Partners In Business. Bad Or Good?!!!!!!!!!!!!

[Visi0n1]

Like everyone else here, I've been thinking about opening a Club / Restaurant and I have money saved and I can get a small business loan. I have a couple of questions, maybe you guys can give me insight on.

1) Why can it be bad to have Partners?

2) Is it possible to own, construct a club, but just hire a manager to run it. I have a lot of other businesses and not sure if I can spend most of my time at the venue.

3) Investors. If I bring in some investors... How does that all work out? How do I pay them back and what do they expect?

[owneroper]

1. What if you and your partners dont agree? I disagree with my manager but I own the place.

2. Of course you can hire a manager but you better make sure you trust them. Cash only business need alot of trust. If you own a bunch of other businesses why would you go into the bar business? Why not a continuation of another of your business.

3. I would think an investor would aready have a good idea of what they wanted as payback. What would you want as pay back if you put up money?

[cayucos cowgirl]

partners is a marriage but depending on how many you have, that is who is involved in the marriage. The divorce in the event that things don't work out, can be very expensive. But more than the money, it can cost you in your health by the amount of stress the situations that partnerships bring on. The bar business is already an emotionally charged atmosphere, and add partners to the mix, and you can come up with a volitile concoction. Lawyers love these ventures as they fail most of the time. Everyone has a different idea of what would be best and they always think their idea would be more effective.
If you form a corporation, you could end up with your other shareholders voting against you. And if they are jerks and drink too much in the club, they could cause a liability to the entire financial security of the venture
If you have no experience in the business, it will be tough to get people to invest as silent partners. One thing you can try is to go and investigate bars in the immediate area and find one that you think is really well done and approach the owner to join you in you plan. They may be interested in keeping the competition in their own pocket. They would have to be trust worthy as they could work it to their own benefit by driving customers from your bar to the one they have full control of. You never know though, you might actually meet someone who can appreciate diversification without having to hoard the whole enchilada.
In closing, I do not recommend going into business with anyone. It can kill you if you are weak when things go Very Badly. If you are tough and want to put yourself and your money on the line, go for it. It could be done any way you want it. All you have to do is present a plan that protects you to the people that see your vision as a winning venture. There is always money looking to grow with people who know how to do it.. ;)

[Jallen0]

1) Why can it be bad to have Partners?

There are many ways a partnership can go bad, and since you are a successful business person I am sure that you know most of them. I would suggest you turn that question just a bit and ask, WHY have a partner?

A partnership could bring you the ability to bring on board someone who knows more about the bar / club business then you do. The best business plan can go bad if the execution isn't done the right way.

Assuming you do not need to share the cost, a partnership could also be an operational partnership. My first bar I was a partner in was that way. I did not have the dollars to invest, but had the operational experience. That worked out well for all concerned.


2) Is it possible to own, construct a club, but just hire a manager to run it. I have a lot of other businesses and not sure if I can spend most of my time at the venue.

Of course it is. People do it all the time. And most of them work out well. But you should ask yourself, are you doing this because you want to own a bar / club and need help or are you looking for another investment vehicle?

In other words, are you looking for a manager you can find locally to run day to day business or, in all probality, are you willing to go outside of your area to find that manager who is exceptional.



3) Investors. If I bring in some investors... How does that all work out? How do I pay them back and what do they expect?

Like any business, it depends on the investors. Are THEY in it because they want to make money?, because they want to own a nightclub?, because of any number of reasons?

And of course, what percentage of ownership will they control and will they be silent or active partners. These are things that make a huge difference, more so in the nightclub business.

Hope all of this helps.

[intensity]

Like everyone else here, I've been thinking about opening a Club / Restaurant and I have money saved and I can get a small business loan. I have a couple of questions, maybe you guys can give me insight on.

1) Why can it be bad to have Partners?

2) Is it possible to own, construct a club, but just hire a manager to run it. I have a lot of other businesses and not sure if I can spend most of my time at the venue.

3) Investors. If I bring in some investors... How does that all work out? How do I pay them back and what do they expect?

1. Partners are fine. Just make sure all responsibilities are spelled out in detail and that each partner has an exit plan.

2. You should have a manager. However, you cant be an absentee owner. Noone will care about your business as much as you do.

3. Risk = Reward. Bars/restaurants are high risk and therefore should have a high reward for investors. Length and amount of investment play a big part here.

[ministry]

i will never have a partner again. had one ( a guy i knew for 10 years) built 1 bar ( with mostly my $ ) built a second ( with $ from bar 1) and he decided he wanted to be a rock star, not show up to work, cheat on his wife, didn't want to work. we split the bars up and his ( the new one, 1 year old) closed after 5 month on his own. well i'm doing a second (again) by myself and only have my ass on the line now. i have a great manager so we will split up the nights and make it happen. think twice and use my bad luck as a "what if "

[crystal]

Most businesses that get sold are sold because of "disagreements" among partners... That should be reason enough :)

[realityrox.com]

Hope this isn't the same for everyone - but EVERY partnership I have been involved with on my businesses - has failed. Money makes people do weird things. So does control. I suppose if you care nothing about the person you are in business with - it wouldn't much matter, but in my experience - I don't have one positive relationship with ex-partners, now.

[excellentbars]

Like everyone else here, I've been thinking about opening a Club / Restaurant and I have money saved and I can get a small business loan. I have a couple of questions, maybe you guys can give me insight on.

While everyone is answering your questions I would like to turn this back as a question to you....Why would you want to get into this line of business if you cannot answer these easy questions?

Bar/Nightclub Joke...

What is the easiest way to make a small fortune?......start with a large fortune and buy a bar! hahahahahahah! :D

As a business person I would at this point be looking for a partner who is extremely experianced......as your management will most likely run you into the ground as they as shipping cash out the back door in large black trash bags!
I would look to get someone who has some chedder in the game!

As or the other questions........once you get a pro they will know if you need these other options and how to handle them.......as we have no idea of what where when and how you are planning to do this project!

Cheers
Chris

[blur07]

I agree with what's said above. Every bar I've worked in that's been a partnership ended badly.

just make sure you get roles, money, investments, etc... on paper before going into it.

[ministry]

oh ya one more thing, the repo man came last night to take my old parners truck at his house ! merry xmas !

[Ruben]

1) Why can it be bad to have Partners?

-> There is a saying in business - Partners are sinking ships.
There can be a lot of problems involving partners.
Such as theft, Greed etc etc



2) Is it possible to own, construct a club, but just hire a manager to run it. I have a lot of other businesses and not sure if I can spend most of my time at the venue.

-> Yes it is posible just make sure you can trust the manager you are hiring. You want someone that will make your business money and not steal it at the end of each night.

3) Investors. If I bring in some investors... How does that all work out? How do I pay them back and what do they expect?

-> Depending on how much they lend you you pay them their full amount lent + a % in lets say the terms are 3 year payback or how ever you guys negoiate it.