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How much does Casago cost?
Initial Investment Range
$23,000 to $1,287,000
Franchise Fee
$14,000 to $112,000
We franchise the right to operate a single “Casago” full-service property management business providing short-term vacation and corporate housing rentals and property management services.
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Casago April 4, 2025 FDD Risk Analysis
Free FDD Library AI Analysis Date: August 22, 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 audited financial statements for Casago International LLC (Casago) as of year-end 2024 show a working capital deficit exceeding $1.2 million and a total members' deficit over $2 million. The FDD explicitly lists "Financial Condition" as a special risk and notes to the financials state reliance on parent funding to continue operations. This financial weakness could impact Casago's ability to provide support, especially with its planned growth, posing a significant risk to your investment.
Potential Mitigations
- Your accountant must conduct a thorough review of the audited financials, including the notes on liquidity and the pending merger, to assess the franchisor's viability.
- A business advisor can help you evaluate the potential impact of the franchisor's financial state on their ability to deliver promised support and services.
- Discuss the specific risks outlined in the state-mandated addenda regarding financial condition with your attorney to understand their implications.
High Franchisee Turnover
Medium Risk
Explanation
Item 20 data for 2024 shows that two franchised outlets were terminated during the year, out of a starting base of 29 units. While the system is growing, a termination rate of approximately 7% can be a point of concern for a young franchise system. Exhibit G lists the franchisees who have left the system. Understanding the reasons for these departures is a key part of your due diligence.
Potential Mitigations
- It is crucial to contact the former franchisees listed in Exhibit G to understand their experiences and reasons for leaving the system.
- A discussion with your business advisor can help you analyze the turnover rate in the context of the industry and the system's age.
- Ask your attorney to help you formulate questions for the franchisor regarding the circumstances of these terminations.
Rapid System Growth
Medium Risk
Explanation
The franchise system is growing quickly, doubling its number of franchised units in 2023 and adding more in 2024. This rapid expansion, especially when viewed alongside the company's weak financial position and the massive number of units potentially coming from the pending Vacasa merger, raises questions about Casago's ability to provide adequate and timely support to all franchisees. A support system stretched too thin could negatively affect your business operations and growth.
Potential Mitigations
- With your business advisor, question the franchisor about their specific plans to scale support infrastructure to handle continued growth.
- Contact a wide range of existing franchisees, both new and established, to inquire about the current quality and responsiveness of franchisor support.
- Your accountant should review the franchisor's financials to assess if they have the resources to fund the necessary support for this growth.
New/Unproven Franchise System
High Risk
Explanation
Casago began franchising in April 2021 and explicitly discloses "Short Operating History" as a special risk. An unproven system carries inherent risks, including the potential for underdeveloped support structures and unrecognized branding. Furthermore, the pending merger with Vacasa is set to fundamentally change the business model, meaning the future operational reality of the franchise is also new and unproven. This combination increases the overall investment risk.
Potential Mitigations
- Conduct extensive due diligence on the management team's prior experience in both the vacation rental industry and in franchising.
- A conversation with your business advisor can help you weigh the risks of joining a young system against any potential benefits, like available territories.
- Your attorney might be able to negotiate more favorable terms in the Franchise Agreement to compensate for the higher risk associated with a new system.
Possible Fad Business
Low Risk
Explanation
This risk was not identified in the FDD Package. The business model, short-term vacation and corporate housing rental management, is an established and mature industry. While subject to economic cycles and local regulations, it is not considered a short-term fad. Your success will depend more on execution and market conditions rather than the fleeting popularity of the concept itself.
Potential Mitigations
- A business advisor can help you research the long-term stability and demand within your specific local market for vacation rental management services.
- You should still evaluate the franchisor's plans for innovation and adaptation to stay competitive within this established industry.
- An accountant can help you model the financial performance of the business based on the mature industry's typical economic cycles.
Inexperienced Management
Low Risk
Explanation
This risk was not identified in the FDD Package. Item 2 indicates that the key executives, particularly the founder Steve Schwab, have extensive experience in the property management and travel industries dating back to 2001. This suggests that the leadership team possesses relevant industry knowledge, which can be a positive factor for the operational guidance of the franchise system.
Potential Mitigations
- It is still advisable to discuss the management team's specific franchising experience with current franchisees.
- A business advisor can help you assess how the leadership's industry experience translates into effective support for franchisees.
- You should confirm with the franchisor who your primary support contacts will be and review their specific experience.
Private Equity Ownership
Medium Risk
Explanation
The FDD discloses that upon the closing of the Vacasa merger, Casago will be owned by a consortium of new institutional investors. While this may provide needed capital, it introduces risks associated with private equity or institutional ownership. The new ownership's primary focus may be on maximizing short-term returns, which could potentially lead to decisions that are not aligned with the long-term health of franchisees, such as cutting support or increasing fees.
Potential Mitigations
- Research the track record of the named investors, such as Silver Lake and TRT Holdings, with other franchise or portfolio companies.
- Your attorney should review the assignment clauses in the Franchise Agreement to understand your rights if the system is sold again in the future.
- Discuss with your business advisor the potential strategic shifts that can occur when a founder-led company transitions to institutional ownership.
Non-Disclosure of Parent Company
Low Risk
Explanation
This risk was not identified in the FDD Package. Item 1 appears to provide a detailed description of the current and future ownership structure, including parent companies like Casago Holdings, LLC and Casago Global, LLC. The financial statements also disclose related-party transactions and reliance on member contributions for funding, suggesting a degree of transparency about the corporate structure.
Potential Mitigations
- Your attorney can still verify the corporate structure and ensure all entities providing guarantees or essential services are properly disclosed.
- An accountant should confirm that if a parent company guarantees the franchisor's performance, that parent's financials are included and reviewed.
- Always ask for an organizational chart if you are unclear about the relationship between the franchisor and its various affiliates.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified in the FDD Package. The franchisor, Casago International LLC, was formed in 2020 and the FDD does not disclose any predecessors from which it acquired the business system. Therefore, risks associated with a hidden or problematic history from a prior version of the company do not appear to be present.
Potential Mitigations
- Your attorney should still confirm the company's history and ensure there are no undisclosed predecessor entities.
- You can perform independent online searches for the company and its principals to look for any prior business history.
- A discussion with a business advisor can help you understand the implications of investing in a company without a long corporate history.
Pattern of Litigation
Low Risk
Explanation
This risk was not identified in the FDD Package. Item 3 of the disclosure document states, "No litigation is required to be disclosed in this Item." This indicates that the franchisor has not been involved in any recent, material legal actions with franchisees, suppliers, or government agencies that would meet the criteria for disclosure, which is a positive sign.
Potential Mitigations
- Your attorney can conduct an independent search of court records to verify the absence of significant litigation.
- It is still prudent to ask current and former franchisees about any disputes they may have had, even if they did not result in formal litigation.
- Understand that Item 3 has specific criteria, and non-material disputes may not be disclosed; your business advisor can discuss this.
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
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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
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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
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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
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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
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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
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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
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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