Franchise Essentials

TD Bank and Kiddie Academy Develop Relationship

Today's economic conditions has banks and lending institutions cautious about handing out funds for business propositions that may or may not succeed. However, Kiddie Academy Domestic Franchising has devleoped a relationship with the lending institution, TD Bank - good news for franchisee applicants seeking to secure loans. The partnership demonstrates that the franchisor has been deemed a qualified borrower.

Over the last 10 years Kiddie Academy has had 20 million dollars in SBA loans with a zero default rate. This stellar track record proves their concept is sound and offers qualified borrowers an option of a 10-year loan with a fixed rate and a requirement of 20 percent equity instead of the typical 30 percent.

This comes on the heels of a recent deal with Kiddie Academy franchisee, Henry Emezie, who just opened his location in Charlotte, NC. "When I decided to open a Kiddie Academy franchise, TD Bank was willing to work with me on loan options and provided support that other financers did not. Kiddie Academy's financial team was with me every step of the way. I'm thrilled to be a part of the organization and am impressed with my experience with TD Bank."

"We are excited about this new relationship and believe it is a testament to our processes and our franchise system. We've been working with TD Bank for many years and have been pleased with the loan packages and service they've been able to provide our franchisees," said Susan Wise, CFO and COO for Kiddie Academy.

To find out how Kiddie Academy can work with you on finding the appropriate lending institution, visit kiddieacademyfranchising.com to contact a Director of Franchising.

Using Your 401k to Help Finance Your Franchise



Finding financing and securing loans is a critical part of starting up your franchise and no small feat. One option more and more franchisees are exploring is the use of their 401(k)s as a means of investment.

This option, little known even by business-savvy people, is to use your IRA or 401(k) penalty free to assist you in financing your new business. Without having to pay penalty fees to re-appropriate funds from your 401(k), you get to use your retirement savings to invest in yourself. This works by creating a C corporation to set up a 401(k) plan that allows the rollover of existing retirement funds into the new account. This is often referred to as a ROBS loan - Rollover as Business Start-ups, so-named by the IRS.

This is a self-directed plan -- you run it and make all the investment decisions. Under your direction, the 401(k) then buys stock in your new corporation. The corporation uses those dollars as seed money to cover your wages and other working capital needs.

There are several considerations to weigh before tapping into your nest egg. At Kiddie Academy, our team of finance professionals can assist you in determining if this is an option for you, as well as have conversations with over a dozen banks to help you find the right lender. Please visit kiddieacademy.com or kiddieacademyfranchising.com to contact a Director of Franchising to start these discussions.