In a previous article, we discussed some of the difficulties restaurants face when raising funds.
One of the main issues is that founders often don’t own the building they operate out of, meaning they struggle to raise asset-based financing, leaving restaurateurs reliant on either personal guarantees, crowdfunding platforms, business angles or private equity when looking to grow or ease cash flow problems.
While bad news for those running restaurants, it’s good news for TV viewers: restaurants looking for funding via private equity is the premise of the show “Million Pound Menu.”
For those unfamiliar, this is a Dragon’s Den-style programme in which budding restaurateurs attempt to convince a panel of investors to inject money into their ideas.
It’s an interesting show that provides unique insights into the challenges faced by both restaurant owners and those who want to invest in the industry.
Million Pound Menu Mishaps
Looking back at the restaurants that successfully received funding in series one shows an interesting mix of successful and not-so-successful investments.
Industry publication Big Hospitality released an article earlier in the year that followed up on some of the show’s initial success stories. According to the article, at the time it was published none of the ideas that received funding had successfully established restaurants.
Fine-dining concept Epoch, for example, received an offer of £750,000 to build their idea. However, despite holding some private functions, the chef behind the concept is now working as the Head Chef at a hotel in Luton.
Meanwhile, the chef behind the Korean restaurant concept Dynasty accepted £500,000 and a residency in Berlin. However, this doesn’t appear to have worked out as his Instagram account suggests he is still looking for a permanent space.
Since the publication of the article, some restaurants have been able to turn their fortunes around, however.
Bubble and squeak restaurant Bubble & Now serves its fresh take on the traditional meal out of Hawkyns Restaurant in Amersham. Additionally, Cuban street food restaurant Finca has found a permanent spot in Liverpool’s Duke Street Market.
Season 2: Pilgrim’s Successful Journey to Funding
Season two of the show aired earlier this year with some changes to the format. One of the restaurants that successfully received funding also appears to have had a smooth journey towards initial success.
European restaurant concept Pilgrim launched its first restaurant in May this year in Liverpool at the Duke Street Market Food Hall — the same place as Finca mentioned above – just three months after the show aired.
The restaurant has a menu inspired by the Camino de Santiago pilgrimage to Santiago de Compostela in Spain. It features food from the countries that make up the route of the pilgrimage, including Spain, Portugal, and France.
The restaurant has 40 seats, including a bar, mezzanine, and terrace. The main concept is a four-course tasting menu.
Pilgrim received £600,000 investment on the show from Matt Farrell, the co-founder of Liverpool-based bar and restaurant group Graffiti Spirits Group (GSG). The group operates the venue that Pilgrim will move into, and also has vast experience in growing restaurants, having increased from a single site when it opened in 2009, to nine venues this year.
As well as being a hit with the show’s investors, Pilgrim appears to be finding success with foodies. The restaurant has good reviews on Google and was also the only Liverpool restaurant to receive a Michelin Bib Gourmand in this year’s UK Michelin guide.
Of course, the concept is still in its early days. While it appears to have had a successful start, it will be interesting to see whether it can continue to be successful once the initial hype wears off.
Speak to Reparo Finance for Short Term Restaurant Funding
Reparo Finance provides short-term loans to help businesses get set-up or ease cash flow problems.
Our team of experts consider all types of businesses and make lending decisions based on several factors, including the business plan and ability to pay us back. We are also flexible and will always try to come up with a funding solution.
While asset-light restaurants operating in a difficult environment may not be easy to fund, our team will take a look at any business – because if there is one thing we’ve learned every business is unique. We offer loans of between £10,000 and £1 million and can approve applications within days. To discuss a loan with one of our experts, give us a call on 0161 451 5710 or contact email@example.com.