What is the significance of Byrider Franchising Partners not being in business for three years regarding financial statement requirements?

According to Byrider's 2025 Franchise Disclosure Document, Byrider Franchising Partners does not have a three-year operating history. As a result, the FDD only includes an unaudited opening balance sheet as of September 5, 2024, in Exhibit A, and it cannot include all the financial statements typically required by the Federal Trade Commission (FTC) Franchise Rule.

This is significant for prospective franchisees because it limits the amount of historical financial data available for review. Typically, an established franchisor would provide several years of audited financial statements, allowing potential franchisees to analyze trends in revenue, expenses, and profitability. The absence of this historical data means that franchisees must rely more heavily on other sources of information, such as the financial performance representations in Item 19 and their own due diligence.

Prospective Byrider franchisees should carefully consider the limited financial history of Byrider Franchising Partners and conduct thorough due diligence. This may include seeking advice from financial advisors, attorneys, and current franchisees to assess the financial viability of the franchise opportunity. Requesting the written substantiation for the financial information provided in Item 19 is also crucial to gain a better understanding of potential earnings.