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Tuesday, Jul 23, 2024

Goddard School Overcomes Small Business Challenges

Abhijit and Preeti Patel are set to open their Goddard School in Tustin, following a long and sometimes difficult journey of more than six years.

The husband-and-wife team and their partners faced various challenges as they secured land for their school franchise, while negotiating with the city and other government agencies.

The key was a multimillion-dollar Small Business Administration loan, arranged through TMC Financing of Irvine two years ago.

“Our construction is complete,” Abhijit Patel told the Business Journal recently, breathing a sigh of relief.

It took three years to negotiate with the local school district, as they built the school building, at 1629 Victory Road, from the ground up.

“Going through that process was pretty long and arduous. Just dealing with any government agency—it has its curves and bends, and everything took way longer,” Patel said.

Market Haywire

“By the time everything got solidified, the market went haywire post-COVID—30% to 35% cost increases and the cost of construction,” Patel added.

He said he and his partners went back to the lender, “they were pretty understanding,” he said.

“They had been witnessing the market patterns. We got approved for the loan we were looking for, even though financially the business case still worked and all the good stuff. But just going through that process was pretty stressful,” he said.

Patel said he expects licensing to come through soon.

Goddard School offers early childhood education programs for children aged six weeks to 6 years old. The school has a specialized learning program, Wonder of Learning, to help children explore their interests and prepare them for school and beyond.

Goddard has more than 600 franchise locations across 37 states and Washington, D.C. Goddard currently has more than 75,000 students.

The company is based in King of Prussia, Pa.

Patel said there is an aspect of profitability, but the true motivators are its early years educational community aspects.

“It’s a proven business model,” he said.

Referring to the SBA 504 loan, he said with a laugh: “At a moment like this, I need to make those payments.”

The SBA loan provided for an “interest reserve” that shielded him and his partners as the school ramps up.

“From then on, it’s going to be our not-so-deep pockets.”

The school will start with 50 pupils, then graduate to about 100 and top out at about 240.

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