I never liked writing checks. Even with a payroll check an employee had fully earned, the act of parting with the money made my gut tighten. Each cashed check meant that much less in the coffers, that much greater chance we’d go under.
But there was one check I was delighted to write: the security deposit on the restaurant lease.
For five months, I’d been scrounging for every penny, but I made it. And I didn’t even have to pull off another crowdfunding campaign to get there.
January had been brutal. School vacation brought revenue way down, right when I needed to pay my bills from a hot December fueled by exams.
February flipped the script. Students were back, orders picked up, and the only bills I had to cover were from that anemic January. This gave me a nice short-term boost to my cash flow.
Before I wrote that check, if I’d fallen short on a single rent payment, even by a day or two, the landlord had the right to kick me out and rent the space to someone else. Since I couldn’t afford to move, that would have meant crashing and burning. But when I handed over the security deposit, the landlord handed me a fresh lease, now in my name. That gave me four more years guaranteed at an affordable rate.
“So what’s the first thing you’re going to do?” Dedrick asked when he heard the news.
“What do you mean?”
“How are you going to celebrate?” He clapped me on the back, leaving a floury handprint across my shoulder. “You’ve been working your butt off, sleeping on the floor of your crummy office, and taking showers at the gym to make it all work. Now you did it! Paying the security deposit was your last big leap out of cash flow hell. You can stop treating yourself as a pauper.”
I shrugged. “Sleeping in the office doesn’t bother me.”
“It bothers me, man.” He waved his hand in front of his nose. “Every time I step in there, it’s like I’m invading your bedroom. Sometimes I wonder if you only do it so you won’t have to give the rest of us a raise.”
I raised an eyebrow. “How’s that?”
“Because you can always point to yourself and say, ‘Hey, I’m living like a gutter rat. How dare you ask for more than minimum wage?’”
“Is that what you think?”
“I think you have an air of poverty about you.” He threw a pinch of flour at me. “And I get it, you needed to do it or you’d lose this place. But you’re no longer in danger of closing down. You’re good, man. It’s time to live a little. Stop doing double shifts. Get yourself an actual apartment. Maybe even a car. You’re a successful business owner.”
I pulled out a bag of red pepper flakes to refill the canisters. “I’m the owner of a business that’s always been one step from bankruptcy.”
“Exactly. And now it’s not.” Dedrick caught my eye. “And neither are you. And you’ve got to stop living like it.”
My shoulders grew tight. “What’s wrong with living inexpensively so I can save for the future?”
“Look, I’d hear that if you were a salaried stiff. But you’ve got a business.”
“How’s that make any difference?”
“The difference,” he said, tossing a dishtowel over his shoulder, “is that The Pizza Lab already covers your monk-like lifestyle. If you’re happy sleeping on the floor, you could coast on this thing forever.”
“Trust me, I have no intention of coasting.” I sealed the bag of pepper flakes and returned it to the shelf. “But the last thing I want to do is spend money I don’t have and end up with my back against the wall again. There are better ways to spark creativity.”
“OK, I hear that.” He slipped a pie onto a pan. “You want to earn the money first. But you can at least set some goals, right? Like, how much do you have to earn before you’re willing to move out of the pizzeria? Or pull back to just eight hours a day?”
“Right now, I still need every dollar coming in the door just to give us the working capital we need.”
“Really?” He gave me that look. “You need every dollar?”
I gathered the full canisters. “For the next month or two for sure. I wouldn’t want to run the business without a bit of cushion.”
“And if profits continue to go up?”
I thought about his question as I laid the canisters on the tables. “Then I guess I could be a little more flexible.”
“So if we brought in enough extra cash to pay another staffer, you’d drop your hours?”
The truth was, unlike the chocolate pizza, the new desserts were showing real traction. Dessert sales kept climbing, hiking my average order size. Cash flow really was increasing. “I…uh.”
“See? You can’t do it. You’re so married to the idea that you have to slave over this business that even when your circumstances change, you can’t adjust. And despite all your work building stronger systems, since Carrie left, you’ve been so afraid of delegating that you’ve barely put those new systems to the test.”
For the next week, I couldn’t get two lectures out of my head. The first was Professor Hunt’s, about getting better utilization out of my existing resources. The second was Dedrick’s lecture about my poverty mindset.
Could it be that sleeping in the pizzeria was sabotaging business growth? After all, from the time I went to bed to the time I woke, all of the pizzeria’s resources were supporting one objective: saving me money on an apartment. Could those resources be better utilized?
I raised the question during the next class. “I’m paying for 24/7 access to a prime location a block off campus that can seat 40. Up till now, I’ve been asking myself, ‘During what hours are there enough customers wanting to order pizza to make it worthwhile to be open?’ Now I’m starting to ask a different question, ‘Are there profitable uses for my space during any of the hours when I don’t want to sell pizza?’”
Lisa said, “I’m actually looking for a place to teach yoga classes in the morning.”
I blinked. “Doesn’t strike me as a great combo.”
A few chuckles rippled through the room.
“Speak it out more, Ty.” Professor Hunt leaned against the edge of her desk. “What uses are you considering?”
“Plenty of students are night owls, and there aren’t that many decent places to grab a bite. Last year, when I looked for something late at night, I’d usually go to the gas station and buy a candy bar. But I’m already selling Italian desserts. If I add hot drinks to go with them, that’s a more attractive alternative for a midnight snack. You know,” I said, snapping my fingers, “I could even call it that.”
“The Midnight Snack?” Jenna asked.
I nodded. “Yeah, I like the sound of it.”
“How much would you need to make it worthwhile?” Professor Hunt asked.
“That’s the beauty of it. Rent is already covered. My only fixed cost would be staffing. But the drinks and pastries are both high-margin, so even if I only got a handful of customers per hour, I should be able to run it profitably.”
Professor Hunt gave a slow, approving nod. “You know something, Ty? I do believe you’re starting to think like a business owner.”
“That’s not all.” A grin tugged at my face. “College students might be famous for eating cold pizza for breakfast, but no one’s rushing out for a slice at 8 a.m. It’s not worthwhile to sell pizza before the lunch shift. But if I can profitably sell other items late at night, there’s no reason I couldn’t do it in the morning as well.”
“What would you sell?” Andrew asked.
“The bakery where I get my desserts also sells plenty of breakfast pastries. So I could order from them and offer tea and coffee. That would be low-hanging fruit. Or I could go the healthy route and sell smoothies.”
“What about doing a real breakfast?” Owen asked. “Omelets, pancakes, hash browns?”
I shook my head. “That’s what I’m trying to avoid. We’ve got our kitchen set up for pizza. I don’t want too many cooks getting in each other’s way. But my risks are minimal if I can find easy options a single staffer could handle.”
“At least until it gets so popular they need help, right?” Jenna said, winking.
I raised my hands and eyes heavenward. “One can only hope.”
“I had an idea I wanted to run by you, Boss,” Dedrick said in the lull between lunch and dinner.
“Lay it on me,” I said, slicing mushrooms with the rhythmic speed of someone who’d done it far too many times.
“You know what I do when I leave here each night?”
“I can only imagine.”
“Don’t overstress your imagination,” he said, bumping my arm with a grin. “I normally go back to my dorm and do my homework. I rarely get to bed before two, often not till three.”
“OK. And?”
Dedrick straightened. “I know you’re expecting a bit of revenue from The Midnight Snack, but you’re hardly expecting to make a killing. And if I know you, you’re probably stressed about the cost of the extra staff time, am I right?”
I set my knife down. “I think I see where this is going.”
“And I thought, if I’m up doing homework anyway, I might as well be here and sell the odd desserts to hungry students like myself.”
“Look, Dedrick, I’d love to give you more hours. And honestly, having someone I trust open this thing up would be a relief.” I scratched the back of my neck. “But I’m not paying anyone to sit in my pizzeria and do homework. If you’re here, I want you working.”
“That’s exactly what I was trying to say.” He put a hand on my shoulder. “Don’t pay me a dime for those hours.”
“You’re going to work for free?”
“Free? Hell no. But I’ll do it for a cut of the profits.”
My eyes narrowed. “What kind of cut?”
“We’d take the food cost off the top. Whatever’s left, we’d split fifty-fifty.”
I swept the mushrooms into their bin. “So rent would be on me?”
“Yep. And my time comes wage-free.”
I slid the lid over the bin and tucked it into the fridge, my mind already running numbers. “I love the idea of not having to pay anyone out of pocket. That helps me protect my downside. But the partnership model also limits my upside.”
“Look, Ty, this is your place,” he said, turning up the charm. “We’re not signing a contract, and you’re not committing to having me run The Midnight Snack forever. Anytime you want to kill the fifty-fifty split and put me back on the clock, you go ahead. But for now, what have you got to lose?”
“Nothing, I guess.”
“Worst comes to worst, I’ll be in an empty cafe doing my homework rather than doing it from home. But I’ll at least have the chance to earn a few extra bucks.”
I grabbed a bunch of peppers and got to chopping. Artemis had taught me to always think about what could go wrong before entering a new deal. “What happens if we’re a success?” I asked. “What if we’re so busy that we need to hire a second person to help you out? Do I just switch you to hourly at that point?”
“You could, but it wouldn’t be my preference.” He wiped his eyes as he slid his onion slices into their container. “The way I see it, if we get so busy that it takes two of us to run the place, some of that success should be credited to me. Agreed?”
“Agreed. Especially if you use some of that marketing genius of yours to get people in the door.”
“Without a doubt. If I’m able to cash in on the upside, I’ll work hard to make this project a huge success. And since it’s your idea and your pizzeria, I acknowledge your right to take back control any time you like. But given all the contributions I’ve made to help you turn this joint around, I’d hope you’d leave it in my hands if it’s successful and continue to honor the fifty-fifty split.”
“I’d like to, but if I need to hire someone to help you, much of my earnings would evaporate. Or are you suggesting you take your assistant’s salary off your side, since your deal had The Midnight Snack staffed at no cost?”
“My deal had all the variable costs, such as the desserts, coming off the top and splitting the remainder. I think we should treat additional staff time the same. My labor will be free, but additional help would be split between us. What do you say, Boss? Do we have a deal?” He stuck out his hand.
I had to admit, I felt more optimistic about The Midnight Snack’s chances of success with Dedrick in charge. And I liked starting a new experiment without hefty staffing costs. Also, Dedrick had been a big part of the turnaround. Why shouldn’t he enjoy some upside?
I shook his hand. “You’ve got a deal.”
Meg followed me back to the restaurant after class the next day to share an idea. She asked me to invite Dedrick as well. I went a step further and sent a second invite to Joanna, which I knew would annoy Meg, but I’d learned to value my avatar’s insights. The four of us gathered in the pizzeria a bit before lunch prep began.
“Here’s the thing,” Meg said, pointing to the doors, “you’ve got two entrances to this place.”
“So?”
“So the main one on Pearl everyone knows is for the pizzeria. You can’t miss it. The first thing you hit when you walk in is the pizza counter. But the side entrance is nothing right now. Customers use it to come and go from the eating area. But you could change that.” She went over to the other door. “This side entrance from Grand could be for The Midnight Snack and whatever you want to run here in the morning.”
I crossed my arms. “So when there’s no pizza, we’d keep the Pearl entrance locked?”
“Exactly.”
“I like this,” Joanna said, stepping forward. “You could even have a display case visible from the sidewalk, right here by the window. Desserts on full view. I bet that alone would bring a bunch more people in.”
“Wait.” I held up my hands. “Are the two of you actually in agreement?”
“The three of us,” Dedrick piped in. “One thing I didn’t like about your idea was the overlap between running The Midnight Snack and needing to clean up the pizza counter. The same would be true in the morning; you’d want to be prepping while staff is trying to sell donuts or smoothies or whatever. But if the Pearl entrance is locked, the pizza counter immediately becomes sidelined.”
“Except we still need a counter for pastries and drinks,” I pointed out.
“You could create it right over here.” Joanna headed to the window next to the side entrance. “That’s where the display case would go, visible from outside. Then a counter can jut out over here.”
I tried picturing Joanna’s vision. “This entire corner of the restaurant would be gone.” I shook my head. “I’d lose two tables.”
“And gain a new revenue source,” Meg retorted.
“But I’d have to buy a refrigerated display case and a new counter,” I said, the knot already twisting in my stomach.
“Yep,” Joanna said, casually dropping into a chair.
I gritted my teeth. “Of course, none of you are bothered by the cost. It wouldn’t be coming out of your pockets.”
Meg groaned. “Where in this restaurant do you make your money, Ty?”
“From the pizza counter.”
“Exactly.” Meg sat at the table and eyed me. “All the income in this place comes from twenty percent of the space. I’m not concerned about the cost because we’re taking some of your least productive space and making it into another revenue center.”
“We’re just talking about before and after hours,” I said, turning to Dedrick. “Couldn’t we still use the pizza counter for that?”
“Who says the new counter could only be used during off-hours?” Dedrick asked. “Already there’s a backup half the time at the pizza counter. Opening a second counter could speed up the line by sending people back here for desserts, espresso, or whatever. You could even put in that soda fountain you said you couldn’t afford a few months back.”
“Now I’m supposed to pay for the soda fountain and an espresso machine?”
“You know what I keep hearing, Ty?” Dedrick’s voice stayed light, but there was steel behind it.
“What?”
“We’re all in brainstorming mode. We’re coming up with great ideas that require some investment but could bring in a lot more than they cost. You, on the other hand, are stuck in penny-pinching mode.”
Were they ganging up on me? “Yeah, because I’m the one who’ll have to pay for all this.”
“Granted. Nonetheless, if you weren’t so nervous about money, I think you’d be far more open to the crazy potential you’re missing right in front of your eyes.”
“So what?” I snapped. “You’re telling me I should just deal with it?”
“No.” Meg’s voice was low and calm, as if talking a stray cat out of hiding. “Let’s approach it from a different angle, Ty. You’re focused on financing these ideas out of pocket, which would eat into your cash flow. But that’s only because you assume no one would offer you a loan for such a project. That was true before, when you had one foot in the grave. But now you’ve got proven profits, a long-term lease, and steadily improving cash flow. Truthfully, if you could finance everything we’ve discussed, knowing it could be paid off through the additional profits it brings in, would you still be wary?”
I inhaled deeply to calm my racing heart. “I suppose not.”
Meg smacked the table. “Then it’s time to get yourself back to that bank.”
“I see your receipts have gone up steadily.” The bank account manager studied his screen, tapping a key now and then, lips pursed.
“Yes, sir.” I wiped my sweaty palms on my pants. I wore my only button-down shirt and khakis for this meeting. “Except for during winter break, of course.”
“I’m glad to see it.” He gave a half-nod without looking up.
I leaned forward, motioning toward the stack of papers I’d laid out on his desk. “And I now have a lease for the next four years.”
He scrolled again. “I also see you haven’t bounced any checks in a few months.”
“Sorry about those. Cash flow was mighty tight the first few months, but is now under control.”
He looked up. “So what can I do for you?”
I sat a little taller, trying to seem more professional than I felt. Owen had coached me for this meeting, so I had my lines down. He’d encouraged me to use the guy’s name because people love hearing their name. “Daniel, I wanted to see about a line of credit.”
“Look,” he shook his head, “you haven’t been in business long enough for us to consider an unsecured line.”
“How long would I need?”
“We like to see two years.”
My heart sank. “So there’s nothing we can do?”
“Fortunately, we are running your credit card transactions.” His eyebrows danced, reminding me that he himself had advised me to make this choice. “While I can’t give you an unsecured line, I can give you a secured line using those transactions as collateral. You’d have to commit to keeping your credit card processing with us throughout the life of the loan.”
Seriously?! Was he saying yes? “I’m fine with that.”
“Based on your current level of transactions, I could give you…” He typed some numbers into his computer. “A $25,000 line at prime plus one and a half. How would you feel about that?”
With that amount, I could afford to construct the pastry counter, buy the display fridge, and get myself an espresso machine and soda fountain. If the new expanded hours worked as planned, the additional cash flow they generated would cover the loan payments. That meant I could use our existing cash flow to pay myself enough to rent a decent apartment and even hire another staffer for eight hours a day.
“Tyler, are you OK?”
I felt the heat behind my eyes. I blinked it away. I couldn’t mess this up. I needed my poker face. “Where do I sign?”
