Will I ever get financing for my Pizzeria?

I’m 35, I have bad credit and no collateral. How will I ever get financed? What if I form a partnership or an LLC with someone? Any advice will be much appreciated.

try to seek out an investor. you better have a REALLY good business plan and budget. your credit history could be a red flag to an investor and it might prohibit you from getting purveyors, you would have to be COD and NO terms. if you cant make payments, or manage you own money, and investor is going to be running for the hills because now their money is in your hands.

everyone pulls credit reports for each service you are going to need; power, water, phone, cable/satellite, linens, etc. they might make you pay a huge first payment because of your history. money will be tight enough at the start, and paying huge bills upfront with nothing coming in can be frustrating.

have you made pizza before?

I don’t have my own recipes yet, but I’ve worked part-time in Pizzerias off and on for most of my adult life. I’m passionate about quality pizza, and I know what it takes to run a store. The part of town I live in is nearly untapped. There’s only one mom’n’pop pizzeria here, their pizza is crap, and they’ve stayed in business for years; I know I can beat them with superior service and quality. I’ve got a great name picked out (I’ve already bought the domain) and I have plenty of ideas for for keeping service and product quality high, while keeping overhead low. I even have a few lifelong friends who are pizza “lifers,” so I know I can put together a good crew that should last. My own pizzeria is my dream, and I want to do more research and put together a proper business plan, but after investing so much time and energy, I’d hate to get the thumbs down at every turn .

Not to be a bucket of cold water on your dream, but it does not sound to me like you are ready. In your current circumstances, any investor you find is going to be looking for a return you can not provide and still be the owner of your dream. My suggestions:

  1. Go get experience running a pizza restaurant. Working part time in them for years does not begin to qualify you to open or run one. Find either a quality idependant or a national and work there full time. Earn your way into a position of responsiblity. The track record of running a store will go a long way with investors and lenders when the time comes. In particular, you need to learn to manage food and labor costs, food safety issues, buying and scheduling and staff management. Surprisingly, since so many fail to do it, making good pizza is pretty easy; running a smooth operation is the hard part of the job.

  2. Work on repairing your credit. If you have some existing debt, clear it up. If you have any credit cards, pay them off. Once you have them paid off, use them only for everyday stuff like gas for your car, regular groceries etc and PAY THEM OFF EVERY MONTH.

  3. Get to know your banker. Introduce yourself to a lending officer at your bank. Tell them your ambition is to open and own your own place. Ask them straight out what they will want to see in terms of up front money and experience to be interested in working with you. Determine if they work with SBA loans or any lending programs sponsored by the State you are in. If they do not work with programs like this or do not loan to restaurants, change to a bank that does and make the change now so when the time comes you have been there a while.

  4. Contact your local S.C.O.R.E. chapter. Ask if they have any counselors with restaurant experience. If they do not, look for a counselor in another chapter that does. These guys can be a lot of help, but some of them have only large business experience and don’t know a lot about small business.

  5. Perhaps most imporant after #1, SAVE SOME MONEY. In order to own the place you need to have your own money in the business. Nobody is going to put up all the money and give you more than 10% of the business to run the place. You need to have skin in the game to get a lender to work with you.

  6. When the time comes, (you have the money and the experience) look for a failed pizza place to buy. It will be a lot cheaper than building one. Change the name and pretty much everything else and go for it!

I realize that my advice may be discouraging but I think it is based in reality. Good luck.

bodegahwy hit the high points. It is hard enough to succeed in start-up business without huge road blocks in the way. Keeping the finances stable is hard when I had good credit and a sense of managing money (and no pizza experience). He makes good advice spending some time setting yourself up to succeed. It will be time you will not regret. It is time you are investing in your business . . . and time you can spend writing a tight and effective business plan. Get one and live by it. Modify when needed, and live by it.

I cannot imagine getting to my 4th year if I had double the utility deposits, higher interest rate on my SBA loan ($35,000) and completely COD on all vendors. My Credit Cards saved my bacon more than once, and the rates were below 12%. If I were at 21%, it would have taken chunks more out of my cash flow. Work on getting at least “average” credit ratings. It will help people take you seriously. Work on getting something of your own to invest in the business. no one will give you 100% of the money you want to open your business . . … it is an incredibly poor risk with no collateral. Used equipment is good for 10% on the dollar at auction, and a huge percentage of restaurants fail within a year. Your credit picture and a relationship with a banker (your character) will make some difference, but not all.

Flopping pizzas on a conveyor (or deck) part time is useful . . .but it is light years from owning and operating your own store. Management experience in the business will make a difference that can help you know if this is something you’ll still want to do and be good at.

You hit the nail on the head right here Nick.

Ideally, as an owner, you’ll have other qualified individuals that can slap out the pies for you…and you’ll be the one “in the office” crunching the numbers and ordering and staying there the long days when employees call in.

If anything, start as a shift leader and work your way up at the company you are working for right now, assuming you are with a pizzeria still right now.

Get to know how it is on the “rungs” of the ladder, because if you don’t like it at any of those levels…well, owner/op is ALL of them…so better to know now than to invest all of your credit or cash into a dream that becomes a nightmare.

Just my .02 for the tank.


Basic Credit Repair Info



2 of my employees are going saturday

i think it is going to be like the bbc show last restaurant standing

Thanks for all the advice, fellas. I know my situation looks pretty grim, but I can’t help but believe there’s a way. I know 35 isn’t exactly young, but I think I have a little bit of time on my side. I wonder what the average age of first-timers is?

I am 3 months and a week into my Pizza Dream…39…Environmental Specialist before this…no retaurant experience prior. Wish i had worked in a pizza place before i took the leap. The good Lord is on my side so far and still climbing but i have lost 35 pounds from the stress of bills, employee’s, wondering if the next day will bring more profit…and so on. I’m thinking about writing a book called “So you want to own your Pizza Palor!”. But, with all that said…i think i would do it again. I don’t know if your religous or not…but pray on…think on it…and pray some more befor you take the leap. Good luck.

I sold over a year ago and I am still a size zero. Like you, I had no experience in this industry. I was a financial controller and a gourmet cook. I combined the two and my business boomed. It was the most difficult time of my life but yet, the most gratifying. And I PRAYED.

I miss it, went through serious pizzeria detox after selling and have no regrets; simply learnt by the mistake of selling.

My message to this poster: Don’t do it. You obviously are mislead with this business. It takes more than good credit and finances to make it work. Those factors help but the spectrum is so much larger. Take a good six to twelve months and research. ‘’


This post really brought back some memories. If you need anything at all, recipies, accounting advice, legal advice, strength, opinions…contact me at any time. Been there, done it. What does not kill you only makes you stronger but you rolled into this business for a reason. Keep going.


But it can kill you. :lol:

So just don’t put a timeline on your success. As long as you are heading in that direction, you are okay. Be gentle with yourself.

I am 4 years, 1 month, 21 days and 5 hours . . . 1 cancelled lease, two leaking roofs, one total contruction of a restaurant inside a hardware store, and one new real estate purchase . . . . into my career operating a pizzeria.

I was 38 when we opened our first night of business. Less hair, graying beard . . . . but I got this great brass colored pole to dance at in the kitchen :smiley:

Too much information … :shock:

Wow Nick…a hardware store? I’m starting my place end of April in a truckstop/utility trailer manufacturing building. We are working our BUTTS off to renovate the office area of the building. Have a real tight budget, just about all used equipment and praying for the best. Not looking to make a killing just a living serving fresh food, mostly NY style made from scratch. Lot’s of bumps in the road, but we keep plugging. Worried and excited at the same time. The hardware store really caught my eye.

My advice is to buy an existing place. When I got into the business I was 21 years old and had zero experience. A relative of mine had a friend who wanted to retire and sell his pizza shop. I was able to buy the business for $25,000. I had set up a deal with the owner where I paid him $3000 down and then $500 a month until I had the remaining balance paid off. The owner also stayed on for the first month for free and trained me. It took about a month to close and during that time I also worked there for free trying to learn as much as I could before I took over ownership.

The main advantage of buying an existing pizza shop is that you will have an instant customer base the day you take over ownership. You will have a steady stream of money coming in right from day one. On the flip side, you are also acquiring the reputation of this business whether it be good or bad.

On a side note: When I bought my place I had nothing to lose. I was young, single, no mortgage, and didn’t have a family to support. If I didn’t make it, I wouldn’t have been any worse off then when I started. With the state of the pizza industry today, I would only get into the business if I was in the same situation where I had nothing to lose. Prices of supplies are at an all-time high and probably aren’t going down any time soon! As you probably already heard on the news, flour is now skyrocketing as well! It’s a difficult time for pizza operators right now. I currently have two places and in the process of opening a third. With the way supply prices are now and if I still only had one place, I would be struggling to make a good living or probably out of business. In the past year and a half, just my cheese and chicken wing prices have increased $1,000 a week. That equals $52,000 a year taken from my yearly profits!

So basically what I’m trying to say is think long and hard about whether or not you’re in a situation where if you lost everything tomorrow, you’re life wouldn’t be any worse off. If you do decide to go ahead and get into the business, get educated first. I know you have worked in pizza shops before but I’m talking about getting educated on how to run a business. Learn every thing you can about marketing, effective advertising, managing employees, book keeping/accounting, implementing systems in you business, etc. The day to day operations of making pizzas is easy. It’s the “back office” side that will determine whether you succeed or fail. This think tank has a great deal of information that can help you. Read through the archives and memorize everything. When you think that you have it all memorized, read through it again.

As far as your financing situation, I would have to agree with some of the other members. You might be wise to go get another job for now and work on saving money and building your credit back up. By doing this you will give yourself a better chance at succeeding when you finally do get into the business. Lack of financing is one of the biggest reasons many pizza shops fail. What ever you decide to do, I wish you the best of luck.

I don’t enjoy being so bleak about your dream, but from what I’ve read, your dream would shortly become a nightmare, and not one that you can wake up from! As the other posters have said, you need to get your credit in order and gain more actual experience at running a pizzeria. Until you have those, you will have virtually no chance of getting funding from any banker.

Bodega spelled out best what you need to do in order for you to successfully make your dream a reality. Don’t be in such a rush to get your own store open that you set yourself up for failure. Why not go to work part time at that “crap” mom & pop in your area - let them see your passion for quality pizza, also let them know about your goals and dreams. Who knows, maybe you’ll wind up buying them out & taking over their customer base - at worst you’d make some valuable inroads with that base.

We have been contacted by a company that claims to be able to finance start ups.
If you will phone me 734-458-8850I will put you in contact with themif you wish to give it a try.

I have had companies make this claim before but not come through so I am not positive they can help you. If they do let me know.

George Mills

I’m just telling our experience, we spent months on a in depth business plan and good credit, but we could not get financing for a start up business, unless you have a lot of equity in your home then maybe you can but for us we didn’t have that option. we finally did get financing from a private investor, so not to say it isn’t possible but we didn’t find it. george, if that does come through I would love to find out because we are doing a much scaled down budget from what we originally had planned, so it would be nice to borrow additional funds.