Forums: Discussions for entrepreneurs and small business.

Is this a good idea to sale the master license to raise the start-up capital?

Fine Food-to-Go is a new proprietary licensing catering business
designed to deliver with the utmost convenience; the finest food freshly
prepared hot and completely ready-to-eat right to the home of the busy
consumers.

The answer to the daily 5 o’clock dilemma: What’s for diner? This concept
will provide the three most precious commodities in today’s modern
society: Time, Nutrition and Convenience
The target market is very specific and easy to locate anywhere: the busy
executives and well-to-do retirees in their upper-income household
gated communities or high-rises apartment building. In Las Vegas the
initial market, 95,657, in the entire U.S., this niche encompasses 22
million households. Each community is a TAM (Total Addressable Market),
as every household or apartment represents a potential customer who
must eat at least once a day and fits the profile of a typical Fine Food-to-
go™ customer.

The combination of a patent pending food carrier with a unique business
method on the Internet and a Food Production Center (FPC), this
revolutionary concept has all the advantages upon which a Strategic
Business Design can be based, resulting in sustainable competitive
benefits and unique capability to shield from the competition.

The uniqueness of this solid concept lies in its scalability. It has all the
elements necessary for a successful licensed chain. A new trend with a
guaranteed market following, repeated experience and basic unit
economics where large numbers of incremental units of different size and
capacity can be quickly and efficiently put into service and produce
extraordinary, above-market returns. Appropriate legal protections are in
place through utility and design patents, trademarks and a registered
domain name.

Selling a master license can be a way to bring capital into the business. 

1. Consider how much you can get at this early stage compared to its future value.

2. You will need to avoid the appearence of selling a franchise - since that requires greater documentation and specific regulations apply.

Robert Johnson

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Business Growth Masters, LLC -
Capital Catalysts for Entrepreneurs
Home of the Scalable Business Plan and QuikStart Capital Programs
http://www.bizgrowthmasters.com
info@bizgrowthmasters.com

Yes, make sure you`re not giving away a monster asset for a song!

Don`t do anything you`ll regret later!


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Read About Double Entry Accounting & The Accounting Equation

Thanks Robert,

1. Consider how much you can get at this early stage compared to its
future value.

      Once the project is operational, famous chefs such as Wolfgang Puck
would pay ten times the entrée fee. The license fee is based on the
number of households in a specific zone above $100,000 income. For
San José, 89,000 at least.

2. You will need to avoid the appearance of selling a franchise - since
that requires greater documentation and specific regulations apply.

       My lawyer specializes in licensing. We don’t even charge royalty fee
only website maintenance fee based on sales.

Sounds like you`re all set up to move forward.

All the best,

Robert Johnson

-------------------------

Business Growth Masters, LLC -
Capital Catalysts for Entrepreneurs
Home of the Scalable Business Plan and QuikStart Capital Programs
http://www.bizgrowthmasters.com
info@bizgrowthmasters.com

Hi Gilbert

 

Look very very closely at the way the prep kitchen concept is rolling out over the USA and internationally. There are a lot of hungry mouths (I don’t believe that they are the customers) and a lot of free lessons to learn about the value propositions of new food ventures.

 

When valuing a licence oportunity realy think about whether you are selling a proven or untested concept. They will value quiet differently.

 

Also remember that the US franchising laws are very strict about when a licence is a franchise by another name. Really take the time with your legal team to understand just how the licensing and operating conditions you impose on the licencee not just the fees raised, will or will not drop you into the franchising basket.

 

If you can stay on the right side of the code you will not be on  the receiving end of a very big nightmare.

 

Regards

J

I guess master license implies the holder will be able to issue sub-licenses in whatever area they are marketing.  Pricing could be an issue, since it is going to be more expensive (and a harder sell) then your individual license.  Maybe a bonus for referrals, or some variation of MLM marketing, if this is the type of business that can handle it, and your clients accept it.