T MINUS 278: Skin In The Game

It's been 3 days since I had the chance (or made the time, really) to journal about the latest updates on Concept and I can tell! I've never really had the discipline to do anything as routine as journaling on a daily basis- or exercise on a regular basis for that matter- but the three days that I've gone without journaling has really taken its toll on me. Writing has always been cathartic for me and the journey of living this dream is no exception. Since I was here last, I had a meeting with a local banker who set out to intentionally shoot holes in my theory; the bank put a hold on the money I need to pay the construction manager to retain him and I learned that, even if you are independently wealthy, getting ahold of liquor license can still be hard to come by.

I must have brought my mom closer to a nervous breakdown than I am when I called her last night. I've tried not to bother anybody with the challenges that I've faced so far because just thinking about what the naysayers would have me believe gives them the power they are seeking. There has been so much negativity that I have faced in doing this day by day that when I was met with positivity for the first time yesterday, I didn't know what to do! I met with a guy who has a vision similar to mine, who wants to change the nightlife scene here in Tallahassee and we are thinking about some ways to work together moving forward. I spoke with someone who is seriously interested in being a part of the success of Concept and wants an ownership stake in the business. Those two encounters alone are worth far more than any other challenges.

Like the challenge of having the capital and collateral needed to back the loan application I will be submitting. They asked me about 'skin in the game.' How much of your own capital will you put up to get the loan that you are seeking? That's a fair question- I have to have something at risk for it to be worth my while. I would venture to say that the risk that I've put in are the opportunity costs that I have paid to date to pursue this dream. Dr. Wilson would be proud that I still know what an opportunity cost is: the value of something that has been sacrificed in order to capitalize on another opportunity.

I left my 'lucrative' career in pharmaceutical sales in 2007 to be a full-time entrepreneur. My 2006 tax return said that my AGI was $63K (I didn't have shit to show for it though). So, not accounting for the time value of money and any increase in the cost of living, let's theorize that my gross income for 2007 and 2008 would have remained at that figure had I stayed in sales. That opportunity cost is $126K.

The Art Institute of Tampa's tuition per credit hour is $450; I have accumulated 112 credits. The opportunity cost for my degree is then $50,400. While I was in school, I commuted between Tampa and Tallahassee nearly every weekend so that I could try to maintain a presence in the business community with 71 Proof. My car is 3 years old and has a 125,000 miles because of that...I don't even want to get into the depreciation expense on that.

That brings my skin in the game to $176,400 so far. Hopefully, my financial advisor isn't reading this, but I also liquidated my 401K- now granted I had only been in Corporate America for three years so I had only accumulated a little over $10K ..and then with the state of the stock market, it's value has decreased by 30%. So, with early distribution penalties of around 20% when it's all said and done AND the opportunity cost I'm paying by not allowing the fund to continue to grow, I'd say that's about another $20,000 ballpark.

All things considered, I would say I'm in pretty deep.