Growth Club
1851 Growth Club
I’m In: The Franchise Funding Group Aims to Become the Shark Tank for Franchising
Cincinnati-based investment group wants to change the way emerging entrepreneurs navigate franchising
“Simply put, we are Shark Tank for franchising.”
That’s how Daniel Murphy describes Franchise Funding Group, the booming Cincinnati-based investment group for which he serves as president, and just like the “sharks” who hear pitches from upstart entrepreneurs on the hit ABC show, the team at Franchise Funding Group is using their combined sea of experience to help the next emerging generation of entrepreneurs navigate franchising’s tricky waters.
“We looked at Shark Tank and kept saying, ‘We can help people expand their businesses nationwide. We could be the Shark Tank for franchising – the investors and strategic partners they are seeking.’ We want to give back and make a difference for the future generation of franchisors,” said Murphy.
The team has a 30-year track record of creating, supporting, and guiding successful franchise concepts and has awarded over 2,000 franchises across 15 countries. They have grown multiple brands such as Home Helpers, Caring Transitions, TruBlue Total House Care, and Fresh Coat* Painters. Murphy himself is the founder and CEO of The Growth Coach franchise system which is currently in 14 countries and in over 100 major U.S. markets serving several thousand clients each year.
On paper, the Franchise Funding Group concept is simple. Share your big idea for the next great franchise, and the team at Franchise Funding Group will invest up to $150,000 of financial support, services, and marketing of your new franchise company as a true partner in building the system and priming the concept for expansion.
“Our value proposition is pretty strong to these entrepreneurs who have a profitable business and a large vision. We take 25 percent equity in the new franchise entity only and a 10 percent management fee moving forward, but we’ll help build your franchise system and guide you. You’ll call the shots, but we’ll be there to help. That’s a great value proposition and people have been very open to it,” said Murphy.
Since launching in October 2014, the team at Franchise Funding Group started getting applications immediately and they kept coming in at a steady pace. However, after a feature story ran in Entrepreneur magazine in March of this year, the number of applications skyrocketed.
“Going through hundreds of applications can be tedious, and there are some who apply that aren’t ready for it yet,” said Murphy. “But these are great entrepreneurs we’re talking to, they’re passionate, they have good businesses.”
The group’s first foray into partnering with a new concept has been a roaring success. The team helped launch Cincinnati-based Pet Wants as a franchise – a home-based pet food concept that delivers fresh, top-quality food right to subscribers’ doors – in the 3rd quarter of 2015. By mid-April 2016, the brand had already grown to 25 open locations with 21 in process across 18 states. Most of those Pet Wants franchisees signed single unit deals – however, some have already signed for a second territory and many others are investigating the potential to expand less than a year after opening.
“We knew pet care would be big and Pet Wants has been a home run for us,” said Murphy. “It’s been explosive growth.”
Murphy and the Franchise Funding Group team believe that low cost concepts in hot segments (pet food is a $22 billion dollar segment within the $58 billion dollar pet care industry) like Pet Wants is where they will find their first wave of successful franchise brands.
“What we’re looking for are home-based, mobile businesses, or small store fronts. That’s where our core-competency is,” said Murphy. “We like care-based businesses where you have to care for seniors, kids, pets, homes, cars – those are the type of industries where the demand is always high in good times and in bad, and they’re hard to make obsolete with technology.”
Murphy said the team is extremely selective and only want to take on one or two investments per year in order to make sure they have the right focus. Due to this, they want to partner with the right people and he believes they’ll be able to announce their second investment by the end of summer 2016. However, the buzz around this new opportunity has been so impressive that Murphy said that Franchise Funding Group has started receiving numerous requests from owners of concepts that have already started franchising, but need that extra support to break through – an area he says that the team is considering getting into as they continue to develop the system and expand, with the potential of creating a separate investment fund or getting more investors involved.
Either way, Murphy said that their passion for creating great franchises is what keeps them motivated.
“We’re older and don’t have the time to start these things up from scratch for ourselves anymore,” Murphy laughed. “We want to help the younger generation. We are the answer to the question, ‘How do I franchise my business,’ and we’re having a blast doing it.”
*This brand is a paid partner of 1851 Franchise. For more information on paid partnerships please click here.
MORE STORIES LIKE THIS
NEXT ARTICLE
Featured Franchise News
Featured Brand News
