Finding restaurant investors & how to work with them
It’s no secret that opening a restaurant is an expensive undertaking, hovering somewhere between $175,500 and $750,500.
If you’re a restaurateur or food entrepreneur with a brand idea cooked up and ready to serve, finding restaurant investors stands as an attractive means to realize your culinary vision—without shouldering the risk (and cost) alone.
Still, the question remains: How do you find, attract, and work with quality restaurant investors? Let’s find out.
Set the ambiance: build a digital presence
Your online presence sets the tone and expectations for potential restaurant investors. Just as you’ll likely want to research interested investors, you can expect they’ll do the same to you.
Before you even start your investor search, consider upping your digital footprint with:
• Executive Summary
• Restaurant Overview
• Market Analysis
Put simply, to attract the right investors, you need to ensure you're easily discoverable online, effectively showcasing your identity and the value of collaborating with you.
Lay out the menu: prepare your pitch
Approaching restaurant investors starts from the endgame. What makes your restaurant idea unique? Where do you plan to set up shop? Why should they invest in you?
These are the beats you want to hit while crafting your pitch deck, a streamlined 10 to 15-page slideshow that details your restaurant idea. These are also questions you’ll want to answer when practicing your elevator pitch, a concise and engaging summary that captures your restaurant's vision and mission.
Here are some points to keep in mind while crafting these two essential pitches:
Put passion into it – Don’t be afraid to showcase your personal story—why you want to open this restaurant, and how it resonates with the community. Paint a picture of the overall experience and your target audience.
Back it up with numbers – Show investors that you’ve done the math. Give a concise overview of key metrics, including overhead and operational costs, profit margins, and growth forecast.
Be prepared to follow up – Investor interest may be fleeting, so try to think one step ahead. Then, make it as easy as possible for interested investors to take that next step. Offer to go into more details over dinner, or have a premade packet of everything they need to know ready to hand off after a successful pitch.
Prep and passion are the salt and pepper of your presentation. By taking the time to prepare well, you can have confidence that a restaurant investor who shares your passion will be hungry to hear more.
The main course: be an active community member
Genuine relationships, mutual respect, and trust are all key ingredients to a strong investor partnership. This is especially true for restaurants—the heart and soul of local communities.
To that end, community events are an excellent means to not only gain brand exposure, but also open the doors to potential investors. Consider engaging in events such as:
• Local culinary and cultural festivals, farmers markets, and concerts
• Restaurant expos, food incubators, or even community cooking classes
• Nonprofit food drives and similar volunteer initiatives
• Mom-and-pop shops, cafes, and restaurants
Such platforms can be a breeding ground for partnerships and networking opportunities with kindred spirits. Community events pave the way for restaurant investors to get a firsthand, authentic taste of your brand.
Pairing the perfect wine: how to work with restaurant investors
Finding the right investor for your business likely won’t be an overnight process. It can require patience, practice, and persistence. So, it’s important to set the right expectations—for yourself, and for interested restaurant investors.
What can you expect from restaurant investors? An ideal candidate brings more to the table than funding. Seasoned investors can accentuate your budding venture with:
• Industry knowledge and experience
• Invaluable connections
• A passion that matches your own
At the same time, restaurant investors are taking on risk by putting down capital on your idea. So they may expect certain benefits beyond their profit margin share.
Before entering into any legal contracts, it’s a good idea to discuss what kind of perks investors can expect, such as meal credits or priority on table reservations. Restaurateurs may need to research local regulations, as some of these benefits are taxable and could incur additional costs.
Like selecting the right wine to complement your meal, partnering with the right investor can enhance your restaurant’s impact. With patience, preparation, and a bit of luck, you can find the ideal investor to turn your venture into a five-star experience.
The secret ingredient: invest in a ghost kitchen
To truly understand an investor's mindset, why not become one?
Ghost kitchens, with their reduced overheads and scalability, offer a unique investment opportunity. By eliminating the need for front-facing restaurant staff and seating, ghost kitchens are a lower-risk means to test brand concepts and gain insights into the investor psyche.
With CloudKitchens, you can get your restaurant idea rolling in weeks instead of months. Check out our ghost kitchens today to jumpstart your culinary venture.
CloudKitchens offers the ghost kitchen space you need to turnout delicious food without the hassle. Whether you're an established restaurateur seeking expansion or a young chef trying to burst onto the culinary scene, our functional equipment is ready to serve your future food fanatics.
Take a tour of a CloudKitchen to learn why they're an exceptional next step on your journey as a culinary chef.
Restaurant Owner.com. How Much Does it Cost to Open a Restaurant? https://www.restaurantowner.com/public/Survey-How-Much-Does-it-Cost-to-Open-a-Restaurant.cfm
OpenTable. How to raise funds for your restaurant. https://restaurant.opentable.com/resources/raise-funds/
DISCLAIMER: This information is provided for general informational purposes and we do not guarantee any specific results. We recommend that you consult with financial, legal, and business experts for advice on your specific idea or plan.
More insights & stories