Ask YC: Advice on startup idea and funding. • Hacker News Board

Re: Ask YC: Advice on startup idea and funding.

#11

Post by maxklein » Tue, Jun 03, 2008, 4:51 AM UTC

Very flawed approach. The restaurant business is the hardest type of business to get into. It's terribly difficult to survive for more than a few months. And the only way to survive is if you have an extremly detailed financial breakdown, with all possible scenarios - worst case and best case.

Only if those all look rosy should you start. And if you want to start that way, you need to do surveys of other businesses in the area as well as your potential customers. This is what people learn in business school, and starting without having a business school person on your team is a great risk.

Also, funding is not your problem. This type of business you are talking about is what bank loans are designed for. The bank loan is made out to the company, so if you fold, you are not personally liable.

If I were you, I'd only do this if I were really passionate about milk and cookies. Personally, I like neither milk nor cookies, so you would not have me as a customer.

At the same time, you cannot start such a store without focusing to a large part on cofee. Coffee is addictive, and will make your customers return. Milk is not addictive, and it tastes the same everywhere, and is much cheaper. What incentive do you have towards making people return to your store when the milk is just the same as everywhere else, but overpriced?

Re: Ask YC: Advice on startup idea and funding.

#12

Post by scooter53080 » Tue, Jun 03, 2008, 4:59 AM UTC

I would love to come to a place like this. In fact, I go code at a coffee shop near my house, and usually get a tea and a shortbread bar. As others have pointed out, with such a narrow product scope, I think you might have a problem selling enough to make it work. Maybe you could also run a bakery-style operation and sell larger orders...pre-order by the dozen. Perhaps look into distribution possibilities with other places (coffee shops, convenience stores, ?) However, I think the cookies will need to be fairly special/unique to make this happen. This is somewhat similar to cupcakes shops...might be able to find out how they make it work (I bet it isn't one cupcake at a time.)

Re: Ask YC: Advice on startup idea and funding.

#13

Post by menloparkbum » Tue, Jun 03, 2008, 4:59 AM UTC

You'll be competing with every cafe that sells cookies, which is almost all of them. You better have a really good cookie recipe.

For inspiration, read the pinkberry story on wikipedia.

Re: Ask YC: Advice on startup idea and funding.

#14

Post by caaaaaam » Tue, Jun 03, 2008, 5:01 AM UTC

sgibat wrote: post #9

oldgregg wrote: post #2

Build and sell a web startup... use the profits to open a cookie store?

An online-ordering based cookie delivery system would be a nice addition to your store.

If you plan on trying this, maybe these guys might have some advice for you:

http://www.insomniacookies.com/index.php

Re: Ask YC: Advice on startup idea and funding.

#15

Post by hugh » Tue, Jun 03, 2008, 5:12 AM UTC

A: Yes, I'd go there. Milk doesn't get enough respect as a drink on its own. However, would I go there more than a few times, once the novelty wore off? Probably not.

B: I really doubt any VC will be interested in this kind of business -- there just isn't enough potential for growth. If you really want to do it, you'll have to do it with some combination of debt and your own money, and unless you already have a fairly large chunk of money already it's just not going to happen.

Re: Ask YC: Advice on startup idea and funding.

#16

Post by hugh » Tue, Jun 03, 2008, 5:16 AM UTC

caaaaaam wrote: post #14

sgibat wrote: post #9

Earlier quoted context omitted.

An online-ordering based cookie delivery system would be a nice addition to your store.

If you plan on trying this, maybe these guys might have some advice for you: http://www.insomniacookies.com/index.php

Another potential business model to follow, if you're really interested in the cookie industry is the Byron Bay Cookie Company (www.cookie.com.au)

Re: Ask YC: Advice on startup idea and funding.

#17

Post by thaumaturgy » Tue, Jun 03, 2008, 6:00 AM UTC

asnyder wrote: post #8

Interesting idea, but be wary. I opened up a hookah lounge last year 2 blocks from Brighton Beach in Brooklyn NY. Before we opened we were hoping to get the chic, hip, free-wifi crowd, but instead got 18yr old troublemakers that don't spend a dime. It's one thing to want a particular clientele and it's another to actually get it. There's no guarantee, and with something like cookies, you don't know who you'll get. To…

Out of curiosity, have you tapped into running local advertising on your free wifi login page?

If so, is that helping your revenue much?

Re: Ask YC: Advice on startup idea and funding.

#18

Post by thaumaturgy » Tue, Jun 03, 2008, 6:06 AM UTC

izaidi wrote: post #6

I really like the idea, but are you sure you'd be able to sell enough milk and cookies to make up for the cost of running the place? Seems like the only way to make it work would be to sell "gourmet" cookies and overprice them, and that kind of moves you out of the hipster/student arena and into yuppiedom.

| I really like the idea, but are you sure you'd be able to sell enough milk and cookies to make up for the cost of running the place?

That's what I'm wondering. Specifically, coffee shops get by (barely, in some cases) by taking relatively inexpensive ingredients, and adding value to them in the form of a barista that mixes them up in hopefully really tasty ways.

I don't see how you can do that with milk. They might be able to bring in some of the world's finest cocoa powder and come up with a chocolate milk recipe that blows everybody away, but after that ... then what?

How do they plan on running a coffee house model without the coffee revenues?

Also, LA rent has gotta not be cheap, especially in the market areas they would want to target. Maybe something like this would be better somewhere on the edges of the Valley, where rents would be less but they'd still have the right crowd?

Re: Ask YC: Advice on startup idea and funding.

#19

Post by kirse » Tue, Jun 03, 2008, 6:14 AM UTC

This reminds me of the Cereality store at PSU that gives out free wifi to its employees, who get to sit around 12 hours a day and surf the web while nobody goes in the store.

You better be selling cookies with crack in them or have an extremely good marketing plan. Otherwise, just selling cookies and milk at normal prices will not work.

Re: Ask YC: Advice on startup idea and funding.

#20

Post by Tichy » Tue, Jun 03, 2008, 6:55 AM UTC

Both cookies and milk are very unhealthy. What I really miss is a venue where I can get healthy food. There are coffee shops everywhere, selling cookies, doughnuts, muffins and so on, but there are hardly any healthy choices (Edit: there are NO healthy choices).

I can only speak for Munich, Germany, but I suspect the situation in the US is far worse. But from my local perspective here, I think the coffee shop thing is a bit over (and you are in my eyes just a coffee shop without the coffee). Something new needs to take over and make a killing.

Edit: also I would not like making my riches by destroying my customers health. It worked for Warren Buffet, though (Coca Cola, Snickers...).