Closing Knock Knock Restaurant

In 2024, I successfully sold my restaurant, Knock Knock, to a Vietnamese chef. I recovered 50% of the proceeds by utilizing seller financing and subleasing. This experience taught me invaluable lessons in financial management and strategic planning.

Capital Raising for a Family Office

I assisted a family office in raising capital for their hospitality debt platform. Although I decided in the summer to pursue my business ventures without securing the desired funding, I facilitated connections with Managing Directors and Heads of Real Estate from major firms such as Apollo, Ares, HPS, and Goldman Sachs. One memorable moment was meeting StripMallGuy in person, who encouraged me to share my personal growth online.

Launching Yuan Capital Partners

Within three months, I passed three FINRA exams and partnered with a broker-dealer firm to launch Yuan Capital Partners. This milestone marked a significant transition from my previous ventures to establishing a new private placement business.

Securing My First Mandate

Last month, I officially signed my first mandate with a Single-Family Rental (SFR) fund. This achievement validates my efforts and sets the foundation for future growth.

I began 2024 with a struggling restaurant business and concluded the year by establishing a new private placement venture. These developments were not part of a premeditated plan but emerged organically as I navigated various challenges and opportunities.

To conclude, I’d like to share one of my favorite sports quotes: “Don't ever underestimate the heart of a champion,” a memorable line from Rudy Tomjanovich, the former head coach of the Houston Rockets.

Personal Commitments for the New Year

I am not setting specific New Year resolutions. Instead, I will continue to:

Exercise 2-3 times weekly

Maintain a consistent bedtime before 10 PM

Invite people for coffee chats

Share my progress publicly

Spend quality time with my family

Thank you for following my journey; I wish everyone a prosperous 2025!

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2. Study the more difficult exam, SIE first, 63 second.

3. I purchased the achievable online course, which I am a big fan of because of the UIUX, which is super user-friendly

4. Start with any chapter you like, just look at the names and find the one you are interested in. This step is very important; it refers to atomic habit, which helps you build momentum.

5. Read all of the chapters; you do not need to remember everything; just read fast and finish all the chapter quizzes, screenshot the questions you did wrong, and read them before you go to bed.

6. Take the midterm and final exam and repeat step five.

7. You will quickly realize which chapters you need to work on more, go back to read the chapters, line by line, and watch the tutorial videos.

8. Repeat step 5 until you did 10 practice final exams. By then if the last three final exams you scored above 70%, I think you are ready to pass SIE.

9. If you practice a lot of options and mathematical questions for SIE, it will help you prepare for series 7.

10. The key is to practice the exams and read the questions you get wrong before going to bed. 10. Series 63 is about state regulations, and I used the achievable method again. It is a lot more memorizing. Take the time to read the laws, Investment Act, Blue Sky, etc. Rule of 10, practise the final exams 10 times.

11. Series 7. Do not get scared when you see the exam is four hours long. I would say the content is 70% the same as SIE.

12. I spend three full days to study and practise option questions. Take the time to read, watch video, do the chapter quizs, draw the graph, This is the hardest chapter. Once you nail this one, the rest of the chapters would be relatively easy.

13. Suitability, rule of 100; for example, Andrew is 30 years old, 100-30=70%, so it is good for Andrew to allocate about 70% of the capital to stock. Rule of 100 can help you eliminate at least two out of four multiple-choice answers. 14. I hope whoever reads this post helps you pass the Finra exams more efficiently.

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Purchasing an existing broker-dealer can be an attractive way to enter the securities business with minimal downtime. However, several factors influence the feasibility and success of this approach:

Key Considerations

1. Approved Lines of Business: Ensure the broker-dealer is authorized for the specific lines of business you intend to engage in.

2. Current Clearing Agent: Understand existing clearing arrangements and assess if they align with your operational needs.

3. Firm's Background: Investigate the firm's history, reputation, and any regulatory issues it may have faced.

4. Seller's Cooperation: Determine the seller's willingness to assist during the transition, which can be crucial for a smooth handover.

5. Buyer's Expectations and Resources: Align your business goals with your qualifications and available resources to ensure feasibility.

6. FINRA Restrictions: Verify that there are no restrictions or disciplinary actions from FINRA that could hinder your plans.

The Acquisition Process

1. Find a Suitable Broker-Dealer for Sale: Look for a firm that matches your business objectives. You can add additional lines of business during the acquisition process if necessary.

2. Conduct Thorough Due Diligence: Collect and review essential documents, such as:

   • Current membership agreement

   • Clearing agreement (if applicable)

   • Form BD (Uniform Application for Broker-Dealer Registration)

   • The last four FOCUS reports (Financial and Operational Combined Uniform Single Report)

   • Most recent annual financial audit

   • FINRA and other regulatory reviews and responses

   • Copies of fidelity bonds

   • SIPC (Securities Investor Protection Corporation) registration

   • Corporate formation documents and operating agreements

   • Vendor agreements, including leases and personnel contracts

3. Enter into a Purchase Agreement: Ensure the agreement satisfies your requirements and complies with FINRA regulations.

4. File the Continuing Membership Application (Form 1017): Submit your application through the Central Registration Depository (CRD) system, detailing proposed ownership, financing, and supervisory structures.

5. Respond to FINRA Inquiries: Be prepared to provide detailed answers to any questions regarding your firm's structure, financing, and supervision.

6. Finalize the Process: Continue engaging with FINRA until you receive approval or denial.

Filing Requirements

• General Securities Principal: Must hold a Series 24 license with relevant supervisory experience.

• Financial Operations Principal: Must hold a Series 27 license and will be responsible for filing FOCUS and financial reports.

• Adequate Financial Resources: Typically, you should have enough capital to cover 12 months of operating expenses.

Essential Documentation

• Ownership and organizational charts

• Flow of funds chart

• Comprehensive business plan

• Resumes of supervisory personnel

• Continuing education plan

• Email compliance program

• Anti-money laundering procedures

• Written supervisory procedures

• Business continuity plan

Note: The acquisition process can be lengthy and requires patience and persistence.

Filing an Application for a New Broker-Dealer

Starting a broker-dealer from scratch involves additional steps but allows for complete customization of your firm.

Key Points

• Approval Wait Time: Anticipate a 4-6 month period before you can commence any business activities.

• Establishing Foundations: You'll need to set up all documents and arrangements anew, including fidelity bonds and SIPC registration.

Comparison of Options

Buying an Existing Broker-DealerFiling a New ApplicationPros- Operational within ~45 days or immediately
- Existing infrastructure and agreements- Saves ~$65,000 in acquisition costs
- No need for due diligence on an existing firm
- Allows for a custom-tailored setup- Acquisition cost of around $65,000
- Requires extensive due diligence- Takes 4-6 months before operations can begin

Conclusion

Choosing between buying an existing broker-dealer and starting a new one depends on your resources, timeline, and business objectives. Acquiring an existing firm offers a quicker path to operation but comes with higher upfront costs and the need for due diligence. Starting anew is cost-effective and customizable but involves a longer wait before you can begin operations.

I invited the cluster X friends to celebrate the restaurant's re-opening, which has been locked down since December 2020 due to the COVID-19 Omicron Variant.

This is the 1^st time I have hosted events. I had zero experience before.

I wrote a thank you letter, signed it by hand, and gave it to everyone.

My first restaurant is an Omakase restaurant called IKEBANA ZEN. NYC started lockdown around March 20th. I immediately called the landlord and agreed to pay him $6,000 per month. I kept communication open with the landlord during the lockdown and promised not to leave if he forgave some rent, but he wasn't willing at first. We maintained a good relationship with the building super by offering him free food and drinks. One day, he shared valuable information: every other tenant wasn't paying rent, leaving us as the only ones. The landlord still had to pay the mortgage. I promptly called the landlord, stating I'd close the business if he didn't offer more rent discounts or forgiveness. I knew he couldn't afford to lose my rent; if I left, he'd receive no income from the building. The landlord feared my departure, so I agreed to pay the entire year upfront for $36,000 and guarantee the lease for two years. The second year's rent would be $4,000 per month. I also agreed to use a one-month deposit of $12,000 to cover the owed rent, totaling $40,360.

I stayed calm throughout the emergency situation and used wet towels to prevent breathing toxic fire smoke. I would recommend having a fire detector at home and teaching your children about a Basic survival guide in any emergency situation.

As an international student at NYU pursuing my master's degree, I discovered the potential of the real estate industry through a conversation with a residential agent. Learning about their commission-based earnings and flexible schedule, I recognized the perfect opportunity for a full-time student like myself.

Then I did the following steps

·      Googled how to become a real estate agent in NYC and enrolled in a 75-hour online course.

·      Overcame language barriers, passing the school exam on the second attempt and the state exam on the fifth attempt.

·      Joined a residential brokerage founded by the agent who helped me find my apartment.

·      Specialized in rentals for 9 months, earning over $100K in commissions.

·      Self-generated leads prompted me to explore commission retention strategies.

·      Explored opening a brokerage through online research.

·      Despite lacking a broker license, pitched partnership to brokers in the firm.

·      Partnered with Max from the firm to establish our own firm, Highkey LLC.

·      Max also invested in my omakase restaurant.

How I pitched Max?

"Do you realize you could start your own firm?"

 "Hmm, really? How would I go about doing that?"

"Well, you already have your broker license. With that, it's totally feasible. Let me break it down for you. Last year, you earned over $250K in commission, splitting it 50/50. But if you owned the brokerage, you could keep 100% of that, totaling $500K. I'll handle all the setup work for the company. What do you say?"

 "Count me in. Let's do it."

What I learned:

·      Taking decisive action is vital; I didn't overthink, realizing I could obtain the license like others.

·      Persistence pays off; it took seven attempts to pass the real estate exam.

·      Specialize to succeed; I recognize the potential for higher earnings by owning a company.

·      Cultivate key relationships; Max's support was indispensable.

·      Embrace learning; despite initial uncertainty, I committed to mastering company operations once Max joined me.

1.     Google, YouTube, podcast

2.     Read as many books as possible about this topic

3.     Talk to people who are the best at that topic in my network and ask for referrals

4.     Send people thank you note and ask for more referrals and repeat

5.     If you hope people sit down talk with you, go to places convenient for them, find time works for them

6.     Dress good, show up on time, bring notebooks, prepare good questions

7.     I always find ways to provide value, connect them to people in my network, go one extra mile and do not expect any return

8.     Good things will happen

9.     My end goal: work with people are smarter than me, had more experience than me , partner together when the time is right

10.  Never let other people out work you. And always ask, if you do not ask, the answer is always no.

My parents are very strict about teaching me the value of money. My dad is majoring in physics and engineering, and my mom is a CPA, so you can imagine how good they are with numbers. They would give me money to cover the tuition, rent, and essential costs of living like meals, so I have to figure out how to make money for leisure activities such as going out to have dinner with friends, taking my girlfriend, now my wife, on dates, traveling, and more.

I know myself as a doer, so I decided to become a real estate agent.

I googled the NY state real estate license, signed up for the online course, finished the 75-hour class, took the school exam, failed, had another shot, and went back to study for another month; I passed.

Then, I signed up for the state exam. I failed the exam three times in a row. Eventually, my girlfriend and I decided to spend the entire Christmas break helping me study for this. I did not have any expectations when I walked into the test room for the fourth time. I did not know if I would pass it or not after I returned home, so I decided to sign up for the 5th time.

The real estate terms are complex for me. English is my 2nd language. After the 4th try, I went to e-access, the state website, to check my score daily as usual. I still remember the joy I tasted after I saw "pass" in my account. That was the happiest day of my life at that time. I was confident that I would be able to make some real money from closing deals.

I believed in myself that I could pass it, so I did not give up after failing the exam each time. I knew that if I studied hard, I could pass it. The license was the only thing between me and the money. Later, I found out the exam had a version in Chinese, but I am glad I took it in English. It made me more professional in doing business with native English-speaking agents.

I joined the firm, where the same agent helped me find my apartment. It is a brokerage full of Chinese agents, our target clients are Chinese. My split is 50/50. I learned how they run the firm and also closed several deals within the first six months. I made about $50K.

The firm does not have a marketing budget and no office support, etc. So I felt splitting 50/50 with the company was unfair.

In addition, I developed clients from my network. Then I did the math. If I did the same number of deals every year, I would double the commission by having the same workload. Why don't I open my firm to keep 100% of the commission then?

I Googled how to open a brokerage in NYC and found the bottleneck is that I need the broker license to open my firm. Then I identified the guy, Max, the only broker in the firm; that firm's license is under his name.

I invited him for coffee/lunch/dinner to pitch him the idea of leaving the firm and opening a new brokerage with me. I told him what other big brokerages doing, how they run the business, what is the split with the agent etc.

He is very smart. We instantly clicked, but he does not know how to open an LLC, payroll, hire, marketing, etc. I had no ideas either, but I told him I could learn. I promised him I would take care of everything if he made the jump. He agreed, and we shook hands.

I Googled how to open a real estate brokerage, asking friends for referrals to meet with CPAs and hang out with brokers working at big firms. Lawyer friends reminded me to execute the operating agreements. They told me this is the most important document about partnership.

I hired a lawyer to draft it and executed it with Max. In the end, we brought in another person; he was the most sociable person we knew back then. The deal was that we each held 40%, and the third guy held 20%. The brokerage name is Highkey LLC.

I wanted the firm to be the opposite of LOWKEY, so I named it Highkey

In May 2019, I graduated from NYU.T. I returned to China post-graduation to spend the summer with my family. After landing, I stayed in a hotel in Shanghai and rested from the jetlag. After a shower, I noticed there was a lump, ping-pong ball size, on the right side of my neck. I told my parents immediately, they looked very nervous. We visited ENT doctors in my hometown, Zhangjiagang, and in Nanjing. They performed the neck ultrasound , CT scan, and Biopsy; I was diagnosed with Thyroid Cancer. I had trouble falling asleep for the next couple of days. I started researching and reading about cancer nonstop. I was so scared of death. I thought I was going to die.

I immediately returned to New York and visited the Memorial Sloan Kettering Cancer Center. Surgery was performed the day before July 4th. That was the darkest period in my life

I lay on the bed, and my brain was heavy and empty. I had no idea what was next in my life. I can not move my head, must take pain medications, and the scar on my neck looks very scary. The good part was my girlfriend; my parents were with me all day long so I did not feel lonely.

One month after I was discharged from the hospital, my wife booked us dinner in an omakase restaurant called Shuko to celebrate. The sushi chef who stood in front of us overheard our conversation about my real estate brokerage business. He asked me where I recommend opening a restaurant.I gave him my number. Surprisingly, He immediately reached out that night to ask my help finding him a restaurant space.

He asked me where he should open a restaurant. My gut feeling is that this guy is ready to open his own place. I gave him my number and said he could follow up after dinner. The same night, he immediately reached out to ask for my help finding him a restaurant space.

I agreed to help him despite the fact that I knew nothing about restaurant leasing, and I was transparent with him about it but I can learn if he was not in a rush.

Maybe my transparency made him trust me. He insisted on having me represent him in this deal.

Figuring out how to find a restaurant space and negotiate the lease made my mind busy and shifted my focus away from the physical pain. I find a purpose again.

I bought books, watched YouTube, and cold-called brokers to learn how to negotiate the restaurant lease. I also decided to learn how to open and run a restaurant by doing the same process.

I would learn something new and then share it with the chef. I hope I can help him avoid costly mistakes. Sharing is so much fun.

For two months, we met frequently to tour restaurant spaces. Finally, we found a turn-key space at 53rd and 9th Ave., where the previous restaurant had closed one week ago. We toured it. He liked the space and wanted to sign it.

During the meeting to review the LOI, he invited me to run the business with him. It did not take me too long to say yes because I became a little bit superstitious; everything happens for a reason, especially since I just had cancer.

We already paid $12K rent back in December. Then I paid the rent for May and June, but I know I can not continue to pay the total rent. I maintained a good relationship with the building during the renovation period. I asked him if anyone else in the building was paying.

He told me no one was paying. This piece of information is very important. I called the landlord immediately and told him I would pay 50% of 12K, which is 6K, or leave the space. He agreed, and we agreed we would meet again after we re-open.

In Sep, We finally opened outdoor dining. I reached out to the landlord to resume the discussion of restructuring the lease because I want to amend the lease in order not to pay the missing rent in the future. I knew I was still liable for the missing rent.

After rounds of negotiation, the landlord agreed to let me apply 12K from the deposit to cover the missing rent. For the next two years, there would be 3k monthly rent for year one and 4k monthly for year two, but in exchange, I would personally guarantee for the next two years.

I thought I had a good deal at that moment. Looking back today, the best decision was just shutting down the business, exiting that lease, and doing something else instead.

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I learned that running a business needs luck. Cutting losses would be the best decision.

What else do I learn from this? The school has trouble onboarding international students; lots of international students decided to defer enrollment due to COVID-19, and few students applied for an MBA because most classes would be on zoom, etc. I think it is the perfect opportunity for me to apply for the MBA because of the less competition. In addition, it is on my to-do list anyway, so I decided to apply.

I learned a piece of valuable information from the email.

Most international students decided to defer or withdraw their enrollment due to COVID-19.

I realized it was the perfect opportunity to apply for the MBA program. I have interesting stories to sellso I decided to apply.

During the process of preparing the application package, I did not reach out to any alumni to share my essays for feedback. This is a costly mistake. After I turned in the application, I waited for two months. Bad news arrived one day, I got rejected.

The story did not end here; I regretted I did not do enough. The good news was  CBS is the only M7 business school that offers a January entry program. I decided to apply again. This time, I will do whatever it takes to get accepted.

I reached out to people in my network and cold-messaged CBS alumni on LinkedIn. One person was very helpful. His name is Sida. He was studying at CBS. We played basketball a couple of times together. He told me he visited the admission office and had a one-on-one conversation with an admission officer.

It was impossible to meet people in person during COVID-19, so I decided to email everyone who works in the admission office. Morgan, Sida also talked to her; Morgan replied and shared her personal cell. The call was planned for 30 mins but We ended up talking for an hour.

During the call, I kept sharing my stories. I treated it as an interview. I understood how valuable the opportunity is. 90 minutes later, she told me you are very inspiring. My gut feeling was that I had a good chance of getting accepted.

I received the interview email the following day. I aced the interview with an Argentine alumni; my stories really resonated with him.

Unsurprisingly, this time, the offer arrived. I was so grateful about people  who helped me during the whole process.

I wrote down three goals before the school year started.

Goal No.1

Learning as much as I can from the real estate program.

Goal No. 2

Building as many meaningful relationships as I can.

Goal No.3

Promoting my Omakase restaurant, Ikebana Zen with people.

IKEBANA ZEN closed again in Dec 2020 due to the Delta COVID variant and reopened in March 2021. I organized an opening event and invited friends from my cluster to celebrate the re-opening.

I actively participated in seven clubs by applying as the AVP to organize social events for the members. In Year 2, I continued to serve as VP for all seven clubs.

The following list is the clubs and positions in which I participated.

Real Estate Association: VP of Events

Family Business Club: VP of Membership

Hospitality and Travel Association: VP of Trek

Gourmet Club: VP of Events

FinTech&Blockchain: VP of Events

Greater China Society: VP of Community

Japanese Business Club: VP of Events

Challenges I faced running IKEBANA ZEN

The restaurant closed and re-opened three times due to different COVID-19 variants.

1st Manager suddenly resigned from the job due to a family emergency.

Chef partner stopped showing up to work, stole money from work, verb abused employees.

Stuff got injured during the shift.

A customer fell at the store ramp late at night on a heavy rainy day.

The newly finished outdoor dining shed received a letter from DOT requiring us to take it down due to 9th Ave road construction.

And more

The Solution

I solved all the problems, bought out the chef partner, hired a chef consultant, hired a new manager, hired a new crew, worked every position in my restaurant, went to a conference, met a speaker who knew Andrew Rigie, the founder of Hospitality Alliance, saved my outdoor shed.

In the beginning, I would have panic and anxiety all the time from running a restaurant. After getting through so many emergency situations, I developed a framework to solve problems.

Calm down-identify the real problem - find who not how to solve the problem.

The story of Knock Knock: My second restaurant, a specialty coffee shop in the morning and a modern dim sum restaurant in the evening. Knock Knock inspired by finger taping gesture. If you are interested in learning more, read this article.

https://www.thespruceeats.com/the-origin-of-finger-tapping-694328

Summer 2021: My wife's friend connected us with her bartender friend. We hung out a couple of times, and I liked his personality. We got along well. Later, he told me he wanted to open a bar in Long Island City, Queens, also known as LIC.

He shared the business plan with me. I liked it, and I also like the LIC market because LIC has delivered most residential units to the NYC market in the last ten years. The majority of the people who live in LIC are Asian, and LIC lacks good food and beverage options.

We decided to partner to open the speakeasy. He and his investors would contribute 70% of the money, and I would contribute 30%. My responsibility is to find the bar space, finish the build-out, and obtain the licenses and permits.

I made a mistake by signing the lease under my name. After we signed the lease, this guy told me he did not have any money because his group ( he and his friends) had spent all the money on another project and claimed they got scammed.

I was shocked and extremely angry. Then he lied to me again, saying they were waiting to get their money back. I was very naïve that I trusted him again so I decided to wait. He started ghosting me soon after. I did not have a backup plan, but I knew I must move on from him.

I did not know how to run a bar, but I knew how to run a restaurant. I had an idea to pair the dim sum with cocktails. It is like tapas, small bites. Also, there was no dim sum in LIC.

I remember having a great time at Hakkassan in the past, so there is a real-world successful example. I did not have enough time to continue the due diligence, in-depth market research, and seek feedback from other LIC small business owners, so I went with my gut feeling.

I got stuck in the mentality that I believed I could do it. Nothing is impossible. Overconfidence would make me pay for what is happening next.

I made one more costly mistake. I hired an architect friend fresh out of college. I got nine months of free rent for renovation; four months have passed, so I wanted to save money from other categories.

This is a very dangerous mindset. It often leads to a series of bad decisions. At first, he suggested we do a simple drawing, file for permits to start the construction and update the drawing along the way.

I trusted his judgment and went for the idea. He told me he did not have the architectural license yet, so we needed to ask another architectural firm to stamp his drawing. Guess what? It costs more money. I received more surprising news: building a restaurant also requires mechanical, electrical, and plumbing drawings, also known as MEP drawings.

He did not know how to draw either. I had to spend additional money on the MEP plan. The worst part was that the GC was also not good. Three months have passed again. I got so frustrated. Finally, I decided to fire the architect and the GC and find a solution.

I contacted the architect firm directly to make sure they would file the right drawing to the DOB. At the same time, my manager introduced his Polish GC friend to me. He did the renovation for IKEBANA ZEN. My overall experience with him is reliable and transparent, so I gave him the job.

We worked together to figure out the MEP plan for the following month. We did hand drawings for Plumbing, HVAC duct, hood, fire system, etc. Then, I would send emails to the Architect's office, attach the drawings' pictures to request they update the drawings for us. It takes countless rounds back and forth to get everything right. I worked under extreme stress for the month, did not sleep well, and lost about 10 pounds of weight.

A few months later, I wanted to replace the host stand in the front of the shop with a bar. I think it is good to build a drink bar at the front of the restaurant to attract customers.

I did market research about what kind of drink products would sell during the day. I picked coffee. Why? coffee is the most popular drink, and it is addictive.

However, changing the layout and adding a new design would increase the build-out cost and delay the opening date.

I decided to go for it and take more risk but I have no idea how to make coffee drinks.

What do I do? I googled the barista school. There is only one Specialty coffee association, aka SCA-certified training lab, in the northeast, the Coffee Project Academy in LIC.

It is very close to my restaurant. I first signed up for the latte art class for my wife and me. We took it and met one of the founders, Kaleena. We enjoyed the class, and she encouraged us to take the intermediate barista training class, which is a three-full-day program with an exam at the end.

After three days of lectures and high-intensity training, we learned how to run a cafe program. We passed the exam. The exam is making four drinks, two expresso drinks, and two milk-based drinks within 8 minutes, plus cleaning the machine and station.

At the end of the last day, Kaleena and I started chatting. She mentioned they had recently collaborated with another restaurant to help launch its coffee program. Bingo, my head started spinning. I immediately told her I was planning a restaurant called Knock Knock in LIC.

I shared the meaning of Knock Knock, inspired by the Cantonese finger-taping gesture. Coincidentally, Kaleena and Sum, the co-founders, are Malaysian Chinese; their partners originally immigrated to Malaysia from the Cantonese region of China.

The Knock Knock story resonated with them. It made them feel homesick.

Kaleena helped me book another session with Sum, her partner. We returned home and decided to make a PowerPoint presentation for them to explain the food and drink concept of Knock Knock.

During the second meeting, I shared the restaurant's vision and business plan via PPT.

They told us this was the first time people took them so seriously, and they appreciated our well-prepared PPT.

They decided to collaborate with us and help us launch the coffee program.

Knock Knock Café opened in 2022; we waited six more months for Con Edison to turn on the gas. The developer filed the gas plan without including the meter for the commercial unit. This mistake cost us a lot of money. As a long-time Hospitality Alliance member, I continued to stay in touch with Andrew Rigie. I reached out to him, asking for help. He connected me with his friend at Con Edison, who helped us save time in scheduling gas inspections. Knock Knock restaurant finally opened in April 2023. The business did not perform close to my revenue projection. Sadly, Knock Knock closed on Jan 2024.

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How did I find my current partners?

As I mentioned a couple of times, I do not want to run out of plans, so I always look for the next thing for myself.

Knock Knock's soft opening did not run well, so I had doubts about the business.

I have a habit of reading Bloomberg and WSJ every morning. I noticed multiple articles discussing private credit and the CRE wall of maturity. I realized it could be a life-time opportunity.

I have been doing coffee chats regularly with people for a while, so I became even more actively asking CBS real estate people for a coffee chat.

My friend Kira connected me with Alex. She said Alex was so helpful during their coffee chat.

After Kira connected us via email, I sent this to Alex.

Hi Alex,

Thanks, Kira for the introduction. I moved you to bcc now. Nice to e-meet you, Alex. I am currently running a modern dim sum restaurant, Knock Knock, in LIC.

I have always been passionate about real estate development and investing. Would you be available for a quick phone call this week?

I am looking forward to hearing from you!

Andrew Yuan

We scheduled the coffee chat for the following week. When we met, Alex was so curious about my life, my restaurant, my CBS time, etc.We asked each other questions back and forth.

In the end, he had to go, but he insisted we meet again the following morning at my restaurant so he could introduce his twin brother to me.He and Benjamin showed up at my restaurant at 9 am. I told Benjamin everything I shared with Alex, and he followed up with more good questions.

In the end, we had mutual respect for each other. We concluded we needed to stay in touch frequently and build a meaningful relationship because we are young, ambitious, and entrepreneurial.

Alex offered to teach me how to underwrite multifamily deals and share step-by-step instructions on how they close equity deals.

Starting the following week, we did a one-hour session every week about multifamily 101. At the same time, I was running a weekly networking event in my restaurant to promote the business and build relationships with people. I invited them to my networking events; they came two times out of six. In the 7th week, we did a real estate panel discussing today's real estate market, challenges, and opportunities. I posted on my LinkedIn and sent out invites to my friends. The turnout was great; over 30 people showed up.

Alex also shared with me that he has been working on a new project for a while: direct hotel lending. His mentor connected him with his son, a Managing director who focused on hospitality finance at a large US bank. My head started spinning, and I wanted to help. I asked Alex how I could help; he told me that they will raise capital from LPs after they officially launch. As a solo entrepreneur, I understand how challenging it is to start a new business so I decided to help them by introducing people in my network. Soon after, I decided to do even more by going to conferences, panels, mixers, happy hours, posting content on my social media, etc.

After I closed the Knock Knock, Alex and I continued to meet frequently. He would update me about the hospitality credit project, and I would go out to meet people and connect them with Alex. Finally, the business launched on May 6th. We are closing our 1st deal. I signed up for everything I could find on the internet related to Private credit, private debt, family office, CRE, etc. I will be always ready to shoot my shot at any situation. I want to end with my favorite quote from Ray Dalio's book Principles: "Build meaningful relationships." I love building long-term, meaningful relationships with people!

Right now, I am working on become an Independent placement agent.

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“The new opening vibe cooled down in the second month, and we didn’t see a lot of repeat customers,” Yuan told the New York Business Journal. “By the end of the second month, restaurant traffic was quite slow. We had to try something else because we could already see the ending of the restaurant.”

Despite changing the concept from Asian fusion to dim sum and seeing sales numbers improve, it still wasn’t enough for Knock Knock to break even on a monthly basis.

Ultimately, he made the tough decision to close the restaurant in mid-January.

The National Restaurant Association estimates that around 60% of restaurants fail within their first year of operation. Knock Knock is part of this statistic.

This was Yuan's second restaurant in New York City. His first was Ikebana Zen, which opened in March of 2020. A few years later, the concept changed to a coffee shop that is run by one of his friends.

After spending the last couple of months reflecting, Yuan shared with the New York Business Journal what contributed to Knock Knock's demise as well as the lessons he learned from this experience.

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Knock Knock restaurateur shares the mistakes he made

Early on, Knock Knock didn’t appeal to the demographic in Long Island City, Yuan found.

“Long Island City is a young Chinese concentrated neighborhood,” he said. “They want authentic Chinese food that makes them feel at home. We didn’t really have an identity for the restaurant with Asian fusion.”

Yuan said Knock Knock would have been a dim sum restaurant from the start had he been able to find a dim sum chef. He pivoted to doing an Asian fusion restaurant when a friend connected him with a chef who specialized in Asian fusion-style food.

“That’s the mistake we made,” Yuan said. “We didn’t really have any second thought on if the Asian fusion concept would work in Long Island City.”

Underwhelming foot traffic also didn’t help. Yuan said there were many slow days for Knock Knock.

And to make up for the loss of revenue that accompanied those days, he kept as few staff as possible to lower overhead costs. At one point, Knock Knock had only one bartender, one waiter, one runner, one manager, one dishwasher and three cooks.

“If you don’t have enough staff scheduled, then customers won’t have a good experience because you don’t have enough people to serve them,” Yuan said. “If I want people to have a good experience, I need to schedule X amount of staff on the floor every day regardless of the revenue.”

When it came to funding the restaurant, Andrew was forced to turn to his friends and family for the money.

Initially, he was planning to open a speakeasy in the Knock Knock space with a friend of his wife. They had agreed to do an equity split to fund the business.

However, after Yuan signed the lease, he didn’t hear anything from his partner for four months. Yuan later found that this individual had lied about having the money to fund this venture.

“The decision I made was to take over 100% project and switch the concept from a speakeasy to an Asian restaurant,” Yuan said.

As a result of all of these factors, Yuan lost confidence in his ability to turn his business around and ended up pulling the plug on Knock Knock in mid-January.

Lessons learned in Long Island City

Now, having spent the past couple of months reflecting on his experience, Yuan acknowledges that if he could go back in time, he would do a couple of things differently.

He wishes that he would have hired a reputable architecture firm to do the interior design of his restaurant. Instead, he hired a young architect fresh out of college to do the interior design, and fired him after three months on the job because he lacked experience.

Yuan ended up having to take over the interior design job and had to teach himself how to design a coffee bar, cocktail bar and the kitchen. As a result, the opening was delayed, and the cost to finish the build-out of his restaurant became more expensive than it needed to be.

If he had hired a good architecture firm in the first place, Yuan said he would have had a much better idea of how much he would spend on renovations in the space, and it would have been easier to stay on budget.

“A lot of mom-and-pop restaurant operators want to save money on the architect fee,” Yuan said. “My advice is do not. That will cost you more during that construction period.”

In addition, Yuan believes his restaurant would have been more set up for success if he had found a good chef partner.

“You need a good manager to run the dining floor and you also need a great chef to run the kitchen,” Yuan said. “If you only have a good manager and don’t have someone good running the kitchen, it's like riding a bicycle with one wheel.”

Lastly, Yuan admits that he had an overly optimistic outlook on the neighborhood and the area surrounding Knock Knock.

Long Island City is still an emerging New York City neighborhood that is growing. Since 2016, the number of residential units in the neighborhood has tripled, according to a recent retail report from Marcus & Millichap.

“I saw a lot of construction sites and figured all of these buildings would finish soon and more people would move in,” Yuan said. “That process took way longer than I thought.”

To get a better idea of the lunch and dinner foot traffic in the neighborhood, he said that he would have picked a weekday and a weekend day to spend the entire day counting the number of people who walked by Knock Knock’s space.

“This is how you will know what the good days are and what time of day has the most traffic,” Yuan said. “You also get to see the demographic that walks around there.”

'We did something right'

Although Knock Knock’s time in Long Island City may have been brief, it did resonate with members of the community.

“I still receive messages from people checking in and sharing that they miss Knock Knock,” Yuan said. “I appreciate that. It means we did something right for the community.”

Looking ahead, Yuan’s first priority is to find someone to take over the Knock Knock space so he can get out of his 10-year lease.

Once that is taken care of, he is planning to work on a real estate private equity project with alumni from the Columbia Business School.

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This decision was made in recognition of the challenges faced by international students with regards to travel, compounded by the uncertainties brought about by the global pandemic. As a result, many applicants opted to defer their enrollment to a later term.

Then I did the following steps

· Prepare and submit an application as an international student.

·      Face rejection, persist, and reapply for J term.

·      Network with CBS student and emulate their strategy.

·      Reach out to admission officers to share my experiences.

·      Only one officer agrees to chat.

·      Share the story of starting a brokerage and restaurant after thyroid cancer.

·      Speak uninterrupted for nearly 2 hours.

·      Receive interview email, paired with international alumni.

· Share stories

and inspire alumni.

·      Receive the offer promptly.

· Send thank you emails to everyone who helped me in this journey!

What I learned from this:

Luck matters: COVID-19 increased acceptance chances as other students couldn't physically attend NYC.

Courage matters: I took the leap and never looked back.

Never give up: Despite rejection, I persisted and honed my storytelling skills.

Be prepared and presentable: I meticulously crafted and practiced my story until it flowed naturally.

Enjoy the process: MBA was a goal, but cancer accelerated my journey, reminding me to savor each step.

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If you want to make money legally by helping GP raise capital, you should become a registered representation with a broker-deal firm. If not, you can only be a finder. Let me tell you step by step how to become a placement agent so you can start earning as soon as possible.

If you google “how to become a private placement agent”, Here is the answer,

• Education: An undergraduate degree in economics or a related field 

• Professional experience: Some experience in finance 

• Registration: Registration with the U.S. Securities and Exchange Commission (SEC) as a broker or dealer 

• State and local registration: Registration or licensing with relevant state and local authorities 

• Exams: Passing the Series 82 exam and the SIE exam to obtain Private Securities Offerings registration 

• Work background: A track record of building connections in the private equity sector 

• Industry knowledge: Staying up to date on trends, strategies, and developments in private equity 

In my experience, I spend a lot of time studying for the exam because I need to pass the security license exam, Series 82 exam, and state exam Series 63. I can take SIE and Series 63 before the BD firm hires me. The Series 82 exam requires a BD firm to register you at the Finra database first and then schedule the exam for you.

I also recommend people reach out to GPs you had a relationship with in the past and tell them you plan to become a placement agent. So when they launch the next fund, and they need someone to help them raise, they can think about you. It is very important because you need a mandate ( client) here to hire you and engage with you; more importantly, they are willing to pay you after you are done onboarding with a BD firm.

BD dealer platforms like Stonehaven, Tangent capital partners etc are good for placement agent who want to stay independent. They built infrastructure to support you so you can focus on capital raising.

In conclusion, If you seriously want to become a private placement agent, Pass the SIE and Series 63 exam asap, at the same time, Maintain a good relationship with the BD platform and GPs.  At the end, you want to make it a win-win-win situation for everyone.

May 2022: I received a letter from the DOT asking me to remove the outdoor dining shed due to road construction on 9th Ave between 50th and 57th Street.

Here's what I did:

Reached out to other restaurant owners in Hell's Kitchen who were facing similar challenges.

Created a group chat for us to share information and support each other.

Emailed the community board and DOT to gather more details about the project.

Met a speaker at the Cowen conference and invited him to dine at Ikebana Zen.

Asked him if he knew anyone who could advocate for restaurants, and he happened to be friends with Andrew Rigie, Executive Director of the NYC Hospitality Alliance.

Andrew invited me to join the Hospitality Alliance and connected me with people from the DOT and SBS.

Attended a meeting organized by the community board, DOT, and SBS.

After a walk around the area, the DOT measured the distance between 9th Ave and my sheds.

DOT confirmed they no longer needed the space in front of my restaurant.

Saved my newly finished $100,000 outdoor dining shed.

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What I learned from this:

Prepare for the worst case and fight for the best case

Small businesses are the backbone of NYC, and the city is willing to protect business owner’s interests.

Always ask for help; you never know who might have a solution.

Find your community and stand together to overcome challenges.

How do you open a restaurant in NYC without any experience?

New York Small Business Service can guide you through each step if you have a language barrier.

License & Permit

1.     Register your LLC, file publication

2.     File DBA form usually is your restaurant name

3.     Apply sales tax certificate

4.     Health Permit

5.     Liquor License

6.     Operating Agreement

7.     Liability insurance, Work Compensation, Paid Family Leave

8.     Open business checking and business credit card

Liquor License

1.     Have the LOI signed, and hire an excellent attorney to prepare the application

2.     Pay attention to the 200 feet and 500 feet rule. No church or school within 200 feet

3.     It is best to lease a space that has an existing liquor license history

4.     File a 30-day notice with the local community board and schedule the hearing asap

5.     Gather information and documents, send it to the attorney

6.     NY state is in legislation to pass a new law to speed up the time to process liquor license

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Site selection

Find a broker who specializes in retail space and understands the local market.

1.     Turn key vs. White box: Make sure you check the certificate of occupancy and any violation history on the Department of Buildings’ website.

2.     I recommend 1^st time operators lease turn-key space, less risk, and open sooner

3.     White box space, I strongly recommend you engage experienced architect, Mechanical engineer, plumbing as early as possible

4.     It will save you time, money and they will give you a good idea about how much it will cost to build the space, and you can use this info to negotiate TI (tenant improvement) with the Landlord

5.     Hire the same Architect firm as your project manager and ask them to help you negotiate the contract with the GC.

6.     Find a good GC

Software

1.     POS System: Toast

2.     Reservation Management: Resy/OpenTable/yelp

3.     Inventory Management: Craftable

4.     Bookkeeping: QuickBooks

5.     Payroll: Toast Payroll or ADP

6.     Website Design: Bento Box

7.     Graphic Design: Canva

8.     Scheduling: Sling

9.     Spotify business music

Operation:

1.     File quarterly sales tax

2.     Annual health permit renewal

3.     Fire system inspection

4.     Make sure to buy trash bin for curb-side pick up, the new city rule

5.     Apply for the outdoor dining program. The new rule, from March to Nov.

6. You need at least one person in the restaurant to have a food handler certificate.

7.     Make sure you follow food safety guidance, Department of health will inspect you within 12months after you open.

Vendors

·      Baldor

·      Southern Glazer's Wine & Spirits (liquor)

·      Empire merchants (liquor)

·      Pat Lafrieda (meat)

·      Aquabest, Yama seafood, True World (seafood)

·      JFC, MTC (Janpanese)

·      ABC (Chinese)

·      McDonald Paper & Restaurant Supplies

·      https://www.webstaurantstore.com/cart/

·      Amazon business

·      other niche vendors depend on cuisine type

This is what happened

·      I hired the contractor referred by a friend I just met through a mutual friend.

·      I signed a simple fee agreement with him for $70k

·      I paid him 80% percent when he finished 40% of the job

·      He threatened me to stop the job if I did not pay him an additional $30k

·      I told him to Fuck off and find someone else to finish the job

I was mad at myself and did not want to make the same mistake again. I had coffee chats with lawyers, GCs, and developers. Let me share the steps for hiring the right GC with you.

•             Ask real estate professionals for referrals and get bids from at least three good GCs.

•             Ask people about past working experience with this particular GC

•             Interview the GC and find the one you vibe with, and the price is somewhere in the middle

•             Sign construction agreement, detailed the work scope and payment schedule, I would recommend you working with a architect and a attorny for more complex projects.

•             Sign a hold harmless agreement and get COI from the GC

•             Pay no more than 30% of the total payment at the beginning, and hold at least 10% of the total payment before the job finish

•             Ask GC to sign the lien waiver after each payment

•             Ask GC for a one-year guarantee on all his work. Ask for a longer quality guarantee for certain work, such as plumbing, electricity, etc.

•             I appreciate my CBS friend Tomer, a Jewish developer, sharing his knowledge and experience with me.

My parents are very strict about teaching me the value of money. My dad is majoring in physics and engineering, and my mom is a CPA, so you can imagine how good they are with numbers. They would give me money to cover the tuition, rent, and essential costs of living like meals, so I have to figure out how to make money for leisure activities such as going out to have dinner with friends, taking my girlfriend, now my wife, on dates, traveling, and more.

I know myself as a doer, so I decided to become a real estate agent.

I googled the NY state real estate license, signed up for the online course, finished the 75-hour class, took the school exam, failed, had another shot, and went back to study for another month; I passed.

Then, I signed up for the state exam. I failed the exam three times in a row. Eventually, my girlfriend and I decided to spend the entire Christmas break helping me study for this. I did not have any expectations when I walked into the test room for the fourth time. I did not know if I would pass it or not after I returned home, so I decided to sign up for the 5th time.

The real estate terms are complex for me. English is my 2nd language. After the 4th try, I went to e-access, the state website, to check my score daily as usual. I still remember the joy I tasted after I saw "pass" in my account. That was the happiest day of my life at that time. I was confident that I would be able to make some real money from closing deals.

I believed in myself that I could pass it, so I did not give up after failing the exam each time. I knew that if I studied hard, I could pass it. The license was the only thing between me and the money. Later, I found out the exam had a version in Chinese, but I am glad I took it in English. It made me more professional in doing business with native English-speaking agents.

I joined the firm, where the same agent helped me find my apartment. It is a brokerage full of Chinese agents, our target clients are Chinese. My split is 50/50. I learned how they run the firm and also closed several deals within the first six months. I made about $50K.

The firm does not have a marketing budget and no office support, etc. So I felt splitting 50/50 with the company was unfair.

In addition, I developed clients from my network. Then I did the math. If I did the same number of deals every year, I would double the commission by having the same workload. Why don't I open my firm to keep 100% of the commission then?

I Googled how to open a brokerage in NYC and found the bottleneck is that I need the broker license to open my firm. Then I identified the guy, Max, the only broker in the firm; that firm's license is under his name.

I invited him for coffee/lunch/dinner to pitch him the idea of leaving the firm and opening a new brokerage with me. I told him what other big brokerages doing, how they run the business, what is the split with the agent etc.

He is very smart. We instantly clicked, but he does not know how to open an LLC, payroll, hire, marketing, etc. I had no ideas either, but I told him I could learn. I promised him I would take care of everything if he made the jump. He agreed, and we shook hands.

I Googled how to open a real estate brokerage, asking friends for referrals to meet with CPAs and hang out with brokers working at big firms. Lawyer friends reminded me to execute the operating agreements. They told me this is the most important document about partnership.

I hired a lawyer to draft it and executed it with Max. In the end, we brought in another person; he was the most sociable person we knew back then. The deal was that we each held 40%, and the third guy held 20%. The brokerage name is Highkey LLC.

I wanted the firm to be the opposite of LOWKEY, so I named it Highkey

In May 2019, I graduated from NYU.T. I returned to China post-graduation to spend the summer with my family. After landing, I stayed in a hotel in Shanghai and rested from the jetlag. After a shower, I noticed there was a lump, ping-pong ball size, on the right side of my neck. I told my parents immediately, they looked very nervous. We visited ENT doctors in my hometown, Zhangjiagang, and in Nanjing. They performed the neck ultrasound , CT scan, and Biopsy; I was diagnosed with Thyroid Cancer. I had trouble falling asleep for the next couple of days. I started researching and reading about cancer nonstop. I was so scared of death. I thought I was going to die.

I immediately returned to New York and visited the Memorial Sloan Kettering Cancer Center. Surgery was performed the day before July 4th. That was the darkest period in my life

I lay on the bed, and my brain was heavy and empty. I had no idea what was next in my life. I can not move my head, must take pain medications, and the scar on my neck looks very scary. The good part was my girlfriend; my parents were with me all day long so I did not feel lonely.

One month after I was discharged from the hospital, my wife booked us dinner in an omakase restaurant called Shuko to celebrate. The sushi chef who stood in front of us overheard our conversation about my real estate brokerage business. He asked me where I recommend opening a restaurant.I gave him my number. Surprisingly, He immediately reached out that night to ask my help finding him a restaurant space.

He asked me where he should open a restaurant. My gut feeling is that this guy is ready to open his own place. I gave him my number and said he could follow up after dinner. The same night, he immediately reached out to ask for my help finding him a restaurant space.

I agreed to help him despite the fact that I knew nothing about restaurant leasing, and I was transparent with him about it but I can learn if he was not in a rush.

Maybe my transparency made him trust me. He insisted on having me representing him for this deal.

Figuring out how to find a restaurant space and negotiate the lease made my mind busy and shifted my focus away from the physical pain. I find a purpose again.

I bought books, watched YouTube, and cold-called brokers to learn how to negotiate the restaurant lease. I also decided to learn how to open and run a restaurant by doing the same process.

I would learn something new and then share it with the chef. I hope I can help him avoid costly mistakes. Sharing is so much fun.

For two months, we met frequently to tour restaurant spaces. Finally, we found a turn-key space at 53rd and 9th Ave., where the previous restaurant had closed one week ago. We toured it. He liked the space and wanted to sign it.

During the meeting to review the LOI, he invited me to run the business with him. It did not take me too long to say yes because I became a little bit superstitious; everything happens for a reason, especially since I just had cancer.

We already paid $12K rent back in December. Then I paid the rent for May and June, but I know I can not continue to pay the total rent. I maintained a good relationship with the building during the renovation period. I asked him if anyone else in the building was paying.

He told me no one was paying. This piece of information is very important. I called the landlord immediately and told him I would pay 50% of 12K, which is 6K, or leave the space. He agreed, and we agreed we would meet again after we re-open.

In Sep, We finally opened outdoor dining. I reached out to the landlord to resume the discussion of restructuring the lease because I want to amend the lease in order not to pay the missing rent in the future. I knew I was still liable for the missing rent.

After rounds of negotiation, the landlord agreed to let me apply 12K from the deposit to cover the missing rent. For the next two years, there would be 3k monthly rent for year one and 4k monthly for year two, but in exchange, I would personally guarantee for the next two years.

I thought I had a good deal at that moment. Looking back today, the best decision was just shutting down the business, exiting that lease, and doing something else instead.

I learned that running a business needs luck. Cutting losses would be the best decision.

What else do I learn from this? The school has trouble onboarding international students; lots of international students decided to defer enrollment due to COVID-19, and few students applied for an MBA because most classes would be on zoom, etc. I think it is the perfect opportunity for me to apply for the MBA because of the less competition. In addition, it is on my to-do list anyway, so I decided to apply.

I learned a piece of valuable information from the email.

Most international students decided to defer or withdraw their enrollment due to COVID-19.

I realized it was the perfect opportunity to apply for the MBA program. I have interesting stories to sellso I decided to apply.

During the process of preparing the application package, I did not reach out to any alumni to share my essays for feedback. This is a costly mistake. After I turned in the application, I waited for two months. Bad news arrived one day, I got rejected.

The story did not end here; I regretted I did not do enough. The good news was  CBS is the only M7 business school that offers a January entry program. I decided to apply again. This time, I will do whatever it takes to get accepted.

I reached out to people in my network and cold-messaged CBS alumni on LinkedIn. One person was very helpful. His name is Sida. He was studying at CBS. We played basketball a couple of times together. He told me he visited the admission office and had a one-on-one conversation with an admission officer.

It was impossible to meet people in person during COVID-19, so I decided to email everyone who works in the admission office. Morgan, Sida also talked to her; Morgan replied and shared her personal cell. The call was planned for 30 mins but We ended up talking for an hour.

During the call, I kept sharing my stories. I treated it as an interview. I understood how valuable the opportunity is. 90 minutes later, she told me you are very inspiring. My gut feeling was that I had a good chance of getting accepted.

I received the interview email the following day. I aced the interview with an Argentine alumni; my stories really resonated with him.

Unsurprisingly, this time, the offer arrived. I was so grateful about people  who helped me during the whole process.

I wrote down three goals before the school year started.

Goal No.1

Learning as much as I can from the real estate program.

Goal No. 2

Building as many meaningful relationships as I can.

Goal No.3

Promoting my Omakase restaurant, Ikebana Zen with people.

IKEBANA ZEN closed again in Dec 2020 due to the Delta COVID variant and reopened in March 2021. I organized an opening event and invited friends from my cluster to celebrate the re-opening.

I actively participated in seven clubs by applying as the AVP to organize social events for the members. In Year 2, I continued to serve as VP for all seven clubs.

The following list is the clubs and positions in which I participated.

Real Estate Association: VP of Events

Family Business Club: VP of Membership

Hospitality and Travel Association: VP of Trek

Gourmet Club: VP of Events

FinTech&Blockchain: VP of Events

Greater China Society: VP of Community

Japanese Business Club: VP of Events

Challenges I faced running IKEBANA ZEN

The restaurant closed and re-opened three times due to different COVID-19 variants.

1st Manager suddenly resigned from the job due to a family emergency.

Chef partner stopped showing up to work, stole money from work, verb abused employees.

Stuff got injured during the shift.

A customer fell at the store ramp late at night on a heavy rainy day.

The newly finished outdoor dining shed received a letter from DOT requiring us to take it down due to 9th Ave road construction.

And more

The Solution

I solved all the problems, bought out the chef partner, hired a chef consultant, hired a new manager, hired a new crew, worked every position in my restaurant, went to a conference, met a speaker who knew Andrew Rigie, the founder of Hospitality Alliance, saved my outdoor shed.

In the beginning, I would have panic and anxiety all the time from running a restaurant. After getting through so many emergency situations, I developed a framework to solve problems.

Calm down-identify the real problem - find who not how to solve the problem.

The story of Knock Knock: My second restaurant, a specialty coffee shop in the morning and a modern dim sum restaurant in the evening. Knock Knock inspired by finger taping gesture. If you are interested in learning more, read this article.

https://www.thespruceeats.com/the-origin-of-finger-tapping-694328

Summer 2021: My wife's friend connected us with her bartender friend. We hung out a couple of times, and I liked his personality. We got along well. Later, he told me he wanted to open a bar in Long Island City, Queens, also known as LIC.

He shared the business plan with me. I liked it, and I also like the LIC market because LIC has delivered most residential units to the NYC market in the last ten years. The majority of the people who live in LIC are Asian, and LIC lacks good food and beverage options.

We decided to partner to open the speakeasy. He and his investors would contribute 70% of the money, and I would contribute 30%. My responsibility is to find the bar space, finish the build-out, and obtain the licenses and permits.

I made a mistake by signing the lease under my name. After we signed the lease, this guy told me he did not have any money because his group ( he and his friends) had spent all the money on another project and claimed they got scammed.

I was shocked and extremely angry. Then he lied to me again, saying they were waiting to get their money back. I was very naïve that I trusted him again so I decided to wait. He started ghosting me soon after. I did not have a backup plan, but I knew I must move on from him.

I did not know how to run a bar, but I knew how to run a restaurant. I had an idea to pair the dim sum with cocktails. It is like tapas, small bites. Also, there was no dim sum in LIC.

I remember having a great time at Hakkassan in the past, so there is a real-world successful example. I did not have enough time to continue the due diligence, in-depth market research, and seek feedback from other LIC small business owners, so I went with my gut feeling.

I got stuck in the mentality that I believed I could do it. Nothing is impossible. Overconfidence would make me pay for what is happening next.

I made one more costly mistake. I hired an architect friend fresh out of college. I got nine months of free rent for renovation; four months have passed, so I wanted to save money from other categories.

This is a very dangerous mindset. It often leads to a series of bad decisions. At first, he suggested we do a simple drawing, file for permits to start the construction and update the drawing along the way.

I trusted his judgment and went for the idea. He told me he did not have the architectural license yet, so we needed to ask another architectural firm to stamp his drawing. Guess what? It costs more money. I received more surprising news: building a restaurant also requires mechanical, electrical, and plumbing drawings, also known as MEP drawings.

He did not know how to draw either. I had to spend additional money on the MEP plan. The worst part was that the GC was also not good. Three months have passed again. I got so frustrated. Finally, I decided to fire the architect and the GC and find a solution.

I contacted the architect firm directly to make sure they would file the right drawing to the DOB. At the same time, my manager introduced his Polish GC friend to me. He did the renovation for IKEBANA ZEN. My overall experience with him is reliable and transparent, so I gave him the job.

We worked together to figure out the MEP plan for the following month. We did hand drawings for Plumbing, HVAC duct, hood, fire system, etc. Then, I would send emails to the Architect's office, attach the drawings' pictures to request they update the drawings for us. It takes countless rounds back and forth to get everything right. I worked under extreme stress for the month, did not sleep well, and lost about 10 pounds of weight.

A few months later, I wanted to replace the host stand in the front of the shop with a bar. I think it is good to build a drink bar at the front of the restaurant to attract customers.

I did market research about what kind of drink products would sell during the day. I picked coffee. Why? coffee is the most popular drink, and it is addictive.

However, changing the layout and adding a new design would increase the build-out cost and delay the opening date.

I decided to go for it and take more risk but I have no idea how to make coffee drinks.

What do I do? I googled the barista school. There is only one Specialty coffee association, aka SCA-certified training lab, in the northeast, the Coffee Project Academy in LIC.

It is very close to my restaurant. I first signed up for the latte art class for my wife and me. We took it and met one of the founders, Kaleena. We enjoyed the class, and she encouraged us to take the intermediate barista training class, which is a three-full-day program with an exam at the end.

After three days of lectures and high-intensity training, we learned how to run a cafe program. We passed the exam. The exam is making four drinks, two expresso drinks, and two milk-based drinks within 8 minutes, plus cleaning the machine and station.

At the end of the last day, Kaleena and I started chatting. She mentioned they had recently collaborated with another restaurant to help launch its coffee program. Bingo, my head started spinning. I immediately told her I was planning a restaurant called Knock Knock in LIC.

I shared the meaning of Knock Knock, inspired by the Cantonese finger-taping gesture. Coincidentally, Kaleena and Sum, the co-founders, are Malaysian Chinese; their partners originally immigrated to Malaysia from the Cantonese region of China.

The Knock Knock story resonated with them. It made them feel homesick.

Kaleena helped me book another session with Sum, her partner. We returned home and decided to make a PowerPoint presentation for them to explain the food and drink concept of Knock Knock.

During the second meeting, I shared the restaurant's vision and business plan via PPT.

They told us this was the first time people took them so seriously, and they appreciated our well-prepared PPT.

They decided to collaborate with us and help us launch the coffee program.

Knock Knock Café opened in 2022; we waited six more months for Con Edison to turn on the gas. The developer filed the gas plan without including the meter for the commercial unit. This mistake cost us a lot of money. As a long-time Hospitality Alliance member, I continued to stay in touch with Andrew Rigie. I reached out to him, asking for help. He connected me with his friend at Con Edison, who helped us save time in scheduling gas inspections. Knock Knock restaurant finally opened in April 2023. The business did not perform close to my revenue projection. Sadly, Knock Knock closed on Jan 2024.

How did I find my current partners?

As I mentioned a couple of times, I do not want to run out of plans, so I always look for the next thing for myself.

Knock Knock's soft opening did not run well, so I had doubts about the business.

I have a habit of reading Bloomberg and WSJ every morning. I noticed multiple articles discussing private credit and the CRE wall of maturity. I realized it could be a life-time opportunity.

I have been doing coffee chats regularly with people for a while, so I became even more actively asking CBS real estate people for a coffee chat.

My friend Kira connected me with Alex. She said Alex was so helpful during their coffee chat.

After Kira connected us via email, I sent this to Alex.

Hi Alex,

Thanks, Kira for the introduction. I moved you to bcc now. Nice to e-meet you, Alex. I am currently running a modern dim sum restaurant, Knock Knock, in LIC.

I have always been passionate about real estate development and investing. Would you be available for a quick phone call this week?

I am looking forward to hearing from you!

Andrew Yuan

We scheduled the coffee chat for the following week. When we met, Alex was so curious about my life, my restaurant, my CBS time, etc.We asked each other questions back and forth.

In the end, he had to go, but he insisted we meet again the following morning at my restaurant so he could introduce his twin brother to me.He and Benjamin showed up at my restaurant at 9 am. I told Benjamin everything I shared with Alex, and he followed up with more good questions.

In the end, we had mutual respect for each other. We concluded we needed to stay in touch frequently and build a meaningful relationship because we are young, ambitious, and entrepreneurial.

Alex offered to teach me how to underwrite multifamily deals and share step-by-step instructions on how they close equity deals.

Starting the following week, we did a one-hour session every week about multifamily 101. At the same time, I was running a weekly networking event in my restaurant to promote the business and build relationships with people. I invited them to my networking events; they came two times out of six. In the 7th week, we did a real estate panel discussing today's real estate market, challenges, and opportunities. I posted on my LinkedIn and sent out invites to my friends. The turnout was great; over 30 people showed up.

Alex also shared with me that he has been working on a new project for a while: direct hotel lending. His mentor connected him with his son, a Managing director who focused on hospitality finance at a large US bank. My head started spinning, and I wanted to help. I asked Alex how I could help; he told me that they will raise capital from LPs after they officially launch. As a solo entrepreneur, I understand how challenging it is to start a new business so I decided to help them by introducing people in my network. Soon after, I decided to do even more by going to conferences, panels, mixers, happy hours, posting content on my social media, etc.

After I closed the Knock Knock, Alex and I continued to meet frequently. He would update me about the hospitality credit project, and I would go out to meet people and connect them with Alex. Finally, the business launched on May 6th. We are closing our 1st deal. I signed up for everything I could find on the internet related to Private credit, private debt, family office, CRE, etc. I will always be ready to shoot my shot at any situation. I want to end with my favorite quote from Ray Dalio's book Principles: "Build meaningful relationships." I love building long-term, meaningful relationships with people!

Right now, I am pursuing a career to become a registered private placement agent.

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