What was the net cash used in investing activities for 360 Painting in 2022?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
| Net income | - | 948,081 | 948,081 | | Distributions to Members | (780,913) | - | (780,913) | | Balances at December 31, 2022 | (3,015,800) | (685,640) | (3,701,440) | | Net income | - | (733,879) | (733,879) | | Distributions to Members | (750,000) | - | (750,000) | | Balances at December 31, 2023 | $ (3,765,800) $ | (1,419,519) $ | (5,185,319) | | | 2023 | 2022 | |----------------------------------------------------------------|-----------------------|-------------| | | | | | Cash flows from operating activities | | | | Net income | $ (733,879) $ | 948,081 | | Adjustments to reconcile net income to net cash | | | | provided by (used in) operating activities | | | | Depreciation and amortization | 1,671,567 | 1,445,548 | | Amortization of deferred loan costs | 79,207 | 69,742 | | Payments on contingent consideration liabilities | - | (33,819) | | Changes in assets and liabilities | | | | Accounts receivable | (661,073) | (224,286) | | Prepaid expenses and other current assets | (31,950) | (1,163,663) | | Other assets | (1,564,311) | (201,140) | | Accounts payable | 243,259 | (166,886) | | Accrued and other liabilities | 209,310 | (71,621) | | Deferred revenue | 311,391 | 85,663 | | Other long-term liabilities | 1,908,039 | 277,322 | | Net cash provided by operating activities | 1,431,560 | 964,941 | | Cash flows from investing activities | | | | Business acquisitions, net of cash acquired | (5,979,862) | (4,050,000) | | Purchases of property and equipment | (87,473) | (56,961) | | Capitalized software development costs | (405,933) | (106,529) | | Net cash used in investing activities | (6,473,268) | (4,213,490) | | Cash flows from financing activities | | | | Member distributions | (750,000) | (780,913) | | Borrowings from long-term debt, net of deferred financing
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 56)
What This Means (2025 FDD)
According to 360 Painting's 2025 Franchise Disclosure Document, the net cash used in investing activities in 2022 was $(4,213,490). This figure represents the total cash outflow related to investments made by 360 Painting during that year. These investments include business acquisitions, purchases of property and equipment, and capitalized software development costs.
Specifically, the investments comprised $4,050,000 in business acquisitions, $56,961 in purchases of property and equipment, and $106,529 in capitalized software development costs. These cash outflows indicate that 360 Painting was actively investing in expanding its business through acquisitions, infrastructure, and technology during 2022.
For a prospective franchisee, this information provides insight into how 360 Painting manages its finances and invests in its growth. A significant net cash outflow in investing activities suggests that the company is focused on long-term expansion and development, which could be a positive indicator for the future of the franchise system. However, it is essential for potential franchisees to consider these figures in the context of the company's overall financial health and performance.