Mr Beast Burger Franchise in 2024: Costs, Fee & FDD

MrBeast Burger, founded by renowned YouTube personality Jimmy Donaldson, aka MrBeast, is a unique virtual dining concept that took the food and beverage industry by storm. Launched in December 2020 when the COVID lockdowns were impacting much of the U.S. economy, the brand capitalizes on MrBeast’s massive online following, leveraging his innovative marketing strategies and entertainment-driven approach to business. The concept was developed in collaboration with Virtual Dining Concepts, a company specializing in virtual brands that operate out of existing restaurant kitchens, making it a pioneering venture in the burgeoning ghost kitchen sector.

Currently, MrBeast Burger does not offer franchise opportunities. The brand operates through a virtual dining model, utilizing ghost kitchens in collaboration with existing restaurants. This allows them to scale rapidly and efficiently without the need for traditional franchising. However, if MrBeast Burger were to consider franchising in the future, it would likely attract significant interest due to its established popularity and innovative business model.

MrBeast Burger’s menu focuses on classic American fast food with a twist. The core offerings include a variety of burgers, such as the signature Beast Style burger, along with seasoned fries, crispy chicken sandwiches, and grilled cheese. Additionally, the menu features ancillary items like cookies and soft drinks. The primary market for MrBeast Burger consists of MrBeast’s dedicated fanbase, predominantly younger demographics who are avid followers of his YouTube channel. This brand caters to the fast food-loving crowd who appreciate convenience, quality, and the novelty of supporting a favorite internet personality.

Since its inception, MrBeast Burger has expanded rapidly, boasting over 1,000 locations across the United States and several other countries. These locations are predominantly ghost kitchens, which allow the brand to scale without the overhead of traditional brick-and-mortar establishments. The daily customer base is substantial, driven by MrBeast’s frequent promotional campaigns and viral marketing strategies. The brand’s ability to tap into the vast network of MrBeast’s social media followers ensures a steady stream of customers and substantial daily sales volumes.

A significant highlight of MrBeast Burger is its innovative approach to marketing and customer engagement. MrBeast is known for his elaborate giveaways and philanthropic efforts, which often tie into promotions for the burger brand. This unique strategy not only boosts sales but also enhances brand loyalty and public image. Additionally, the collaboration with Virtual Dining Concepts has set a precedent for other celebrities and influencers looking to enter the food industry, showcasing a successful model for leveraging personal brand equity in the restaurant sector.

Who is MrBeast?

MrBeast is an American YouTuber known for his expensive stunt videos. Officially known as Jimmy Donaldson, the 23-year-old MrBeast has 163 million followers across all platforms, making him one of the most popular internet celebrities. Most of his videos center around two ideas: giving away lucrative prizes as a result of simple challenges, or participating in grueling punishments. For example, some of his most popular video titles include “I Spent 50 Hours in Solitary Confinement”, “Anything You Can Fit In the Circle I’ll Pay For”, and “$456,000 Squid Game in Real Life”; each of these videos has an over 150 million views.

These videos with their appealing, curiosity-inducing titles and thumbnails often go viral, drawing the attention of a large audience. Donaldson has recognized that large monetary prizes are critical for viewer engagement and retention; to this end, his videos often include donating large sums of money to individuals or charities. Such partnerships have benefitted his image and income streams, because, in January 2022, Forbes ranked MrBeast as YouTube’s highest-earning creator, with income exceeding $54 million in 2021.

MrBeast has also gained fame and recognition for his philanthropic contributions, including his partnerships with TeamTrees and TeamSeas, organizations that plant trees for every dollar donated and remove waste from aquatic ecosystems, respectively.

MrBeast’s exciting videos, entertaining personality, and philanthropy, among other things, have made him a very popular entertainment star. Recently, an opinion poll by SurveyMonkey in 2021 found Donaldson to be one of the most liked YouTubers with a 70% approval rating and only a 12% disapproval rating.

MrBeast Burger Franchise Insights

1. MrBeast Burger was launched in partnership with Virtual Dining Concepts, allowing it to utilize ghost kitchens and expand rapidly without the traditional costs associated with brick-and-mortar establishments.
2. In its first three months, MrBeast Burger achieved over one million burgers sold, showcasing the immense demand and popularity driven by MrBeast’s extensive online presence and innovative marketing tactics.
3. The brand leverages MrBeast’s YouTube channel, which boasts over 100 million subscribers, for promotional campaigns, ensuring a vast and engaged audience with every new product or marketing push.
4. MrBeast Burger operates in over 1,000 locations across multiple countries, demonstrating its scalability and the effectiveness of the ghost kitchen model in international expansion.
5. Each MrBeast Burger location benefits from the brand’s unique approach to marketing, including viral challenges and giveaways, which significantly boost customer engagement and sales.

MrBeast Burger Franchise Key indicators

How much does it cost to open a MrBeast Burger franchise?

Since MrBeast Burger does not currently offer franchise opportunities, there are no specific costs associated with opening a MrBeast Burger franchise. The brand operates through a partnership model with Virtual Dining Concepts, utilizing existing restaurant kitchens to prepare and deliver its menu items. This approach eliminates the traditional expenses of opening a franchise, such as real estate, build-out costs, and franchise fees.

However, if MrBeast Burger were to offer franchising in the future, potential costs might include initial franchise fees, equipment costs, marketing expenses, and ongoing royalties, similar to other fast food franchises. These costs can vary widely based on location, size, and other factors. Keep an eye on official announcements from MrBeast Burger and Virtual Dining Concepts for any updates regarding franchising opportunities.

Min & Max Investment

Opening a MrBeast Burger location involves several key costs. As MrBeast Burger does not produce an up to date Franchise Disclosure Document (FDD), we can estimate the costs for a MrBeast Burger based on public information and analysis.

The costs to open up a new MrBeast Burger virtual location are estimated to be between $34,000 to $145,000.

Item 7 in the Franchise Disclosure Document (FDD) is the “Estimated Initial Investment” section. It outlines the total costs a franchisee can expect to incur when starting a franchise, including the initial franchise fee, equipment, inventory, real estate, and other startup expenses. This section is crucial because it provides potential franchisees with a detailed understanding of the financial commitment required, helping them assess affordability and plan their investment strategy effectively.

Required Capital

Since MrBeast Burger does not currently franchise in the U.S., there is no definitive figures on the required capital to open a MrBeast Burger franchise. The required capital, liquid assets, and net worth to potentially open a MrBeast Burger franchise can base estimated based on the typical virtual kitchen franchise. This can vary significantly depending on the brand and specific circumstances. Here are some general estimates based on available information and typical requirements for similar ventures:

• Initial Investment As shown above, the total estimated initial investment ranges from $34,000 to $145,000. This includes initial fees, equipment, setup, inventory, marketing, and initial working capital.
• Liquid Assets Requirement Virtual kitchen concepts similar to MrBeast Burger typically requires franchisees to have a minimum of $25,000-$75,000 in non-borrowed personal resources (liquid assets). This ensures the franchisee has sufficient funds to cover unforeseen expenses and maintain financial stability during the startup phase.
• Net Worth Requirement A net worth requirement for comparable virtual or ghost kitchen franchises might range from $100,000 to $250,000, ensuring that the franchisee has sufficient financial stability and resources to sustain the business.

These figures are estimates based on typical requirements for virtual kitchen franchises and may vary based on the specific franchise, location, and business model. It’s always best to consult directly with the franchisor for precise requirements.

How much does a MrBeast Burger franchise owner make?

Calculating the salary of a MrBeast Burger franchise owner involves analyzing gross sales to determine total revenue, assessing operational efficiency to understand profit margins, and accounting for franchisor fees and additional expenses such as rent, utilities, and payroll. Effective management of these factors can significantly impact the profitability and financial success of a MrBeast Burger franchise owner. This comprehensive financial analysis helps estimate net profits, from which the owner’s salary can be derived. A clear understanding of these factors ensures accurate salary projections and financial planning for sustainable business operations.

MrBeast Burger Revenue & Gross Sales

As of 2024, we estimate that MrBeast Burger locations have an average gross sales of $40,000. It is hard to judge how this revenue figure compares to other concepts as virtual kitchens a relatively new phenomenon. This seems quite low compared to how franchises in the Food & Beverage industry typically perform. However, it is important to note that MrBeast Burger can be viewed more as a marketing licensing deal, which means that there is potential for decent margins for MrBeast even at $40,000 gross sales per location.

Which key factors impact the average revenue performance of MrBeast Burger locations?

The performance of U.S. MrBeast Burger locations’ average gross sales revenue can be attributed to several key factors. First, the massive online following of MrBeast, with over 100 million YouTube subscribers, provides a built-in customer base eager to support his ventures. Second, the virtual kitchen model allows for rapid scalability and reduced overhead costs, enabling a larger number of locations to open quickly. Third, MrBeast’s innovative and engaging marketing strategies, including viral challenges and giveaways, consistently drive significant traffic and sales. Lastly, the menu’s appeal, focusing on popular fast food items like burgers and fries, caters to a broad audience, ensuring consistent demand. These factors combined have likely contributed to the strong performance of MrBeast Burger locations across the U.S.

MrBeast Burger Franchise Operational Costs

When considering opening a MrBeast Burger franchise or a similar virtual kitchen franchise, there are several key ongoing operational costs to keep in mind:

• Food and Beverage Costs Cost of ingredients and supplies for menu items and inventory management to minimize waste and ensure freshness.
• Labor Costs Salaries and wages for kitchen staff and management and training and development expenses for employees.
• Rent and Utilities Lease payments for the kitchen space, utility bills, including electricity, water, and gas.
• Technology and Software Fees for point-of-sale (POS) systems and order management software and costs for online ordering platforms and delivery app integrations.
• Marketing and Advertising Digital marketing campaigns to attract and retain customers and costs for social media promotions and sponsored content.
• Delivery and Packaging Expenses related to third-party delivery services and costs for packaging materials and branding.
• Maintenance and Repairs Upkeep of kitchen equipment and facilities and regular maintenance to ensure operational efficiency.
• Insurance coverage for liability, property, and employee-related risks.
• Royalties and Franchise Fees Ongoing payments to the franchisor for brand use and support (if franchised).
• Miscellaneous Expenses Costs for permits, licenses, and other regulatory requirements and miscellaneous office supplies and administrative costs.

These primary operational costs are crucial to consider for budgeting and ensuring the financial sustainability of your virtual kitchen franchise.

MrBeast Burger Franchise Fees

Since MrBeast Burger is not a franchise, it does not have any franchise fees. MrBeast Burger does not charge any franchise fees because it operates all of its locations as part of a partnership with Virtual Dining Concepts rather than a franchise. This means that all MrBeast Burger locations are owned and managed by the corporate entity rather than by individual franchisees. By maintaining direct control over all its restaurants, MrBeast Burger tries to ensure consistency in quality, service, and operational standards across all its locations. This corporate structure allows MrBeast Burger to implement its business strategies uniformly and maintain a strong brand identity without relying on external franchise operators

MrBeast Burger Franchise Earnings

The earnings of a MrBeast Burger can vary significantly based on a variety of factors including location, sales volume, operational efficiency, and cost management. However, on average, MrBeast Burger can expect to earn a decent income on a per location basis.

MrBeast Burger locations have an estimated average gross sales of $40,000. Based off of the average gross sales, we estimate an average MrBeast Burger location makes the kitchen operator $4,000 in estimated earnings (EBITDA) per year and MrBeast corporate $8,000 in estimated earnings (EBITDA) per year.

MrBeast Burger has a very unique business model that is much different from typical fast food franchises or even standard virtual kitchen franchise. Therefore, it likely only works in conjunction if the virtual kitchen operator is offering food from other brands as well.

How to Open a MrBeast Burger Franchise

MrBeast Burger is not a franchise, which means it does not offer individual ownership opportunities for entrepreneurs to open and operate their own MrBeast Burger locations. Instead, MrBeast Burger operates as a virtual kitchen or ghost kitchen concept, where existing restaurants and commercial kitchens can partner with Virtual Dining Concepts (VDC) to prepare and deliver MrBeast Burger menu items.

Steps to open a new MrBeast burger location with Virtual Dining Concepts:

1. Partnership Agreement

An existing restaurant or commercial kitchen partners with Virtual Dining Concepts. This involves signing an agreement that outlines the terms, responsibilities, and expectations for both parties.

2. Kitchen Setup and Training

The partner kitchen receives training and guidelines on how to prepare and package MrBeast Burger menu items according to brand standards. This includes recipe instructions, portion control, packaging, and quality assurance.

3. Technology Integration

The partner kitchen is integrated into the VDC’s technology platform. This includes setting up the necessary software for order management, delivery coordination, and customer service. VDC provides the technology stack required to handle online orders and deliveries efficiently.

4. Marketing and Launch

VDC and the partner kitchen collaborate on a marketing strategy to announce the new MrBeast Burger location. This may include social media promotions, local advertising, and leveraging MrBeast’s significant online presence to drive initial orders and awareness.

5. Operational Support

VDC offers ongoing operational support to ensure consistency and quality across all MrBeast Burger locations. This includes regular check-ins, performance monitoring, and addressing any operational issues that arise.

6. Order Fulfillment

Once the location is set up and trained, it begins accepting and fulfilling orders through delivery platforms such as UberEats, DoorDash, and Grubhub. The partner kitchen prepares the food, and the delivery services handle the logistics of getting the food to customers.

By partnering with VDC, existing restaurants can tap into the popularity of the MrBeast Burger brand without the need to undergo the traditional franchising process. This model allows for rapid expansion and scalability while maintaining brand consistency and quality.

Pros & Cons

Pros:

Leverage of Established Brand: MrBeast Burger benefits from the massive online following of MrBeast, providing a built-in customer base and strong brand recognition.

Low Overhead Costs: Utilizing existing kitchen facilities reduces the need for significant capital investment in real estate and new equipment.

Revenue Diversification: For existing restaurants, adding MrBeast Burger can diversify revenue streams without significantly altering current operations.

Marketing Support: Virtual Dining Concepts provides extensive marketing support, leveraging MrBeast’s social media presence and viral marketing strategies.

Scalability: The virtual kitchen model allows for rapid expansion with relatively low risk compared to traditional brick-and-mortar franchises.

Operational Flexibility: Kitchens can operate multiple virtual brands simultaneously, maximizing the use of their resources and increasing revenue potential.

Cons:

Dependency on Delivery Platforms: Reliance on third-party delivery services can reduce profit margins due to fees and commissions charged by these platforms.

Quality Control: Maintaining consistent food quality and customer experience across different locations can be challenging, especially with varying kitchen capabilities.

Brand Saturation: Rapid expansion can lead to market saturation, potentially diluting the brand’s appeal and reducing individual location profitability.

Operational Complexity: Managing multiple brands and menu items can increase operational complexity and require additional training and oversight.

Competition: The virtual kitchen space is becoming increasingly competitive, with many new entrants and established brands vying for market share.

Revenue Variability: Revenue can be highly variable and dependent on effective marketing and seasonal demand fluctuations.