Franchise Tries to Lure Potential Buyers With Crowdfunding

By

NEIL PARMAR
June 12, 2014
A frozen-yogurt chain is trying to spark interest among potential buyers with a new take on crowdfunding.

Late last year, Forever Yogurt Franchise Co. launched a platform called CrowdFranchise.com, where franchises can fund new outlets by letting multiple people buy ownership stakes and thereby pay a lot less than they would for a whole store.

Forever Yogurt, which operates more than 20 locations in the U.S. and China, has secured $650,000 for a new store in Chicago. The 25 investors will get a proportional share in the profit and have a say in who acts as the location’s operating manager. They can also advise on day-to-day decisions if they choose.

The company is seeking funds for 12 more outlets, while other businesses have signed on to raise funds through the platform.

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Tough Times

The effort comes during a tough time for would-be franchisees. The demand from potential buyers has steadily increased since 2010, and outpaced what banks have been willing to lend.

 

 

 

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Source http://online.wsj.com/articles/franchise-tries-to-lure-potential-buyers-with-crowdfunding-1402457469

 

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