Welcome to The Nitty Gritty’s Pitfalls & Pivots series where I share insights every entrepreneur should know to Avoid costly Pitfalls; Pivot with Purpose; and Reclaim their Power at every stage of this crazy journey!
SITUATION:
My leap into entrepreneurship in 2001 was a big one with the location for my first business venture, a retail development project. It was a large warehouse building located on waterfront property. With a 15-year lease on the building and the contract of sale to purchase, my team had full control of this valuable real estate site.
City planning for a pier waterfront development included the retail center as an anchor site for the project with a possible ferry service to transport daily commuters and weekend visitors to and from the site.
125th Street and 12th Avenue, New York
A joint venture partnership with a developer positioned my team to purchase the building and develop the site into a retail complex.
A group of entrepreneurs hopes to turn the shuttered, 26,000 square foot factory into a destination for hip, upper-crust fashionistas form Harlem and elsewhere.
“The shop will be called N, as in new, nuance of style.”
- Nikoa Evans
Daily News, 2002
All things looked promising until an alternative development plan for the area emerged. Property owners and leaseholders along the corridor were approached to sell, which many did quickly and quietly.
My team, however, did not accept the offer to sell; despite the $1M offer that was presented.
PITFALL:
After two years of capital investment in leasing the property while raising capital to fund the project’s development, our vision and passion had become emotionally invested in the physical building as well. As a result, the “idea” of our retail project being central to the proposed waterfront development plans had blurred our ability to separate the vision from the physical asset.
This prevented us from making a smart business decision and take the deal for the purchase of the building when the signs were clear that a new development plan for the area had emerged, one spearheaded by a large institutional development group with the influence and resources to override any previous efforts.
Shortly thereafter, the media began reporting on the new development plans and our joint venture partner pulled out of the deal a week before closing on the building purchase as the new institutional development plans no longer aligned with our vision for a bustling commercial corridor anchored by our flagship retail center. We were unable to identify another partner within the one week deadline. In an instant, a deal that took two years to develop was gone. The two years of cash investment toward monthly lease payments and the 10% deposit for the contract of sale...gone.
To make matters worse, the institutional developer was successful in gaining city approval for ‘eminent domain’ soon after, and all the remaining real estate along the corridor was seized for the new development plan in the interest of the “public good.”
The proceedings were further complicated when a handful of business owners in the area refused the purchase offers.
October 2022
Eminent Domain is the government’s right to take private property for public use, even if the owner doesn’t want to sell.
LESSON:
Allowing our emotions to drive our decision was a costly mistake, one that resulted in the loss of valuable time & significant capital investment. If we had sold to the larger institution when we had the opportunity, we could have walked away with a large sum of cash that could have been leveraged to secure another property for a new store location.
Lesson learned….
Never allow your emotions to be the primary driver of a decision that impacts your business’ trajectory, regardless of whether that decision pertains to:
Physical Assets
Team/Staff Members
Investors/Partnerships
Business Strategies
Assess the data and actual circumstances without emotion entering the equation. Once the due diligence has been conducted and you’ve determined how to proceed based on the insights gained from the data and research, then allow your intuition to weigh in on the final decision if needed.
You will always make mistakes.
What you learn from those mistakes is what matters.
PIVOT:
A couple of years later, we did open that store to great fanfare and success in a new location with brand partners including Nicole Miller, Supermodel Iman Cosmetics, Hugo Boss, Tracey Reese, Byron Lars.
Miller and Iman were to headline an opening night party Monday in the 4,000 sf boutique at 114 W. 116th Street. Initially, Miller’s company had planned to open a freestanding store with Nikoa Evans, one of N Boutique’s owners. After a prime spot near Fairway’s W. 132nd Street location fell through, Evans and her partners decided to go with a multi-brand boutique.
Bud Konheim
Chief Executive Officer, Nicole Miller
Womens Wear Daily, 2006
THE NITTY GRITTY TAKEAWAYS:
Remember, the true asset in your arsenal is You!
Your vision, strategy, and skill set are THE most important assets you have. With these, you can ALWAYS pivot with a new strategic direction, new location, new product idea, or new service.
A failed attempt does not equate to being a Failure.
Failing is a part of the entrepreneurial journey to success.
Make the hard decision and Pivot when necessary.
Setbacks position you for EPIC comebacks.
So…
if you stumble, get back up; brush your shoulders off; and create a new vision.
Pivot & Keep it moving.
Because what's meant for you...is Yours. And one setback (or two or three) isn't going to change that.
That’s the Nitty Gritty.
Nikoa
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