Introduction
Franchise roll-ups offer proven scalability but require significant capital and lenders who understand franchise systems. Yaw Capital structured $30M in franchise acquisition financing for an operator acquiring 18 locations across three states.
The Challenge
The buyer was an experienced operator but faced obstacles:
- Deal size exceeded SBA thresholds.
- Multiple franchise brands involved.
Need for both acquisition financing and renovation capital.
Our Solution
Yaw Capital engaged a franchise-focused debt fund and structured:
- $30M senior debt package secured by multi-unit franchise assets.
- Flexible terms to include capex reserves for renovations.
- Syndication to spread risk across multiple lenders.
We coordinated directly with franchisors to ensure lender comfort with franchise agreements.
The Outcome
The acquisition closed within 90 days. The buyer successfully integrated 18 locations and used capex reserves to modernize stores, boosting unit-level performance.
Key Takeaways
- Franchise acquisitions require lenders experienced in the model.
- Capex reserves ensure post-closing stability.
- Yaw Capital’s network unlocks debt funds that specialize in franchise systems.
