Prairie Dogs Hot Dogs & Handcrafted Sausage

Prairie Dogs Hot Dogs and Handcrafted Sausages is a locally owned encased meats and market.  We specialize in an all day menu of unique and innovative hot dogs, encased meats and condiments utilizing local and sustainable ingredients, while maintaining a high flavor profile.  Our market will have available various charcuterie, meats and sausages as well as condiments for sale.  Along with supporting local farmers, we also feature locally crafted beer and sustainable wines.  Our menu is available to eat in, take out or delivery via bicycle and vehicle.  At Prairie Dogs, we strive everyday to provide great food and service to our guests.  Furthermore, we strive to maintain quality lasting relationships amongst our team and our community.

 

 

 

Funding A Restaurant The Hard Way

First of all let me state right off the bat (and to put the SEC at rest), this is not a solicitation for investors. Well, not outright at least. This is merely a story about the difficulties and travails (sic) of what it’s like to find the money to open a restaurant.

Last October we had an idea to combine a sausage and charcuterie shop with a hybrid fast casual restaurant / bar serving bistro style hot dogs. In our minds it was a home run idea. The response we got from friends and colleagues was the same. A common response was, “Why hasn't this been done before, it’s a brilliant idea that can fit just about anywhere. It works for families and hipster foodies.”

So…we went for it. We thought a smart way to develop the food and bring some attention to our concept would be to hold “pop-up” events at various restaurants around town. And from the start we grabbed the attention of the foodies and fans of encased meat, of which there were a lot more than we had even first imagined.

What we didn't attract were investors. Brutal truth… neither of us is in a position to ask for a bank loan without someone to co-sign for us. So, our only other option was to find investor(s) to put up the money we needed. In return we presented several different scenarios that would work for us.

1.      The investment is a loan to be paid back at an interest rate to be discussed. The investor receives 30% of non-voting membership in the LLC. He/she can then stay in to receive dividends (or liabilities) or we can work out a pre-arranged buy-out. Their choice.

2.      The investor gets 49% of LLC in non-voting membership. The investor would receive 90% of dividends until the initial investment is returned, then the dividend split reverts to 49%

3.      The investor becomes a full partner and gets an equal voting membership in the LLC as an operating member. The remaining portion is then divided equally between the original partners. The dividend split would be 90% to the investor until the initial investment is returned, then the split reverts to 33.3%

So We've come up with one more scenario;

The investor receives 91% in voting membership. The dividend split is 100% to the investor until the investment is returned. Then the 91% reverts to 33.3% and the original partners equally receive the remaining memberships so we all own 33.3%. The dividend split would then be 33.3% as well.

All of these would require someone to cosign a bank loan that would be paid back by the business. The size of the loan will depend on the size of the operation when we settle on a space we can use. But my estimation is that the loan should be somewhere between $50k and $85k.

Finally, we would also use some crowd funding to raise extra capital to use for various purposes. These funds would not diminish or change any of the scenarios we've listed.

 So, there you have it. We’re looking at a space now that we estimate could be opened for less than $125k of which, $55k would be available cash, $50k would be a bank loan and the remainder would be a combination of owner equity and accounts payable that would be amortized over the first year of operation.

Interested? There’s a whole lot of data to support how successful the business can be and we would be happy to show you. We need to get someone in our corner so when a great location comes up, we can pounce on it and get it up and running quickly. Send us a note or give us a call and let’s get an encased meat sandwich in every hand in the Twin Cities.