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M14Hoops

M14Hoops Franchising LLC
https://www.m14hoops.com
1-331-281-0192
2414 Church Road, Aurora, Illinois 60502

How much does M14Hoops cost?

Initial Investment Range

$104,880 to $430,000

Franchise Fee

$76,000 to $314,500

The franchise that we offer is for M14Hoops, a youth basketball development academy providing basketball instruction and life skills for children of all ages and other services and products.

Enjoy our partial free risk analysis below

Unlock the full risk analysis to access 9 more categories covering 100+ risks.

M14Hoops April 30, 2025 FDD Risk Analysis

Free FDD Library AI Analysis Date: July 16, 2025

DISCLAIMER: Not Legal Advice - For Informational Purposes Only. Consult With Qualified Franchise Professionals.

1

Franchisor Stability Risks

Start Here
Total: 10
3
2
5

Disclosure of Franchisor's Financial Instability

High Risk

Explanation

The FDD explicitly warns that the franchisor's financial condition "calls into question" its ability to support you. Audited financials in Item 21 confirm this, showing a net loss in 2023 and a negative Members' Equity (deficit) of over $88,000 at year-end 2024. This may indicate an inability to provide promised services, invest in the brand, or even remain solvent, creating significant risk for your investment.

Potential Mitigations

  • An experienced franchise accountant must thoroughly review the franchisor's financial statements, including all footnotes and year-over-year trends.
  • Inquiring with your business advisor about the franchisor’s capitalization and its ability to fund operations without relying on new franchise sales is critical.
  • Your attorney should investigate if any financial assurance, like a bond or escrow, is required by your state due to the weak financials.
Citations: Item 1, Item 21, FDD Exhibit A, "Special Risks to Consider About This Franchise" section

High Franchisee Turnover

Low Risk

Explanation

The FDD does not indicate a high rate of franchisee turnover in Item 20. However, the franchise system is very new, so this data may not yet reflect long-term trends. High turnover is generally a major red flag, potentially indicating systemic problems like a lack of profitability, which could emerge as the system matures. Four of the five franchisees in the Item 19 financial performance report showed a net loss.

Potential Mitigations

  • Discussing the negative financial performance shown for most franchisees in Item 19 with your accountant is essential to gauge future turnover risk.
  • It is vital to contact a significant number of the current franchisees listed in Exhibit C to discuss their satisfaction and profitability.
  • Your attorney can help you frame questions for current franchisees regarding their experiences and intent to continue with the system.
Citations: Not applicable

Rapid System Growth

High Risk

Explanation

Item 20 data reveals very rapid growth for a new system, from one to thirteen franchised outlets in just two years. When combined with the franchisor's disclosed financial weakness, this rapid expansion raises concerns. The franchisor may lack the financial and personnel resources to adequately provide the training, site support, and operational assistance required for such a quickly growing network of franchisees.

Potential Mitigations

  • A thorough review of the franchisor's plans for scaling its support staff and infrastructure to match unit growth should be conducted with your business advisor.
  • Asking a broad range of existing franchisees about the current quality and responsiveness of franchisor support is a critical due diligence step.
  • Your accountant should help assess whether the franchisor's financial statements show sufficient investment in support systems to sustain this growth.
Citations: Item 11, Item 20, Item 21

New/Unproven Franchise System

High Risk

Explanation

The franchisor, M14Hoops Franchising LLC (M14Hoops LLC), is a new entity, formed in 2021, and this is explicitly highlighted as a "Short Operating History" risk. Investing in an unproven system carries higher risk than a mature brand. It may involve underdeveloped operating systems, minimal brand recognition, and a higher potential for franchisor instability. The financial performance representations in Item 19, showing significant franchisee losses, underscore the unproven nature of the business model's profitability for franchisees.

Potential Mitigations

  • With your business advisor, conduct extensive due diligence on the founders' direct experience in both the youth sports industry and in managing a franchise system.
  • It is imperative to speak with the earliest franchisees listed in Exhibit C to understand their experience with the developing systems and support.
  • Your accountant must carefully analyze the franchisor's capitalization to determine its ability to weather early-stage challenges.
Citations: Item 1, Item 19, Item 20, Item 21, "Special Risks to Consider About This Franchise" section

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 create long-term risk for franchisees who are locked into a 10-year agreement. You should independently assess if the youth basketball training industry has long-term, sustainable consumer demand in your market.

Potential Mitigations

  • Assessing the long-term market demand for the product or service with your business advisor is important to determine if it is a sustainable business or a novelty.
  • A discussion with your financial advisor can help evaluate the business model's sustainability beyond current trends and its resilience to economic downturns.
  • You should review the franchisor's plans for innovation, adaptation, and staying relevant as disclosed in FDD Item 11.
Citations: Not applicable

Inexperienced Management

Medium Risk

Explanation

The executives listed in Item 2 have extensive experience founding and operating the M14Hoops academy locations since as early as 2009. However, their experience in operating a franchise system, which involves different skills like supporting third-party owners, only dates to the franchisor's formation in 2021. This relative inexperience in franchising itself could present challenges in providing franchisee support, though their industry experience is extensive.

Potential Mitigations

  • Thoroughly vetting the management team's background and relevant experience in both the specific industry and in managing a franchise system is a task for your business advisor.
  • It is important to speak with existing franchisees about their perception of management's competence and the quality of support provided.
  • You can inquire with the franchisor about any experienced franchise consultants or staff they have engaged to guide their new system.
Citations: Item 2

Private Equity Ownership

Low Risk

Explanation

The risk of private equity ownership, which can prioritize short-term investor returns over the long-term health of the system, was not identified in Item 1 of the FDD. The franchisor is disclosed as being wholly owned by M14 Enterprise, LLC, which appears to be controlled by the founders.

Potential Mitigations

  • Your attorney should always confirm the ownership structure disclosed in Item 1 and identify the ultimate controlling parties.
  • A business advisor can help research the ownership group's track record with other businesses if they are not the original founders.
  • It's prudent to discuss any ownership changes with existing franchisees to understand their impact on the system.
Citations: Not applicable

Non-Disclosure of Parent Company

Medium Risk

Explanation

Item 1 discloses that M14Hoops LLC is wholly owned by its parent, M14 Enterprises, LLC. However, the FDD does not provide financial statements for the parent company. While not always required, the absence of parent financials can obscure the overall financial strength and resources backing the franchisor, particularly for a new and financially weak entity like this one. This presents a risk as the parent's stability is unknown.

Potential Mitigations

  • Your accountant should assess if the franchisor's standalone financials are sufficient to meet its obligations without parent support.
  • Given the franchisor's weak financials, it would be prudent for your attorney to inquire about the parent company's financial condition and its commitment to supporting the franchise system.
  • A business advisor can help research the parent company to understand its history and other business interests.
Citations: Item 1, Item 21

Predecessor History Issues

Low Risk

Explanation

This risk was not identified in the FDD. Item 1 states that the franchisor does not have any predecessors. This is consistent with the franchisor being a new entity established in 2021 to franchise the pre-existing M14Hoops business model.

Potential Mitigations

  • Your attorney should always carefully review Item 1 for any mention of predecessors, as their history can reveal inherited systemic issues.
  • When a predecessor is identified, a business advisor can help you research that entity's history and reputation.
  • It is wise to ask long-term employees or affiliates about their experiences under any previous ownership structures.
Citations: Not applicable

Pattern of Litigation

Low Risk

Explanation

This risk was not identified in the FDD. Item 3 discloses that there is no litigation history that requires disclosure. This is a positive sign, although it is common for a very new franchise system to have no litigation history yet.

Potential Mitigations

  • Your attorney should always review Item 3 carefully for any litigation, especially cases initiated by franchisees alleging fraud or misrepresentation.
  • A business advisor can help you understand that a high volume of franchisor-initiated lawsuits against franchisees can also be a red flag.
  • It is useful to perform independent online searches for news or discussions related to the franchisor and legal disputes.
Citations: Not applicable
2

Disclosure & Representation Risks

Total: 15
3
2
10

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

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3

Financial & Fee Risks

Total: 10
5
3
2

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.

4

Legal & Contract Risks

Total: 16
6
6
4

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.

5

Territory & Competition Risks

Total: 5
3
1
1

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.

6

Regulatory & Compliance Risks

Total: 10
4
1
5

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.

7

Franchisor Support Risks

Total: 4
2
2
0

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.

8

Operational Control Risks

Total: 12
3
3
6

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.

9

Term & Exit Risks

Total: 18
8
6
4

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.

10

Miscellaneous Risks

Total: 2
1
1
0

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.