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I4 Search Group
How much does I4 Search Group cost?
Initial Investment Range
$65,300 to $271,100
Franchise Fee
$50,000 to $240,000
The franchise that we offer is for i4 Search Group, a business that provides permanent placement recruitment services for healthcare facilities and providers.
Enjoy our partial free risk analysis below
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I4 Search Group April 14, 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 franchisor explicitly warns that its financial condition calls its ability to provide support into question. Financial statements in Exhibit D confirm this risk, showing a history of net losses and a significant stockholder's deficit of over $750,000 in 2024. This may impact the franchisor's ability to fund growth, support franchisees, and meet its obligations, posing a significant risk to your investment.
Potential Mitigations
- An experienced franchise accountant must thoroughly review the franchisor's financial statements, including all footnotes and trends.
- Discuss the franchisor's capitalization and plans for achieving profitability with your business advisor.
- Your attorney should inquire if any states have required a financial assurance like a bond or escrow due to these financials.
High Franchisee Turnover
High Risk
Explanation
Item 20 data from 2023 indicates a high franchisee churn rate of approximately 22.7% (5 exits from a starting base of 22 units). While 2024 data shows improvement, this recent history of high turnover could suggest potential issues with the business model, franchisee profitability, or franchisor support, which warrants further investigation. High turnover can be a significant indicator of systemic problems.
Potential Mitigations
- A thorough discussion with your accountant is needed to analyze the historical turnover rates and their potential implications for the system's stability.
- It is essential to contact a significant number of former franchisees listed in Item 20 to understand their reasons for leaving the system.
- Your attorney can help you frame specific questions for the franchisor regarding the causes of past franchisee exits.
Rapid System Growth
Medium Risk
Explanation
Item 20 data shows the system grew from 7 to 38 franchised units in three years. While growth can be positive, such a rapid expansion rate for a young franchisor could strain its resources. This might potentially impact the quality and availability of training, operational support, and other assistance you will rely upon as a new franchisee. You should verify the franchisor's capacity to adequately support its growing network.
Potential Mitigations
- Engaging a business advisor to assess whether the franchisor's support infrastructure is scaling appropriately with its unit growth is beneficial.
- You should ask the franchisor directly about their specific plans to manage and support this rapid expansion.
- In discussions with current franchisees, it is wise to inquire about the consistency and quality of support they have received as the system has grown.
New/Unproven Franchise System
High Risk
Explanation
The franchisor, i4 Franchise Development Inc. (i4 FDI), was established in late 2020 and began franchising in 2021. As a relatively new franchise system, it lacks a long-term track record of supporting franchisees and sustaining brand growth. Investing in a newer system carries inherent risks related to unproven operational models, developing support structures, and limited brand recognition, which could affect your business's ramp-up and long-term stability.
Potential Mitigations
- A business advisor can help you conduct extensive due diligence on the founders' and management's experience in both the recruitment industry and franchising.
- It is important to speak with the earliest franchisees to gauge their experience with the evolving systems and support.
- An accountant's review of the franchisor’s capitalization and financial plans is crucial to assess its long-term viability.
Possible Fad Business
Low Risk
Explanation
This risk was not identified in the FDD package. A fad business is one tied to a fleeting trend, which can be a significant risk because your long-term contractual obligations remain even if consumer interest disappears. Evaluating a concept's long-term market demand and sustainability is a key piece of due diligence for any prospective franchisee.
Potential Mitigations
- Assessing the long-term market demand for the product or service with a business advisor can help distinguish a sustainable business from a trend.
- Reviewing a company's plans for innovation and adaptation with your financial advisor is a prudent step in evaluating its long-term prospects.
Inexperienced Management
Medium Risk
Explanation
Item 2 indicates the principal officers have prior experience as multi-territory franchisees of another recruiting franchise (Gecko Hospitality). While this provides relevant experience from a franchisee's perspective, it is different from the experience of managing and supporting an entire franchise system as a franchisor. You should assess if their experience adequately prepares them to provide the necessary franchisor-level support, training, and strategic direction for the i4 Search Group system.
Potential Mitigations
- In discussions with the franchisor, you should inquire how their past franchisee experience translates to their ability to support you as a franchisor.
- Speaking with current franchisees about the quality and effectiveness of the management team's support and guidance is highly recommended.
- A business advisor can help you evaluate the management team's overall business acumen and strategic vision for the company.
Private Equity Ownership
Low Risk
Explanation
This risk was not identified in the FDD package. Franchisors owned by private equity firms can sometimes prioritize short-term returns for investors over the long-term health of the system and its franchisees. This can potentially lead to increased fees, reduced support, or a quick sale of the franchise system, creating uncertainty for franchisees.
Potential Mitigations
- Should you encounter a PE-owned franchisor, researching the firm's track record with other franchise systems is a wise step for a business advisor to assist with.
- It is important to have your attorney review any terms that allow the franchisor to sell the system and understand the implications for you.
Non-Disclosure of Parent Company
Medium Risk
Explanation
The FDD discloses an operating affiliate, i4 Search Group LLC, which owns the trademarks and operates a similar business. The franchisor, i4 FDI, is a separate entity. While this structure is disclosed, its financial statements reflect a significant stockholder's deficit. There is no parent company guarantee mentioned. This raises a risk that the franchising entity may be financially separated from the core operating affiliate, potentially isolating risk and limiting the resources available to support franchisees.
Potential Mitigations
- Your accountant should carefully analyze the financial statements of both the franchisor and any disclosed affiliates to understand their interdependencies.
- It is critical to have your attorney review the licensing agreement between the affiliate and the franchisor to understand its terms and stability.
- A business advisor can help you assess the operational relationship between the franchisor and its affiliates.
Predecessor History Issues
Low Risk
Explanation
This risk was not identified in the FDD package. The franchisor states in Item 1 that it does not have any predecessors. When a franchisor has predecessors, it is important to review their history for any red flags, such as past litigation, bankruptcies, or high franchisee failure rates, as these issues could potentially carry over to the new entity.
Potential Mitigations
- When evaluating a franchise with predecessors, it is advisable to have your attorney carefully review their history as disclosed in Items 1, 3, and 4.
- A business advisor can assist in researching the predecessor's public reputation and track record.
Pattern of Litigation
Low Risk
Explanation
This risk was not identified in the FDD package, as Item 3 discloses no litigation. A pattern of litigation, especially lawsuits initiated by franchisees alleging fraud, misrepresentation, or breach of contract, can be a major red flag. It may signal systemic problems within the franchise, such as unfulfilled promises, a flawed business model, or poor franchisor-franchisee relations.
Potential Mitigations
- If you encounter an FDD with disclosed litigation, a thorough review of the allegations and outcomes with your attorney is critical.
- It is wise to ask a business advisor to help you understand the potential business implications of any disclosed legal disputes.
- Contacting other franchisees to discuss any disclosed litigation can provide valuable context.
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.
