How to Finance a Shaghf Cafe Franchise: Dubai Coffee Concept
By Marc Cornella
A Shaghf Cafe franchise loan finances an upscale, Gulf-inspired coffee lounge rather than a quick grab-and-go coffee stand. Shaghf is a coffee chain based in the United Arab Emirates, and its U.S. cafes pair Arabic-style coffee and pistachio drinks with Dubai-style desserts in spaces designed for lingering, meeting and studying.
That format shapes the financing. Buyers typically need money for a substantial interior build-out, specialty beverage and dessert equipment, imported inventory and working capital. This article explains what is publicly known about the brand, how a Shaghf Cafe deal is usually financed, what the SBA Franchise Directory listing means, and how lenders evaluate an emerging international brand.
US Professional Funding is not affiliated with, sponsored by or endorsed by Shaghf Cafe; the name is used only to describe the business. Figures from the franchisor’s disclosure document can change, loan programs and terms vary by lender and borrower, and every loan is subject to lender review and approval. Nothing here is legal, tax or investment advice, and buyers should review the current Franchise Disclosure Document (FDD) and franchise agreement with a qualified franchise attorney and accountant.
Shaghf Cafe Franchise Loan at a Glance
- Concept: a UAE-based specialty coffee chain built around Arab coffee culture, pistachio-forward drinks and Dubai-style desserts.
- Format: upscale cafe lounges designed for gathering, working and studying, with extended evening hours at many locations.
- U.S. footprint: franchised cafes have opened in several states, including Michigan, Texas, California and New York, and the brand also operates in Canada.
- Fees and investment: the franchise fee, royalty, marketing contributions and total investment are disclosed in Items 5, 6 and 7 of the current FDD; we could not verify them from franchisor-published materials.
- SBA Franchise Directory: listed (code S8746), with a note that an applicant operating under a master franchisee agreement is not eligible for SBA assistance.
What Is Shaghf Cafe?
“Shaghf” is the Arabic word for passion, and the company says the brand embodies a passion for coffee-making and the essence of Arab coffee culture. The chain grew in the Gulf region before expanding internationally through franchising, with U.S. cafes opening in recent years.
The menu. Shaghf cafes serve Arabic-style coffee, specialty lattes, frappes and non-caffeinated drinks, along with karak chai at some locations. Pistachio is central to the brand’s identity, featured in signature frozen drinks and desserts. Dessert cases typically include Dubai-style chocolate filled with knafeh and pistachio cream, croissants, cakes and mousses.
Imported ingredients. U.S. franchise owners have said much of their product comes from Dubai, and the franchisor works with owners on recipes and sweetness levels to suit local tastes. Imported supply chains matter to a lender because they affect inventory cost, lead times and how much working capital an owner should hold.
The space. U.S. Shaghf cafes are typically positioned as upscale lounges where guests sit, meet and stay. Larger seating areas and premium finishes raise build-out costs compared with a counter-service coffee kiosk.
How lenders see it. Lenders generally view Shaghf as an emerging brand in the U.S. with an established international system behind it. Strengths include a distinctive menu and a loyal following in communities that value Gulf-style coffee culture. Lenders will focus on the owner’s restaurant or retail experience, the site, the lease and the depth of the franchisor’s U.S. support.
Shaghf Cafe Franchise Costs
Shaghf does not publish a U.S. franchise fee or investment range on materials we could verify, so the current FDD is the only reliable source. Item 7 will typically break the initial investment into categories such as:
- Initial franchise fee
- Lease deposits and pre-opening rent
- Leasehold improvements and interior build-out
- Furniture, fixtures and decor
- Espresso, brewing, blending and refrigeration equipment
- Signage
- Point-of-sale technology
- Opening inventory, including imported ingredients
- Training travel and expenses
- Grand opening marketing
- Additional funds for the initial operating period
Build-out. An upscale lounge format usually means more seating, premium finishes and larger spaces, so build-out is often the largest cost. Our article on financing a restaurant or cafe build-out explains how lenders handle construction budgets and draws.
Equipment. Expect espresso machines, grinders, blenders, ice machines, under-counter and display refrigeration, dessert cases and dishwashing equipment.
Working capital. Imported products, a new team and a ramp-up period all call for reserves beyond the opening budget.
Ongoing Fees and How They Affect Your Loan
Item 6 of the FDD lists ongoing fees, which for a cafe franchise commonly include a royalty on gross sales, a marketing or brand fund contribution, technology fees and transfer and renewal fees. Some international systems also require owners to buy proprietary products from approved sources; Item 8 of the FDD describes any such purchase requirements.
How lenders factor fees in. A lender will model expected sales, subtract royalties, marketing, rent, labor and cost of goods, and test whether the remaining cash flow covers debt service with a cushion. Because imported ingredients can carry shipping costs, be realistic about cost of goods and pricing in your projections.
Franchisor Requirements for New Owners
Minimum net worth, liquid capital and experience requirements for U.S. owners were not published on franchisor materials we could verify. Ask the franchisor for its current criteria and confirm them in the FDD and franchise agreement.
In practice, lenders will look for food service, hospitality or multi-employee retail management experience, plus personal liquidity to fund the equity injection and reserves.
Ways to Own a Shaghf Cafe
A new cafe. Most U.S. owners open new locations, so lenders underwrite projections, the lease and the owner’s experience rather than an operating history. See our page on restaurant start-up financing.
Buying an existing cafe. As the system matures, existing U.S. locations may come up for sale, subject to franchisor approval of the transfer. A resale lets a lender underwrite actual sales. Our article on buying a coffee shop covers what to review.
Unit franchise versus master franchise. International brands often grant master franchise rights for a country or region, and the SBA listing specifically notes that an applicant operating under a master franchisee agreement is not eligible for SBA assistance. A buyer signing a standard unit franchise agreement for one cafe is in a different position from someone acquiring regional development or sub-franchising rights.
Financing Options for a Shaghf Cafe Franchise
SBA 7(a) loans. For a unit franchisee, an SBA 7(a) loan can generally be considered for the franchise fee, build-out, equipment and working capital, subject to approval.
SBA 504 loans. If an owner buys the building where the cafe will operate, the SBA 504 program may fit the real estate and long-lived equipment. Most cafes lease their space, so 504 is less common for a first location.
Conventional term loans. A conventional business loan may suit borrowers with strong credit and liquidity, or those who are not eligible for SBA programs, such as master franchisees.
Equipment financing. Espresso machines, blenders, refrigeration and dessert display cases can often be financed separately. Learn more about restaurant equipment financing and leasing.
Working capital and lines of credit. Imported inventory orders, payroll during ramp-up and seasonal swings can strain cash. A line of credit helps owners order ahead without draining reserves. See our restaurant working capital options.
Seller financing on resales. When buying an existing cafe, a seller may carry part of the price. Any seller note must be acceptable to the senior lender, is typically subordinate to it and may be limited by program rules.
SBA Loans for Shaghf Cafe Franchisees
SBA lenders generally require a franchise brand to appear on the SBA Franchise Directory before they make an SBA-guaranteed loan to its franchisees. A listing does not approve any borrower; it means the franchise relationship has been reviewed for SBA eligibility.
The listing and its note. Shaghf Cafe is listed under code S8746. The note says an applicant operating under a master franchisee agreement is not eligible for SBA assistance. In plain English, an owner who holds master rights, typically the right to develop a region or sell franchises to others, cannot use SBA financing for that business. A unit franchisee that signs a standard franchise agreement to run its own cafe can generally still be considered. If your agreement is with a U.S. master franchisee rather than the brand’s home company, confirm with your lender how the structure is treated.
Loan size and tips. The SBA 7(a) program maximum is currently $5 million, though program rules can change. Bring the FDD, your franchise agreement, a signed or proposed lease, contractor bids for the build-out, equipment quotes, a business plan, personal financial statements and tax returns. Our SBA loan calculator gives planning estimates only, not an offer or approval.
How Lenders Evaluate a Shaghf Cafe Deal
Personal credit and financial history. Lenders review credit, tax returns and a personal financial statement, and typically require a personal guarantee.
Net worth and liquidity. Expect to fund an equity injection and keep reserves after opening, especially with imported inventory.
Industry experience. Cafe, restaurant or hospitality management experience strengthens a request, particularly for a brand still building its U.S. presence.
Business plan and projections. Build projections around your trade area, seating capacity, evening traffic, average ticket, dessert sales, imported cost of goods and the brand’s fees. Our article on financing an emerging franchise explains what lenders want to see from newer systems.
The FDD and franchise agreement. Lenders read the term, renewal, transfer and territory provisions, Items 5 through 8, and who the franchisor actually is for U.S. owners. Review Items 3 and 4 for litigation and bankruptcy history and Item 19 to see whether the FDD includes financial performance representations. Our article on how lenders read a Franchise Disclosure Document covers the key items.
Site and lease. Lenders want a lease term that covers the loan term, reasonable rent for the projected sales and a location suited to a destination cafe.
Multi-Unit Growth and Development
Owners who perform well may seek a second or third Shaghf Cafe in their market. Lenders will underwrite the first cafe’s results alongside projections for the next, and may structure each additional Shaghf Cafe franchise loan separately. Remember that multi-unit development rights differ from master franchise rights, which the SBA listing excludes from SBA assistance.
Real-World Scenarios
A first-time cafe owner. A former hospitality manager signs a unit franchise agreement and uses an SBA 7(a) loan for the franchise fee, build-out, equipment and working capital, with a lease covering the loan term.
An experienced restaurant operator. An operator who already runs restaurants opens a Shaghf Cafe with a conventional loan, financing the espresso and refrigeration package separately.
A master franchise investor. An investor acquiring regional master rights learns that SBA assistance is not available for that structure and arranges conventional financing instead.
Common Mistakes to Avoid
- Assuming every franchise structure qualifies for SBA financing when the listing excludes master franchisees
- Underbudgeting the build-out for an upscale lounge format
- Ignoring shipping costs and lead times for imported ingredients
- Signing a lease shorter than the loan term
- Using budget numbers from anywhere other than the current FDD
For more pitfalls, read the restaurant loan mistakes that cost owners the most.
Next Steps to Finance Your Shaghf Cafe Franchise
Step 1: Request the FDD. Get the current FDD and confirm which entity is the franchisor for U.S. owners.
Step 2: Clarify your agreement type. Confirm whether you are signing a unit franchise agreement or acquiring master or development rights.
Step 3: Review with advisors. Go through Items 5, 6, 7, 8, 17 and 19 with a franchise attorney and accountant.
Step 4: Find and evaluate a site. Gather lease terms, contractor bids and equipment quotes.
Step 5: Talk with a financing specialist. Build a loan request around the FDD figures and your projections.
Step 6: Apply and coordinate. Align closing with the lease, construction schedule and training.
Shaghf Cafe Franchise Loan FAQs
How much does it cost to open a Shaghf Cafe franchise?
The investment range is disclosed in Item 7 of the current FDD. Build-out for an upscale lounge, equipment and imported inventory are usually the biggest costs.
What is the Shaghf Cafe franchise fee?
The fee is stated in Item 5 of the FDD. We could not verify it from franchisor-published materials.
Can I get an SBA loan for a Shaghf Cafe?
Shaghf Cafe is on the SBA Franchise Directory, so a Shaghf Cafe franchise loan for a unit franchisee can generally be considered under SBA programs, subject to approval. Applicants operating under a master franchisee agreement are not eligible.
What does the master franchise note mean?
It means an owner holding master rights, such as rights to develop a region or sub-franchise, cannot use SBA assistance. Unit franchisees running their own cafe are treated differently.
Can I finance espresso and refrigeration equipment separately?
Often, yes, through equipment loans or leases. Coordinate with your primary lender on collateral.
Can I buy an existing Shaghf Cafe?
Possibly, if an owner sells and the franchisor approves the transfer. Lenders then underwrite actual sales history.
Can a first-time owner qualify?
Yes, with franchisor approval, an equity injection, reserves and relevant management experience.
Does Shaghf Cafe offer financing?
Check Item 10 of the current FDD, which discloses any financing the franchisor offers.
What documents will a lender need?
Expect personal financial statements, tax returns, a resume, the FDD, the franchise agreement, the lease, build-out bids and a business plan.
Final Thoughts
A Shaghf Cafe franchise loan is built around a premium build-out, specialty equipment, imported inventory and the right agreement structure. Buyers who confirm whether they are a unit or master franchisee, rely on the current FDD and plan for working capital give themselves the strongest footing.
US Professional Funding helps franchise owners finance start-ups, acquisitions, equipment and working capital. Learn more about our franchise financing and restaurant and cafe financing solutions.
