Securing restaurant funding is a crucial part of opening a foodservice business. Restaurants require a large upfront investment, so unless you’re independently wealthy or recently received a windfall, you’ll need investments to fulfill your dream.
With so many expenses to think about, this restaurant funding checklist can help you remember all of them. Download our free checklist, then keep reading to get the answers to the most frequently asked questions on this topic, like how to get funding for a restaurant, how to get funding to open a restaurant, and how to find funding for a restaurant.
What You’ll Find in This Restaurant Funding Checklist
While other restaurant funding checklists only cover how to land restaurant loans or approach investors, this comprehensive document takes a more holistic approach. You’ll learn how to:
- Calculate your restaurant startup costs to determine how much money you’ll need
- Forecast your sales before you open
- Write a winning restaurant business plan
- Obtain restaurant financing and startup capital through loans and investors
How to Find Funding for a Restaurant
So, where should you go to secure financing for your business? Here are several popular restaurant funding options to consider:
- Banks: If you’re in good financial standing, you can secure a business loan from a bank. Shop around to get the best interest rate possible.
- Investors: Seek private investors or venture capitalists who will flood your business with money and offer expertise in exchange for a stake in your business.
- Family and friends: Your personal network may want to help you fulfill your dreams. In order to preserve close relationships, outline the terms of the loan or gift in writing.
- Grants: Look for grants from organizations that support restaurants, small businesses, or minority entrepreneurs (if applicable).
- Crowdfunding: Pitch your dream to the public and let them fund you via crowdfunding sites like Kickstarter and GoFundMe.
How to Get Funding for a Restaurant
Follow these three steps to secure funding for restaurants and other existing foodservice businesses:
- Determine your needs: Identify what you need money for. If you need it to launch your business, read the next section titled “how to get funding to open a restaurant.” Perhaps you already run a restaurant and need more funds to renovate your space, open a new location, or upgrade your equipment. After determining what you need the investment for, figure out how much money you need.
- Pitch lenders: Then, approach investors or lenders with your ask, business plan, and financial documents (i.e., bank statements and a profit and loss sheet, at a minimum).
- Evaluate your offers: Choose the restaurant funding option that makes the most sense for your business goals.
How to Get Funding to Open a Restaurant
If you need restaurant funding to open your business, you’re going to follow a process similar to the one described above, but with a few additional steps.
- Create a business plan: A business plan shows lenders that you have seriously considered what will go into running a financially viable restaurant.
- Determine your needs: Calculate your restaurant startups costs. This will be the amount you ask for.
- Forecast your finances: Because you don’t have financial statements to show investors, you’ll have to make them up. By this, we mean forecasting your anticipated expenses and revenue – you can use these four restaurant financial spreadsheets to do so.
- Approach investors: Meet with investors and lenders and present them with your ask, your business plan, and financial forecasts.
- Evaluate your offers: Choose the restaurant loans or other financing option that’s most aligned with your business goals.
Want to learn more about how the finances behind opening a restaurant? Download our free checklist for funding a restaurant today.