With a $50,000 prize from a Small Business Administration competition, Café Commerce has announced a new pilot program, Break Fast and Launch, that will focus on accelerating new restaurants, bakeries, food technology, caterers, brewers, food truckers, and all things culinary in San Antonio.
The nationwide $2.5-million Growth Accelerator Fund began in May 2014 to create new accelerator programs throughout the country in industries and geographical areas where access to conventional investment are less common. Café Commerce jumped on the opportunity just two months after it opened its doors at the Central Public Library. Out of 800 applications, 50 organizations received the $50,000 award.
The accelerator will be accepting five applicant teams to participate in three different waves of programming. The first wave, which is expected to start in early January 2015, will be composed of restaurant and food truck entrepreneurs. After about three months of training, mentoring, and hands-on demonstrations about everything from bookkeeping to borrowing to marketing – the business end of the culinary craft – the second wave will begin: brewers, bars, and beverages. The final wave will include food products, catering, and food technology.
Why? Because great cities have great food and while San Antonio has a decent base of strong culinary options and has seen the recent addition of many quality establishments, it still seems to lag behind in “where do you want to eat tonight” options. That’s where Break Fast and Launch comes in, breaking the ice for many thinking about starting or expanding their own place or product.
“When you do something for the first time, you’re going to pay the Dumb Tax,” said Café Commerce President Peter French during the weekly 1 Million Cups presentation Wednesday morning. While restaurants have a failure rate only slightly higher than other small business ventures, “The psychic impact of these failures is greater because they’re so visible (to the community at large). These are places we go and try out … (so) when they close, we notice.”
Café Commerce staff and partners at the microlender Accion Texas, who will receive $15,000 of the SBA award for associated courses and training, are constantly hearing from new business owners who wish they could talk to someone who has done this whole “entrepreneurial thing” before, French said. Mistakes are expensive. That’s essentially what Café Commerce does: connects people to experience.
“We’re going to make it easier – not easy (starting a business) is never easy … but at least make the Dumb Tax a little bit smaller,” French said.
Just like most startup accelerator programs, each cohort will have a “demo day” – or Dinner Day, in this case – culminating in a final presentation dinner.
Café Commerce will begin accepting team applications on Nov. 1 for the first wave. Proceeding application and programming start dates are tentative.
Applicant teams must consist of more than one person because, really, there is no way you can do it all alone, French said. If you’re a chef, you’re going to need help with marketing, accounting, staffing, real estate, etc.
“The things that don’t relate to your beautiful vision of a crepe or quesadilla or cold press juice or cookie,” he said. “That is your magic stuff, but what you need to know is to make sure your books balance, or that your lease got renewed or that you have the zoning for your property or that the health inspector can’t come and shut your food truck down. We want people who are passionate about food and food-related businesses to have the back support so that their business is actually successful.”
Break Fast and Launch basically mirrors Café Commerce’s general programming and mission to make entrepreneurship easier by connecting new business owners with local resources for information, market data, and guidance. The culinary pilot program, however, provides structured, industry-specific programming – some existing and some created specifically for Break Fast and Launch.
“We’re a startup that helps startups,” French said. “It creates this whole metacycle … a vicious cycle of support.”
Bake Broil and Brew will receive $15,000 of the SBA award as a key partner in the program. The commercial kitchen – which offers its facilities to rent by the hour, day, week, or month – already serves as an incubator for culinary projects. Some are successful, some failed. Bake Broil and Brew’s facility located at 1508 Guadalupe St. will provide kitchen space and beer brewing equipment for applicants to test and try their products.
“We’re a demo kitchen, (have) private cooking classes, tastings for weddings … all kinds of people come here,” said Co-founder David Solis of the wide variety of tenants and customers who rent kitchen space.
Restaurants – as many small businesses – require a lot of initial capital. This is something David and his wife, Co-founder Michelle Solis, found out soon after establishing her own cupcake business.
“Why did we say ‘no’ to this cupcake dream? Money,” David said. So they decided to start a place that provided the space and equipment for others to follow their culinary passion.
The tenants who aren’t ready to start their own business typically last about three to four months. Most of the ones who have “made it” to their own facilities were with Bake Broil and Brew for a year or two, David said of their tenant turnover rate.
Part of taking a business plan and trying to bring it to life with staff, supplies, and resources often means finding out it can’t survive.
Typical tech startup accelerator programs like Techstars are extremely competitive to get into, French said, because the applicants’ business plans are close to fully formed with the expectation of dedicated follow-through by the applicant. Break Fast and Launch, however, may serve as a wake up call for some applicants.
“(We may be) bringing them face to face with the reality that they’re not prepared to do what they’re about to do,” French said. “And that’s okay … we’ll be charting the success of the people who come through this program in different ways.”
If the program simply creates a better employee or a more well-rounded chef, that can be counted as a partial win, as well, he explained. But the goal is to have 80% first-year continuation rate (survival rate) for pilot participants – either in an incubator or by opening their own shop.
Ultimately, they’d like the original participants to come back to mentor future teams. The future of the Break Fast and Launch program depends on the interest of future sponsors and partners. As the pilot program forms in the coming months, there are many opportunities to mentor, volunteer, and participate. Visit www.cafecommercesa.org/break-fast-launch for more information.