What's the best way to finance a franchise through investors?
The financing market is very difficult and has been for the past couple of years--that's the bad news. The good news is that the investment market is just about as bad and there are lots of people with money to invest that can't figure out what to do with it.
If investors take the safe route and put their money in bonds, CDs or saving accounts they won't earn any return to speak of. If they take more risks and invest in the stock market, they could make more or they could end up losing a considerable portion of their original investment. Neither of these options are very attractive for many people in today's market.
For this reason you might find a favorable audience with potential investors in your franchise business. The big caveat here is that you will almost always have better luck getting money from someone who knows you.
This could be a friend or relative or former co-worker or boss. Maybe someone you know from church or other social outings--cast a wide net and hopefully you'll catch a good investor for you.
Jeff Elgin has almost 20 years of experience franchising, both as a franchisee and a senior franchise company executive. He's currently the CEO of FranChoice Inc., a company that provides free consulting to consumers looking for a franchise that best meets their needs.