Risk Score
Pending analysis
Investment Range
$213,400 - $465,200
Franchise Fee
$50,000
Total US Locations
6
Business Summary
The Coven Franchising, LLC offers individual unit franchises for the development and operation of a business known as The Coven Communities. These communities provide an inclusive network of co-working and private workspaces, along with other related services and products. The business aims to create a supportive environment, especially for women, non-binary, and trans individuals.
Corporate History
The Coven Franchising, LLC was formed as a Delaware limited liability company on October 5, 2022. It began offering franchises for The Coven Communities in October 2022. The concept for The Coven was originally created by its predecessor and parent company, The Coven LLC, which was formed on August 8, 2017, in Minnesota. This entity later converted to a Minnesota corporation, The Coven, Inc., on August 5, 2019. The Coven, Inc. started operating the first community in October 2017 and currently operates two communities in Minnesota.
Financial Overview
Investment Range
$213,400 - $465,200
Franchise Fee (Low)
$50,000
Franchise Fee (High)
$50,000
Royalty %
8%
Marketing %
2%
Equipment Costs (Low)
$70,000
Equipment Costs (High)
$210,000
Working Capital
$7,500
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
The Coven Franchising, LLC's financial statements are audited as of December 31, 2024. The company notes that its financial condition, as reflected in these statements, raises questions about its ability to provide services and support to franchisees. The franchisor also states that because it began franchising in 2022, it has not been in business for three years, and therefore cannot include all financial statements required by the FTC Rule.
Financing Details
The Coven Franchising, LLC does not offer any direct or indirect financing to its franchisees. Additionally, it does not guarantee any notes, leases, or other obligations for franchisees.
Performance Metrics
Total US Locations
6
Franchised Units
4
Corporate Units
2
Avg Square Footage
7,500
Franchising Since
2022
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
The Coven Franchising, LLC has no litigation to report. Item 3 of the FDD states that no litigation is required to be disclosed.
Bankruptcy History
The Coven Franchising, LLC has no bankruptcy history to report. Item 4 of the FDD states that no bankruptcy information is required to be disclosed.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew the franchise agreement, The Coven Franchising, LLC franchisees must provide written notice 180 to 365 days before the current term ends. They must have complied with all material provisions of the current franchise agreement, paid all outstanding monetary obligations, and met all operating and quality standards. Additionally, the franchisee must demonstrate the right to maintain possession of the community premises and make necessary capital expenditures to remodel and redecorate the space to current brand standards. Alternatively, they must secure a new, approved location within the protected territory and make all required improvements. A Principal Owner and the General Manager must satisfactorily complete any new or refresher training programs. Franchisees must also pay a renewal fee equal to 25% of the then-current initial franchise fee and sign a general release of claims. The new agreement may have materially different terms and conditions.
Training & Support Program
Franchisor Assistance
The Coven Franchising, LLC provides pre-opening assistance to franchisees, including consulting for site selection and approval, prototype drawings and specifications for the community, a list of approved suppliers, initial training, and access to a confidential Operations Manual. The franchisor also offers marketing strategy and materials such as webpages and creative asset libraries. After opening, The Coven Franchising, LLC assists with community opening, provides advisory services on operations, products, marketing, and administrative procedures, and offers updated Operations Manual materials. It also manages the Marketing Fund, provides access to The Coven Digital Community, and may offer guidance on pricing and discounts.
Initial Training Hours
58
Training Location
Virtually and in St. Paul, Minnesota, or another designated location.
Ongoing Support
The Coven Franchising, LLC provides ongoing operational assistance to franchisees, including advisory services on community operations, products, marketing, and administrative procedures. It periodically provides updated materials for the Operations Manual and determines the content and rules for The Coven website and intranet system. The franchisor also operates a Marketing Fund for general brand promotion and provides access to The Coven Digital Community. It continues to offer marketing strategy and materials and may provide guidance on pricing and discounts. Franchisees may be required to attend supplemental and refresher training programs up to 5 days annually, as well as mandatory franchise conventions and meetings.
Franchise Requirements
Ideal Candidate Profile
The Coven Franchising, LLC seeks franchisees who can successfully develop and operate a The Coven business offering an inclusive network of co-working and private workspaces. While the FDD does not explicitly detail a specific 'ideal candidate profile' beyond general financial requirements and operational commitment, it implies that successful franchisees would be individuals or entities capable of managing a membership-based workspace business, understanding the market for inclusive co-working spaces, and committed to adhering to The Coven's system and standards. Franchisees are expected to have a Principal Owner and a General Manager (who can be the same person) successfully complete the initial training program and meet ongoing operational standards. The franchise emphasizes the importance of an inclusive environment and actively participating in marketing and promotion.
Industry Experience Required
No
Management Experience Required
No
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Retail
Owner Participation
Supervisory
Territory Type
Protected
Territory Size Requirements
The Coven Franchising, LLC grants franchisees a 'Protected Territory' that generally consists of a 10-minute drive time from their specific community location.
Staffing Notes
The Coven Franchising, LLC requires franchisees to hire all their own employees, determining their terms of employment, scheduling, benefits, discipline, and compensation. Franchisees must conduct background checks on all potential employees using an approved vendor. They must also implement a training program for community employees according to franchisor requirements and maintain a staff sufficient to meet standards. The community must always be supervised by a General Manager, who is responsible for day-to-day operations on a full-time basis and must not have significant conflicting time commitments outside the business. All employees must comply with required licenses and certifications.