Anybody who needs to resort to Gofundme is almost certainly very under capitalized. Under capitalization is a big factor in the early failure of many businesses.

ekreider wrote:Anybody who needs to resort to Gofundme is almost certainly very under capitalized. Under capitalization is a big factor in the early failure of many businesses.

Also--didn't the practice of giving money to help grow a business used to be called an investment? Yet I doubt the GoFundMe was offering shares in the business. Why anyone would just give money to a private profit-making venture without any promise of profit participation is beyond me. (As is the asking for said money.)

If the GoFundMe was offering shares in the business, I retract the statement.

I've seen other restaurant GoFundMe requests, and those would give you a coupon for that amount (or more) to use at the restaurant.

riddlemay wrote:

ekreider wrote:Anybody who needs to resort to Gofundme is almost certainly very under capitalized. Under capitalization is a big factor in the early failure of many businesses.

Also--didn't the practice of giving money to help grow a business used to be called an investment? Yet I doubt the GoFundMe was offering shares in the business. Why anyone would just give money to a private profit-making venture without any promise of profit participation is beyond me. (As is the asking for said money.)

If the GoFundMe was offering shares in the business, I retract the statement.

Based on the article I linked to above, it seems that for nearly all cases the end result is the same, the restaurant closes.

To that point, maybe there is more honesty in a GoFundMe. Or, to put it another way, the incentive of people who invest in a restaurant is the same whether they are buying shares or putting money in a GoFundMe - they might get special treatment for a little while and they get to support a local business (until that business closes).

bobbywal wrote:

riddlemay wrote:

ekreider wrote:Anybody who needs to resort to Gofundme is almost certainly very under capitalized. Under capitalization is a big factor in the early failure of many businesses.

Also--didn't the practice of giving money to help grow a business used to be called an investment? Yet I doubt the GoFundMe was offering shares in the business. Why anyone would just give money to a private profit-making venture without any promise of profit participation is beyond me. (As is the asking for said money.)

If the GoFundMe was offering shares in the business, I retract the statement.

Based on the article I linked to above, it seems that for nearly all cases the end result is the same, the restaurant closes.

To that point, maybe there is more honesty in a GoFundMe. Or, to put it another way, the incentive of people who invest in a restaurant is the same whether they are buying shares or putting money in a GoFundMe - they might get special treatment for a little while and they get to support a local business (until that business closes).

I do get this sort of thing in certain situations. For years I scoffed at people who gave money to WFMT, because the station is a commercial profit-making enterprise. I don't just walk in to my neighborhood dry cleaners and give them money, after all. But eventually I became a WFMT member, because the resource of classical music on the radio in Chicago is so scarce. They're the only game in town, and if they go, classical music on the radio in Chicago goes too.

But a single restaurant (to me) does not represent an only-game-in-town, completely- indispensable, life-will-not-go-on-without-it enterprise. Others' mileage may vary.

riddlemay wrote:
But a single restaurant (to me) does not represent an only-game-in-town, completely- indispensable, life-will-not-go-on-without-it enterprise.

That completely depends on the restaurant.

stevez wrote:

riddlemay wrote:
But a single restaurant (to me) does not represent an only-game-in-town, completely- indispensable, life-will-not-go-on-without-it enterprise.

That completely depends on the restaurant.

I take your point, and I agree completely that certain restaurants are so special that their loss is highly lamentable, and to be, with no exaggeration, mourned. But just to give a restaurant money with no promise of return on investment (other than its hoped-for survival)? I can't see it. (But I'm sure others can.)

I take your point, and I agree completely that certain restaurants are so special that their loss is highly lamentable, and to be, with no exaggeration, mourned. But just to give a restaurant money with no promise of return on investment (other than its hoped-for survival)? I can't see it. (But I'm sure others can.)

I think you're just operating with a very narrow definition of ROI.

LPython wrote:

knitgirl wrote:

excelsior wrote:Is it my imagination or are restaurants closing even quicker than usual? Within months for these:

https://www.dnainfo.com/chicago/2017071 ... -next-move
Every time I see a business, especially a restaurant, use a crowdfund to open their business, that seems like a short-term plan to me. Do businesspeople think too optimistically, "if you build it, they will come?" Or, is Chicago just oversaturated?

And Sunday I was thinking of trying out Vidalia's pizza and the ordering link kept on taking me to a listing on Milwaukee Ave, so I ended up doing something else instead. Now it makes sense.

There's a basement spot on Damen, just south of Foster that was a short-lived Filipino restaurant. A sign went up last year for a new restaurant there, and it never even opened!

That spot on Damen is Sweet Virigina's Kitchen. As far as I know, they're still planning to open, it's just taken them much longer than expected to get everything in order. I don't have any inside info, I just contributed to their crowdfunding campaign and get occasional updates. I know their catering operation is functioning, but that preceded the restaurant plans.

Sweet Virginia's Kitchen
5131 N Damen Ave
https://www.sweetvirginiaskitchen.com/

I don't know if the "this fall" on the website refers to this coming fall or last fall, because I'm pretty sure their original target date for opening was November 2016.

Saw some signs of life there this week, but looks like they've got a ways to go.

riddlemay wrote:Why anyone would just give money to a private profit-making venture without any promise of profit participation is beyond me. (As is the asking for said money.)

If the GoFundMe was offering shares in the business, I retract the statement.

It's absolutely an idiotic approach to expanding their business (pretty obvious as to why it failed). On a related note, I am starting a GoFundMe to help me fulfill my lifelong dream of driving a Lamborghini. Who's in?

I haven't been to any of these locations, so I can't speak with any expertise on the local market. But we live in a new world where all the barriers to success of the past decades can be overcome thanks to social media. While a less than ideal location may have held back restaurants in the past, this can be overcome with effective customer outreach and interaction using the latest technology. Today's marketing is on snap, insta, facebook live video, the tweet zone, peach, and yo! Success is measured in followers, impressions, likes, and reach.

Tyrgyzistan wrote:I haven't been to any of these locations, so I can't speak with any expertise on the local market. But we live in a new world where all the barriers to success of the past decades can be overcome thanks to social media. While a less than ideal location may have held back restaurants in the past, this can be overcome with effective customer outreach and interaction using the latest technology. Today's marketing is on snap, insta, facebook live video, the tweet zone, peach, and yo! Success is measured in followers, impressions, likes, and reach.

LOL! Amen, brother. Profits be damned!

=R=

I hear someone is planning to open pelmeni place at 2668 N. Clark. They bought remains of French bakery that used to be there. Is that a good location? The concept seems easy to understand. Or not?

A good chance for know everything LTHers to tell the future