What is a business opportunity?
A business opportunity is a packaged offer to start a business — often vending machines, ATMs, or product routes — sold under the FTC's separate Business Opportunity Rule, not the Franchise Rule. Unlike a franchise, it usually involves no ongoing trademark license and no royalties, and it comes with a one-page disclosure rather than a full FDD. Less disclosure means the burden of diligence shifts almost entirely to you.
The legal line matters: the FTC Franchise Rule governs franchises, while business opportunities fall under the FTC Business Opportunity Rule (16 CFR Part 437), which requires only a short one-page disclosure — and several states add their own business-opportunity registration on top. Because there is no FDD, the year-by-year unit history and litigation record you would lean on for a franchise may simply not exist. Demand the disclosure document you are entitled to, and treat the price of any machine, route, or "secured location" with cold arithmetic against revenue you can verify yourself.
Vending, ATM, and delivery-route offers are the most common forms, and they are where hands-off pitches concentrate. Watch the reclassification trap in reverse: if an offer bundles a trademark license, ongoing support, and a required fee, it may legally be a franchise regardless of what it is called — the three-element test decides, not the brochure.