Funding Process

Funding is one of the most important components in buying a franchise. Much like buying a home, we always recommend getting prequalified first. Through one of our franchise specific lenders you will be able to compare your different funding strategies using different combinations of cash, retirement assets, loans, and other means.

Benetrends has been funding America’s entrepreneurs for over 35 years, offering a comprehensive suite of funding options covering nearly every type of business situation.  The most popular programs are the Rainmaker Plan® (IRA/Rollover) and SBA small business loan programs.  And, they continue to provide innovative solutions, with their newest funding option, The Rainmaker Advantage Program®.  This corporate capitalization strategy is designed to mitigate or eliminate the taxes due on the sale of a business.  Benetrends also offers Securities Backed Line of Credit and Equipment Leasing.

Minimum Requirements

20-30% down for SBA approved businesses

680+ FICO

$250k+ TOTAL net worth

$50k-150k liquidity per location coming from:

  • 401(k) or IRA
  • SBA Loan
  • Loan against securities
  • Home equity line of credit (HELOC)
  • Cash
  • Friends/family

Funding With Retirement Assets

The Rollover for Business Startups (ROBS) program has been around for nearly 30 years and is the most widely used way to fund a franchise both for the tax benefits and availability of funds that were though to be inaccessible.

Simply enough, ROBS allows you to do a 401(k) or IRA rollover just as if you were switching companies or plan carriers but instead of investing in publicly traded shares, you can buy shares of your own business. Because your funds are still being used for retirement you do not see any early withdrawal penalties or taxes. This strategy also allows you to reduce or eliminate debt when investing in a franchise because it is NOT a loan. There is no debt to repay or interest because it's your money. This corporate capitalization strategy is also designed to mitigate or eliminate the taxes due on the sale of a business.

Here's how it's done:

  1. Corporation in your name formed.
  2. 401(k) for your corporation is created.
  3. Perform a rollover into your new corporations 401(k) plan.
  4. Your plan purchases stock in your company as compared to publicly traded stocks or other 401(k) investments.
  5. Your company can now use this money to purchase a franchise.

Depending on your investment strategy and financial situation, you may choose to fund the franchise entirely or do what is more common and use only a portion as a cash injection for an SBA loan.

Join the Future of Franchise Investments

Funding Calculator

Our franchise funding pre-qualification tool instantly gets you an estimated potential budget based on your financial situation. Different combinations of cash, 401(k) or IRA eligible funds, and other assets all affect your potential borrowing power.

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