Opening a business is expensive. To open a restaurant in UAE, it’ll cost you anywhere from AED 500,000 to AED 1.25mn, depending on the size, location, and lease costs.
Unless you’ve already founded and sold a few businesses before, chances are, you will need some extra funds to get your business up and running. This is where a restaurant investor can come in to help through capital investments.
An investor could be friends, family, investment companies, angel investors, or even venture capitalists.
In addition to providing you with capital in the form of money, an investor’s expertise can prove invaluable, regardless of whether you’re an entrepreneur looking to open a new business or an existing business owner looking to open up a new location. Almost a third of all new restaurant businesses close down within their first year.
Fierce competition among existing and upcoming new restaurants can make it hard for a new restaurant business to stay afloat. This is where the expertise and industry exposure of a food investor can help extend the life of your business.
Playing a part in the growth of the business
If you are an existing business owner, a food investor can help support the growth of your business, whether you wish to open a new location, start franchising, new menu developments, expand your business offerings, expansions, etc.
Support you in keeping the business a float
Every business is bound to experience a period of hardship during its lifetime. In such instances, an investor can provide financial assistance to stay afloat while also providing you invaluable expertise that can help turn things around for the business.
Provide you with numerous connections to expand your network
An investor that has a lot of connections within the industry can open up a lot of doors for your business. This can help you save a lot of time, money, and resources. You may even find more opportunities to grow your revenue potential through these connections.
Here’s why it’s important to find a good investor for your restaurant business:
When you are considering bringing an investor onboard, you need to understand that this relationship will involve giving up some control of your business. Any decision that is to be taken has to be signed off by both the parties, you and the investor.
You will also have to share profits (and losses) with them. Most business owners are not fond of this. This is mostly due to the risks involved when bringing someone new into the business.
Choosing the right investor should be considered a make-or-break decision. In our experience as a restaurant business investor, we’d advise you to look for an investor who you can trust.
They should be able to relate to your passion and should show genuine interest in the growth of your business beyond the money that they’ve invested. A good sign to look for in an investor is to see how they view their involvement in the business.
A good investor will consider their investment as a partnership. They show genuine interest and share the same passion as you do. They are interested in establishing a long-term relationship with you that is based on trust, honesty, and transparency.
Finding such investors can be hard, and even challenging, but don’t let them hold you back.
But, where do you find investors for your restaurant business?
Here are a few ways you look for potential restaurant investors:
Once you find a potential investor that you are interested in partnering up with, it’s time to pitch your business to them.
Create a Solid Business Plan
Successfully pitching your business to investors starts with a well-defined business plan. Here’s an outline of what your business plan should outline:
It is a good idea to maintain a short & concise business plan for easy reference, as well as an extended version for a more detailed outlook on these areas.
Define Your Story
Every business has a unique story attached to them, and yours is no different. Sharing your passion and drive behind the business in the form of a story is a great way to get investors to get to know your business better, and understand the challenges you’re facing. It is a fantastic way to get them to develop a common interest that mirrors your own.
Practice Your Pitch
Being able to explain the value & potential of your restaurant business to potential investors clearly & quickly is key. Many business owners walk into meetings unprepared thinking they know their business well.
Take the time to simplify your pitch as much as you can, and create an accompanying presentation (pitch deck) to support your pitch.
Be clear on what you want to achieve, how you aim to achieve it, and what you need from investors to make it happen.
Create a Pitch Deck
At the end of the day, we have to understand that a pitch deck is meant to act as a visual aid to support our pitch. Having lots of bullet points and walls of text on your slides is only going to make your investors “read” your presentation, not listen to what you have to say.
Invest enough time in crafting a well-designed pitch deck that flows well with your pitch.
Remember, you should be able to present your pitch quickly & efficiently.
Prepare financial reports & sales projections to support your case
Have reports & data at hand to support your case and demonstrate how you can take the support you receive from your investors and deliver upon your goals.
There are a lot of free resources available online that you can use to create your own reports & charts to present to investors.
We at Al Nomani Holding Group, understand how picking the right investor for your restaurant business will take time and a lot of effort on your part. Throughout the years, we’ve had the privilege of owning & developing multiple restaurant food chains all over UAE. As a way to realize our vision & give back to the country, we’re looking for aspiring restaurant businesses who are looking for investors to grow.
If you, as a restaurant owner, believe that your business has the potential to make a difference, and require help in realizing your goals, then feel free to reach out to us and let us know how we can help you grow as an investor.