i want to open a bar..... with friends as partners....

[amarowsky]

I know this sounds like the worst idea to any good business man. But I want to start an LLC with for friends and open a small bar and restaurant that we would all run post time on the side of our normal jobs. Any ideas how to make my friends prove they are serious? And any horror or success stories u want to share?

[humandraydel]

I know this sounds like the worst idea to any good business man. But I want to start an LLC with for friends and open a small bar and restaurant that we would all run post time on the side of our normal jobs. Any ideas how to make my friends prove they are serious? And any horror or success stories u want to share?

Well, you obviously already have an idea how common the horror stories are, or you wouldn't have stated that it "sounds like the worst idea to any good business man." I would think long and hard about this one. How many friends? How are decisions going to be made? Is everyone an equal partner? Does any one of you have restaurant experience?

And last, but not least, are you prepared to take on significantly more stress in your life, with a VERY real possibility of losing all your friends in the process?

[disneysteve]

I think you already know the answer to this question based on how you posed it:

this sounds like the worst idea to any good business man

There are very good reasons why it sounds like the "worst idea". What is it Dave Ramsey says, the only ship that never sails is a partner-ship.

Going into business with friends almost guarantees the end of the friendship. Are there success stories? Sure there are, but there are far more horror stories. My advice? Don't do it.

[siggy_freud]

I know this sounds like the worst idea to any good business man. But I want to start an LLC with for friends and open a small bar and restaurant that we would all run post time on the side of our normal jobs. Any ideas how to make my friends prove they are serious? And any horror or success stories u want to share?

How long have you all been friends? The fact that you're asking us for advice on how friends can prove they are serious tells me you don't know them well enough, or trust them enough for this. I already know, hands down, which friends I'd do business with, and which ones I wouldn't.

[disneysteve]

we would all run post time on the side of our normal jobs.

This is a problem right off the bat. How will you divide up the labor? It is inevitable that one or two of you will end up working a lot more on the business than the others which will create resentment, especially if you are splitting profits evenly. "Why should he get the same amount of money when he is hardly ever here?" Then there will be the whole problem of whose vision you go with. I guarantee that if you ask 4 people how something should be done, you're going to get 4 different answers. When your way isn't picked, will you be okay with that? Will everyone else? When the chosen way fails, will people say, "I told you so. Should have done it my way."

Any ideas how to make my friends prove they are serious?

This is a huge red flag. Why do you feel you need to ask this question? That pretty much tells me this is a bad idea. If you aren't convinced that they are serious, why pursue the idea?

[bjl584]

Friends of mine went into the restaurant/bar business with friends. Within a year or so, they were butting heads on the direction of the business. His friend decided to part ways, so my friend had to buy his position out. It was overwhelming for him financially. The restaurant is now closed and my friend has filed bankruptcy.

Not that this story is indicitive of every partnership. But, it looks like you already have doubts. I wouldn't do it.

If you are heartset on doing this, then start a business on your own where you call all the shots, take all the risk, and reap all the reward.

[disneysteve]

If you are heartset on doing this, then start a business on your own where you call all the shots, take all the risk, and reap all the reward.

This. You start the business. Hire employees to work for you. Be open to suggestions and input but you be the one with final say. If an employee isn't working out, you replace him. That isn't so easy when it is a friend who isn't working out.

[jpg7n16]

But I want to start an LLC with for friends and open a small bar and restaurant that we would all run post time on the side of our normal jobs.

Why? Which of you has experience owning and operating a restaurant/bar?

[seen]

This is...eye opening. Some great responses in this thread, I had also been considering joint business ventures with friends who are like family to me but I don't see it happening now.

I think the fact that I know them so well is what makes it even worse. I know exactly what they're capable of doing.

[Redraidernurse]

If you value your friendships, don't do it.

[DayByDay]

We once owned a couple of properties with a (former) friend. Huge mistake. Would never, ever do it again.

[JoeP]

I know this sounds like the worst idea to any good business man. But I want to start an LLC with for friends and open a small bar and restaurant that we would all run post time on the side of our normal jobs. Any ideas how to make my friends prove they are serious? And any horror or success stories u want to share?

Someone will accuse a partner of not putting enough skin in the game. Someone will feel they deserve more of the profits because they put in more work. There will be disagreement over the beers and food to serve. Someone's priorities will change and they won't be able to put in the time. Someone will eventually want to sell their share, not get what they want, and this will strain the friendships. There will be tension when someone proposes an addition to attract more patrons. Someone attempts to transfer their share to their son or daughter.

Personally, there are just way too many risks to consider partnership.

[YLTL_Dan]

Run fast. I almost starting buying real estate with one friend and almost started a different company with another friend. In the back of my mind I knew it was a bad idea, but it was fun to talk about the possibilities and sharing it with a friend. Looking back, I'm so glad I didn't because we all went different directions.

As Dave Ramsey says (or credits someone as saying) - "The only ship that doesn't sail is a partnership".

[amarowsky]

the odd thing is I really wouldn't want to run a bar without my friends. For what its worth I'm 25 and out of those years the most recently acquainted friend was when I was about 8, so everyone has been close friend for 17 or better. We have all lived with each other on different occasions and have never had any real quarrels.

If split by 5 people, according to the numbers I have ran, assuming a small enough location and managing the lowest overhead possible, it should run out to on average $200-400 per person to keep the bar running (utilites, taxes, lease, insurance, averaged permit/license costs). So assuming $0 sales were only out a decent-mid new car payment each a month, however allowing the potential to hopefully break even (when u throw in probably the difference in inventory sold) if there are at least $100 sales profit per day.

I'm trying to approach the idea with the following, these people are at my house drinking and socializing at least 4 days a week per person. And usually they bring a friend or two that I usually know and am friends with and occasionally someone I don't know. As an owner of a frat style house, you can either call it fortune or misfortune that I have an insane amount of friends. Although some may be disrespectful 85% are. I figure if I could (with the help of my other close friends/possible partners) pool a small amount of money from each of us (instead of a lot for one) and deflect this plentiful inflow of friends and friends of friends into an affordable and accommodating bar that still represents my own personal charisma and the supplemented friends of my partners, possibly have a quite successful bar.

Or worst case (which would still be FUN!) have a building close to home that all of our friends can go to drink and live life joking and having fun with a open door policy for strangers or others to supplement our cost.

I have a small novel few experiments I have done to back up this theory. Just based on the volume of people that go to my house. My little brother (lives with me) and one of my friends who also lives with me, recently fixed and old candy machine. And filled it with candy and let it sit at my house for a month with putting in very VERY little money towards our own candy. On a quarter machine we received almost $40 within a month of just hanging around. And to further this idea i'm trying to illustrate I on the regular have to return anywhere from $120-200 worth of cans ($.10 per) a month depending on if its bonfire season or not and if our guitars are in tune.

Keep in mind this is disposable income for most of us, and we never quarrel about something as stupid as money, its more of a fun opportunity with the potential of financial gain. Thats kind of where im coming from instead of merely doing it as an investment.

[amarowsky]

This is a huge red flag. Why do you feel you need to ask this question? That pretty much tells me this is a bad idea. If you aren't convinced that they are serious, why pursue the idea?

I should have been more informative on this. Of the friends (4 to 5) that have been in the dialogue of opening a bar together, naturally different people have different amounts saved. Only me and another have over 20k saved, a few of the others have no real significant financial obligations but we all earn steady and accommodating incomes. And all have good-excellent credit. They all show equal enthusiasm. But Should I propose something like "if you really want in you have to have $1000 to deposit in the business account within X period of time (few months, weeks whatever). Then I suggested that we open an account that can only be accessed by all of us, and force all partners to contribute somewhere around $100-300 monthly to build up the businesses savings. We would have to make agreements on what to do if someone had to leave. we all decided that we could not make it work, or if someone defaulted on the savings agreement. In which case if it didn't work we would simply split it up even between all that contributed, so it just served as an additional savings for all of us.