Startup Stories: Fundraising

The shared kitchen community is growing and it seems we hear of a new kitchen popping up somewhere in the country on a weekly basis. We reached out to a kitchen that is JUST getting started, to share some of their learnings about startup life as a shared kitchen.

The Local Kitchen is Saskatoon’s first ever “Food Hub” with 3 commercial kitchens, space for cooking classes and workshops, event and retail space. They’ve launched a monthly class schedule and you can follow them on Facebook and Instagram too. They’ve graciously provided some insight about client recruitment, fundraising, and the day-to-day struggle.

This is the first of 3 posts we’re posting this week from The Local Kitchen; on Funding, Feasibility and Lessons Learned.

On Fundraising 

The Local Kitchen is a for profit business, so had a really hard time asking for donations or sponsorships. Moreover, we didn’t seem to fit within any parameters for grants. We put in our own money and were very fortunate to have a generous family member who contributed the seed money to begin sourcing and pursuing lending from banks. The process of sourcing funds was not fun! We applied to several lending institutions but were turned away either because we didn’t have any actual sales yet or because they wanted to see more capital contributed… but we had maxed out that option. It helped that we are 3 partners, so we had 3 personal net worths to rely on. We ended up getting some funding from an organization called Women Entrepreneurs of Saskatchewan – it’s a loan arrangement but wonderful to work with an organization specifically set up to help women in small businesses. The rest of our loan is facilitated through Bank of Montreal, but is a government program to help small businesses get going – the Canadian government guarantees 75% of your loan (meaning if our business crashes and burns we aren’t personally on the hook for paying off our loan) which makes it more attractive for lenders to deal with us.

In short, we have a lot of debt – but we did a lot of analyzing our projections to make sure that even at the low end of revenue, we can still cover our loan payments and other fixed costs.

 

Stay tuned on our own Facebook and Twitter feeds to see when the next Startup Story is up. Thanks to the Local Kitchen, looking forward to your success!

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