Ask a room full of people how many would love to start a restaurant and at least a third are likely to raise their hands. It's a common entrepreneurial dream.
And among those who have started and run a restaurant, nearly as common is wishing that they knew then what they know now. Lessons learned are often painful -- so to help you avoid some of that pain I talked to John and Fallon Seymour, a couple who ten years ago started Pop's, a takeout cheeseburger joint in Brooklyn... and since then have opened the chicken & waffle hotspots Sweet Chick, the Trinidadian restaurant Pearl's, and Ludlow Coffee Supply, a coffee shop-slash-barbershop (really).
And neither had formal restaurant experience before starting their first restaurant.
To make it easier I've combined their responses below... which makes sense since John and Fallon are definitely a team.
Let's start with a basic question. What do you wish you had known when you first started?
Everything. We didn't know what we were doing .
One big thing would be establishing procedures, making sure you document and keep records of everything... both for your knowledge and your protection. We should have been more diligent in the beginning. We've heard so many horror stories and were lucky we avoided them.
And even if you've worked in restaurants your whole life, there's a big difference between working in one and running one. Many people have some kind of previous restaurant experience but there were so many details we had to learn along the way.
Give me an example.
Lease negotiations is a big one. We had never negotiated any kind of lease before. Landlords in NYC, especially commercial landlords... well, there are a million ways they can try to get you. You definitely need the help of someone who can not only help you avoid accepting terrible terms but also to help you get the best terms you can.
Timing is also a major issue. License applications, building permits, liquor licenses, even things like changing a bathroom, ... the list of things you need before you open is huge. And so is budgeting, because it always costs more than you hope.
You've done something counterintuitive where competition is concerned: you've opened multiple businesses almost next to each other.
It's funny, our first business was Pops, a small burger spot in Brooklyn. We know opening another burger spot might seem to not make sense, but seeing Williamsburg grow, there weren't many restaurants within those two blocks. And a meatball shop was going to open and we worried that the similar price point would cut into our business, but we were wrong.
Businesses attract other businesses. As long as you represent your brand well, you'll come out on top even with competition in the area.
So we opened Sweet Chick on the corner of where Pops is located, then we opened Pearl's... but we also opened a coffee shop and the two complemented each other. They are two different types of businesses, but it's a perfect marriage.
We couldn't find a better tenant than ourselves. We know our business, we know our customer base in that area, and we can blend the two customer bases together.
Also we get some efficiencies. We have a shoulder to lean on. We borrow stuff from each other all the time. If we need something, we'll run down the block. That really does help.
But we try not to share employees, even though in the restaurant business people don't always work full time and might work at two or three places. We try not to share employees, though, because we want each place to have its own identity. We have two locations of Sweet Chick, but when we opened Ludlow Coffee Supply we brought in a brand new staff so they could build their own culture in that restaurant.
Every restaurant is different, even if it's the same brand.
You've also worked to turn your restaurants into lifestyle brands and have partnered with other brands like Fila.
We've managed to be creative in some different ways. One is co-branding with brands we respect that aren't restaurant specific. We met a guy from Fila and essentially talked him into making a Sweet Chick sneaker. We held a launch party at one of the cooler downtown sneaker stores, Stadium Goods, and they sold out in 45 minutes.
We're in the restaurant business but we're always looking or other opportunities to make it more enjoyable and more fun. With the Northside Festival in Brooklyn, they shut down the block for an arts festival... so we threw our own festival inside.
We partnered with alcohol brands, we brought in live performers, some that are celebrities... it's fun. The block party has never been the same since we did it; all the other businesses like what Sweet Chick did because it helped bring more people to the event.
We also collaborate with artists; we collaborated on a dish with Joey Badass, an up-and-coming rapper, based on one of his songs. Those are the kinds of things that are fun and engaging for our customer base. It takes a lot of work, but we're always planning something.
If we're having fun doing it, then our customer base will also have fun with it. People like to be included.
Opening a restaurant requires significant capital. Where should an aspiring restaurant owner start when looking for investors?
You want to bring people in with a clear understanding of who is running the show and who is not.
It can get confusing; we've seen that close restaurants down because people get into situations where the terms aren't clear.
Luckily for us, Nas is one of our investors in Sweet Chick and he really believes in the business. That's what you need: someone that really believes in you, is a great strategic partner, and provides enthusiasm and inspiration.
The same is true with Pearl's. Fallon had always wanted to open a Trinidadian restaurant and Jillionaire from the group Major Lazer, who is also from Trinidad, is an investor and really helps propel the brand.
Here's the thing about celebrity investors, or investors in general. You can bring in money, but the people who give you their money and their time should really understand what it is you're doing and see the exact same vision. You won't convert them.
And you need a clear vision for the future of the brand. With Sweet Chick, we're known for our chicken waffles. If someone, no matter how much money they came to the table with, said we should ditch that and go with a tuna menu ... well, they can go open their own place.
Have a brand awareness and always be true to who you are.
If an investor has a different vision, they must know they are a silent investor and don't have a say in day-to-day decisions.
I'm sure it's tempting for people to somehow hope things will magically work out, though...
If someone has the same mindset as you, then you can establish from the beginning that they can contribute... but you have to set the standards.
There needs to be a trust factor. You want to invest with your heart but be smart about it. Take on investors with your heart and be smart about it.
And make sure roles, responsibilities, authority, etc is clearly defined, because 5 or 10 years down the road you can find yourself in a different situation... Money can make friends, and family, and really everyone act very differently. Set up a solid operating agreement.
And don't be afraid the money will walk away, because a bad partnership is a lot worse.
A huge percentage of new restaurants close within the first year or two. How can restaurateurs make it through the tough early years?
With Pop's, we lived in and were familiar with the neighborhood. We opened it just before the recession and set low price points and that was an advantage in the marketplace. Serving good quality food at a lower price really helped us.
The restaurant business is very difficult. Everybody thinks they have a great idea... but ultimately you have to figure out how to get people to come in your door. No matter how many spreadsheets you create, if you don't have enough customers you'll never survive.
But getting people in the door is just part of the battle. Once you get people in the door, it comes down to customer service, quality, consistency of food, and ambience. There are so many details that go into running a successful restaurant.
If you don't plan on making good food, don't open up. If you don't plan to be consistent, don't open up because people won't come back.
This is a very tough market and if you don't provide great customer service in NYC... well, people have options. And they'll take them.
Anyone who wants to open a restaurant should read Setting the Table by Danny Meyer.
What about numbers?
Even if you're hitting all the basics, you definitely need to stay on top of the numbers. Food costs, waste, staff costs, lease... a restaurant is really a pie chart of numbers.
If there's a little of that pie left over for you, you're a successful restaurateur.
For example, we've gone to places where the food is amazing and there are lots of customers but they don't have control over the back of the house. If you're running at 45% food cost... it's not going to work.
When you said you wanted to open your first restaurant, almost everyone told you not to.
Before we opened the first restaurant, our dream was to be in the restaurant industry. We literally found Pop's on Craigslist. Everyone we knew told us, "Don't do it."
We took that personally. We literally were saying to ourselves, "Don't tell me what we can and can't do."
Now, when people ask me about getting into the restaurant business, we tell them that story and we don't say, "Don't do it." We say, "Know what you're getting yourself into."
It's not as glamorous as you think. And the margins are small. But if you're successful, it feels amazing. When we walk in and see one of our restaurants full, that's the best feeling.
But it's definitely 24/7. It does not stop.
Still: when we opened Sweet Chick, John would be near the door and say, "How are you doing?" when people came in. He didn't know he was the owner.
When they were leaving, they would say, "Wow, we had the best time..." and to us that never gets old. Those unsolicited opinions are awesome.
You can see the joy on people's faces when they're having a good time. When you're hitting all the angles, when the ambiance is great, the food is great, the service is great... that's the best feeling.