Good investment??? Dirt Factory
Discussion
Great team involved and something exciting...
http://dirtfactory.org
Thinking of putting in a small whack of money but going through all of their info; my naivety is stalling me.
http://dirtfactory.org
Thinking of putting in a small whack of money but going through all of their info; my naivety is stalling me.
veevee said:
Nice idea, but huge indoor facility with a limited market = won't make any money. Better off building a go kart track or something if you had to use the space.
I'm inclined to agree and think the costs of the location alone would absorb a huge amount of your 300k. not to mention the cost of the dirt, build, rates etc etc I think you may struggle to make lots of cash. That said, nothing is impossible and I could be completely wrong
I've put a bit in and received the business plan which I'll be going through and showing to some family members who may take a punt on a bigger investment. I really like what they're planning and I used to race downhill mtb back in the day, so it feels right. Good site: Crowdcube. Impressed.
veevee said:
Nice idea, but huge indoor facility with a limited market = won't make any money. Better off building a go kart track or something if you had to use the space.
various skate / BMX venues start and stop each year ... it;s not as easy as people think and those venues have a wider market ...also unlike climbing walls and artifical snow places there;s far less of the issues with getting to do it for real training wise ...
LDN said:
I've put a bit in and received the business plan which I'll be going through and showing to some family members who may take a punt on a bigger investment. I really like what they're planning and I used to race downhill mtb back in the day, so it feels right. Good site: Crowdcube. Impressed.
How much are the business rates on the building?Friend had an indoor karting track and a massive chunk of the overheads was the rates.
A good investment? I would want to satisfy myself of the following:
- The place isn't open, what is the minimum run rate? What is the breakeven? How is this achievable? What is plan b?
- What is the lease on the building?
- The business case isn't really proven, are there comparable businesses? Skiing domes? Kids play barn things?
- It is very location dependant, what is the local scene like? Lots of disposable money with active A’s & B’s?.
- Seems very seasonal (but then I have taken my kids to paying indoor climbing frames rather than the park at the height of summer), what will happen in the summer?
- They value it today at £660k (which I would argue is a more realistic 3-year target), how is this justified? What are the assets?
- There is no IP. What is the brand worth?
- There is no protection on copy car businesses, what is the plan?
- 6 people are involved and there isn't much skin in the game for them each. How are they going to be motivated?
- Don’t know the background of the people running it. Being a keen cyclist is not the core skills required to start and grow a business. What experience do they have?
- Sporting venues like this seem to involve massive local, central, lottery and charity funds to establish and maintain. How will this be different?
veevee said:
Nice idea, but huge indoor facility with a limited market = won't make any money. Better off building a go kart track or something if you had to use the space.
There's a new place in Glasgow for go karts. All electric, eco friendly bla bla. It's a social enterprise, probably on a similar scale to what's pictured here. They've thrown £3m at it.I know there's big cost in the go karts and timing systems etc but still. I've seen a few of these type of places, karting, BMX etc and they're empty most of the day, most of the weeks. I'd be wanting to see what their plans are to get people in outside of weekends and school holidays. The usual answer is corporate/stag etc but I can't see it myself, not for mountain bikes. And I say that as a (lapsed) mountain biker.
I'd agree with much of the above. Most places like this are dead in the week (and by like this I refer to big indoor (and outdoor) leisure spaces such as kart tracks or kids playcentres). That said, many are successful.
However, in the UK the weather isn't that bad for that long generally and a lot of MTBers like the mud and wet. Once its not really cold (most of the year) the outside is a far better place to be and it has a much better 'track' too. Also, I wonder how many people, on a cold wet day would bother to get their bikes out and drive to somewhere to use it indoors? 2 football pitches of space sounds a lot but I'd bet it soon becomes quite crowded. Has this worked anywhere else in the world?
Also, there's some big indoor dog walking place in the UK that works on a similar model. Have a look and see how that's doing as it'll be similar in terms of challenges (also being a new concept here). Its called actionpetz in wales.
However, in the UK the weather isn't that bad for that long generally and a lot of MTBers like the mud and wet. Once its not really cold (most of the year) the outside is a far better place to be and it has a much better 'track' too. Also, I wonder how many people, on a cold wet day would bother to get their bikes out and drive to somewhere to use it indoors? 2 football pitches of space sounds a lot but I'd bet it soon becomes quite crowded. Has this worked anywhere else in the world?
Also, there's some big indoor dog walking place in the UK that works on a similar model. Have a look and see how that's doing as it'll be similar in terms of challenges (also being a new concept here). Its called actionpetz in wales.
Frimley111R said:
However, in the UK the weather isn't that bad for that long generally and a lot of MTBers like the mud and wet. Once its not really cold (most of the year) the outside is a far better place to be and it has a much better 'track' too.
I know MTBing has changed somewhat since it first arrived but I still think the outdoors is a significant factor for many, fresh air, scenery, wildlife, weather. Indoor can't compete for range, length, terrain, gradients etc, it'd be more suited to a trials type operation. And for all the Danny Macaskill vids we see there definitely isn't a market for that.There's a couple of glorified trampoline places in Glasgow now, seem busy. Kids and adults bouncing abut, no equipment needed. Need good insurance though, and the nouse to get out when the going's good. Trampolining won't be new and shiny forever.
Thurbs said:
A good investment? I would want to satisfy myself of the following:
The good news is...... every single point you raise is indeed answered in their plan which is accessible by signing up and requesting it through Crowdcube. Without addressing every point, the people involved are indeed experienced and range from construction to social enterprise. I do feel as though they have the right people involved.- The place isn't open, what is the minimum run rate? What is the breakeven? How is this achievable? What is plan b?
- What is the lease on the building?
- The business case isn't really proven, are there comparable businesses? Skiing domes? Kids play barn things?
- It is very location dependant, what is the local scene like? Lots of disposable money with active A’s & B’s?.
- Seems very seasonal (but then I have taken my kids to paying indoor climbing frames rather than the park at the height of summer), what will happen in the summer?
- They value it today at £660k (which I would argue is a more realistic 3-year target), how is this justified? What are the assets?
- There is no IP. What is the brand worth?
- There is no protection on copy car businesses, what is the plan?
- 6 people are involved and there isn't much skin in the game for them each. How are they going to be motivated?
- Don’t know the background of the people running it. Being a keen cyclist is not the core skills required to start and grow a business. What experience do they have?
- Sporting venues like this seem to involve massive local, central, lottery and charity funds to establish and maintain. How will this be different?
Regarding whether it'll actually work. There's never any way of knowing for certain but I will say that having a foam pit and jumps means that it will attract pros and novices alike who are wanting to practice tricks. Remember also that they will be using real dirt / mud and they also have the suppose of some major brands in mountain biking albeit from a sponsorship point of view. Bell want to provide the hire helmets for instance.
I might work better as a training venue for bikers to learn techniques and tricks and a race venue, tbh a bit like Silverstone in concept.
As an aside, how do these crowdfunding businesses work in terms of investment? Say 200 people put in, are they all then shareholders with a tiny percentage? How is it really worth putting in any money at such levels? Do they have any voting rights or say in the co?
As an aside, how do these crowdfunding businesses work in terms of investment? Say 200 people put in, are they all then shareholders with a tiny percentage? How is it really worth putting in any money at such levels? Do they have any voting rights or say in the co?
Undirection said:
I might work better as a training venue for bikers to learn techniques and tricks and a race venue, tbh a bit like Silverstone in concept.
As an aside, how do these crowdfunding businesses work in terms of investment? Say 200 people put in, are they all then shareholders with a tiny percentage? How is it really worth putting in any money at such levels? Do they have any voting rights or say in the co?
I'd say that your chances of a decent return on your investment are slim to none. Happy to be corrected, but I think there have only been a couple of liquidity events to date out of the UK based crowdfunding platforms, and I'm not sure they've been 'tenbaggers'. It is reasonably early days though. As an aside, how do these crowdfunding businesses work in terms of investment? Say 200 people put in, are they all then shareholders with a tiny percentage? How is it really worth putting in any money at such levels? Do they have any voting rights or say in the co?
They are gaining in popularity though, and to me they are a way of having a punt on something a little more interesting than normal quoted shares and indices. You can also normally pick up a few benefits offered by the company raising money. The kicker of course is the tax breaks available through the SEIS & EIS schemes.
The real winners in all this are the companies raising the cash. Before these platforms took off avenues for raising capital were rather more restricted. It's very much 'caveat emptor' in my opinion, I'm not convinced about the quality of the due diligence performed on the company's prior to fundraising and the subsequent reporting (if required at all) can be sketchy.
IMHO of course.
Edited by poocherama on Wednesday 3rd February 11:39
Edited by poocherama on Wednesday 3rd February 11:40
eliot said:
£1217 burn a day in rent, rates and salaries.
How many visitors a day is that to break even? I think the principal is good but I'm not sure I can see enough revenue to make anything substantial. Just my opinion.
Where is it going to be based? I think I read something about Mossley but i couldn't tell if that's just where the 'founder' is based.
Location will be everything. The reason why the soccerdome and Chill Factore are always packed is it's location.
There's places like Ray's in the US - http://www.raysmtb.com/
http://www.pinkbike.com/news/ray-petro-rays-mtb-in...
Cleveland and Milwaukee tend to get harsher winters than Manchester though - and they don't bother operating the place in the summer.
http://www.pinkbike.com/news/ray-petro-rays-mtb-in...
Cleveland and Milwaukee tend to get harsher winters than Manchester though - and they don't bother operating the place in the summer.
sjg said:
There's places like Ray's in the US - http://www.raysmtb.com/
http://www.pinkbike.com/news/ray-petro-rays-mtb-in...
Cleveland and Milwaukee tend to get harsher winters than Manchester though - and they don't bother operating the place in the summer.
Interesting. They would need make this place an all round venue with other activities; bike training; race events; workshops; from what I've read: they do plan all of the above. I think Its true; location can make or break a place. Chill Factore near the Trafford centre has been a massive success but I realise that ski domes are a unique proposition.http://www.pinkbike.com/news/ray-petro-rays-mtb-in...
Cleveland and Milwaukee tend to get harsher winters than Manchester though - and they don't bother operating the place in the summer.
Gassing Station | Business | Top of Page | What's New | My Stuff