TL;DR
NFT technology is transforming industries, including franchising, with potential applications in capital raises, franchise ownership, and finance. Chick'nCone has launched an NFT called Chick'nCoin, which represents a new way of raising capital and potentially earning franchise fees and royalties.
NFT’s and franchising?
Yes NFT’s! Those crypto, block-chain driven non-fungible tokens that, seemingly, everyone derides as overpriced JPEG images, represent a massive incoming wave of technology reaching the shores of franchising and every business. NFT technology will be transforming all industries and will tokenize economic transactions that include community building, brand building, capital raises, stock sales, customer rewards, membership programs, contracts and, even, franchise ownership and finance.
How will this influence franchising, franchise finance, franchise agreements, community and franchise brand building? The answer is anyone's guess right now, but the technology is advancing and we’re starting to see signs of change.
Will NFT’s change how franchisors raise capital? They will. NFT’s of the future will come to represent investor equity, debt, and corporate governance instruments. How this plays out and whether or not the NFT’s are just another version of a regulated stock or security is an issue to look out for. In what appears to be a franchise industry first, franchisor Chick’nCone has launched the minting of their NFT Chick’nCOIN.
Based on their website, if you want to mint a Chick’nCoin NFT, you connect your digital wallet, you pay a fee of 3.5ETH (approximately $9,500) and you receive a freshly minted NFT.
What's the value of the Chick’nCoin NFT? Well that’s anyone's guess but according to Chick’nCone’s website your NFT is automatically generated for a particular trade area and if a Chick’nCone restaurant opens in that area you receive a portion of the franchise fees and royalties. You could even buy and sell existing Chick’nCoin NFT’s on the OpenSea marketplace here.
The point of this article is not to recommend the Chick’nCoin NFT. We don't and can't recommend that you buy the Chick’nCoin NFT or any NFT. We can't even say if this NFT is being offered legally. Is it security? Should they be providing a prospectus? Should there be an underlying contract that entitles the holder to collect fees? Plus so many other questions that we have not evaluated and just don't know.
Whether or not the Chick’nCoin NFT is a good idea, legal, or properly executed, the bigger point is that NFT’s are coming. They will include payment tools, community building tools, finance tools, and branding opportunities.
In this story
This story was originally published in 1851 Franchise on February 25, 2022. Burnaze summarizes and links to the original reporting.
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