Aug. 23rd, 2010
Saturday was a day of sitting down and pounding out some serious ideas. We went from having a general idea and thoughts of business to a serious start on the business plan including hammering out a mission statement, executive summary, and more financial issues than we were mentally prepared for.
What I mean when I say that is that I don’t think either one of us knew that when we got together that day that we were going to start playing with numbers. I was ready to do the fun stuff, honing the plan, the concept, the Plot to Rule the World! But needless to say, the numbers have to be done sometime and what better time than right now?? Why put it off, if you need any indication that this may not be the path, there is nothing like trying to figure out on paper what every single one of your imaginary expenses will be, not only to open the doors, but how much loot you are going to need to have in your pocket to run your business for a year…. assuming no profit.
Though I have never owned my own business I do know that 58%-62% of small business close within the first three years and out of those 75% close within the first year. And out of the myriad of reasons that restaurant business fail one of the big ones is undercapitalization. You really need to have enough money to run the biz for a year assuming you will make nothing. That my friends, can be a daunting sum of money.
I know there are things we missed (the dishwasher I only thought of later that night), but that’s to be expected. I am sure that we will be tweaking and adding and maybe even deciding we can do without, but that I doubt. I’m a believer at this point that we should aim for what we really want, trim it only after we ask for money.
Even with all that and figuring out, very roughly mind you, what we would need to outfit our dream and keep the doors open for a year, sucking wind and not making any profit (which I find unlikely but have to postulate anyway), I was surprised at how “reasonable” it was. Okay when I say “reasonable” I mean that I see it as something totally attainable by pitching our idea to investors and a loan officer or two.
Is it scary? Hell yeah! But we aren’t even dipping our toes in, we haven’t taken any risks yet, and have only put up minimal amount of money. Scary is getting the business plan completely finished with no quitting in the middle and deciding, F*** yes we still want to do this. We are going to have so many ducks in an anal little row that a drill sergeant would salute.
The list of things we have to do is daunting, but give me a list and I live to cross things off of it. I preach to students the rules you need to follow in order to achieve your goals, I know everything I need to know to mitigate risk and make it less scary, I just need to follow my own advice. What a way to achieve credibility.
I have to say that some of the things we came up with this week to market and sell ourselves had us dancing around the room and hugging each other, delighted with our shear genius. Seriously I had things pop out of my mouth so unexpectedly that I sincerely shocked myself into a giddy state. I can’t wait till I can tell you all some of the ideas we have!
So this week, I’ve got to start costing things out (without getting too descriptive of what we’re doing), I need to write some of the partnership agreement, look at more places to lease, write up some of our lists that we have started on scraps of paper and keep working on the business plan.
Part of this blogging for me has been cathartic, that I can share things with some anonymity, if I want to talk shit about work I can, if I want to talk shit about relationships with friends or family I can. I chose to not tell people I was blogging, and though I still don’t want students to be following me because I share too many personal things, I haven’t talked as much shit as I thought I might. So with many a trepidation I “came out” to my little brother, telling him I wasn’t ready to tell others about my secret blog, and less than two days later he vomited out a comment about my blog in front of family. I attempted a look that would have melted steel, and was sucked back to high school when the thing that transported me into the second circle of hell with my parents was caused by none other than an off hand comment by my little brother. You are the first one I’m hitting up for money bro, prepare yourself.
God, blogging IS awesome.