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Am I BatShit Crazy for wanting to start a small business?

JSB

By JSB
in Can You Help Me With This?

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JSB

JSB 677

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tl/dr what the hell am I getting into thinking about opening a small business?

 

I’m a CPA, not the type that does taxes and I’m fed up with my job and reporting to an asshole. Due to that I’ve looked into opening a mini golf course in Frisco or Prosper TX. I’ve never run a small business, but I feel like working for myself would give me that vigor and determination again. Problems are the real estate I think would succeed are not cheap, and being my first business I really am learning as I go. I’ve contacted a couple builders and can get something pretty great plus clubhouse and parking lot built for around 300K, maybe 350K. I can pay for that, but the land alone where I would want it is like $1.2M. There isn’t a course within 40 miles, and with how fast the area is growing, I think it is a home run would it not be for the cost of the land.

 

At this price I want to talk to someone that has done something like this before. I don’t know what I don’t know and am struggling finding someone who can help.

 

Am I crazy? I’m being conservative, but I think I could get revenue of $300-$350 a year. Very little overhead

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Chewbacca

Chewbacca 7780

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Are you crazy?  Nope.  I was in your shoes several years ago and I now own a business with a couple partners.

 

Would you be crazy to sink your life savings into something that you have no experience with?  Yes.

 

You need to network.  Find people who know the business.  Maybe take on a partner (but under no circumstances do you give away control).  Get a real proforma together.  Run it by the folks you meet who know the business.  Be prepared to not take a salary for the first year (or more) because everything happens slower than you think it should, including construction.  

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immamac

immamac 42872

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1 hour ago, JSB said:

 

tl/dr what the hell am I getting into thinking about opening a small business?

 

I’m a CPA, not the type that does taxes and I’m fed up with my job and reporting to an asshole. Due to that I’ve looked into opening a mini golf course in Frisco or Prosper TX. I’ve never run a small business, but I feel like working for myself would give me that vigor and determination again. Problems are the real estate I think would succeed are not cheap, and being my first business I really am learning as I go. I’ve contacted a couple builders and can get something pretty great plus clubhouse and parking lot built for around 300K, maybe 350K. I can pay for that, but the land alone where I would want it is like $1.2M. There isn’t a course within 40 miles, and with how fast the area is growing, I think it is a home run would it not be for the cost of the land.

 

At this price I want to talk to someone that has done something like this before. I don’t know what I don’t know and am struggling finding someone who can help.

 

Am I crazy? I’m being conservative, but I think I could get revenue of $300-$350 a year. Very little overhead

 

yeah don't do anything you don't know anything about as your first small business.

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Dbeasy

Dbeasy 15073

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A few comments:

The miniature golf courses have gone away as a result of a combination of high land taxes and declining customer interest.

With that said, there might be a model that is slightly different than a standard mini golf course that could be successful. See TopGolf as an example of tweaking the model.

If you find partners to share the financial risk, you won’t lose that much in the deal if it doesn’t work.

Your CPA background is fantastic for managing the business financially. Make sure someone, your or others, can drive customer demand and the product concept.

Do it. Why not? If it doesn’t work, go back to work.

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Chewbacca

Chewbacca 7780

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25 minutes ago, Dbeasy said:

A few comments:

The miniature golf courses have gone away as a result of a combination of high land taxes and declining customer interest.

With that said, there might be a model that is slightly different than a standard mini golf course that could be successful. See TopGolf as an example of tweaking the model.

If you find partners to share the financial risk, you won’t lose that much in the deal if it doesn’t work.

Your CPA background is fantastic for managing the business financially. Make sure someone, your or others, can drive customer demand and the product concept.

Do it. Why not? If it doesn’t work, go back to work.

This sounds like it was written by someone who doesn't understand personal loan guarantees.  If it doesn't work, he'll lose everything he puts into it and if he takes out debt, the bank will require a personal guaranty from all partners.  

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Bevo

Bevo 13584

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Posted (edited)
4 hours ago, JSB said:

 

tl/dr what the hell am I getting into thinking about opening a small business?

 

I’m a CPA, not the type that does taxes and I’m fed up with my job and reporting to an asshole. Due to that I’ve looked into opening a mini golf course in Frisco or Prosper TX. I’ve never run a small business, but I feel like working for myself would give me that vigor and determination again. Problems are the real estate I think would succeed are not cheap, and being my first business I really am learning as I go. I’ve contacted a couple builders and can get something pretty great plus clubhouse and parking lot built for around 300K, maybe 350K. I can pay for that, but the land alone where I would want it is like $1.2M. There isn’t a course within 40 miles, and with how fast the area is growing, I think it is a home run would it not be for the cost of the land.

 

At this price I want to talk to someone that has done something like this before. I don’t know what I don’t know and am struggling finding someone who can help.

 

Am I crazy? I’m being conservative, but I think I could get revenue of $300-$350 a year. Very little overhead

 

How much can you charge per person? How many people will play during the week and in winter? How many employees will you have? In other words, do the financials. You are a CPA so it should be easy. Don't mess with a complete business plan unless you have no clue about advertising and such. My guess is that your return would kind of suck and it won't be a profitable venture. Compare it to other ventures like starting a CPA firm or buying commercial real estate. And don't let people like me talk you out of things. You need to be entrepreneurial and have drive and confidence. Everyone from Mom and Dad to strangers will tell you all the problems with your idea. But also make sure that it is the right idea.

Edited by Bevo
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Dbeasy

Dbeasy 15073

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This sounds like it was written by someone who doesn't understand personal loan guarantees.  If it doesn't work, he'll lose everything he puts into it and if he takes out debt, the bank will require a personal guaranty from all partners.  

 

Well, I’ve started and run multiple companies over the years, so your take might be a little off. With the venture he is describing, there are ways to limit his personal risk. I’ve done it multiple times successfully.

 

Edit: one more comment. When you look at the capital investment required for this business, along with the working capital requirements, and the fact that the land is a collateral asset, with a few partners you can limit the financial risk to a very manageable level. Now, for larger businesses with deeper capital commitments and greater uncertainty about the time to prove the concept, you can get yourself into trouble pretty quick. And of course the OP has to have some money available that he can afford to lose, or else he will have potentially only a small piece of the venture’s equity.

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Helobious

Helobious 9463

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Lowdown: The key is getting a great location. A highly visible corner with lots of traffic during high playing hours such as late afternoons, early evenings, and weekends would be great. Resort areas are particularly desirable, but not necessary.

You can buy an “off the shelf” miniature golf course to be built on your property, or you can build your own. I strongly suggest you compromise on the course quality if you must; you can always improve it over time—but not the location.

You need to be open lots of hours, such as 10 a.m. to 10 p.m. and have lights for night play—you don’t want patrons arriving to play and finding out you are closed! Ideally, you can really ramp up income and visibility by having youth groups use the facility and host celebrations like birthday parties. You can make a nice side income selling items like soft drinks, candy, and maybe some impulse toys or other novelty items.

That’s from some site called BusinessTown.

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Homesickhorn

Homesickhorn 2202

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Not just surly bullshit but do you think it is a legitimate bad idea?

I was just fucking with you. If you want my take, I say do it, and do it well. Sort out your business plan, financials, and obviously get permission from the wife, but I say go for it. I’m the type of person who enjoys success stories more than cautionary fail tales.

Also, location is arguably one of the most important aspects of this whole situation, and I know a guy who’s arguably one of the best in the bidness.
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bluto

bluto 4933

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a know nothing devil's advocate here..... you're not gonna make a damn dime during at least one month of winter and you' might make one or two dimes in the hottest month of the year. issue with the latter is that summer months when school is out should be your highest rev months. 

also, besides field trip type stuff and cooler summer months you won't be making any rev during the daytime. 

also also, i have to imagine a decent chunk of rev of these operations comes from concession stands. 

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DaysOff

DaysOff 7959

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a know nothing devil's advocate here..... you're not gonna make a damn dime during at least one month of winter and you' might make one or two dimes in the hottest month of the year. issue with the latter is that summer months when school is out should be your highest rev months. 
also, besides field trip type stuff and cooler summer months you won't be making any rev during the daytime. 
also also, i have to imagine a decent chunk of rev of these operations comes from concession stands. 
This sounds about right. Also playing miniature golf the other 9 months of the year sounds fucking awful as well. There has to be a better way to start a cash flow business.
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Bevo

Bevo 13584

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Posted (edited)
6 hours ago, DaysOff said:
7 hours ago, bluto said:
a know nothing devil's advocate here..... you're not gonna make a damn dime during at least one month of winter and you' might make one or two dimes in the hottest month of the year. issue with the latter is that summer months when school is out should be your highest rev months. 
also, besides field trip type stuff and cooler summer months you won't be making any rev during the daytime. 
also also, i have to imagine a decent chunk of rev of these operations comes from concession stands. 

Read more  

This sounds about right. Also playing miniature golf the other 9 months of the year sounds fucking awful as well. There has to be a better way to start a cash flow business.

Probably do it yourself car washes. Maintenance is low. Cost is low. Land requirement is low. It won't be near as fun, though because you won't have to quit the day job and you won't be able to putt your day away waiting for customers.

Edited by Bevo
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bigcigar

bigcigar 1164

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23 minutes ago, Bevo said:

Probably do it yourself car washes. Maintenance is low. Cost is low. Land requirement is low. It won't be near as fun, though because you won't have to quit the day job and you won't be able to putt your day away waiting for customers.

And it’s a great way to clean your drug money.

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Snake Diggity

Snake Diggity 4625

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3 things people don’t think about enough:

 

1. How hard it is to secure funding.  Nobody’s going to loan you $1.2M to buy property to put up a mini golf course.  Unless you already have $1.2M, in which case wtf are you doing opening a mini golf course.

 

2. How long it takes to make money, even if things go well.  This is especially true if starting your business involves construction.

 

3. How much hard work and responsibility is involved.  The responsibility is relentless.  And almost everyone I know who owns a business works harder than they would at a normal job.

 

The rewards are real: the sense of ownership and control, the chance to get equity from your work and build something of lasting value, and unlimited financial upside.  It’s even possible in certain businesses to transition to an absentee situation and live an easy life.  But the 3 things I listed above stop 99% of people from realizing the dream.

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Party_Taco

Party_Taco 3742

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3 things people don’t think about enough:
 
1. How hard it is to secure funding.  Nobody’s going to loan you $1.2M to buy property to put up a mini golf course.  Unless you already have $1.2M, in which case wtf are you doing opening a mini golf course.
 
2. How long it takes to make money, even if things go well.  This is especially true if starting your business involves construction.
 
3. How much hard work and responsibility is involved.  The responsibility is relentless.  And almost everyone I know who owns a business works harder than they would at a normal job.
 
The rewards are real: the sense of ownership and control, the chance to get equity from your work and build something of lasting value, and unlimited financial upside.  It’s even possible in certain businesses to transition to an absentee situation and live an easy life.  But the 3 things I listed above stop 99% of people from realizing the dream.

Pretty much ALL of this...

#2 killed it for me and we had to close our doors after 1.5 years. Another point I would add is that EVERYTHING is more expensive than you anticipate, even if you do the research.
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Brew

Brew 3049

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35 minutes ago, Quagmire said:

Open a storage place with Rv parking , easy money

Correct answer is to partner with a contractor on a storage place where you can build it for near cost. You provide the rental labor, get it in the low 90’s in occupancy, flip it to a large storage company, profit, rinse/repeat.

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midtown

midtown 3346

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I have a 13 and 10 yr old.  I can count the number of times I've played mini golf with them on one hand and that includes Monster golf which is indoor in the summers.  Sounds like a terrible business. 

Does you business model include dealing with minimum wage employees who don't show up to work and/or just quit and you're business isn't even open on a "busy" Saturday?

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Bill Clay

Bill Clay 48

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Are you a golf guy and want to do something because golf is your thing? Or do you think that mini golf is just a sound business idea?

1. If the former, a better idea might be a "virtual" golf club where you rent a small warehouse and have 4 or 5 Trackmans (Trackmen?) or GCQuads setup. Run it like a country club where it's all you can golf for a monthly fee. Keycard access, BYOB, online tee time booking. Hire a pro to manage the thing for free. His compensation is the luxury of giving lessons out of your facility.

2. If the latter, find some raw land and talk to the owner. Convince him to let you lease the land on a year-to-year basis for 25% of the revenue. You're in business for no land cost and your expenses are a portable building and setting up the course. The benefit to the landowner is his property is unencumbered and the "improvements" you've made are easily removed for when he decides to do something real with the land. Somebody alluded to this earlier, and he was correct. Mini golf just isn't the best use for retail/commercial property in the long run.

I actually thought about doing the first one. DM me if you're interested in #1 and we can talk. It would work. ROK Golf is doing something similar in south Austin but it's more retail/hourly than golf club style. Check them out. 

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horn4life

horn4life 3768

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oops thought I posted this yesterday - There are a couple of business pitfalls that are first year killers. Number one is under-capitalization, because of an unrealistic view of revenue as the business builds it's customer base.  A lack of experience in the business endeavor also is a high mortality factor.  Most successful small business owners learn a skill set at an employer, go independent where they can capitalize on their existing contacts and skill set.   

If it's not a long term real estate play, then why go into a field you are not familiar with?  I would do some research on other businesses that you could extract a similar amount of income from with less capital investment for the land.  IF you want to go into that sort of entertainment business I might look closely at PinBallz in Austin.  Those guys started with classic old video games primarily and they have expanded to a small empire.  Funny how the folks with the money to burn want to play those old games. Smaller footprint, less in start up costs, and you might be able to apprentice at one of their stores.  Get a partner with experience or get your own experience before you hang your nuts out.  What about storage units(as now has already been mentioned), a more passive revenue generator, and another long term real estate play as well?  There are kiosk's now that can allow folks to sign up for a new unit in the middle of the night for example that make management easier.  A lot of accounting too!

As a CPA, Why not focus on real estate?  Even though you currently are not the sort of CPA that does taxes!   I assume you have some degree of understanding of the the tax deduction benefits, of Real Estate investing? Especially the bonus of depreciating of an appreciating asset(not in all cases but generally over time if you are smart)?  I would suggest building yourself a portifolio of rent houses while you are still pulling in a W-2. At the same time learn this specialized area of accounting that you currently do not do. You can learn  and hone your expertise on the investment and accounting as you invest in rent houses, and business rentals in time? The accounting is what a LOT of investors pay for and become an expert in RE investing.  Seems a lot less risk than mini-golf?  Get yourself into deals with your newly found RE Accounting clients. Seems like a new business, that could be largely passive in time, that allows you to benefit from your CPA certification. Bonus is you can keep your job right now and be able to leave on your terms with a lot lisk risk to the downside.  Leverage what you already have.

 

Edited by horn4life
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JSB

JSB 677

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12 hours ago, Homesickhorn said:


I was just fucking with you. If you want my take, I say do it, and do it well. Sort out your business plan, financials, and obviously get permission from the wife, but I say go for it. I’m the type of person who enjoys success stories more than cautionary fail tales.

Also, location is arguably one of the most important aspects of this whole situation, and I know a guy who’s arguably one of the best in the bidness.

The wife is one reason I'm considering this. Both kids are now in school, so she could help considerably running things during the day. She is also a CPA. 

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JSB

JSB 677

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OK, I thought this might be a good idea, but evidently not. I like the storage facility idea, but there are already a ton in the area. I'm talking with a Company that does bowling/mini golf/go carts for a franchise opportunity, that may be a better option. The need I want to fill though is family entertainment. Again, the closest thing other than a movie theater and a park is a good 30 minutes away. I've still got to figure out financing though. I've talked with a number of banks, and none of them loan anything greater than $500K for businesses that have not been operating for 24 months. 

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RDCanecutter

RDCanecutter 26454

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Is there something family-entertainment-oriented that could start small in multiple locations, and scale up? I am thinking something the size of a small food truck, but not for food. Something where you're not stuck in one spot if something better opens up.

No idea what that would be. Got the idea from seeing an American dude who owned several small "stores" (glorified vending carts) in Costa Rica.

Maybe play on the idea of "Get your kid's face out of the phone with a fun day at JSB's whatever-they-are Family Fun stands."

Seems kinda carney, but maybe there's something wholesome you could offer. I dunno.

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SydneyCarton

SydneyCarton 48112

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13 hours ago, Homesickhorn said:


I was just fucking with you. If you want my take, I say do it, and do it well. Sort out your business plan, financials, and obviously get permission from the wife, but I say go for it. I’m the type of person who enjoys success stories more than cautionary fail tales.

Also, location is arguably one of the most important aspects of this whole situation, and I know a guy who’s arguably one of the best in the bidness.

YOU KNOW TAYLOR HAMM?!?!?!

 

giphy.gif

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Surly Bevo

Surly Bevo 25080

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Is there something family-entertainment-oriented that could start small in multiple locations, and scale up? I am thinking something the size of a small food truck, but not for food. Something where you're not stuck in one spot if something better opens up.
No idea what that would be. Got the idea from seeing an American dude who owned several small "stores" (glorified vending carts) in Costa Rica.
Maybe play on the idea of "Get your kid's face out of the phone with a fun day at JSB's whatever-they-are Family Fun stands."
Seems kinda carney, but maybe there's something wholesome you could offer. I dunno.


There are mobile video game trucks that show up at parties.
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davidg

davidg 4038

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So,  I went home to visit my dad this weekend and we lived a few blocks from at bowling alley that also has a putt putt golf in the same parking lot.  The PP has been there forever,   I played there 40 years ago when I was a kid and we took our kids there when they were young and up visiting the grandparents.   As I drove by at about 10 PM on a Saturday, I saw that the bowling alley lot was absolutely packed, then I noticed that the PP was completely full too.  I'm talking a group at every hole and others standing around.   I don't know what this means other than there's nothing else to do on a Saturday night in Tyler, TX  (Narrator:  There's not.) or that puttputt golf is so fantastic that everyone wants to go play a round then hit some video games.  

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