I sympathize with his difficulties, and don't want to shit on the guy. Trying to read between the lines, I sense that one of his core problems was weak negotiation skills, or the ability to have tough conversations. He negotiated a lousy lease. He hired a chef who wouldn't do the necessary work. Fundamentals that poison the whole downstream.
Like other commenters, also wondering how his elaborate business plans (made w/ experienced restaurateur's input) could be so wildly inaccurate.
Maybe another lesson is, don't rush to the "hot spot." Maybe find a market that has no good scene instead. Be an early gentrifier. By the time newspapers are writing about "hot spots" "hot jobs" etc, it's almost always the high-water mark.
Multiple times I've spotted tops of commodity bubbles by noticing when news articles talk about the absurd wages being paid the labor force. Miners and crane-operators being paid $250k/year during the initial Western Australia mining boom. Low-level labor in North Dakota being paid crazily during the initial part of the Shale Boom, etc. The news coverage is always breathless and euphoric. Wonder if we could build some sentiment analysis that can detect these sorts of articles in a generalized way?
Another way I've heard it described, "whatever industry the current class of graduating MBA is racing to join--avoid it."
> Like other commenters, also wondering how his elaborate business plans (made w/ experienced restaurateur's input) could be so wildly inaccurate.
I think the author commented on this pretty clearly in the article when they described themselves as someone with "...more money than sense". I've had many friends who are pretty insistent they have what it takes to make a successful run with a restaurant business with some gimmick on the side to bring in audiences, and every time I hear their pitch I can't help but be let down by the lackidasical pitch. I think in general people just don't really understand what it takes to get a restaurant just to "stable", neverminding profitable.
I'm often reminded of the difference between producing something and production something at a production scale; my partner is a chemist, and she tells me how their applicants don't always understand why a 1% impurity in a product matters immensely when you're producing 1 metric tons of the stuff. It's the same with a restaurant, I imagine, and trying to produce the same quality dish rapidly and consistently without much waste or flubbing the process, and being able to also rapidly adjust the volume you produce on a day to day basis with no strong indicator as to which way the demand is going to swing.
But none of that really registers when you read advertisement pieces from cities about booming restaurant scenes and how largely demand can be overstated when a city just wants some fresh air in their night life, and it's really appealing to people to imagine themselves as successful restauranteurs when inundated with such material.
A lot of is is that restaurants are largely built by wealthy people for their own social niche. They aren't designed to be profitable businesses, but more as a social device for their owners.
If you're wealthy in New York City, you will eventually be asked to fund a restaurant.
On the subject of wealthy people having restaurants for "social reasons," this article is an interesting read: "The Thrill of Losing Money by Investing in a Manhattan Restaurant":
Wonder if we could build some sentiment analysis that can detect these sorts of articles in a generalized way?
What would you do with the data?
The canonical example I always turn to is a friend of mine who realized one day that he was being paid $25/hour to sweep the floors in a factory (union job) and there was no way that was sustainable over the long term.
He started going to college at night and graduated and got a good job just before they shut the entire plant down!
Like other commenters, also wondering how his elaborate business plans (made w/ experienced restaurateur's input) could be so wildly inaccurate.
Maybe another lesson is, don't rush to the "hot spot." Maybe find a market that has no good scene instead. Be an early gentrifier. By the time newspapers are writing about "hot spots" "hot jobs" etc, it's almost always the high-water mark.
Multiple times I've spotted tops of commodity bubbles by noticing when news articles talk about the absurd wages being paid the labor force. Miners and crane-operators being paid $250k/year during the initial Western Australia mining boom. Low-level labor in North Dakota being paid crazily during the initial part of the Shale Boom, etc. The news coverage is always breathless and euphoric. Wonder if we could build some sentiment analysis that can detect these sorts of articles in a generalized way?
Another way I've heard it described, "whatever industry the current class of graduating MBA is racing to join--avoid it."