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Thread: Self-Funding a Startup Brewpub--separate entity to loan the money?

  1. #1
    Join Date
    Mar 2019
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    Gallatin, TN
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    Self-Funding a Startup Brewpub--separate entity to loan the money?

    I am in the planning stage of opening a brewpub.

    Scenario: I have 150k to invest, and I will be the only owner in the LLC.

    Using this money, what would be the most ideal way to fund the brewery? Simply open a business checking account and transfer the money to the account?

    If I had multiple owners, I was debating the benefit in starting a separate LLC to finance the brewery. In this case, I could set up a separate LLC to "loan" the brewery the money (with interest), and then pay myself back over the years.

    Just looking for advice/experience on how bootstrapped solo-investor/owners have smartly (or not-so-smartly) cracked this nut in the past.

    Thanks.

  2. #2
    Join Date
    Nov 2008
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    Leadville, CO
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    Quote Originally Posted by trandahl View Post
    Using this money, what would be the most ideal way to fund the brewery? Simply open a business checking account and transfer the money to the account?
    That's essentially what we ended up doing, but talk with your bank first. It could be that they want the cash bonded as collateral, or (more likely) that they'll have you buy the real estate/equipment and then take that as collateral. I would recommend that you keep your working capital set aside until opening, to avoid the interest on your loan(s).
    Sent from my Microsoft Bob

    Beer is like porn. You can buy it, but it's more fun to make your own.
    seanterrill.com/category/brewing | twomilebrewing.com

  3. #3
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    Mar 2019
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    Quote Originally Posted by a10t2 View Post
    That's essentially what we ended up doing, but talk with your bank first. It could be that they want the cash bonded as collateral, or (more likely) that they'll have you buy the real estate/equipment and then take that as collateral. I would recommend that you keep your working capital set aside until opening, to avoid the interest on your loan(s).
    Good advice, thanks.

    Based on that, I'm curious... did you guys get a loan for opening expenses and use cash for operating expenses?

  4. #4
    Join Date
    Nov 2008
    Location
    Leadville, CO
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    Quote Originally Posted by trandahl View Post
    Based on that, I'm curious... did you guys get a loan for opening expenses and use cash for operating expenses?
    Our SBA loan doesn't cover nearly all the opening expenses, but yes. We ended up having to put together about 35% of the total privately.
    Sent from my Microsoft Bob

    Beer is like porn. You can buy it, but it's more fun to make your own.
    seanterrill.com/category/brewing | twomilebrewing.com

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