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Brooklyn Robot Foundry
How much does Brooklyn Robot Foundry cost?
Initial Investment Range
$90,634 to $145,817
Franchise Fee
$52,500 to $54,500
Brooklyn Robot Foundry Franchising, LLC offers individual unit franchises for the development and operation of a Brooklyn Robot Foundry® business offering robotics and engineering classes and workshops for kids and adults, and related services and products.
Enjoy our partial free risk analysis below
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Brooklyn Robot Foundry April 30, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: August 19, 2025
DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.
Franchisor Stability Risks
Start HereDisclosure of Franchisor's Financial Instability
High Risk
Explanation
The franchisor explicitly warns of its precarious “Financial Condition” as a special risk. Audited financials confirm this, showing significant and consistent net losses for the past three years, a growing negative net worth, and negative cash flow from operations. The company's own notes state it relies on parent company funding to continue, and several states have mandated that your initial fees be deferred due to this financial instability, which poses a significant risk to its ability to support you.
Potential Mitigations
- A franchise accountant must thoroughly review the franchisor's financial statements, including all footnotes and the parent company's ability to provide continued support.
- It is critical to understand the implications of the state-mandated fee deferrals and the protections they may or may not offer with your franchise attorney.
- Discuss the franchisor's detailed plan for achieving profitability with your business advisor, beyond just relying on new franchise sales.
High Franchisee Turnover
Low Risk
Explanation
This specific risk was not identified in the FDD package. Item 20 data for the very young franchise system does not show any terminations, non-renewals, or other cessations of operation. High franchisee turnover is a critical indicator of systemic problems, such as lack of profitability or poor franchisor support. Careful monitoring of this data in future FDDs would be prudent as the system matures.
Potential Mitigations
- Your business advisor can help you analyze future Item 20 tables to calculate the annual turnover rate and compare it against industry benchmarks.
- Engaging with a broad group of franchisees from the list in Exhibit F can provide qualitative insight into franchisee satisfaction, which is a leading indicator of turnover.
- An attorney can help you understand the contractual reasons, such as default provisions, that could lead to termination and turnover.
Rapid System Growth
High Risk
Explanation
The franchisor is experiencing rapid growth, expanding from three to nine units in its second year of franchising, with plans for seven more. While growth can be positive, it poses a risk when combined with the company's disclosed financial instability, including significant operating losses and negative net worth. This situation raises concerns about whether the franchisor has the financial and personnel resources to adequately support a quickly expanding system of new franchisees.
Potential Mitigations
- Your accountant should carefully assess whether the franchisor's financial statements demonstrate the capacity to support its projected growth.
- In discussions with your business advisor, question the franchisor directly about their specific plans to scale their support staff and infrastructure.
- Inquire with franchisees who joined at different times to gauge whether support levels have remained consistent as the system has grown.
New/Unproven Franchise System
High Risk
Explanation
The franchisor explicitly flags its “Short Operating History” as a special risk. The company was formed in late 2021 and only began franchising in 2022. Critically, Item 1 states, “We have not directly operated the type of business you will operate.” This lack of a proven, franchisor-operated model, combined with its newness and weak financials, significantly increases your investment risk.
Potential Mitigations
- Extensive due diligence is required; your attorney and accountant should scrutinize every aspect of this young and unproven business.
- Speaking with the first few franchisees is critical to understand their experience with the new system and its initial support.
- A business advisor can help you assess whether the franchisor's business plan and support structure are viable despite their limited history.
Possible Fad Business
Low Risk
Explanation
This risk was not identified in the FDD package. The business model, which involves providing STEAM (science, technology, engineering, art, and math) education classes for children and adults, appears to be in a sector with sustained consumer demand. This is generally not considered a fad business, which would be based on a short-lived trend.
Potential Mitigations
- Your business advisor can help you conduct independent market research to confirm the long-term demand for educational enrichment services in your specific area.
- Evaluating the franchisor's curriculum and plans for future program development can provide insight into its long-term viability.
- An accountant can assist in creating financial projections that model different levels of sustained consumer demand over the franchise term.
Inexperienced Management
Medium Risk
Explanation
While the franchisor's CEO has over a decade of experience operating a similar, non-franchised business, the management team's experience in franchising is very limited, beginning only in 2022. This presents a risk, as managing a franchise system requires different skills than running a single location. It may affect the quality of support, training, and strategic direction provided to you.
Potential Mitigations
- You should question the franchisor about what experienced franchise professionals or consultants they have engaged to guide them through their early growth.
- A thorough discussion with existing franchisees about the quality and effectiveness of the franchisor's support and training is essential.
- Your attorney can review the franchise agreement to ensure the franchisor's obligations for support are as clearly defined as possible.
Private Equity Ownership
Low Risk
Explanation
This risk was not identified in the FDD package. There is no indication in Item 1 or elsewhere that the franchisor is owned or controlled by a private equity firm. Ownership appears to be with the system's founders. Therefore, risks specifically associated with a private equity ownership model, such as a focus on short-term returns over system health, do not appear to be present.
Potential Mitigations
- It is always good practice to ask your attorney to verify the corporate structure and ownership of the franchisor and its parent companies.
- Reviewing Item 1 and Item 2 with a business advisor helps to understand the background and incentives of the ownership and management team.
- Your accountant can analyze financial statements for signs of high debt or other financial structures sometimes associated with PE buyouts.
Non-Disclosure of Parent Company
Medium Risk
Explanation
The franchisor is a subsidiary of a parent company, and its own financial statements reveal it is unprofitable and dependent on the parent for funding. However, the FDD does not include the parent company's financial statements. This is a significant omission, as you cannot independently verify if the parent has the financial strength to provide the promised ongoing support, making the franchisor's viability difficult to assess.
Potential Mitigations
- Your attorney should request the parent company's financial statements to allow for a complete financial due diligence process.
- An accountant should analyze the franchisor's cash flow to determine its level of dependency on the parent's contributions.
- Consider asking your attorney to negotiate for a formal written guarantee of the franchisor's obligations from the parent company.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified in the FDD package. Item 1 does not disclose any predecessor entities from which the franchisor acquired its assets or that previously operated the franchise system. The franchise system appears to be new and developed by the current franchisor entity. Therefore, there are no hidden historical issues from a predecessor to consider.
Potential Mitigations
- Your attorney can help you perform public records searches to confirm the franchisor's corporate history and ensure no predecessors have been omitted.
- It is good practice to ask the franchisor directly about the history and origin of the business concept and system.
- A business advisor can help assess the risks associated with a new system that lacks any predecessor history.
Pattern of Litigation
Low Risk
Explanation
This risk was not identified in the FDD package. Item 3 states that there is no material litigation history that requires disclosure. This includes lawsuits from franchisees alleging fraud or misrepresentation, as well as significant litigation initiated by the franchisor against its franchisees. The absence of such litigation is a positive indicator, especially for a new system.
Potential Mitigations
- Your attorney can conduct independent searches of court records to verify the accuracy of the litigation disclosures in Item 3.
- During discussions with current and former franchisees, it is useful to ask about any disputes they may have had, even if they did not result in litigation.
- Understanding the dispute resolution clauses in the franchise agreement with your attorney is important for assessing how future conflicts might be handled.
Disclosure & Representation Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
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Financial & Fee Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Legal & Contract Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Territory & Competition Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Regulatory & Compliance Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Franchisor Support Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Operational Control Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Term & Exit Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
Miscellaneous Risks
Example Risk: Franchisee Financial Obligations
Blue Risk
Explanation
This risk involves the financial obligations that a franchisee must meet, including initial fees, ongoing royalties, and other required payments. Understanding these obligations is crucial for long-term success.
Potential Mitigations
- Carefully review the Franchise Disclosure Document (FDD) and consult with a franchise attorney to fully understand all financial commitments before signing.
- Conduct regular risk assessments
- Implement monitoring and reporting systems
Unlock Full Risk Analysis
Purchase the complete risk review to see all 102 risks across all 10 categories.
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