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Posts Tagged ‘Optima Bank’

Ask CJ – Opening a Restaurant: The Bitter and the Sweet

Thursday, August 4th, 2011

“I’m interested in opening up my own restaurant and I’ve heard that it is really tough to get financing to do so.  What might be available, if anything?”

Well, you’re quite right in that it’s often more challenging to secure financing for a restaurant.  The reason, as many people know, is due in part to the perception of a high failure rate for new restaurants.  I myself have heard countless times that 9 out of 10 restaurants fail within the first year of operation.  I was about to cite that “statistic” when I decided to do a little digging to see if it was still valid.  Boy am I glad I did!  A professor from Ohio State University’s hospitality program, H.G. Parsa, had trouble believing those statistics (and couldn’t find a source for the data) so he decided to research the failure rate himself. 

Seacoast Business Services Specialist Christine Davis

Parsa used records from the health department to track 2,500 restaurants in the Columbus, Ohio area over a three year period.  He found that about one in four restaurants close or change ownership within the first year of business.  Over three years, that number rises to three in five (Bloomberg Businessweek, April 16, 2007).  The success rate for chain restaurants isn’t much higher.  New businesses in general face similar failure rates.  It is also worth noting that the failure rate was higher when located in an area with a high concentration of restaurants.

The good news is that you have a better chance at success than commonly perceived.  The not-so-good news is that securing financing for your restaurant is still going to be a challenge.  I spoke with Carol Estes from Optima Bank in Portsmouth to see what she recommends for an aspiring restaurateur.  Carol noted that like any business seeking funding, you will have a better chance of getting funded if you have good credit, collateral, a fall back position (cash in the bank) and 10-15 years of experience in the industry.  Previous successful restaurant ownership will also build your case for financing.

Carol pointed out the SBA’s 504 loan program that provides a fixed rate commercial loan for businesses acquiring property.  If you are planning on buying the building, this might be a good option for you.  The program offers a fixed rate for 20 years for real estate and a 10 year fixed rate for equipment. The customer can purchase the property with as little as 10% down with the bank taking 50% of the loan and the SBA covering the other 40%.  A start-up business would require 15% equity.  The banks like this program as they are able to mitigate their risk while still taking care of their customer’s needs.  Funds can be used to purchase land or purchase or construct a building as well as renovate an existing structure.

I also spoke with Fred Palazzolo of the Granite State Development Corporation, www.granitestatedev.com, in Portsmouth about the SBA’s 504 program.  The GSDC focuses solely on the SBA 504 program and Fred noted that the 20 year rate guarantee in conjunction with the low down payment can be a real help to business owners who are looking to preserve cash and have a predictable loan payment.  Fred also shared with me that a start-up is defined as a business with less than two years in existence.  Single purpose facilities would require an additional 5% equity.  Unlike some other SBA programs, the 504 is not an SBA guarantee on a bank loan but actually a loan that is separate from the bank.  To learn the specifics about this program, you can visit the SBA’s website, www.sba.gov, and click on “loan and grants” under the navigation bar. 

Securing financing for a restaurant is going to be as challenging if not more so than for other types of businesses.  However, if you have the experience, credit and the necessary collateral you have a much better chance of getting the financing you need.  My hat goes off to those who are willing and able to open and maintain a restaurant.  As much as I love to eat, I could never take on that endeavor based on family obligations alone.  Restaurant ownership demands an immense investment of time and energy in addition to the knowledge and funds that are required. 

Christine J. Davis works for the NH Division of Economic Development as a resource specialist serving businesses in Rockingham and Strafford counties. Her role is to provide the support needed for businesses so that they may remain viable and growing entities in the community. Ms. Davis lives in Exeter with her two daughters.  When not performing her work or parenting duties, she likes to spend time outdoors and discovering news places and activities in the community with her girls.  She can be reached at Christine.davis@dred.state.nh.us.

Finalists for 2011 NHHTC Entrepreneur of the Year Announced

Tuesday, April 19th, 2011

The current founders of three successful New Hampshire technology companies have been selected by a panel of judges as finalists for the 2011 NH Entrepreneur of the Year.  They are: Erik Dodier, co-founder of PixelMEDIA, Bill Rogers, founder of Ektron, and Jeff Sercel, founder of JPSA.  The winner will be announced at the NH High Technology Council’s 2011 Entrepreneur of the Year (EOY) Awards Dinner. 

high-tech-council-logoThe 23rd annual NHHTC EOY celebration will be held on Monday, May 9, at 5:30 pm at the Radisson, Center of New Hampshire in Manchester. Bill Warner, super-angel investor, serial entrepreneur and founder of Avid Technology, Inc. and Wildfire Communications, will be the keynote speaker. Several FIRST Robotics teams will also be on hand to demonstrate their robots during the reception.

Launched in 1988, the NHHTC EOY celebration is the signature event for the NHHTC.  Over the years, the NHHTC has recognized over 50 New Hampshire entrepreneurs for their significant contributions toward advancing technology and demonstrating leadership, ingenuity and innovation.  The evening event attracts more than 300 tech industry leaders from across the region and includes networking, a banquet, the keynote address, and an awards ceremony recognizing this year’s Entrepreneur of the Year.

“We had a lot of very good applications this year, demonstrating the strength of innovation across New Hampshire.  The selection committee had a hard time narrowing it down to three finalists.  Eric Dodier, Bill Rogers, and Jeff Sercel really demonstrated their innovative approaches to business success, and the committee selected these three as finalists for the 2011 honors,” said James Cook, chair of the NHHTC EOY Committee.

Erik Dodier is co-founder of PixelMEDIA Inc., the largest web development company in New Hampshire.  Located in Portsmouth and founded in 1994, PixelMEDIA has grown from a two-person multimedia company into the successful full service digital marketing studio that it is today.  Today, the company employs 60 people and has four facilities.  Spearheading the efforts to launch PixelMEDIA in 1994 at just 24 years old, Dodier assumed the responsibility as President and CEO while also acting as the only salesperson. The quick acquisition of area clients and the subsequent growth of PixelMEDIA demonstrate Dodier’s talent in each of these roles.


Dodier currently oversees all business activities while also remaining active in the New Hampshire community assisting both businesses and non-profits. Current positions include serving as a board member and entrepreneurship advisor at the UNH Whittemore School of Business, sitting on the Board for Optima Bank, partnering with New Hampshire Innovation Commercialization Center (NH-ICC) to continue to promote business in the state, and sponsoring technology events in New Hampshire such as TechWorld 2010, BarCamp Manchester, and regular eCoast events. In 2010 alone Erik donated over 740 pro-bono hours of PixelMEDIA time to worthy recipients.  

Bill Rogers founded Nashua-based Ektron in 1998 with a simple vision: enable business users to easily author and publish content on websites. Rogers has sparked a revolution in the way organizations create and manage interactive web, intra net and extranet sites. He recognized early on how important websites would become to companies’ business models, and guided Ektron in creating a web content management, marketing optimization and social software platform that provides all the functionality webmasters, designers and developers want in a single application. In his role as a hands-on chief executive officer, Rogers is actively engaged in keeping Ektron a market and technology leader. He sets the company’s strategic direction, aligns product development with his forward-looking vision for website technology and is involved in all aspects of Ektron’s operations. In addition, he frequently participates in industry events and solicits feedback from Ektron’s customers and partners to stay on the leading edge of web technology. 

Rogers also co-founded two other successful technology companies. At Global Telemedix, a telemedicine software developer, he led product development and spearheaded key strategic relationships with technical partners and investors, such as Hewlett Packard Medical Products. At Zydacron Inc., co-developer of the first video conferencing chip set, Rogers conceptualized and executed product development initiatives and pursued strategic partnering efforts with major technology firms, such as IBM. Early in his career, Rogers also worked on new technology development in DuPont Corporation’s desktop publishing group and at MIT Lincoln Labs. 

Jeffrey Sercel began his career in 1983, as a laser engineer at the first excimer laser applications lab and development facility In North America, Tachisto Inc. After receiving his BS degree in Engineering Physics from the University of Arizona, he has devoted over 25 years of his life to become a leading expert in excimer, DPSS and ultrafast industrial laser technology. Sercel was selected as the NHHTC EOY in 1994 for his pioneering work at Resonetics, Inc. an excimer laser micromachining company that he founded in 1987.   

In 1994, he started JP Sercel Associates, Inc. (JPSA) as a consulting service, from which he ran from his home, utilizing a virtual company of technology specialists. During this period, JPSA solved problems and developed processes for industrial laser applications using Sercel’s extensive knowledge of physics modeling, optical and opto-mechanical engineering, CAD, robotics, machine vision, and high accuracy motion control and automation. Located in Manchester, JPSA is a leading supplier of industrial grade UV excimer, DPSS, and ultrafast laser micromachining systems and services to customers worldwide. Applications include LED, solar, semiconductor, research and biomedical markets to name a few. JPSA’s novel laser systems operate at wavelengths from 157nm to 1064nm, and are essential to a growing set of today’s industrial micro-machining applications.   

The judges are successful business leaders and entrepreneurs selected by the NHHTC.  This year’s judges include Nancy Briefs, Jesse Devitte, Steve Boucher, Andy Lietz, Rajesh Nair, and Mark Galvin, and Matt Pierson.