So I think it's time for a little background, as I'm working up to chronicling the current state of my bookstore efforts.
Most of the folks I know who have opened up independent bookstores in the last 10 years or so (it may have been different in, say, the 1970s), have had one of two things:
1) a mortgage
2) a well-off relative or friend.
These are traditional and time-honored means of securing capital for an independent business, especially one as high-risk as a bookstore (it also works with restaurants, bars, and other retail businesses).
I have neither of those things.
What I've got is starry eyes, a passion for bookselling, and eight years of experience, which I've purposefully used to the best of my ability to gain the skills I think I'll need to run a great store. And for a long time, I thought that this experience would attract to me the kind of investor who might stand in for a well-off relative, and be willing to put a big (really big) chunk of money into a startup business on the strength of my capabilities alone. I also expected this person to be satisfied with an eventual financial return and the good they were doing for the Brooklyn community, and not take any interest in the day-to-day operations of the business, which would be my domain. Especially after winning the PowerUp! competition, I was certain it was only a matter of time before someone stepped forward to help me take the next step.
The ALP calls this imaginary investor "the magical millionaire."
Clearly, they have not materialized.
This non-happening has, from time to time, made me a little depressed. Why, in a world where people are always investing in crazy ideas, couldn't just one person invest in my seemingly-crazy-but-actually-totally-solid idea? Why couldn't I just find a grant or even a low-interest loan or SOMETHING that would make it easy for me to make my vision happen? Why couldn't I just be born rich?
But when I stop saying "POOR ME!" and my thoughts clear, it's fairly obvious that I need to let go of the magical millionaire, and try something else.
That's where I am now.
Anyone who is going to put money into my bookstore is going to either want some control of/involvement in the business, or the fulfillable promise of a reasonable financial return. I need to figure out how I can give them what they want, while still getting what I want.
Instead of hoping for some goodwill angel investor type, I am now preparing to formally solicit investors (or lenders). The Fort Greene Association is willing to help to connect me with some likely folks. So I'm putting together a prospectus, including my business plan and investment terms. These will include options for loans, payable by promissory note, or equity investments, which will give investors a share (though never a majority share) of the business, and thus its profits.
I spent this morning with a super nice lawyer in Dyker Heights, talking about how to calculate what interest to offer on a loan like this, and how to figure out the value of the business in order to "sell" portions of it to an investor. It's all fascinating stuff, though I'm a bit slow at it (English major, you know -- this math stuff is not my forte. Though I did get an A in AP Calculus, so just skip the blonde jokes.)
In any case, what this means for the bookstore is that since I'm looking at a formal investment process -- or a longer-term negotiation over a partnership, which is another option -- the bookstore isn't likely to get built and open its doors by this fall. Instead, I'm looking at early spring. Give me a few months to connect with investors, a few months to find and build out the space. And even that is dependent on whether I can in fact find folks willing to plunk even small chunks of money into a business with the profit-to-startup costs ratio of a bookstore (and looking at it this morning, I realized it's not super pretty for several years.)
On the other hand, I've already had three good friends approach me, unsolicited, and tell me that they want to put a chunk of their money into the store. They told me to name the terms -- they just think the bookstore is a brilliant idea, and trust that I can make it happen. Their investments alone only get me a few more yards down the track toward my goal, but that's a lot further than I was before.
And a number of people have already "invested" in Stimulating Reading, plunking down your stimulus check in exchange for a t-shirt, a bag, or some swag from my personal library (and you will get it, I promise!) These are even smaller amounts, but they're basically donations, based on the strength of what Andy Laties calls "social capital" -- you all just think I can do it. I'm hoping there's even more out there, as the checks flow in and folks decide that making a bookstore happen is one way to really boost the economy.
So there's no magical millionaire. But there are already a bunch of ordinary folks willing to get in on my bookstore dream. And I think -- and the FGA thinks -- there will be more.
Instead of a wealthy individual, a rich community. That's pretty magical to me.
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Another way to launch a bookstore out of thin air is to intrude on college students buying their course-books. Len Riggio of Barnes & Noble launched his first bookstore by opening across the street from the NYU bookstore and buying coursebooks back from students for a higher price than the official store, and then reselling them at a lower price than the official store. He certainly was successful as a bookstore owner, starting with no money.
ReplyDeleteAnd the group of professors who launched Seminary Co-op Bookstore at the University of Chicago (now a several-million-dollar-per-year store) did so because they were having trouble getting the official Univ of Chicago bookstore to stock the books they were assigning their students.
Food For Thought Books in Amherst was launched by a group of students who were in the undergraduate Social Thought program, in the 1970s. Its still in business -- a worker-owned co-op. Does a lot of business with professors/students who intentionally shop there in order to preserve its mission and purpose (leftist, progressive).
You could go to professors at Brooklyn College, one by one, and ask them if they would agree to refer their students to you as a first provider of coursebooks. You'd offer some sort of quid pro quo as a service-provider (something that drew on your personality and presence). Professors have enormous power in that they can direct students, to some degree, where to buy books.Brooklyn College is very poorly served by physical bookstores right now, and it has 15,000 students. It's not in the neighborhood you are currently targeting--but it is in a neighborhood with no decent bookstores.
I've catapaulted back in time in your blog to start at the beginning of this magic venture. Since I was very young books have been my passion- reading them, writing them, loving them. My dream has always been to some day own my own bookstore. In seeking guidance on how that might happen, things to watch out for, things to try, I do not think I could have invented a better resource than a well put-together blog by someone who is there doing that exactly.
ReplyDeleteOn this Thanksgiving day, I want to extend my gratitude for putting this out there for other's to read. Sometimes the secretive jealousness of the business world puts me off. Then I remember there are wonderful business people out there more than happy to share their stories and advice with a young upstart. Thank you, very much, for that.