynch financial counselor who regularly advised high-net-worth individuals and had prior franchise experience, owns FranShares. Rose previously worked at FranNet, which is known as the world's largest franchise brokerage.

He is also the CEO of Semfia, his own franchise brokerage that he started in 2017. Rose established FranShares after witnessing firsthand how profitable franchise ownership can be.

Since then, he has established himself as a reliable franchise broker and lecturer in the franchise industry. He's appeared on ABC, Business Insider, and Forbes.

How Legit is Franshares?

FranShares is a legitimate company that is linked with Templum Inc., a registered broker-dealer. The Securities and Exchange Commission (SEC) regulates its offerings under SEC Regulation A+, Tier 1. All A+ offers are registered with the SEC and must provide financial disclosure.

FranShares handles all franchisees completely, and its franchisees are governed by the Federal Trade Commission (FTC), which mandates consistent reporting for each offering. Full launch costs and the predicted financial success of the franchisees concerned are included in that report.

Easy Fractional Franchise Ownership

FranShares effectively collaborates with investors, taking on approximately 20% of the costs while owning 20% of the company and totally managing the selection of specific franchises and locations.

Retail investors pool their funds to form a fund that is wholly managed by the investment platform. FranShares then purchase franchises directly or indirectly before operating them.

Investors both inside and outside the United States can use the platform to acquire fractional ownership in a diverse franchise portfolio. This will offer you money in the form of dividends, which are paid out every month or quarter.

Investors in FranShares profit from appreciation when the franchise's value rises. Investors will get payouts whenever franchises are sold.

Funding for FranShares

FranShares is not a crowdfunding platform that connects investors and franchise owners in need of capital. Instead, it takes entire control of franchise management and operations before selling when the time comes.

FranShares functions essentially as a private equity firm.

Diversify Your Portfolio and Earn Passive Income

Here are a few ways the Franshares team can help you in diversifying your portfolio and earning excellent passive income:

● Superior deals: FranShares' data-driven investing methodology and robust deal flow ensure that only the best franchise investment opportunities are made available to investors.

● Available to everyone: Franchises are constrained by stringent standards and time limitations. However, fractional ownership allows you to invest and purchase shares without any of these complications.

● Real, substantial diversification: We give everyone the chance to diversify beyond conventional assets. Additionally, we facilitate the development of a strong portfolio that is diversified across markets, regions, and business models.

● Investing with minimal effort: Clients of FranShares can invest in franchises through our centralized interface, where browsing offerings and purchasing shares is simple, intuitive, and straightforward.

● Everything you need to know: We provide past performance, financial estimates, profit reports, growth strategies, and full disclosure of all information required to make an informed investment decision.

● World-class operators: To ensure that each location is run as effectively and efficiently as possible, FranShares partners with operators who have extensive industry experience.

● Income that is entirely passive: FranShares is the first platform to give investors the opportunity to make money passively through a share of a franchise. We handle the day-to-day operations while you wait for the profits.

The Benefits of Franchise Investments

Accredited investors can benefit from passive franchise investment in a variety of ways. Individuals who meet the Securities and Exchange Commission's (SEC) financial requirements are considered accredited investors. As a result, they are permitted to participate in investments that are not available to the general public.

Here are some benefits of passive franchise investing for accredited investors:

● Diversification: Accredited investors can diversify their investment portfolios by investing in franchises. This is because franchise investments offer a unique combination of security, growth potential, and passive income. This can be utilized in conjunction with other investments in many franchisees across the country.

Franchise investments are less volatile than other types of investments like equities. This low volatility can help in lowering overall portfolio risk. Furthermore, the passive income provided by franchise assets can be a consistent source of cash flow. Needless to say, it can be very useful in a diverse portfolio.

Finally, franchise investments can provide long-term growth. This can contribute to higher total portfolio returns over time. As you can see, franchise investments can provide investors with a distinct set of advantages that can help diversify and boost their investment portfolio.

● Access to experienced management: Franshares was formed by a team of experts with decades of combined experience. Experts and thought leaders in franchising, finance, investing, operations, and growth make up the team.

This allows accredited investors to invest in well-established franchise systems with professional management teams. This can provide investors with the piece of mind that their money is being managed by specialists with a proven track record of success.

● Limited liability: The franchisee is normally responsible for the day-to-day operations of the firm in a franchise venture, while the franchisor retains authority over the brand and business plan.

As a result, if the franchisee faces legal action or financial issues, limited liability might shield the investor from personally being held liable for the franchisee's debts or legal responsibilities.

This can help to reduce the potential financial risks associated with the investment and provide investors with more peace of mind.

● Government regulation: In the United States, franchising is governed at both the federal and state levels. The FTC regulates it at the federal level, while various franchise registration/disclosure laws, franchise relationship laws, and other laws govern it at the state level.

Government regulation helps to guarantee that franchisors follow all applicable rules and regulations. Local, state, and federal regulations control franchise businesses, and government regulators attempt to enforce these rules and hold franchisors accountable for any infractions.

This protects investors while also ensuring that franchisors operate in a responsible and ethical manner.

● Low volatility: Unlike other assets that may see considerable swings due to investor mood, the increase in value and disbursements from franchise investments are decided over time by the franchises' business operations.

Low volatility is advantageous for franchise investments since it offers investors a more steady and predictable investment opportunity. Furthermore, low volatility allows for longer holding periods, which can be advantageous for investors who prefer a hands-off approach to their assets.

Low-volatility franchise investments also provide more consistent revenue streams, which can be especially useful for those who rely on the investment.

● Potential for passive income: Many franchise systems provide investors with the opportunity to earn passive income through royalties or franchise fees. Accredited investors can benefit from this passive revenue stream without being actively involved in the franchise's day-to-day operations.

The best-in-class franchise leadership team at Franshare ensures that their investors receive complete passive income through distributions.

● Scalability: Franchise investments provide for scalability, which can be a big advantage for investors. This is because the franchising concept allows franchise businesses to grow swiftly and efficiently.

Franchisees are in charge of establishing and operating individual franchises. In contrast, the franchisor offers the essential training, support, and resources. This enables the franchisor to rapidly and efficiently expand its business.

Furthermore, they do so without bearing the expenditures of opening and operating new facilities themselves. As a result, franchise investments have the potential to provide considerable returns as the business grows in terms of sales and profitability.

This scalability also allows investors to diversify their investment portfolios and potentially boost their long-term returns.

● Recession-resistant: Many franchises work in sectors that can withstand economic downturns. People will probably continue to get haircuts, to the gym, take out the garbage, and place restaurant orders even if the stock market declines.

A recession-resistant franchise is more likely to generate revenue even during difficult economic times. This can give investors more stability and predictability in their returns while also lowering total investment risk.

Furthermore, franchises that are recession-resistant tend to be more durable in the long run. This can make them a more appealing investment option for people seeking a dependable, long-term investment.

In conclusion, investing in a recession-proof franchise can give investors more confidence and stability in their investment portfolio.

Accredited investors may be able to diversify their portfolios and have access to skilled management through passive franchise investment. They also reduce their liability, generate passive revenue, and may gain from franchise systems' scalability.

However, like with any investment, there are risks associated. Before investing in any franchise system, accredited investors should carefully consider their financial goals and perform extensive due diligence.

The Franshares Franchise Selection Process

FranShares goes through a thorough vetting procedure to ensure that its investors have access to world-class franchise investment possibilities at all times:

1. Find the greatest franchise opportunities: Franshares' team reviews hundreds of franchise prospects, but only about 1% of them fulfill their investment criterion. They seek franchising opportunities in recession-proof industries with a proven track record of success.
   
   

2. Lock in the best prices: FranShares' strategic bulk franchise purchase not only provides them with the purchasing power to achieve the best valuations, but it also helps them to save an average of 32% on franchise costs.
   
   This clever, cost-effective strategy is just one of the ways they aim to deliver value and support to their investors.
   
   

3. Perform thorough due diligence: When an offer is worth exploring, the Franshares team delves into the details. They will consider industry growth, competitive activity, macroeconomic trends, franchise leadership, risks, and potential return on investment, among other things.
   

   It goes without saying that FranShares assesses opportunities using important, data-driven parameters. This data-driven approach is critical for finding the finest businesses with the most upside and passive income possibilities.

How Investments Are Selected

FranShares chooses which franchises to invest in based on a range of factors. Among them are:

1. Return on Investment (ROI): Franchises with large buildout expenditures, personnel headcounts, and inventory are typically avoided by FranShares. As opposed to doing this, it makes investments in franchises that can demonstrate net profits in its Financial Performance Representation, which increases the potential ROI.
   
   

2. Growth: To make sure the brand is expanding, FranShares examines each franchise's growth per location, store revenue, and the total number of franchisees.
   
   

3. Availability: While most people think of major fast-food franchise businesses when they think about franchising, new location availability is limited to non-existent in good areas. FranShares seeks growing franchise brands with multiple site availability in good markets.
   
   

4. Strong Leadership: When FranShares considers investments, an experienced team with past franchise experience is also necessary.
   
   

5. Sustainable business model: FranShares seeks enterprises in reliable industries such as haircare, automobile, fitness, and so on.
   
   

6. Competitive Advantages and Competition: Instead of creating new sectors, franchising combines already-existing ones. Franshares takes a look at who their rivals are in each industry.
   
   In order to gain market share in the industry, they will assess their growth and the competitive advantages of the Franshares franchisees.
   
   

7. Simplified manageability: FranShares searches for semi-absentee franchises that can be manager-run, typically have lower headcounts, and generally have simpler processes because their entire business model revolves around passive investing.
   
   

8. Recession and Pandemic Resistance: Priority should be given to companies that serve essential and unmet needs since they are more resilient to major global disasters (like pandemics).

Potential Downside Risks to Consider

While franchise investments can provide a variety of rewards, investors should be mindful of potential downside risks. One of the major hazards of franchise investments is that they are frequently linked to the franchisor's profitability.

If the franchisor runs into financial difficulties or has problems with its business strategy, it can have an impact on the performance of individual franchisees and, as a result, diminish investor returns.

Furthermore, franchise investments often require large upfront fees. This includes franchise fees, construction expenditures, and annual royalty payments. If the franchisee is unable to generate enough money to meet these costs, it may result in financial troubles and, in extreme cases, bankruptcy.

Finally, franchise investments may involve legal and regulatory risks. As a result, they must follow a variety of franchise-related laws and regulations.

Invest in Franchises with Franshare

In conclusion, accredited investors searching for dependable, passive income with the potential for growth may find franchise investments to be an attractive investment prospect. Particularly well-known in the franchise investment market is Franshares, which provides a variety of investment options in several sectors.

Check out the websites listed if you're interested in learning more about franchise investments in general or about Franshares in particular and think about getting in touch with their team for additional details.