Fifty units are available for investment at $50,000/unit (units can be broken into smaller fractions at Management discretion). Investors will be given priority reservations and table requests, priority invitations to all Mister Jiu’s special events, and priority access to rent out the dining room or the private dining booths. Mister Jiu’s sees its investors not only as the source of capital utilized to fully create the business, but also as key partners in an overarching marketing/public relations strategy.
Mister Jiu’s expects investors to frequent and enjoy its food and libations as often as possible, inviting friends and co-workers, generating word of mouth buzz and advocating on behalf of the business. To this end, we expect the overwhelming majority of investors to be locals; soliciting investment from those outside San Francisco is highly unlikely. Management and staff will be trained to know every investor and be fully aware of their importance.
Mister Jiu’s Hypothetical Return of $50,000 Investment
Payback period: 36 months internal rate of return (IRR): 29%
Key deal points underlying IRR:
1. Capitalization is all equity, equal to $2,500,000
2. Preferred Shareholders receive 90% of proceeds until return of capital and 40% thereafter
3. Approximately $150,000 of working capital is maintained until return of capital, after distributions at all times
4. Although lease term may be longer than 10 years, including options, IRR calculation is based on 10 year life. There is no terminal value factored into the IRR, which would increase the IRR.
5. After Year 5, cash flow from operations is projected to increase 3.5% per year, through year 10