Mario Villegas Seattle - If this is your first bar
or restaurant finding someone to invest in your restaurant will be a
challenge. You may have listened or read about venture capitalists,
private equity firms, or angel investor organizations. In fact, do your
research on these terms and you'll find plenty of wealthy investment
groups looking for the next bigger ideas to invest in. If you're an
established restaurant with franchise or growth opportunity, then
pursuing these types of investment firms should be relative easier and
yield dividends. However, for startup restaurants, chasing these
professional investment groups is impractical.
If you want to increase your chances of finding an investor or partner you must have a strong and professionally done business plan should reflect your qualifications, experience and track record, and that of your proposed management team if already selected. The business plan needs to do a good job of detailing the restaurant concept and provide a convincing argument of how that restaurant concept can be successful in the local market.
The business plan should include solid, realistic financial projections, including detailed startup costs, sales projections, profit-and-loss, and the expected ROI for the venture. You will be asked to validate your numbers so be prepared to defend them with authority and financial understanding.
Look locally for partners. Avoid turning to family and friends for capital needs, or at least give this road some serious thought beforehand. While your restaurant idea may be your baby, it will involve serious risk by nature. Do you really want to risk your family and friend’s money and your relationship for this venture? When things go badly, and in this business things go badly more than 70 % of the time, most of the time family is all you have to fall back on.
Consider instead, nurturing your existing business and social networks. Run your idea by those in your network of acquaintances. There might be an angel investor in your hub. The angel investor is a high net-worth individual who invests his or her own money in start-up companies in exchange for an equity share of the business. Many angle investors are entrepreneurs themselves and make investments to gain a return on their money, or to participate in the entrepreneurial process.
A Good Investment is When It's Worthy for Everyone
The main key considerations for investment will focus on ROI and equity positions. The most common question is "How much ownership should I give to an investor?"
The answer will depend on number of owners (investors), capital contribution, liability and participation, to name the most commons.
If you think you're going to find an investor who will contribute 100 % of the capital, share full liability, and then offer the investor to take a 50 percent or less equity position, then you may be looking for investors or partners for a long time.
Most bank, investors or partners want you to have skin in the game so to enhance your equity position you need to contribute with some capital as well.
In addition, most of the investors want to get their money back first so the ratio-of-equity ownership percentages do not have to equal the investment contribution. You can still design a deal that ensures you have a greater equity interest by following this simple rule.
Mario Villegas Seattle is serving as a Twilium Management Group. - Seattle, WA 2011 - Present, Policies & Procedures - Revenue Planning & Reporting - Streamlined Operations. Mario Villegas Seattle is a person of repute due the dedicative, reliable and loyal characteristics of his personality.
If you want to increase your chances of finding an investor or partner you must have a strong and professionally done business plan should reflect your qualifications, experience and track record, and that of your proposed management team if already selected. The business plan needs to do a good job of detailing the restaurant concept and provide a convincing argument of how that restaurant concept can be successful in the local market.
The business plan should include solid, realistic financial projections, including detailed startup costs, sales projections, profit-and-loss, and the expected ROI for the venture. You will be asked to validate your numbers so be prepared to defend them with authority and financial understanding.
Look locally for partners. Avoid turning to family and friends for capital needs, or at least give this road some serious thought beforehand. While your restaurant idea may be your baby, it will involve serious risk by nature. Do you really want to risk your family and friend’s money and your relationship for this venture? When things go badly, and in this business things go badly more than 70 % of the time, most of the time family is all you have to fall back on.
Consider instead, nurturing your existing business and social networks. Run your idea by those in your network of acquaintances. There might be an angel investor in your hub. The angel investor is a high net-worth individual who invests his or her own money in start-up companies in exchange for an equity share of the business. Many angle investors are entrepreneurs themselves and make investments to gain a return on their money, or to participate in the entrepreneurial process.
A Good Investment is When It's Worthy for Everyone
The main key considerations for investment will focus on ROI and equity positions. The most common question is "How much ownership should I give to an investor?"
The answer will depend on number of owners (investors), capital contribution, liability and participation, to name the most commons.
If you think you're going to find an investor who will contribute 100 % of the capital, share full liability, and then offer the investor to take a 50 percent or less equity position, then you may be looking for investors or partners for a long time.
Most bank, investors or partners want you to have skin in the game so to enhance your equity position you need to contribute with some capital as well.
In addition, most of the investors want to get their money back first so the ratio-of-equity ownership percentages do not have to equal the investment contribution. You can still design a deal that ensures you have a greater equity interest by following this simple rule.
Mario Villegas Seattle is serving as a Twilium Management Group. - Seattle, WA 2011 - Present, Policies & Procedures - Revenue Planning & Reporting - Streamlined Operations. Mario Villegas Seattle is a person of repute due the dedicative, reliable and loyal characteristics of his personality.
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