The Power of Ideas: Daniel Dain
Restaurants “add so much to the fabric of the city and the quality of the city,” says Daniel Dain, an attorney who represents commercial landlords at the downtown firm Dain, Torpy, Le Ray, Wiest & Garner. “But the way they are financed is crazy.” Even for experienced chefs, the prospect of opening a restaurant in Boston, where liquor licenses are hard to come by and rents are astronomical, is daunting. The typical method for raising money? Begging friends and relatives to chip in. With a stampede of young, tech-oriented companies headed downtown, though, landlords developing new buildings desperately want those restaurants: “The paradigm has shifted from credit-worthy tenants to independent restaurants with cachet,” Dain says.
Like a venture capital fund for indie restaurants, the new Restaurant Investment Group, cofounded by Dain, is bridging the gap between chefs and potential investors—the kinds who seek the perks that come with backing a restaurant: dining credits, comped dishes, VIP tables, and party invitations. His firm has partnered with bigtime restaurant consultants Michael Staub and Ed Doyle—and is shooting to raise a minimum of $1.6 million (to fund two restaurants) and a max of $3.1 million (which could fund four). To qualify, chefs have to get their restaurant concept and business plan approved by the RIG’s advisory board—O Ya co-owner Nancy Cushman; David Hadden, a former business manager for Barbara Lynch; and Nantucket Nectars cofounder and former CEO Tom First.
As of press time, the group was well on its way, with enough funds from accredited investors to launch one restaurant. Once the minimum is secured, they’ll start screening business plans. It’s not lost on the team that it all sounds sort of similar to a certain reality show. “Once we put it together, it was like, ‘Hey, this is kind of like Shark Tank,’” Dain admits. In this case, however, it’s more than just the investors and chefs who win—it’s the entire city.
- $800,000–$1.2 million The capital an independent restaurant operator typically needs to raise to open a 40- to 70-seat restaurant.
- $400,000 Estimated cost of a full liquor license in downtown Boston.
- $100,000 Price of an RIG investment unit (half units are also available).