Help!!

[chrisn1]

i will cut to the chase here my business venture requires me to gather around £375,000.00 to get me up and running, im not sitting on any personal level of capital so getting this money could be extremely difficult especially now.
i have a few guys that may be interested in investing but i dont want to approach them until i have a full and complete business plan to put down in front of them..are they going to be my best option cause im not even slightly hopeful the bank would pay out that sort of money!

any suggestions on raising this level of capital?
Thanks, Chris

 

[Eplaygaming]

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What about startup grants from Business Link types, to top the coffers up.

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[elaine@cheapaccounting]

It will need to be a very robust plan for that level of investment plus I am sure they will want to see some personal investment from you.

Is there anyway of scaling back the idea and launch on a smaller basis - especially at the moment.

 

[Lexpay]

Think for a bank you would need to put a large portion in yourself even if your buying fixed assets to secure it on! You will need a good business plan, perhaps friends and family might help out or like mentioned startup grants!

 

[chrisn1]

its a nightclub im looking to start, ive found the premises that is suitable its already to go but the person who owns it wants the £300,000 for the fitout costs excl rent, and the £75,000 is my startup cost for stock and staff etc.
i had been looking at business angels, anyone know of them?
i had checked with business gateway and there isnt any grants available to me!

 

[Lexpay]

I think the best you could expect from a bank would be 85% these days if that, you would need to put the difference in yourself as well as very strong projections & cashflow possibly prepared by an accountant. I think that business angels may be an expensive and would want to see what your risking..

 

[chrisn1]

im just unsure what to do now, i dont want to let this get in my way.
i mean even if i was to find a suitable premises it would cost more to fit it out properly, so either way im stuck i think.
i honestly dont think i could come up with the extra 15%, i could always get 15/25% from the investors ive got in mind, and the rest from the bank or mix and match amounts.

 

[Lexpay]

I suppose you have to ask yourself if you have the experience to carry it off, to start from scratch in this climate may be a step too far - only you will know if you can do it -why not compromise and look at lease hold or an already established business to start your empire..

 

[elaine@cheapaccounting]

Sorry if I come over negative here - in this climate I would seriously look at the financial plan on this.

Leisure businesses (like many others) are really struggling at the moment. What is your local economy like. Have there been many job losses in your area? How many other similar businesses are there in the area? Have any closed?

I do wish you luck but I do think you may have a very uphill challenge on this one.

 

[chrisn1]

i have more than enough experience to do it which is my plus. The premises im looking at is a leasehold, but the owners want £300,000 for the fitout that was done around 4/5 months ago, the person who had the club before lost their license, and thats why its available.

 

[Maslins]

Ooops, sorry, misposting. Please ignore.

 

[chrisn1]

Sorry if I come over negative here - in this climate I would seriously look at the financial plan on this.

No its fine i dont mind i like to hear all views and opinions, positive and negative.

Leisure businesses (like many others) are really struggling at the moment. What is your local economy like. Have there been many job losses in your area? How many other similar businesses are there in the area? Have any closed?
I do wish you luck but I do think you may have a very uphill challenge on this one.

Well no none of the clubs in this city have closed down, they are all actually running very well, they are at capacity on most nights, with free entry before 11 or 12 then like £5 after, and on saturdays free entry before 11 and £8 after, drink promos from £1, or £1.50, they are still bringing in crowds.
Its a big challenge im aware of that, and its one im willing to face.
Thanks for the advice !

 

[Lexpay]

I reckon your investors are a good option, you will just need to ensure that proper legal agreements are drawn up and you are completely happy with their terms, they may well provide you with the capital to get you a bigger loan elsewhere.

Good Luck!!

 

[chrisn1]

I havent been able to find any positive info on having investors in the company, one question im unsure of, do they have any say in the company at all after they hand out to you?

 

[Lexpay]

I think this depends on how the loan is structured, if they are buying shares then yes, however the may be treated as a debenture whereby they get interest but have no say. You are best checking with the many accountants on here and the lawyers for how you would do it!

 

[elaine@cheapaccounting]

Well no none of the clubs in this city have closed down, they are all actually running very well, they are at capacity on most nights, with free entry before 11 or 12 then like £5 after, and on saturdays free entry before 11 and £8 after, drink promos from £1, or £1.50, they are still bringing in crowds.
Its a big challenge im aware of that, and its one im willing to face.
Thanks for the advice !

Great - looks like you have done the research.

OK have you got the financial plan which breaks down the numbers you need through the door / average spend on drink to cover the costs of the business plus:

- break even
- make profits

Do this with a sensitivity analysis and then show the pay back of the investment.

This will be essential for any investor.

Business Link may be able to offer help putting it together but I would suggest that without it no one will look twice.