DINER: Chinatown’s “Bestie” Exceeds 10K Funding Target In 5 Days. Game Changer?

December 1, 2012.

by Andrew Morrison | You might remember that 5 days ago we put up a post telling of how Bestie – a restaurant under construction in Chinatown – had turned to the Indiegogo fundraising website to help with an infusion of capital. They were looking for $10,000 of public investment. In exchange, the investors would get sausage dividends, or “magic sausage cards”. It was a smart idea, and a successful one…

Indeed. Earlier today Bestie owners Clinton McDougall and Dane Brown met their lofty target (and exceeded it). It took them just 5 days to raise 10 large…from strangers. So yeah, big congratulations are in order.

I hope this means that a reliable supply of proper currywurst and good beer is coming sooner rather than later. But I wonder if their fundraising scheme hasn’t opened a new and bizarre chapter in Vancouver’s restaurant scene. It might pass as being a one off thing that we’ll never see again, or it could have changed the local restaurant start-up game for good. In a few years, will public financing be as normal a step to a prospective restaurateur as, say, opening an Instagram account? Will diners – who are always hungry for new concepts – now volunteer regularly to help foot the bill of construction costs? Or will they revolt by claiming that it’s just another invasive industry subsidy, like the 20% gratuity norm?

Personally, as long as the return on investment is solid (you can’t go wrong with sausages), I’m all for it. In fact, I have $500 that I’d like to invest in a licensed ramen joint in Gastown, just as long as that gets me 75 bowls and beers. Any takers?

ALL ANTICIPATED OPENINGS

  • Emile Att

    It will be interesting to see what happens. I joined, and really look forward to trying it. Agreed you can’t go wrong with sausages.
    I am, I admit, a little concerned about restaurants getting funded this way because, well, as soon as they open the doors they owe $10,000 in free food, so the first few months might be extra challenging, with potentially less revenue coming in. Then again, the fact that enough people were willing to pay in advance suggests that there’ll be a solid opening with lots of bodies coming through the doors, some prepaid, some paying by wallet.

  • UberPoster

    I’ve been getting authentic currywurst for the last couple years at the Vancovuer Farmers Market from Serious Sausage. These guys are a welcome addition, but you can’t forget what’s already been around.

  • Scout Magazine

    Whose forgetting? Serious Sausage is awesome.

  • Scout Magazine

    Better to owe product to customers than profit to banks.

  • Emile Att

    But with a bank loan, you amortize the debt over some amount of time, so you have cashflow from day 1 and then pay interest on the debt. The cash you make in the first week of business pays for the ingredients you buy and then sell for the second week of business (which in turn brings in more cash…).

    When financing via gift cards, you potentially have no cashflow because everyone is using already existing credit. Week 2 rolls around and there’s no money to buy more delicious pork. No beer! No gas to fry the fries or grill the sausages.

    I’m the first to admit I know jack shit about the restaurant biz, and I’m presenting an oversimplified scenario, but still…

    This topic could veer off into all sorts of directions: merits of Groupon for restaurants, or Dine Out Vancouver, Kickstarter vapourware, and on and on.

    I just look forward to having a good currywurst.

  • http://bestie.ca Dane

    Thanks for the comments, folks!

    It’s important to note that Clinton and I are not totally funding Bestie with the Magic Sausage Card campaign. As I’m sure you know, it costs more than $10k to open a restaurant. Even a small one. The campaign has been a wonderful way for us to round out our budget and generate momentum in the lead up to the opening.

    We’re really truly grateful for the support that everyone has given us and we can not wait to open and shake hands with / hug you all. There’s plenty of work to be done but this is a dream come true.

  • Eddie Carter

    @Emile – I’m not sure which banks you’re referring to in the lower mainland, because they don’t generally give out loans for small start-ups. I will agree with you on one point – can’t wait to use my card and dip into some currywurst!

  • Conrad Yablonski

    “10 large”?

    FYI-’10 Large’ is Ten Million Dollars ($10,000,000.)-ten grand is chump change.

  • Scout Magazine

    FYI, no it’s not. “Large” is a thousand.

    gangster

  • Emile Att

    @Eddie – I was referring to the banks that Mr Morrison had mentioned in his previous comment, and was meant more as something to discuss.
    When Re-Up BBQ needed some cash to open their New West sit down joint, they offered $1000+ worth of food over ten years for $500 up front. For every $500 they received, they were on the hook that year for $100 in food plus 10lbs of their homemade bacon. With Bestie, for every dollar they have received, they are on the hook for $1 worth of stuff off their menu, plus some promotional items (pins, shirts, etc.). It’ll be interesting to see how it plays out.
    I suspect they’ll kill it, given that there’s clearly much interest and excitement for them to open, and they were able to pull in that kind of cash in less than a week. But, I wonder what’ll happen if, say, 5 more new restaurants do the same thing in 2013. They can’t all be homeruns, can they?

  • Scout Magazine

    Good points Emile. With or without Indiegogo or Kickstarter, they are never all homeruns. Bestie is a slow pitch down the middle. Plus beer and sausages.

  • Emile Att

    To be frank (pun intended!), I think it’s the fries that excite me the most. Beer and sausages (especially with a curry sauce) are great, but add fries served with a house-made mayo and, well, I was happy to throw down some cash up front.
    I may burn through my Magic Sausage Card in the first month.

  • Megan Kwan

    One Million Dollars is a “rock”, one thousand dollars is “large”. Of course anyone who has watched a little bit of The Sopranos knows the terminology, “This wedding is costing me half a rock” or “I lost 8 large on the Giants game”.

  • Jen

    This is better than a bank loan (if you could secure one). Yes, they’ll have to deal with lots of giftcards being used in the first few months of service. But, unlike a traditional loan, where they would pay back every dollar with interest, here they pay 0% interest and are only on the hook for the wholesale price of beer and food. For example, a $100 sausage card may only cost them $40 out of pocket.

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