One thing that we've struggled with is the notion of how we're going to fund this project of ours. I think for many small businesses it's the elephant in the room that nobody wants to talk about. And most of what I've heard or know about is from coverage of tech startups, where you're focused on finding funding from VCs and angel investors, or, conversely, you bootstrap the whole thing yourself.
It's a bit different with our business idea - it's a brick and mortar business, with relatively lower profit margins and a slower, longer term plan for growth than a tech or consulting based business. The initial outlay for renovations and equipment seems comparatively staggering once we put our estimates together, and not something that we could bootstrap. (We don't exactly have hundreds of thousands of dollars burning a hole in our pockets.) And banks won't even talk to you if you don't have at least two years of revenue to show - which puzzles me, because how are you supposed to start a business without access to capital? So we've been exploring other avenues of funding.
To help this along, we attended a workshop on Saturday called "Get Funding ASAP!", organized by the DIY Business Association. The first group of panelists gave insightful and concise information, and it was enormously helpful. Slava Rubin, a co-founder of IndieGoGo, pointed out some characteristics of successful Indie GoGo campaigns, which will certainly be useful once we're at that stage; Erica Dorn from Accion USA was exactly the person we needed to hear from when it came to microloans. We actually didn't know that they loaned money to startups, for whatever reason we thought they only funded existing businesses.
We also connected with some other aspiring and established entrepreneurs, like Sarah Bacon of Command C Design & Greenpoint Coworking, Jamie of Valentine Goods, Melissa of Callio Fragrance, and Jen Ng. It was helpful to bounce ideas off of others, get feedback about our project, and see how others are tackling similar issues. I'm really grateful that Wayne and I are working on this together because I think our strengths complement each other, but even then it's necessary to get an outside perspective. Some great questions cropped up, like "have you talked to the other restauranteurs/competitors in the neighborhood?" and "have you thought about negative responses from the community in terms of gentrification?". It's stuff that we've been thinking about but haven't figured out the answers quite yet.
We came away with a more solid understanding of how to approach crowdfunding and microloan resources as well as new things we have to research. That only gets us part of the way there, though; more on our funding ideas in future posts.