• America's Favorite Seafood Franchise

What Are Our Financing Options?

There are many ways to fund a Captain D’s franchise, and each should be explored to find the best fit for your situation

As you begin to explore your options, here are some of the most popular financing avenues to consider:

1. Community banks

Loan programs for small businesses are an important service for community banks, which are generally defined as those with less than $10 billion in assets. According to the Independent Community Bankers of America, these lenders make one in five small-business loans. More than half of small-business loans under $100,000 come from community banks, and nearly half of small businesses are financed by smaller banks.

Advantages: Community banks generally offer a range of services for franchisees including: loans for acquisitions, remodels and relocations; financing for equipment, furniture and fixtures; a working capital line of credit; leasehold improvements, and eligible building and sitework costs; refinancing for existing debt; and competitive loan rates with flexible structures.

Things you should know: Prior to any loan, most community banks require the following items to begin the application process:

  • Business tax returns (if any) for the last three years
  • Interim financial statement (if any) dated within the last 60 days
  • One-year cash flow projection
  • Business plan
  • If borrower has ownership in affiliate businesses: copies of the last three years tax returns and financial statements
  • Personal financial statement and the last three years tax returns from all individuals with 20% or more business ownership
  • Estimated cost breakdown of leasehold improvements and equipment
  • Copy of lease agreement
  • Completed loan application documents

2. Leverage retirement funds tax-free and penalty-free

If you have a 401(k) or an individual retirement account (IRA), it can be converted into a self-directed IRA to fund your business. This financing option became extremely popular during the recession, when depressed real estate prices eliminated home equity loans as an option for many franchise buyers.

Advantages: Once you set up a self-directed IRA, you can tap into your retirement funds without paying penalties. Since it’s your money, not the bank’s, you don’t have to worry about a long loan-approval process. As your business succeeds, you make payments back into your retirement account without having to pay interest to a bank. This option also allows you to keep cash in your bank accounts to be available for starting and growing your business.

Things you should know: Your business becomes your retirement plan, which brings risks and rewards. You should be confident that you can beat the stock market by building the value of your business, as well as by avoiding interest payments on a loan.

3. SBA loans

Screenshot 2015-08-06 11.59.05U.S. Small Business Association (SBA) lending has made a strong comeback as the economy has improved, and it is much easier to obtain an SBA loan than it was a few years ago. These are government-backed loans at low-market rates, which eliminates most of the risk for banks.

Advantages: You can finance a percentage of the cost of your business, which allows you to conserve cash; the interest rates tend to be fairly low; there is no prepayment penalty; and you can obtain better loan terms once you have a proven track record.

Captain D’s is in the SBA registry. Loan applications for franchises on the Franchise Registry can be reviewed and processed faster and more efficiently by the SBA and its lenders because the respective franchise agreements do not need to be reviewed in each individual franchisee situation.

4. Friends and family

You may have friends or relatives who are willing to invest in your success.

Advantages: They know you, they are typically flexible on repayment terms and they may have expertise that they can offer your business. They may not require collateral.

Things you should know: If the business doesn’t meet expectations, it may strain your relationships. Family and friends may also seek equity in exchange for your investment, which would create a partnership arrangement.

5. Partnerships

Screenshot 2015-08-06 11.52.29Partnerships can allow two or more people to combine their resources to purchase a Captain D’s franchise. If partners complement one another’s skill sets and add value to the business, it can be a great arrangement.

Advantages: You can split management and leadership duties, which gives you greater capacity and flexibility. Since you have multiple people to oversee operations and marketing, you may be able to grow faster.

Things you should know: Partners must have clear guidelines for who handles what and how profits are divided. In addition, to get the most out of your partnership and avoid disputes, clear communication and a shared commitment to the business are essential.


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  • #1

    We're the number one seafood franchise in America

  • 500+

    Captain D's is the fast-casual seafood leader with restaurants in 21 states

  • 27.9%

    AUV Growth over the last 7 years

  • Captain D’s, the nation’s leading fast-casual seafood restaurant, announced today the opening of two new restaurants in

  • The nation’s leading fast casual seafood restaurant, announced today that Brad Reed has been promoted to chief

  • Captain D’s signs two new franchise development agreements to propel the brand’s growth in Texas. Captain D’s

  • Captain D’s was recently featured in QSRMagazine.com November 2017, By Danny Klein Like the seafood segment in