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Business for coffee shop

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Some one I know for a year has offered me to have a startup for a coffee shop in istanbul, whereby I would invest all of the money and he would take care of he business. He said the business has good potential if coupled with a unique idea. What is your opinion as am not living in istanbul

cheers

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I definitely wouldn't recommend it.

1.  Coffee shops and restaurants often open for a short time, then go out of business for one reason or another. I see them come and go all the time. It is one of the most risky businesses you can invest in.

2. You will not be able to control things, investment or not.

3. There is a significant probability that the owner is not telling you everything. This is quite common in business here--they only tell you the good parts, and conceal the bad parts.

4. Small businesses in Turkey often accrue a lot of debt. So your investment may be used just to pay them off.

5. You are basically just buying air. Unless you buy the assets only, you'll basically just have a piece of paper, if that. Anything can happen, and you could lose your money. Then your friend could go open another business which you will have no control over whatsoever. Often in such situations what the person needs is your money. Even if you give him a loan, there is a good chance you will never be paid back. I have seen this happen many times.

6. Your friend could simply disappear, at any time. I have also seen this happen many times. There is no way you can know what is really going on with him, or his character, other than what he tells you.

If you want to invest, invest in a mutual fund. Or buy a piece of real property.

Sorry for the negativity, but I really think you are going to get burned if you do it.

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The other issue here is that your friend may be honest and have good intentions but if he has financial issues in other areas the coffee shop may be taken as assets in a bankruptcy case. Invest in your own country and bring out the profits to Turkey to live on.

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4 hours ago, IbrahimAbi said:

The other issue here is that your friend may be honest and have good intentions but if he has financial issues in other areas the coffee shop may be taken as assets in a bankruptcy case. Invest in your own country and bring out the profits to Turkey to live on.

More likely will be the case then , which is to use turkey as an end user against foreign income. Same is the case for property investment as well.

Thanks for your valuable input buddy

 

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Never ever go into partnership with anyone. Partnership means that you are responsible for all the other partner's debts however accrued. It is a sure fire way to ruin.

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I sincerely hope you don't invest in that business. I have sent you a PM regarding my personal experience and what I have seen happens when a Turkish small business owner says to a foreigner "let's be partners!" and the foreigner puts up a lot of money. I have also recommended to you a fee-only financial planner who can help you if you want to invest in Turkey.

Fee-only financial planners are the best. You pay a fee for their advice, instead of going to one who will certainly recommend only thos investment options for which they receive a commission. Yes, there are definitely ways to invest in Turkey, but invest in a mutual fund which invests in a wide variety of stocks from multiple companies. That way your investment will be diversified, and not in just one, very small, business which could go out of business at any time, resulting in a total loss of your investment.

And what Cukurbagli said is true also. Let's say somebody has loaned your potential partner a lot of money, and your potential partner has already signed over the business to that person. Or somebody has a lawsuit against the business. If you buy in to that company, you also buy in to its problems. In your case, you would be buying in to a sole proprietorship, owned buy one guy. I cannot think of a riskier investment, or one which is more likely to cause you to lose your investment.

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