All the Small Things
Finding the right size to get started… how to figure out at what size to start. What makes us look good to banks?
One of the items that I have had lots of feedback on is the size of the startup. That the equipment costs and renovation costs are just too high. To be fair, we are a $2.5M start up and our equipment and renovation costs are roughly $1.9M. In order to appease those concerns, we decided to scale back our efforts to something that would be more appealing to banks and investors. In order to drop the cost of our startup to $2M, we lowered our fixed assets (equipment) and renovation costs to $1.6M. It’s not a huge decrease but enough to show some solid movement.
I have fought scaling back because I am afraid of not being able to fulfill our offering with decreased skatemill slots, aka outgrowing our main feature too quickly. I did the math on it all - how many slots per month, how many memberships we plan to sell in the first year, and being able to fulfill those demands. I can’t do it with 1 skatemill - so we have to change that offering. Which isn’t a bad thing because now our offering isn’t so hockey centric. The offering is opening up to Coaching in different areas - strength/conditioning, positional coaching, or skatemills. And let’s face it - being to niche is scary to people. Despite our plans to expand quickly to the underserved sports communities, because we have ‘hockey’ in our name and because people (banks) are unfamiliar with the community, it’s too ‘risky.’
Sooooo….we scaled back and changed our membership offering.
Here are the results of that decrease:
We will feature 1 skatemill, 2 shooting lanes, and a goalie corner
We will have 2,000 sqft gym
We will have roughly 4,000 sqft of turf - as this area can be turned into other uses later with cash
The ProShop will be roughly 2,000 sqft and will still have a restuarant
All of this will fit in roughly 15,000 sqft
With the decrease in costs, we will still have great profitability and breakeven.
Profitable by month 9 (that is with 4 months of construction, open month 5)
Breakeven by month 26.
Now that we scaled back (which I am not thrilled about but I understand it), I have a bit better outlook financially to banks and investors. BUT - I still need an investor! Here I am a month later and still working on the same things.
We need $100k in order to secure a loan
I need an investor or investors who will take a chance on us for that $100k
At this point, I feel like I spend every day writing blind emails to info addresses, calling receptionists, and posting marketing tactics all to attract attention from that 1 person that is going to make a difference for us. Where is that person? We are even so desperate, I applied to Shark Tank last week. We know that once we find the right person to back us - that we will be successful.
It takes one person who gets the community, who remembers the dreams they had as a kid, and who is ready to help make those dreams into viable opportunities. We don’t always get opportunities and when we do, we have to do something with it.
So….while you read this….who do you know? Just one person. Please help us by introducing our amazing, blue collar, do work and get it done community. Together we will get this done.