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Bad Daddy's Burger Bar Franchise Loan: The Complete Financing Guide for Bad Daddy's Burger Bar Franchise Owners
If you're looking for a craft burger franchise with serious growth potential, Bad Daddy's Burger Bar deserves a hard look. Known for its over-the-top gourmet burgers, hand-spun milkshakes, and lively bar atmosphere, Bad Daddy's has carved out a loyal following across the Southeast and beyond. For aspiring franchise owners, this brand offers a compelling mix of differentiated food offerings and a vibrant dining experience that keeps guests coming back.
But like any restaurant franchise, turning that excitement into a real business requires capital - and plenty of it. From the initial franchise fee to build-out costs, equipment, and working capital, the total investment to open a Bad Daddy's Burger Bar can stretch well into six figures. That's where strategic franchise financing becomes essential. Whether you're a seasoned multi-unit operator or a first-time franchise owner, understanding your loan options is the foundation of a successful launch.
This guide covers everything you need to know about financing a Bad Daddy's Burger Bar franchise: what it costs to get started, what loan products are available, how to qualify, and how Crestmont Capital can help you secure the funding you need to open your doors and grow.
- About Bad Daddy's Burger Bar
- Bad Daddy's Franchise Costs and Investment Breakdown
- Why Franchise Financing Matters
- Best Loan Options for Bad Daddy's Franchise Owners
- SBA Loans for Bad Daddy's Franchise
- Equipment Financing for Restaurant Franchises
- How to Qualify for a Franchise Loan
- Franchise Financing Process Overview
- Loan Product Comparison Table
- The Crestmont Capital Advantage
- How to Get Started
- Frequently Asked Questions
About Bad Daddy's Burger Bar
Bad Daddy's Burger Bar was founded in Charlotte, North Carolina in 2007 by Frank Scibelli. The concept was built around a simple but bold idea: serve premium, made-from-scratch burgers in a full-service casual setting with a full bar program. That approach resonated immediately with guests who were hungry for something more adventurous than the average fast-casual burger chain.
The menu features a rotating lineup of creative signature burgers alongside classic build-your-own options, fresh-cut fries, shareable appetizers, hand-spun milkshakes, and an extensive bar menu with craft cocktails and local beers. Locations typically run 3,500 to 5,000 square feet and seat anywhere from 80 to 150 guests, often including an outdoor patio component.
The brand is owned by Good Times Restaurants Inc., a publicly traded parent company, which adds a layer of institutional credibility to the franchise. Bad Daddy's has locations across the Carolinas, Tennessee, Virginia, Colorado, Kansas, and Georgia, with ongoing expansion plans fueled by both corporate growth and franchise development.
- Premium craft burger concept in a full-service casual dining format
- Full bar program drives higher average check size and guest retention
- Backed by Good Times Restaurants Inc., a publicly traded parent company
- Strong brand differentiation in a competitive burger market
- Loyal regional following with growing national footprint
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Apply Now →Bad Daddy's Franchise Costs and Investment Breakdown
Understanding the full cost of a Bad Daddy's Burger Bar franchise is the first step toward building a realistic financing plan. The total initial investment varies depending on location type, construction requirements, and regional labor and material costs, but prospective franchisees should generally be prepared for a significant capital commitment.
Based on publicly available information from the franchise's Franchise Disclosure Document (FDD) and industry benchmarks for comparable full-service casual dining concepts, here is a typical cost breakdown:
- Initial Franchise Fee: $35,000 - $50,000
- Real Estate / Lease Deposits: $15,000 - $40,000
- Leasehold Improvements / Build-Out: $300,000 - $700,000
- Kitchen Equipment and Bar Equipment: $150,000 - $300,000
- Furniture, Fixtures, and Decor: $50,000 - $120,000
- Technology and POS Systems: $15,000 - $30,000
- Signage: $10,000 - $25,000
- Initial Inventory and Supplies: $15,000 - $30,000
- Training Costs: $20,000 - $40,000
- Working Capital (3-6 months): $50,000 - $150,000
- Miscellaneous / Professional Fees: $15,000 - $35,000
Estimated Total Investment Range: $675,000 - $1,520,000+
The wide range reflects variability in location type (ground-up construction vs. a conversion of an existing restaurant space), local real estate markets, and whether the operator is a first-time or multi-unit franchisee with purchasing leverage. Most franchisees land somewhere in the $800,000 - $1,100,000 range for a single location in a secondary or tertiary market, with higher-cost metro areas pushing totals above $1 million regularly.
Ongoing fees include a royalty of approximately 5% of gross sales and a marketing fund contribution of around 2-3%. These should be factored into your financial projections when evaluating return on investment and debt service capacity.
Why Franchise Financing Matters
Even well-capitalized franchise owners typically use financing to fund a significant portion of their total investment. Here's why financing is not just common but strategically smart:
Capital preservation. Tying up all your liquid capital in a single restaurant location leaves you without a financial cushion for unexpected expenses, a second location, or personal emergencies. Financing allows you to preserve cash while still acquiring the assets you need.
Tax efficiency. Interest on business loans is generally tax-deductible, reducing your effective cost of borrowing. Additionally, equipment financed separately may qualify for Section 179 deductions, allowing you to write off the full purchase price in year one rather than depreciating it over time.
Leverage your returns. If your Bad Daddy's location generates a strong return on invested capital, financing allows you to amplify those returns by investing less of your own money upfront. This is especially powerful when planning to open multiple locations.
For franchisees exploring their options, Crestmont Capital offers a range of small business loans designed to meet the unique needs of restaurant franchise operators, from SBA loans and equipment financing to fast-close working capital lines.
Best Loan Options for Bad Daddy's Franchise Owners
There is no one-size-fits-all approach to franchise financing. The right loan product - or combination of products - depends on your credit profile, available collateral, equity contribution, and how quickly you need to close. Here are the most common loan types used by restaurant franchise owners:
1. SBA 7(a) Loans
The SBA 7(a) loan is the most popular financing vehicle for franchise owners in the U.S. These government-backed loans offer loan amounts up to $5 million, competitive interest rates (typically Prime + 2.25-2.75%), and repayment terms up to 10 years for working capital and up to 25 years for real estate. The SBA guarantees a portion of the loan, making it easier for lenders to approve borrowers who might not qualify for a conventional loan.
2. SBA 504 Loans
If your franchise includes real estate ownership or involves significant equipment purchases, the SBA 504 loan is worth exploring. These loans are structured in two tranches - one from a Certified Development Company (CDC) and one from a private lender - and offer below-market fixed interest rates. They're particularly well-suited for large equipment packages or property acquisition.
3. Conventional Business Term Loans
For franchisees with strong credit and existing assets, conventional term loans from banks or alternative lenders can offer faster closing timelines and fewer documentation requirements than SBA products. Loan amounts, rates, and terms vary by lender and borrower profile.
4. Business Lines of Credit
A business line of credit is an excellent complement to your primary term loan. Lines of credit give you on-demand access to working capital for inventory, payroll, marketing pushes, and seasonal fluctuations. Interest is only charged on the amount drawn, making this a cost-efficient tool for managing cash flow.
5. Equipment Financing
Restaurant equipment - commercial fryers, refrigeration units, POS systems, bar equipment - represents one of the largest upfront costs of opening a Bad Daddy's location. Equipment financing loans are secured by the equipment itself, often allowing borrowers to finance up to 100% of the equipment cost with no additional collateral required. Terms typically run 3-7 years with fixed monthly payments.
6. Fast-Close Business Loans
When timing is critical - whether to meet a lease deadline, fund a rapid expansion, or cover an unexpected capital need - fast business loans from alternative lenders can provide funding in as little as 24-72 hours with minimal documentation. These loans come at a higher cost than SBA products but offer speed and flexibility that traditional bank loans cannot match.
SBA Loans for Bad Daddy's Franchise
The SBA loan remains the gold standard for franchise financing, and for good reason. The combination of long repayment terms, competitive interest rates, and government backing makes SBA loans the most cost-effective financing option for most franchise owners. Here's what you need to know about using an SBA loan to fund your Bad Daddy's investment:
SBA 7(a) Loan Highlights for Franchise Financing:
- Loan amounts from $50,000 to $5,000,000
- Repayment terms up to 10 years (working capital) or 25 years (real estate)
- Interest rates: Prime + 2.25% to 2.75% (variable) or fixed options available
- SBA guarantee up to 85% for loans under $150,000; 75% for larger loans
- Down payment requirement typically 10-20%
- Personal guarantee required from all owners with 20%+ equity stake
SBA Eligibility for Franchise Owners:
To qualify for SBA financing, the franchise system must be listed in the SBA's Franchise Directory. Franchisees must also meet SBA size standards (typically based on number of employees or annual revenue), demonstrate sufficient industry experience and creditworthiness, and inject meaningful equity into the project.
Bad Daddy's Burger Bar, as an established franchise backed by a public parent company, is likely to be recognized by SBA-approved lenders as a viable franchise investment, which can streamline the loan approval process.
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Start Your Application →Equipment Financing for Restaurant Franchises
The kitchen is the heart of any Bad Daddy's Burger Bar location, and equipping it properly is one of your largest upfront investments. A typical Bad Daddy's build-out requires a comprehensive suite of commercial kitchen equipment including char-broilers, flat-top griddles, commercial fryers, refrigeration systems, prep tables, dishwashers, and a full bar setup with draft systems, coolers, and glassware inventory.
Equipment financing is specifically designed to handle these purchases. Here's why it makes sense for franchise owners:
- 100% financing available: In many cases, you can finance the full cost of the equipment with no down payment, preserving your cash for other startup expenses.
- Equipment as collateral: The equipment itself secures the loan, which means you don't need to pledge real estate or other personal assets to get approved.
- Fixed payments: Predictable monthly payments make cash flow management easier, especially in your first year of operation.
- Tax advantages: Section 179 deductions and bonus depreciation may allow you to write off a significant portion of the equipment cost in the first year.
- Faster approval: Equipment loans typically close faster than SBA loans, sometimes within 24-48 hours for smaller packages.
For larger equipment packages exceeding $250,000, it may make sense to include equipment within your SBA 7(a) or 504 loan to take advantage of the longer repayment terms. Crestmont Capital's team can help you structure the optimal financing mix for your specific situation. See also our guide on financing a Firehouse Subs franchise for a detailed comparison of equipment financing strategies used by restaurant franchise owners.
How to Qualify for a Franchise Loan
Lenders evaluate franchise loan applications using a combination of personal credit, business financial history, industry experience, and the strength of the franchise system itself. Here are the key factors that determine your eligibility and the terms you'll be offered:
Credit Score
For SBA loans, most lenders require a minimum personal credit score of 680-700+. Conventional lenders and equipment financiers may work with scores as low as 620, but the best rates are reserved for borrowers in the 720+ range. Check your credit reports before applying and address any errors or derogatory items that could be dragging your score down.
Net Worth and Liquid Capital
Most SBA lenders require borrowers to inject at least 10-20% of the total project cost in equity. For a $1,000,000 Bad Daddy's buildout, that means having $100,000 - $200,000 in liquid capital available to deploy. Lenders also look at your total net worth to ensure you have financial stability beyond the franchise investment itself.
Industry Experience
Restaurant industry experience - whether as a manager, operator, or multi-unit franchisee - significantly strengthens your loan application. Lenders want to see that you have the operational knowledge to run a profitable restaurant business. If you lack direct restaurant experience, partnering with an experienced operator or completing the franchisor's training program can help offset this gap.
Business Plan and Financial Projections
A well-constructed business plan with realistic revenue projections, expense budgets, and break-even analysis is essential for SBA loan applications. Your lender will use your projections to calculate your projected Debt Service Coverage Ratio (DSCR) and determine whether your anticipated cash flow can support the loan payments.
Franchisor Approval
Before any lender will finalize a franchise loan, you must have a signed Franchise Agreement from Bad Daddy's parent company. The approval process includes a financial review, background check, and formal site approval. Starting the lender relationship early - even before you have final franchisor approval - allows you to get pre-qualified and be ready to close quickly once the agreement is signed.
Franchise Financing Process Overview
How to Finance a Bad Daddy's Burger Bar Franchise
Review the FDD, speak with existing franchisees, and calculate your total capital need including equity injection.
Contact Crestmont Capital to get a preliminary assessment of your financing options before committing to a franchise agreement.
Complete your formal loan application with supporting documents: tax returns, bank statements, business plan, franchise agreement, and personal financial statement.
Your lender reviews financials, runs credit, and evaluates the franchise system. SBA loans typically take 30-90 days; alternative products can close in days.
Sign your loan documents, funds are disbursed, and construction or build-out begins. Equipment loans may fund directly to vendors.
Open your Bad Daddy's location, monitor performance, and begin building the track record needed to secure financing for your next unit.
Loan Product Comparison Table
Different loan products serve different needs. Here's a side-by-side comparison of the most common financing options used by restaurant franchise owners:
| Loan Type | Amount | Term | Rate | Speed | Best For |
|---|---|---|---|---|---|
| SBA 7(a) | Up to $5M | 10-25 years | Prime + 2.25-2.75% | 30-90 days | Full franchise launch |
| SBA 504 | $125K - $5M+ | 10-25 years | Below-market fixed | 45-90 days | Equipment + real estate |
| Equipment Financing | $10K - $5M | 3-7 years | 5-15% | 24-72 hours | Kitchen + bar equipment |
| Business Line of Credit | $10K - $500K | Revolving | Prime + 1-5% | 3-10 days | Working capital / cash flow |
| Term Loan (Alt.) | $25K - $2M | 1-5 years | 8-30% | 24-72 hours | Fast capital needs |
The Crestmont Capital Advantage
When it comes to franchise financing, working with a lender who understands the restaurant industry makes a real difference. At Crestmont Capital, we specialize in helping franchise owners across the country secure the capital they need to open, grow, and scale their businesses. Here's what sets us apart:
Fast decisions. We know that franchise timelines don't wait for slow banks. Our streamlined application process means you can get a funding decision in as little as 24-48 hours for many loan products - far faster than the weeks or months required by traditional SBA lenders.
Multiple product options. We're not a one-loan-fits-all lender. We work with you to find the right combination of term loans, equipment financing, and lines of credit that match your franchise investment profile and cash flow needs.
Restaurant industry expertise. Our team has helped finance hundreds of restaurant franchise owners, from QSR operators to full-service casual dining franchisees. We understand the unique challenges of the restaurant business and structure loans accordingly.
Competitive rates. We access a broad network of lenders and funding sources, allowing us to match you with the most competitive rates and terms available for your credit profile and loan size.
Ongoing support. Our relationship doesn't end at funding. As your business grows, Crestmont Capital is your ongoing partner for additional capital needs - whether that's a second location, a major equipment upgrade, or a seasonal line of credit.
For additional context on how other franchise owners have financed their investments, check out our detailed guides on Jersey Mike's franchise financing and the broader world of small business lending.
Ready to Open Your Bad Daddy's Burger Bar?
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Apply Now →How to Get Started: Your Next Steps
Request the current Franchise Disclosure Document from Good Times Restaurants and review it with a franchise attorney. Pay special attention to Item 7 (estimated initial investment), Item 19 (financial performance representations), and Item 21 (financial statements).
Pull your personal credit reports, gather your last 3 years of personal and business tax returns (if applicable), 4-6 months of bank statements, and a personal financial statement. These documents are required for most franchise loan applications.
Develop a detailed business plan including your market analysis, site selection rationale, management team bios, and 3-year financial projections. Your lender will use this to evaluate the viability of your investment.
Submit your application to Crestmont Capital. Our franchise lending team will review your profile, match you with the best loan product(s), and guide you through the process from application to funding. We offer SBA loans, equipment financing, term loans, and lines of credit all in one place.
Once approved, work with your lender to coordinate funding with your construction timeline and equipment delivery schedule. Plan your grand opening marketing campaign and build your team. Your Bad Daddy's Burger Bar journey is about to begin.
Frequently Asked Questions
How much does it cost to open a Bad Daddy's Burger Bar franchise?
The total investment to open a Bad Daddy's Burger Bar typically ranges from $675,000 to $1,520,000 or more, depending on location, construction costs, and market. The initial franchise fee is generally $35,000 to $50,000, with the majority of the investment going toward leasehold improvements, equipment, and working capital.
Can I get an SBA loan to finance a Bad Daddy's franchise?
Yes. SBA 7(a) loans are one of the most commonly used financing tools for restaurant franchise owners. As long as the franchise system is recognized by SBA-approved lenders and you meet the personal credit, equity injection, and experience requirements, you can apply for an SBA loan to fund your Bad Daddy's investment.
What credit score do I need to get a franchise loan?
For SBA loans, most lenders require a minimum personal credit score of 680-700. Conventional and alternative lenders may work with scores as low as 620-650, but better rates and terms are available for borrowers with scores of 720 or higher. Before applying, review your credit reports and dispute any errors.
How much of my own money do I need to open a Bad Daddy's franchise?
Most lenders require an equity injection of 10-20% of the total project cost. For a typical $1,000,000 investment, that means having $100,000 to $200,000 in liquid capital available. Some lenders may accept sweat equity or seller financing as part of the equity contribution, though this is less common in restaurant franchise lending.
What documents do I need for a franchise loan application?
Typical documents required include: personal and business tax returns (3 years), personal financial statement, bank statements (4-6 months), signed franchise agreement or letter of intent, business plan with financial projections, resume/management team bios, and lease or letter of intent for your restaurant space. SBA applications require additional forms including SBA Form 1919 and Form 912.
How long does it take to get approved for a franchise loan?
Approval timelines vary by loan type. Alternative business loans can fund in 24-72 hours with minimal documentation. Conventional bank loans typically take 2-4 weeks. SBA 7(a) loans generally take 30-90 days from application to funding, depending on lender processing times and the completeness of your application package.
Can I finance restaurant equipment separately from my SBA loan?
Yes. Equipment financing can be used alongside or instead of an SBA loan for the equipment portion of your investment. Equipment loans are secured by the equipment itself and often fund much faster than SBA products. For smaller equipment packages, standalone equipment financing may be more cost-effective than including it in a longer-term SBA loan.
Does Bad Daddy's Burger Bar offer any in-house financing?
As of current publicly available information, Bad Daddy's Burger Bar does not offer direct in-house financing. However, the franchisor may have relationships with preferred lenders who are familiar with the franchise system, which can streamline the loan approval process. Always ask your franchise development contact about any preferred lender relationships.
Can I finance multiple Bad Daddy's locations at once?
Multi-unit franchise financing is available from both SBA lenders and alternative lenders. The most common approach is to secure financing for one location at a time, building a track record of financial performance before borrowing for additional units. Some lenders offer portfolio loans for experienced multi-unit operators. Your ability to qualify for multiple units simultaneously will depend on your existing assets, cash flow, and the strength of your initial location's performance.
What is the royalty structure for Bad Daddy's Burger Bar?
Based on publicly available FDD information, Bad Daddy's Burger Bar charges ongoing royalties of approximately 5% of gross sales, plus a marketing fund contribution of approximately 2-3% of gross sales. These fees are in addition to your loan payments and should be factored into your financial projections when modeling your expected cash flow.
What is a good Debt Service Coverage Ratio (DSCR) for a franchise loan?
Most SBA and conventional lenders require a minimum projected DSCR of 1.25, meaning your net operating income should be at least 1.25 times your annual debt service (principal + interest payments). A DSCR of 1.35 or higher is generally considered strong. Your business plan projections should clearly demonstrate that your anticipated revenue and expense structure supports this coverage ratio.
Do I need a personal guarantee for a franchise loan?
Yes. All SBA loans require a personal guarantee from any individual who owns 20% or more of the business. Many conventional lenders require personal guarantees regardless of ownership percentage. A personal guarantee means you are personally responsible for repaying the loan if the business cannot. This is standard practice in franchise and small business lending.
What happens if my franchise loan is denied?
If your loan application is denied, the lender must provide a written explanation. Common reasons include insufficient credit score, inadequate liquid capital, lack of industry experience, or concerns about the market or location. You can address the specific issues cited, improve your financial profile over 6-12 months, or explore alternative lenders who have different credit requirements. Working with a specialist like Crestmont Capital can help you identify and qualify for the right loan product the first time.
Is Bad Daddy's Burger Bar a profitable franchise?
Profitability varies by location, operator experience, and local market conditions. Reviewing Item 19 of the FDD (Financial Performance Representations) provides the most accurate picture of how existing locations perform. Engaging with existing franchisees during your discovery process - which the franchisor is required to facilitate - gives you real-world insight into unit economics and profitability timelines.
How do I apply for a Bad Daddy's franchise loan with Crestmont Capital?
Applying is easy. Visit Crestmont Capital's application portal and complete the short online form. A franchise lending specialist will contact you within 24 hours to discuss your needs and financing options. The application takes just minutes and does not require a hard credit pull to get started.
Disclaimer: The information provided in this article is for general educational purposes only and is not financial, legal, or tax advice. Funding terms, qualifications, and product availability may vary and are subject to change without notice. Crestmont Capital does not guarantee approval, rates, or specific outcomes. For personalized information about your business funding options, contact our team directly.
