Patrick: Well, thanks so much for everyone for coming out.
My name is Patrick Findaro, managing partner at Visa Franchise and we support foreign investors looking to immigrate to the US through investments and franchises.
A little bit about my firm, we work with different investments and different franchise industries. All the way from someone that’s looking for an investment that’s secure for them and their family and its visa to multi-operators are looking to create a mini empire with multiple units of the franchise. So we work with different types of entrepreneurs, of all different types of backgrounds across the globe. We’re based in Miami, Florida which is pretty strategic. Most of our clients are looking to open up businesses in Florida, Texas, California. Constantly travelling between those states as well as a lesser extent the Eastern Seaboard and up in California or up in the Pacific Northwest.
My role is really to be a matchmaker understanding your skill set, where you wanna be living, what type of businesses that we could look out together and see a few different options that match your profile and then have you be…give you as much information as possible and have you make the ultimate decision.
A little bit about my firm, so I started this pretty recently last year with my brother. I have experience in banking, financing, consulting, both on the credit side and a little on the deal side. And then in the past few years I’ve been working with investments that qualified for investor visas, principally the EB-5 where I was a junior partner at a small private equity fund where we gave loans to franchises like Dunkin’ Donuts. So that’s how I entered in the space of franchising as well as with investor visas, always working alongside immigration attorneys. And then my brother worked at RBI-Restaurant Brands International where he was in finance, market analytics and development for Burger King and also working with Tim Hortons, based not too far from here.
Partners are key, you know, questions about taxes, questions on immigration or just simple account opening or banks that are giving lends…lending to foreign nationals, those are the things that I’ve helped my clients with, not me because I’m most focused on just evaluating, finding the best franchise opportunities for you. But with my strategic partners that, you know, based here in Toronto as well as based throughout many major U.S. cities. So its extremely key because it’s a major decision moving you, your family to the U.S. and we wanna make sure that it’s as smooth as possible for both a business perspective as well as your…the personal side of it.
The U.S. franchise industry is really big. It’s a very diverse industry as well. Most people probably think about franchising and think fast food. That’s about 50% of the industry but there’s also a lot of other ones that I’ll talk about. It’s growing a lot, you know, 4% year over year. There are a lot of different brands, so including franchises and different licenses there’s over 5,000, so it can be pretty daunting task for someone that’s looking to move to the U.S. and start to evaluate a lot of these options.
We had some questions earlier, you know, investing in existing business and the seller might not wanna be held up and there are some franchises unfortunately that don’t work with foreign nationals. I’ve done that research. There are all different type of franchises out there that some aren’t great businesses, the vast majority are not great businesses that I would introduce my clients to. So I’ve done a lot of the work, we’ve researched a lot of franchises, we have personal connections with many of the top executives of these brands and we’re here to help you.
Franchise investments usually equals lower risk. There’s risk involved in any business. If not, you wouldn’t have a return on your capital. Looking at franchise businesses versus independent businesses over a 10 year period, and this isn’t just me saying…this is from the U.S. Department of Commerce, but over a 10 year period, 90% of franchise businesses are still in operation and then if you look at the independent businesses, it’s less than 20%, 18%. So, you know, that in itself is fact enough for me to really work exclusively with franchise brands. Firms like Domenico’s Gelato-go that he’s made a lot of mistakes in the beginning when he was starting his business and you can learn a lot from his mistakes and not make the same errors. So franchises really provide you a lot of the support with on-going training, they have a verifiable track record, the vast majority of franchisers I work with are familiar with the E-2 investor program and do understand that it is a process and it can take a little more time in the evaluation and they’re happy to work with me and our immigration partners.
And really…you moving to the U.S. and especially, you’re not established in the local community and you come in and create your own brand, it can be quite tough but it’s different when you’re coming to the U.S. investing in an established business that already has a brand presence, already has negotiating contracts with suppliers and it’s really gonna facilitate a lot. We have clients that one of the spouses will be the investor and then the other one’s gonna work in a multi-national bank or do something more that’s a little more entrepreneurial and high risk, but they have that visa tied to the franchise. And I would advise them, you know, I think that it’s the best thing to do if you’re able to do that and you have a spouse that might wanna work outside the E-2 investor…E-2 visa program.
So here are examples of the industries that we see poised for growth over the coming years and we’ve identified some key franchises in these industries. Some might be large brands with over 100 units, 300 units and some are just emerging concepts that the industry is really just growing right now in the U.S. and they’re growing rapidly.
Quick service restaurants. I like gelato, coffee, some yogurt concepts, generally high margin, not too difficult to run. Obviously, there is a learning curve. And what’s good about these concepts is you can scale up where you start with one franchise and you create multiple units and you have economies of scale.
Beauty, massage therapy and hair salons. There are some innovative concepts in this space and you can have some renewable revenue streams where someone’s going every two to three weeks for a massage or every four to six weeks for a guy to get a haircut so you have that renewable revenue stream. And unless you really upset your clientele, they’re gonna keep going to you.
Pet care, daycare services and pet stores – these are really growing in the US. There are some interesting concepts both on the grooming space as well as the pet hotels that we like for our clients. You also really have to have an affinity for pets in this space as it’s gonna be non-stop in dealing with all different sorts of animals.
So real estate, everyone always asks about real estate, “Can I buy a house and get an E-2 Visa?” You know, Bobby’s probably mentioned a hundred times, “No, no, no.” There are some ways of…there are some concepts where you invest in a property management franchise perhaps a couple of units or your own units, but then you go out to the community and you’re gonna get a lot of residential commercial units under your management. And the idea is to grow up to 200, 250 units under management and that you have scale and leverage the technology of these property management franchisors.
Education, tutoring, childcare…space that’s grown over the past years, continues to grow. And then just rounding out, healthcare, senior care. There is some great concepts coming about and especially for, you know, if you’re licensed in Canada as a nurse, doctor and issues with transferring the license over to the states or if you just in the business here in healthcare and it provides a good transition to the states. So these are just some examples, there are many more but these are the key industries that we work with and the next slide goes through…
Male 1: Sorry, you passed through the cleaning.
Patrick: Cleaning, yes. So, good. Thanks. Cleaning, commercial cleaning, so having a franchise that’s gonna provide maintenance and cleaning services for a building like this, even restoration services, probably some of you are looking to move to Florida. Issues with floods, fires and then hurricanes do come by once in a while so there are some good concepts in that area. And then more B to C is in the dry cleaning space.
Male 1: What about residential?
Patrick: Residential cleaning, there are some options but I prefer commercial cleaning. It’s a little easier when you’re dealing with some of these businesses where you have contracts that are a little more renewable in that sense and scalable. Any other questions?
Here’s a scale of the different franchise opportunities. I had earlier in my presentation 150 and if I mentioned 50k is the minimum E-2. I mean, right here I have…
Male 1: Is it good for sort of start-ups?
Patrick: Yeah, definitely more for start-ups, franchising under a 100k there aren’t too many franchises available that I would feel comfortable placing my clients into. There are some but they’re not great. In general, they are not the best franchises. Often times they are home based, which I understand has some complications as well as for the E-2 investor visa. But going through a few examples, you know, Steamatic is on the commercial cleaning side, restoration, Gelato-go for today’s franchise. Domenico will speak more about that concept. And then going up the spectrum you have other franchises. And then once you get to 500k+, many of our clients then decide to do an EB-5 Direct Investment and we can provide that level of support with VisaPlace.
Male 2: In EB-5, can you have partners?
Patrick: Yes, you can have partners. The key is we need to make sure that there’s gonna be enough jobs created, but we have clients looking at investing in motels, hotel concepts where they create a lot of jobs or it has to be really fast casual fast food where you’re gonna create a lot of full-time jobs. And in this case, it would be W-9 if I’m not mistaken.
Male 3: Yes. At least 10 full-time employees for each investor outside of the individual and the family.
Male 4: Can you tell the top franchise in the U.S.? Top five.
Patrick Top five? I mean, looking at Subway, McDonald’s, Burger King and those concepts, they’re not really interested in someone that’s gonna invest in one unit. They wanna have a multi-unit developer, someone that’s gonna invest in 10, 20 units. So, but that’s something that you’re able to explore then, you know, those are different opportunities to bring to the table but…
Male 4: But it is scalable, isn’t it? As you said, like, if you go with the big place in the market like 7-11 or Subway, you start with one and then you scale.
Patrick: For sure. The issue is Subway, many of them actually don’t even accept foreign nationals. Subway doesn’t accept foreign nationals as investors. Last time I checked, Dunkin’ Donuts as well. So a lot of the big franchisors wanna have someone that’s already been in that community for awhile and has other complimentary businesses to give a license. But it’s really on a case by case basis and we have to sit down together and evaluate some opportunities.
So a bit about my process and this goes in parallel with Fadi’s process on the legal side. But generally, sit-down with my client, have a complimentary franchise consultation, understand a bit about your background. I tell more details about my service, then you would contract my services and then in about three weeks, four weeks’ time, I present a handful of franchises that match your profile and then I would connect you directly to the franchisor and you’re going through the evaluation process. I provide you SWOT analysis and other information related to those franchisors as well as an industry analysis and then you’re also able to connect with the franchisees. And that’s just to understand how the day to day of the operation is to see what you’re getting yourself into.
And then at that point, you decide to invest alongside your attorney and, you know, new businesses that…it gets a little tricky with escrow and adds an extra step and oftentimes franchisors aren’t willing to do that. There are some exceptions. But you would go ahead and go full force investing in a business and the immigration attorneys you work with have such a high approval rate for the E-2, especially for franchises that we’re quite confident about this process.
Maybe just a quick note on the existing versus new businesses because I get a lot of people that come to me after they’ve been looking for existing businesses. And I’ll give an example of someone that’s recently came to my office who’s been looking a year and a half coming back and forth to the U.S. Had done five plus due diligences on businesses and always found some error where the owner had co-mingled personal and corporate liabilities and assets or just the numbers were off or they realized that it was more of a…imagine a B to B business, a commercial cleaning business and the relationships between the client base and the owner were really so tight that had they bought that business then all…it would be very…worth very little as all the relationships were based on that one owner.
So I, you know, there are some exceptions where I do work with existing businesses but it would be a case like Domenico was saying, “Hey Patrick, we’d like to sell one of our corporate units,” or another franchisor is selling a corporate unit or lesser times where they have a franchisee that the franchisor approaches me and they’re retiring as Fadi had mentioned earlier.
Female: I have a question. Who would go through the due diligence, would you help with that? Or…
Patrick: No. In terms of existing businesses, I would advise you to contract an attorney or an accountant to do the due diligence.
Patrick: Yeah, I’m helping on an advisory basis showing franchises that fit your profile and I’ve done my own analysis and sharing with you, but in terms of due diligence that’s an attorney or accountant.
Male 5: When you speak about L-1, what is the minimum?
Patrick: So the L-1 visa, there, depending on the franchise, you can also apply for an L-1 visa through your franchise investment. It’s a little trickier but and E-2 gives us a lot more flexibility in the types of franchises. Any other questions?
So, I’m based in Miami. We’re here till tomorrow evening and basically with my clients, I’d rather work with 15, 10 clients at a time rather than many people that are interested in looking at different businesses, so I charge an upfront fee for my services of $1,000 for doing the franchise search and helping you out throughout the process and opening the relationships I have with other professional advisers.
Female: Is that just your retainer or that’s the whole thing, the whole fee?
Patrick: That’s…yeah, that’s the fee and then there’s the business plan fee, which for the E-2 investor bases at $2,000 flat fee.
Female: So 3k total?
Male 6: Can we talk about the EB-5, you said something about generation of jobs?
Patrick: Yeah, I mean, so perhaps we could sit down after with Fadi, but essentially it needs to be something that there’s gonna generate a lot of jobs and so at least 10 full-time jobs and there are different structures that we could look at where some of the smaller franchisors will help you while you’re waiting for that adjudication period because its a little tricky where it can take up to 16 months to get an approval. So there…EB-5s, we have to…it’s a lot more effort’s gonna go into matching the business with the visa requirements.
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