Our franchise
investing philosophy
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How We Choose
The Franchise Selection Process
At FranShares, we undergo a rigorous vetting process to ensure our investors always have world-class franchise investment opportunities.
Identify the best franchise brands
We review hundreds of franchise brands, but less than 1% meet our investment criteria. We look for franchise opportunities in recession-resistant industries with a strong track record of success.
Identify strong operators
We look for seasoned operators who are seeking capital to expand their current footprint or launch new brands. We do thorough due diligence on each operator to ensure they have the experience required to be successful.
Conduct rigorous due diligence
When we find a deal worth pursuing, we dive into the details and look at everything including industry growth, competitive activity, macroeconomic trends, franchise leadership, risks, and potential return on investment.
Investment Criteria
We take franchise investing
seriously so you don’t have to.
At FranShares, we evaluate opportunities based on key, data-driven metrics to determine the best franchises with the highest upside and potential for passive income.
FranShares only works with franchises that show net profits in their financial disclosures so our investors can have a better understanding of potential returns. We avoid franchises that have high buildout costs, employee headcounts, and inventory to maximize ROI.
We take a close look at each franchise’s growth per location, store sales, and number of franchisees to ensure the brand is growing quickly, efficiently, and sustainably.
We prioritize growing franchise brands that have high availability for multiple locations in good markets — not established, highly saturated franchises whose availability is limited to non-existent in good markets.
As part of FTC regulation, each franchisor’s leadership must be disclosed. We look for experienced teams based on their involvement in their franchise’s industry and in franchising as a whole.
While we may not always invest in the “sexiest” businesses, FranShares looks for those that are more essential services that have great long-term outlooks. We avoid quick fads and stick with staples like haircare, automotive, fitness, etc.
We conduct extensive competitor research on prospective franchises to determine if they have the advantages necessary to capture market share in their space.
We stive to focus on franchise opportunities with simple operations that have lower employee head counts as they are often easier to scale and manage.
Franchises are often service-based businesses, which are considered “recession-resistant.” The most resistant are those that fulfill customer needs: haircare, automotive services, home improvement, child-care and education, and healthcare are all good examples. If consumers absolutely can’t do without it, the investment is likely to perform well regardless of the economy.
Our Operators
Invest in seasoned franchise operators.
At FranShares, we recognize the significance of investing in proven franchise operators poised for growth. We diligently focus on identifying operators with robust track records who are actively seeking capital for startups and expansion.
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