The referee waved the fight off in the fourth round after the 28-year-old from Gainsborough had been sent to the deck for a fourth time.
The loss was Franco’s first in the bareknuckle boxing ring and cost him his world featherweight championship and his place at the top of the pound-for-pound rankings.
Nevertheless, Franco found a victory in the loss.
He underwent a life-and-death battle with ulcerative colitis last year and said: “Nine months ago I asked the surgeon if I would box again and he said: ‘Are you serious ?’
“I just wanted to prove him wrong.
“I have won just by getting back in the ring. I’m just happy to be fighting again.
“I wanted to show people you should chase your dream and keep going.”
The fight got off to a bad start for the defending champion when he was cut on his left cheek in the opening minute.
Worse was to follow as Franco ran onto a right hand later in the round that dropped him.
Though his legs looked shaky after he quickly picked himself up, Franco waded straight back into battle and the fighters traded punches in a wild exchange until the bell.
Franco went on to make the second round close and the third was in the balance until the last 30 seconds.
Again Franco walked onto a right hand and went down.
He was dropped twice more in the fourth and the towel came in.
But despite the defeat, Franco felt he has a lot more to offer and is keen to take on Sweeney again.
Franco said: “I didn’t feel myself in there and Jimmy was strong. He’s a true champion. Let’s have a third fight.”