General start up advice

[MR3589]

Hey all,

I'd really appreciate some insight into a conundrum I'm facing right now. I'll try and keep it as brief as I can.

For about five years now I've had this idea for a gaming venue for my local area that's severely lacking of anything of the sort, and a large part of our population here are young people/adults that I feel could really benefit from something like this. Gaming meaning consoles, VR etc. The problem I'm hitting time and time again is how I'm going to fund this. Unfortunately my personal credit isn't the best although this is due to my early teens being not so sensible with money and leaving it so long to rectify.

I have a near solid business plan in place, all that's missing is overhead figures which I'm struggling to produce as I don't have a specific premises in place, nor would I know how to acquire estimates if I did.

I suppose what I'm asking is, will I likely ever be able to fulfil this dream of mine? If so, what options can I try?

I appreciate any and all feedback, constructive criticism also. Thank you

M

 

[Mark T Jones]

It will largely revolve around the nature of 'not the best credit'

The Govetnment Start Up Loan scheme is red hot on personal credit history

Asset finance lenders are variable, but will put a lot of emphasis on your current financial status.

Equity finance - probably won't care, but will need a lot mire than an idea and an incomplete business plan

 

[MR3589]

It will largely revolve around the nature of 'not the best credit'

The Govetnment Start Up Loan scheme is red hot on personal credit history

Asset finance lenders are variable, but will put a lot of emphasis on your current financial status.

Equity finance - probably won't care, but will need a lot mire than an idea and an incomplete business plan

Hey Mark,

Thank you for your reply. Yes I have discovered start up loans are as robust as you say. I completely understand I would essentially be a risk for anyone to take on which is why I'm fully focused on getting the business plan as ironclad as possible. If ok, could you shed some light on the equity finance? And thank you for the links

 

[DazRave]

First of all do you know how much you actually need? Could you start small instead with low overheads? For example save up for awhile and put on a gaming night in a local pub, build up a fan base and get the ball rolling.

You'll be naive to think having a dedicated venue actually works. GAME have 'Belong' arenas now that you can rent consoles and PCs for quite cheap on an hourly basis. I put on a 'lan' party for about 20 mates (all ex gaming Dad's eager to revisit their youth) once a year and 'Belong' charge us all around 25quid from 10am to 10pm. I don't think they intend to make money from it and purely use it to keep us in their stores and hopefully then buy items when we are there.

In a nutshell, unless you're already in the industry don't just assume because people are young and that there's lots of gamers around they'll spend a lot of time and money with you. Especially when they can play for free and with their friends back at home.

Would you be a customer of your own business if you really really thought about it and it existed? What would you realistically pay to play and how long would you stay? How often would you go?

 

[MR3589]

Hey Daz,

These are all valid and useful points,thank you. This is definitely a minefield to navigate for sure. I have considered that GAME already offer this service at a much better rate than myself as an independent business would be able to duplicate. That bei g said, there's a lot the company don't do for the exact reason you stated, they're not doing it for the money.

Naturally I want to not only make a living off this, I want it to effectively sort myself and my family out for the foreseeable future, whilst also providing something the town I live in, have never had before and will come to be glad to have. As a gamer myself, I have sat and asked, would I pay for a service like this and my answer is yes. Although we can sit at home and do this for free, I'm someone who appreciates the community aspect of gaming and I've worked int he industry for quite some time so it's been a big part of my life. I miss the days I used to be able to sit with my brother and hash out hours of fun on games whilst catching up in the process. This would give people the opportunity to meet, have a drink and some food whilst sharing a love for games and all they entail. With the Internet effectively turning everyone into introverts nowadays, I think something like this could be a huge benefit.

Generally cost wise, I know what I'd need to make this a success, and I have a firm hold on how I can accrue the revenue to turn over a profit. The only thing holding me back right now is working out a cash flow forecast as I can't estimate overheads on properties I don't lease.

 

[DazRave]

Have a look into NQ64. They have a few bars now and are basically gaming bars. Granted, retro gaming, but they seem to be doing well.

There's certainly a market for it but places like NQ64 are clearly making their money on drinks and the games are second. They are basically a bar first and foremost with a bit of a quirky aspect to it.

Validate your idea as quick as you can. Market research doesn't have to be expensive. You'll never know (do they even exist) if you have a water tight business plan so I don't really think that's where your focus should be right now.

 

[MR3589]

Have a look into NQ64. They have a few bars now and are basically gaming bars. Granted, retro gaming, but they seem to be doing well.

There's certainly a market for it but places like NQ64 are clearly making their money on drinks and the games are second. They are basically a bar first and foremost with a bit of a quirky aspect to it.

Validate your idea as quick as you can. Market research doesn't have to be expensive. You'll never know (do they even exist) if you have a water tight business plan so I don't really think that's where your focus should be right now.

I really appreciate your help on this, it's been a huge help. Coincidentally enough I was planning on having a bar/refreshment attached to this as that did cross my mind near the start. I have researched other venues similar to what I have in mind and they all seem to be vastly further away from me so competitively, I don't have much to worry about, obviously I'd want to make this my own but these venues seem to have something that works well

 

[GFI]

As a father of teenage boys and girls (1 boy and 2 girls)...

Cinema, nah
Bowling, nah
Ice Skating, nah

Ipad / phone / TV (streaming obvs) / Gaming (the boy only) or all 3/4 happening at once (a new skill for this generation).

They only know how to be social via digital now, they do not want to game side by side - you will not change that with your idea. You will try, you will graft and then you will close. And that will cost you money, but more importantly - it will cost you time and effort and heartache.

Cinema's struggling
Bowling venues struggling
Pubs struggling - that is where we went to catch up with friends, the kids now will not do that enough to keep pubs thriving. They are a dying thing ((

Premesis
Rates
Staff
Utilities
Equipment to do drinks and food/snacks
Buying stock
VR and gaming equipment
Insurance
etc
etc

Then the cashflow of all that...

Have you got a huge chunk of cash to put behind this to support the dream for several years?

Not trying to put a downer on it, just being real.

 

[MiekeClaerhout]

Hi M,


Interesting idea you have there and interesting to read your description.

3 things I'd like to share with you that hopefully add value to your idea:

1. the psychology that is linked to your business setup is important. Many small business owners don't think about this. Who will be your target audience? Do they have money to spend in your venue? Will the gaming bring in 'negative' things (e.g. teenagers with issues)? If that might be an option, then how will you anticipate this? What rules will you set up?

2. about funding your new business: many people who dream of having their own business think 'I don't have the money for this', 'I can't afford this', 'this is so expensive' etc. Having these thoughts is instantly crushing your dreams AND options. Try to shift your way of thinking into 'HOW can I do this' and 'HOW can I make this dream come true', and 'HOW will I fund this'. It's just a slight different way of thinking but it might open your mind to more ideas

3. in my professional life I help people like you to start up and/or grow their small local business. If you're open to be a bit inspired I welcome you to watch a few of my videos on youtube. Just search for @MiekeClaerhout

I hope this helps. Good luck

Mieke Claerhout Local Shop Guidance

 

[BubbaWY]

Unfortunately my personal credit isn't the best although this is due to my early teens being not so sensible with money and leaving it so long to rectify.

Without wanting to be too nosy, how bad is your current credit score? If not already checking your credit score, you can sign up for free here. It also gives tips on how to improve your score, etc. https://clubs.moneysavingexpert.com/creditclub/login

My credit score also used to be poor. But, depending on your current circumstances (debts, ability to pay, etc), you can quickly turn around your rating (by quickly I mean in a year, rather than years).

 

[Mark T Jones]

Hey Mark,

Thank you for your reply. Yes I have discovered start up loans are as robust as you say. I completely understand I would essentially be a risk for anyone to take on which is why I'm fully focused on getting the business plan as ironclad as possible. If ok, could you shed some light on the equity finance? And thank you for the links

I've written a few articles on here on the topic of business funding - you can dig them out under 'articles'

 

[JamaC]

Naturally I want to not only make a living off this, I want it to effectively sort myself and my family out for the foreseeable future, whilst also providing something the town I live in, have never had before and will come to be glad to have. As a gamer myself, I have sat and asked, would I pay for a service like this and my answer is yes. Although we can sit at home and do this for free, I'm someone who appreciates the community aspect of gaming and I've worked int he industry for quite some time so it's been a big part of my life. I miss the days I used to be able to sit with my brother and hash out hours of fun on games whilst catching up in the process. This would give people the opportunity to meet, have a drink and some food whilst sharing a love for games and all they entail. With the Internet effectively turning everyone into introverts nowadays, I think something like this could be a huge benefit.

This seems to be all about you, what about your actual customers, what do they think and what would they prefer..?

Put a survey/questionnaire together and learn all about who you are selling to. Gamers will be very easy to conduct market research on, as they have many communities online. You can start with Facebook groups.

Find out if they would pay for something like this, or prefer one off events ( tournaments etc), the max an minimum they would be willing to pay, would they be interested in food etc, what games are the most requested etc etc etc

You can use the data to mould your business plan, which may completely change dependant on what your target audience says. This will also help you when seeking investment/finance as you will have solid reliable data to back up your idea.

 

[LukeTalentTent]

Bit late to the thread but wanted to added my 2 pence as someone who is an avid gamer. First off, I absolutely love the sound of it and one of my favourite places as a student in Cardiff used to be a gaming centre called V-Sync. It was incredible! All the latest gear, food, drink etc. But personal love of it aside, it just wasn't viable as a business. Take PCs for example... For people to want to pay to come to you then you need the latest gear, that gets expensive real fast. Especially when you need do upgrade a couple times a year..

So if you think ok then my prices need to match this.. fine. I am someone who could afford a relatively premium price for maybe a few hours a week to game but I would absolutely not go somewhere where (and no offence meant to anyone or their children) there were kids being noisy/messy etc. I think the realities of making this into a viable, profitable business, is going to be a real struggle. I sincerely hope I am in the wrong though as I love the idea.

 

[Ozzy]

I had this idea in the 90's before broadband, and there were companies like The Playing Fields in London (which since went bust but big game publishers used to launch their games there), and then there was something who setup a load of gaming locations at bowling alleys around the country. Again it went under. I tried to launch a venture called GamesLAN but it never took off.

Basically for all the same reasons that @LukeTalentTent just alluded to. The cost to run such a venue significantly outweighed the revenue it could generate. Sad, as I am also an avid gamer and like the sound of it but wouldn't pay to go to a venue like this. Enjoy the comfort of my own home too much.

 

[DoolallyTap]

You will need BIG, HUGE, MASSIVE buckets of cash to start this and then, it will all go POP!