sold, which would achieve his
goal of making it possible for
his parents to retire.
I started my business
seven years ago and
have grown it to
$3 million in sales.
Our work is never-ending. We work
and every holiday.
Whenever it looks
like we’re going to
hit a lull in the action,
the phone rings for
a last-minute job,
and off we go. I’ve
reached the point
where I realize I can’t
handle any more
myself. For the
company to grow,
I need to bring in a
These guys are
to $120,000 a year—
and they don’t produce revenue. I am
having a difficult
time figuring out
what to expect when
I spend that kind
of money on a non-revenue-producing
employee. I’m also
having trouble getting my brain around
the fact that this new
hire would be the
in the company.
Norm on getting ready for growth
Every business gets built in stages.
The challenge is to stay focused
on the stage you’re in—while
preparing for the ones to follow.
Sooner or later, every growing
business reaches a point at
which the owner can no longer
handle both sales and opera-
tions and has to decide which
responsibilities to hand over to
someone else. The mistake
many people make is to base
the decision on whatever prob-
lems they’re having at that
particular moment. Instead,
they need to start by figuring
out where they themselves
want to wind up.
We’re dealing with multiple stages right now at Kobeyaki,
the Asian fast-casual restaurant chain I’m building with
three partners—Brian Kelly, Brian Konopka, and Sal Bar-rera. Our first restaurant, in the Chelsea neighborhood of
Manhattan, has been a huge success. Now, we’re moving
on to the second stage: starting up two more restaurants
in other parts of Manhattan.
But our goal is to go national. And to do that, we’re
going to need outside funding, probably from a private
equity group. The question is, What should we do now
to put ourselves in the best position to get the right kind
of backing later? I didn’t have the answer. So I took note
when Brian Konopka mentioned that he knew Gary Levy
at the CohnReznick accounting firm. Levy is one of the
leading experts on the hospitality and restaurant business
industries. “Can you get us a meeting?” I asked.
Levy generously offered us an hour of his time. By the
end of the meeting, it was clear to me that he was exactly
the person we needed to guide us through the next stages
of the business. But for him to serve as our adviser, we’d
have to hire him as our accountant. Brian Kelly whistled
softly. “That could be really expensive,” he said.
“Well, it’s your call,” I said. “But it seems to me his
advice is worth it. You’ll have at your fingertips whatever
information you need to build this business.” They agreed,
and the investment began paying off almost immediately.
Among other things, Levy answered my question about
how we should prepare for getting private equity. “You
need to prove the concept,” he said.
“Will we prove it if we open seven profitable stores
in New York City?” I asked. “Putting all of them in great
Manhattan locations doesn’t prove the concept,” Levy
answered. “They’ll want to see if it works elsewhere.
At least two of the seven should be outside New York.”
After we discussed locations for a while, I asked him if
he could get us a meeting with some potential investors, so
I could ask them directly what they look for. He thought
that was a good idea. “But not yet,” I said.
I’m sure Levy could get us a meeting now, but I’d
much rather wait until we’re beginning to create buzz and
look like a hot concept. I figure that will be after the three
restaurants are up and going strong—maybe in a year.
Meanwhile, we’ll stay focused on Stage Two.
Norm wants to help your business. Send your questions to him and his
co-author, Inc. editor-at-large Bo Burlingham, at AskNorm@inc.com. You
might also want to read their book: Street Smarts: An All-Purpose Tool Kit for
Entrepreneurs. Follow them on Twitter at @normbrodsky and @boburlingham.