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Bouncing Back When Your Business Goes Belly Up

Bouncing Back When Your Business Goes Belly Up
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By Don Portolese

It is almost one year to the day that I began a strange foray into the world of bar ownership. Prior to that I had been a teacher. I was growing somewhat tired of the profession and was looking for a change. I had recently shown one of my short films in a bar in Bushwick, Brooklyn and that’s where my debacle began.

The night of the showing everything that could possibly go wrong did. The owner of the bar had no idea how to handle the number of people who would be attending the showing. His audio-visual equipment was spotty at best. His bartenders barely understood how to open a simple bottle of wine, let alone make a proper martini. The movie froze in the middle of the showing. The one bartender on duty walked out in the middle of her shift.

After such a fiasco one would think I would want nothing more to do with the bar or its idiotic owner. In hindsight I probably should have stayed as far away as I possibly could. However, the place had so much potential. In addition to a bar, this was also a huge event space conducive to performances of all kinds. What’s more, it was in the middle of one of the hottest neighborhoods in Brooklyn; it was a gold mine without the right miner in charge.

I spoke with the owner. His partner had recently abandoned the business (I would later understand why) and he was simply overwhelmed with running the place. He had the idea that he could simply put liquor in the place and he would start turning a profit. He didn’t realize that you need to develop an atmosphere and a social media presence to appeal to the neighborhood’s changing demographic.

I was by no means an expert at such things, but had much more of an idea of how bars operate and the atmosphere people were looking for in Brooklyn. I asked him if he wanted to partner with me so we could finally get this place off the ground. After hammering out what I thought was a fair and legitimate agreement, I finally signed a contract with him. I didn’t realize then that I was signing a deal with the devil himself.

According to the terms of the agreement, the owner would be a silent partner and I would be in charge of putting the bar on the right track. He had put up a considerable amount of money for the liquor license and other important aspects of the business, so I had to pay him what many would consider a nominal fee (my entire life’s savings) to enter into the partnership and do the brunt (meaning all) of the work.

In January of last year, I began to pour my heart and soul into this new project. A friend and I worked twelve-hour days, transforming the place from the lugubrious dungeon it was to a bright cheery place with heaps of hip atmosphere. Despite many glitches, we had a very successful grand opening weekend. However, once the novelty wore off and supportive friends fell away, we were left with the grim realities of bar ownership, a fickle world dictated by the whims of a less than stable population.

Winter is not the best time to open a bar, less so when it is one of the coldest and snowiest winters in recent memory. Besides the weather, there were other elements to overcome. Unbeknownst to me the bar had developed quite a reputation as an unfriendly place that opened rather infrequently.

I did my best to battle the wintery and dark elements. I worked 16-hour days to make sure that we had the inventory, the live acts and the proper promotion to keep the momentum rolling. Despite the damage to my health and mental well-being, I began to see an increase in the number of regulars. People were finally deigning to cross our threshold once word got around that the bar was under new management and with a new atmosphere that promoted the arts, something very important in a neighborhood like Bushwick.

Just as things were beginning to blossom, my silent partner decided to stop being silent and began to gum up the works with greed and impatience. After only three months in operation, he was not satisfied with the economic gains we were making. Despite the fact that our contract stipulated that all bills prior to our partnership were the sole responsibility of my partner, bills were turning up that he hadn’t paid since he started the business. A $14,000 bill from the local electric company was the clincher. When they came to turn off the electricity, I told my partner to either pay the bill or I would dissolve our partnership. He seemed to think that the terms of our contract, which was signed and notarized, could be changed whenever he felt like it. When I refused to use any of the funds from the bar to pay for these bills, things completely fell apart.

Tens of thousands of dollars in debt I considered litigation, but realized that it would cost me every remaining cent I had to take him to court. I would have certainly won the case, but then I would be faced with trying to collect from someone who simply didn’t play by the rules and certainly wasn’t go to worry about his credit.

I blamed myself for my poor judgment. I was too blinded by the potential of the bar to realize I had an unscrupulous, money-grubbing cheat for a partner. I had lost faith in people, my partner as well as some of the unsavory drunkards who frequented our establishment. I felt as empty as my bank account and simply had no will to do anything. I was also at a loss as to what my next career move would be. As much as I could go back to teaching, it felt like taking a step backward rather than a step forward out of this miserable situation.

I was officially a failure in my own mind and felt that was how others viewed me as well. I shrank from social interactions, especially around the neighborhood. I did not want to see anyone who had witnessed my demise. I even felt slightly paranoid that my partner was going to exact some unjustified form of retribution.

It was only over time that I was able to understand that this was a phase in my life, not the end of it. I talked with other entrepreneurs, some who were quite successful, who explained to me that a first venture often resulted in failure. Yet that doesn’t mean we should give up. When I did bump into former patrons, I was comforted by their kind words. They were disappointed that the bar had closed. They told me that it was a unique place with an unpretentious atmosphere. I realized that that atmosphere was an offshoot of personality, and that the kind words they had to say about the bar were because of all of my hard work.

Rather than feeling ashamed I began to feel proud of my efforts. Had it not been for my partner’s negligence, the place would have been hugely successful.

For any of you who have experienced something similar, I can only impart this bit of wisdom: A life full of failed attempts is better than a life of inaction. Underneath those failed attempts lies a kernel of wisdom that can only come from having tried. It may carry you through to the next career choice or a better understanding of how to run your next business. Either way, you did gain something and, as long as you remained true to your principles in the process, you are a better person for having tried.

 

 

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