How to Finance a Project Function Franchise: Patented Machines
By Anthony Cornella
A Project Function franchise loan pays for a different kind of gym: a movement studio built around proprietary, patented training machines rather than racks of standard cardio and strength equipment. That makes the equipment package, the space and the owner’s own liquidity the center of any financing plan.
This article explains what Project Function is, the figures the franchisor publishes, what the brand’s SBA Franchise Directory listing and its note mean, and how new owners typically combine SBA, conventional and equipment financing to open a studio.
US Professional Funding is not affiliated with, sponsored by or endorsed by Project Function; the name is used only to describe the business. Figures from the franchisor’s website and disclosure document can change, loan programs and terms vary by lender and borrower, and every loan is subject to approval. Nothing here is legal, tax or investment advice; review the current Franchise Disclosure Document (FDD) and franchise agreement with a qualified franchise attorney and accountant.
Project Function Franchise Loan at a Glance
- Concept: a movement and strength studio that uses what the company calls proprietary, patented equipment to help members move better, build strength and train without pain.
- Estimated total investment: the franchise page lists $206,740, based on a 1,500 sq ft facility and 15 patented machines. Confirm the full Item 7 range in the current FDD.
- Liquidity requirement: the franchise page lists a $500K liquid net worth requirement.
- Certification: owners must be HBS1 (Human Biomechanics Specialist) certified.
- Preferred studio size: 1,500 to 6,500 sq ft.
- Studios: the company lists Hayward, Morgan Hill and Santa Monica in California and Henderson and Summerlin in Nevada, with headquarters in Henderson.
- Initial fee, royalty and marketing fees: not published on the franchise page; confirm them in Items 5 and 6 of the FDD.
- SBA Franchise Directory: listed as Project Function (code S8365), with a note about the Gym Lease Addendum explained below.
What Is Project Function?
Project Function describes itself as a one-of-a-kind studio focused on sustainable, pain-free results. Its stated goals are better movement, strength and flexibility with less risk of injury, and its marketing points to correct joint positioning, better posture and moving without limitation.
The defining feature is the equipment. The company says it has over 50 patented innovations, and the franchise page says the concept has been in development for 20 years.
The studio layout. The franchise page shows a sample 2,500 sq ft floor plan with a machine area, an open mat area for one-on-one training and a simple reception area, and it favors sites with ample parking and easy access.
Why lenders look closely at this brand. Project Function is a young franchise system with a handful of studios, so underwriting rests on the owner’s liquidity, the FDD, the site and a realistic membership ramp. Our overview of financing an emerging franchise explains what changes when a brand is early in its growth.
Project Function Franchise Costs
Initial franchise fee. The franchise page does not publish the initial fee. Item 5 of the FDD states the amount, when it is due and whether any part is refundable.
Real estate and build-out. Most owners will lease retail or flex space. The published estimate assumes 1,500 sq ft; a larger studio adds rent and build-out for flooring, lighting, HVAC, restrooms and signage but may hold more machines and members.
Equipment. The patented machines are the core asset, and the published estimate is based on 15 of them. Ask whether machines must be bought from the franchisor or an approved source and what warranty and service apply.
Opening costs and working capital. Expect pre-opening marketing, training, insurance and an operating reserve to carry payroll and rent until membership builds.
Total investment. The franchise page states an estimated total investment of $206,740 for a 1,500 sq ft facility with 15 patented machines and says other estimates are included in that cost. Use Item 7 of the current FDD for the full low-to-high range and the line-by-line assumptions. Typical Item 7 categories to review include:
- Initial franchise fee and lease deposits
- Leasehold improvements and build-out
- Patented training machines and other equipment
- Technology, fixtures and signage
- Training, travel and grand opening marketing
- Additional funds for the initial operating period
Ongoing Fees and How They Affect Your Loan
The franchise page does not list a royalty, marketing fund contribution or technology fee, so read Item 6 carefully before sizing a Project Function franchise loan.
How lenders factor these in. Lenders deduct royalties, marketing contributions, technology fees and rent from projected revenue before measuring debt service coverage. Because a new studio’s revenue starts low and builds as members join, lenders want to see how fixed costs are covered during the ramp. A fixed monthly fee weighs more heavily early on than a percentage fee.
Franchisor Requirements for New Owners
The franchise page lists three firm requirements:
- HBS1 certification. Owners must hold HBS1 (Human Biomechanics Specialist) certification, a hands-on, in-person biomechanics course that is the first of four levels.
- Liquidity. A $500K liquid net worth requirement.
- Leadership. Candidates must be accountable, reliable and a leader.
Access to a suitable space and fitness or business experience help but are not required.
The approval process. The company describes eight steps, from an interest form, questionnaire and interview through FDD review, application, analysis, a formal offer and a signed contract. Line up your loan request with the FDD review and site search.
Ways to Own a Project Function
A new studio. This is the main route today. Financing covers build-out, machines, opening costs and working capital, and the lender underwrites projections and the owner’s liquidity. Our page on fitness center start-up financing covers this kind of request.
Using an existing space. The franchise page says existing access to a suitable space is a plus. An owner who already controls a training facility may cut build-out costs, though the lender still underwrites the machines and franchise costs.
Buying an existing studio. With a small network, resales will be rare at first. If one comes up, the lender can underwrite actual membership and financial history, and the franchisor must approve the transfer under Item 17.
Financing Options for a Project Function Franchise
SBA 7(a) loans. Because the brand is on the SBA Franchise Directory, an SBA 7(a) loan can fund the franchise fee, build-out, machines, opening costs and working capital in one package, subject to lender approval. The program maximum is currently $5 million, though program rules can change.
SBA 504 loans. If an owner buys the building for the studio, an SBA 504 loan may finance owner-occupied real estate and long-lived fixed assets. This is also where the brand’s SBA directory note comes into play.
Conventional term loans. Owners with strong liquidity or collateral may use a conventional business loan, which often asks for more equity.
Equipment financing. The patented machines, mats and reception technology can be financed separately through fitness equipment financing and leasing, if the franchisor and senior lender allow it.
Working capital and lines of credit. A studio needs cash for payroll, rent and marketing before membership matures, and memberships can soften in some seasons. Our fitness center working capital options can help cover the ramp-up.
Seller financing on resales. If a studio is purchased from an existing owner, the seller may carry part of the price. A seller note must be acceptable to the senior lender, is typically subordinate to it and may be limited under SBA rules.
SBA Loans for Project Function Franchisees
SBA lenders use the SBA Franchise Directory to confirm that a brand’s agreements have been reviewed for SBA eligibility. A listing does not approve any borrower; it clears the franchise relationship so a lender can consider the loan. Project Function is listed under code S8365.
What the directory note means. The listing says that when the real estate where the franchise business is located will secure the SBA-guaranteed loan, the Gym Lease Addendum may not be executed. In plain English, the Gym Lease Addendum is a franchisor document that is normally attached to a studio lease to protect the franchisor’s interests in the location. If the owner is buying the property instead of leasing it, and that property is pledged as collateral for the SBA loan, the addendum is not signed. Owners who lease will usually still sign it, so give your lender the lease and the addendum early.
SBA application tips. Prepare a personal financial statement, tax returns, a resume, proof of HBS1 certification or enrollment, the FDD, a lease or letter of intent, a machine and build-out budget and monthly projections. Our article on SBA loans for gyms covers how lenders read fitness deals, and the SBA loan calculator can help with early payment estimates, which are for planning only and are not an offer.
How Lenders Evaluate a Project Function Deal
Personal credit and financial history. Expect a review of credit, tax returns and existing debts, plus a personal guarantee.
Net worth and liquidity. For a Project Function franchise loan, the $500K liquid net worth requirement sets a floor. Lenders also want to see an equity injection plus reserves left after closing, since a new studio with proprietary machines has limited resale collateral.
Industry and management experience. HBS1 certification shows technical knowledge of the method. Lenders will also look for management experience, such as running a studio, leading a team or overseeing a budget.
Business plan and projections. Build projections on monthly membership growth, local pricing, trainer staffing and machine count, and explain how the pain-free positioning will attract members in your market.
The FDD and franchise agreement. Lenders review the fees, territory, term, renewal and transfer rules, and any franchisor financing in Item 10. Ask whether the FDD includes an Item 19 financial performance representation. Our article on how lenders read a Franchise Disclosure Document explains which items matter most.
Site and lease. Lenders check the lease term, rent, improvement allowances and whether the Gym Lease Addendum is in place.
The Patented Equipment Package
Most gyms buy standard equipment that a lender can value against a broad resale market. A Project Function studio is different: its main assets are proprietary machines that are useful mainly to other studios in the same system. That can affect how a lender treats them as collateral and is one reason SBA lending, which leans on cash flow, can be a better fit than a pure equipment loan.
Before closing, get a written machine list, delivery schedule and warranty terms. Adding a second phase of machines is easier to finance once the studio has a track record.
Multi-Unit Growth and Development Agreements
The company has not published a multi-unit program on its franchise page, so ask whether development agreements are available in your market and what schedule they require.
Financing a second studio. A second Project Function franchise loan is easier once a first studio has stable membership and clean financials. Lenders can then underwrite the existing cash flow alongside projections for the new one. Many owners finance each studio separately so that one location’s ramp does not strain the other’s debt.
Real-World Scenarios
A certified trainer opening a first studio. A trainer who has earned HBS1 certification and meets the liquidity requirement leases space in a busy shopping center. An SBA 7(a) loan covers build-out, the machine package and working capital, and the owner keeps a reserve for the membership ramp.
An owner adding machines. After the first year, an owner with a waitlist adds machines with an equipment loan approved by the senior lender.
An owner buying the building. An investor buys a small commercial building and opens a studio in it. The real estate is financed with an SBA 504 loan, and because the property secures the loan, the Gym Lease Addendum is not executed, as the directory note allows.
Common Mistakes to Avoid
- Relying on the published single-figure estimate without reading the full Item 7 range
- Underestimating build-out for a larger studio than the base 1,500 sq ft plan
- Assuming proprietary machines carry the same collateral value as standard gym equipment
- Leaving too little working capital for the membership ramp
- Starting the loan process before HBS1 certification is underway
- Overlooking the Gym Lease Addendum when negotiating the lease
For more pitfalls, see the fitness center loan mistakes that cost owners the most.
Next Steps to Finance Your Project Function Franchise
Step 1: Confirm the requirements. Make sure you meet the liquidity requirement and plan your HBS1 certification.
Step 2: Complete the franchisor’s process. Submit the interest form, finish the questionnaire and interview, and request the FDD.
Step 3: Review the FDD with advisors. Study Items 5, 6, 7, 10, 17 and 19 with a franchise attorney and accountant.
Step 4: Talk with a financing specialist. Learn how an SBA 7(a), conventional or equipment structure would fit your budget before you sign a lease.
Step 5: Secure a site. Find space in the preferred size range with parking and easy access, and negotiate the lease and addendum.
Step 6: Apply for financing. Submit your financial documents, projections, machine and build-out budget and franchise documents.
Step 7: Close, build and open. Coordinate build-out, machine delivery, hiring and pre-opening marketing so the studio opens with members ready.
Project Function Franchise Loan FAQs
How much does a Project Function franchise cost?
The franchise page lists an estimated total investment of $206,740, based on a 1,500 sq ft facility and 15 patented machines. Check Item 7 of the current FDD for the full range.
What is the Project Function franchise fee?
The franchise page does not publish it. Item 5 of the FDD states the initial franchise fee.
What royalty does Project Function charge?
The royalty and other ongoing fees are not listed on the franchise page. Item 6 of the FDD lists them.
How much liquid capital do I need?
The franchise page lists a $500K liquid net worth requirement.
Do I need a certification?
Yes. Owners must be HBS1 (Human Biomechanics Specialist) certified.
Can I get an SBA loan for a Project Function franchise?
Yes, the brand is on the SBA Franchise Directory under code S8365, so qualified borrowers can apply for SBA-guaranteed loans, subject to lender approval.
Does Project Function offer financing?
The franchise page does not mention franchisor financing. Item 10 of the FDD discloses any financing the franchisor offers.
How big is a Project Function studio?
The preferred size is 1,500 to 6,500 sq ft, and the company shows a sample 2,500 sq ft floor plan.
Can I buy an existing studio?
Resales are possible with franchisor approval, though the network is still small. A lender can then review the studio’s actual results.
How long is the franchise term?
The franchise page does not say. Item 17 of the FDD covers the term, renewal and transfer rules.
Final Thoughts
A Project Function franchise loan finances a studio built around equipment you cannot buy anywhere else, which shapes both the investment and how a lender views the deal. Buyers who meet the liquidity requirement, finish their certification, read the full FDD and plan for the membership ramp put themselves in the strongest position to finance a studio.
US Professional Funding helps franchise owners finance start-ups, acquisitions, equipment and working capital. Learn more about our franchise financing programs and fitness center financing.
