"I'm dying to hear about Mudd Coffee."  This seems to be the topic that my small group of readers have been asking me.  I've been delaying writing about this topic, because months and months later...it STILL makes be bitter. 

Partnerships are tough...no matter how you cut it.  Finding the right business partner is as difficult as finding the right person to marry.  In fact, business partnerships are very much like marriages...WITHOUT the sex.  That's not very attractive is it?

To be perfectly honest, I'm not sure I would go into business with a partner again.  I'm 100% sure I would never enter a 50/50 partnership again.  I'm not saying that partnerships can't work.  I'm sure they can just like a marriage can work.  However, you need to find the right person and you have to plan for the POSSIBILITY of failure.

So what happened, you say?  Well, I had a business partner that came to me with this phenomenal concept of the drive-thru coffee kiosk at a time when I was a relatively new entrepreneur and I was "blinded by the bling" as Dr. Boyce Watkins would say.  When he asked me if I wanted to partner with him, I said yes before he even finished his sentence and before I truly thought through the ramifications of that decision.  For those that know me, I make A LOT of my decisions in a similar manner...for better or worse.  The thought of "what if this kiosk concept doesn't work?" didn't even cross my mind...and if it did, it was countered by the thought, "if it doesn't work, I'll figure my way out of it!".  To be quite honest, I need to be a LITTLE more cautious with some of my business decisions while maintaining my "dive right in" attitude that enables me to do the things I do. 

So, my business partner was a salesman, and a good one in many ways.  He sold me not only on the concept, but he sold me on his merits to be my business partner.  He told me about all the businesses he had started and sold successfully.  I was so eager to start this new business that I didn't take the time to check out any of the things that he had done.  I should have...  As we started the business, there were some basic things that he had no clue how to do or even that we SHOULD do them...such as forming an entity.  My intuition told me that something was not right.  Why would this man who had started so many businesses not know how to START A BUSINESS?  "Someone else always took care of the paperwork for me".  Ok, that makes sense.

We formed our partnership - but in doing so we failed to do 2 things:  we failed to put down IN WRITING how we were going to make decisions and we failed to talk about what we would do in the event of the failure of our business.  Well, the next few months turned into a battleground.  Most of these arguments were over money...we were on the OPPOSITE end of the spectrum - I'm a firm believer that you have to spend money to make money and he was of the opinion that we should spend as little money as possible until we were profitable.  I'm not going to get into a discussion on why my philosophy was right .  The point is that we had no way to solve these disputes - it was mostly a matter of who had the stronger will which is no way to make business decisions.  This was the beginning of our downfall. 

The second step was money itself.  We were a 50/50 partnership which meant we should have been contributing capital equally.  Well, I learned early on that there are A LOT of excuses why a person doesn't have money available - a person who had bragged to me that they had a net worth well into the millions.  But because I can't stand to see things done half ass, I paid for a lot of our initial costs.  We got to the point where it was probably about a 33/67 split (and yes, I was the 67 percent).  It was at this point in the partnership that I started to learn troubling things.  I learned that some of the businesses he had started were NOT as he made them out to me.  The jazz club he told me he started - well it turns he was one of 10 silent partners in the deal and he had NOTHING to do with the operations of the club.  I'm not going to get into details, but during the time when he said he didn't have any money to put into the business, he was doing things like putting a pool and an addition at his house.  WOW!!!!!

Now this would have been all right if the business had been doing well.  After our grand opening, we thought we had a winner.  We had 90 cars come through in 2 hours and we made $435 our first day in business - which works out to well over $100,000 in revenue a year.  Well, turns out that's about all we made our entire time in business...no seriously, it wasn't that bad but it was BAD.  We went from break even to losing money to HEMORRHAGING MONEY.  I will go into more details why I think we failed in a later entry, but ultimately, it came down to our location.  Our grand opening experience made me believe that our marketing and our concept were solid but our location was less than ideal.  When you are selling convenience, an inconvenient location KILLS your business. 

Anyway, I put myself in a precarious situation.  How could I get myself out of the situation?  I didn't have a lot of options available to me, especially given that I was in a 50/50 partnership with someone that I DID NOT TRUST.  I did the only thing that I felt that I could do - I bought out his half of the business.  I did a seller financed deal so that I spread out my payments over 5 years which limited the amount of money that I had to come out of pocket for.  As soon as we signed the paperwork for the buyout, I contacted a business broker.  Without going into details, I was able to sell the business within a few months. 

Believe me, I lost enough to pay for an MBA degree at a top university when it was all said and done.  And that's how I look at the situation - I received an MBA in the University of Experience.  I don't regret anything, as painful as the situation was for me.  I learned an INCREDIBLE amount of information from this experience and it has made me a smarter entrepreneur.  Although, I'm not sure if I will ever do a partnership again...but if I do, I'll be a LOT smarter in regards to who I choose to partner with.  I'm going to be a LITTLE smarter before I jump into some of these new ventures (and I stress a LITTLE LOL).  But I learned invaluable lessons about the retail side of business.  Going through the process of selling a business was fascinating to me and I think it will only make me better in future ventures.  I'm most proud of the way I handled "failure" and how I actually did "figure my way out of things".  I took a huge hit and I'm still alive and not THAT much worse for wear.  It gives me confidence in my abilities.  It also taught me to plan a lot better to AVOID failure, but also plan better for the POSSIBILITY of failure.  I'm sure that I will write more about this experience, but that is the jist of "what happened to Mudd Coffee".  If you're interested, the owner kept the site that we designed for the Mudd Coffee.