OAKHURST — A post on social media this morning alerted us to some bad news. The first word from a friend was, “devastated,” followed by this missive from town-favorite Slim’s Koffee Shak. “Well folks, in a spectacular turn of events, Slim’s has come up short. As of today, Slim’s is up for sale,” writes owner Scott Marsh in a Facebook post that will be a heartbreaker for many.
“I received notice yesterday that our first to-be partner and investor is unable to materialize their investment. Unfortunately, this leaves the company vulnerable and underfunded. I have put all of my resources on the line over the past few months to ready the company for investment and expansion to our new Mariposa location. I’m not sure what to expect from here on out. So, I hope you enjoy our food and company one more time before we go. As of now, we are planning to shut down on May 26th. Thank you for everything!”
Reached by phone at the Oakhurst location, Scott was still trying to absorb the information he received Thursday night. Energy was understandably low as he struggled with the task of telling his current staff of nine people about the collapse of investment.
Slim’s North Fork has been open for over five years, and the loan on that shop is paid off. The place is on “cruise control,” according to Scott. In other words, it’s doing well selling the delicious and healthy, mostly organic menu items both locations are noted for. The Oakhurst shop still has a bank loan for the next four months, and it’s doing well, too.
With plans for expansion into Mariposa, a friendly investor expected to cover a hefty portion of the roughly $35,000 it costs to build out a shop like Slim’s was unable, for personal reasons and through no fault of his own, to finalize the deal.
“We had plans to expand to a third location with an investor. We had leased a building in Mariposa about a month ago. I was notified yesterday that for personal reasons, that I completely understand for him, that he is not able to fulfill his financial committment right now.”
Scott explains that the expansion plan has exhausted current resources over the last three to four months.
“It’s taken all the money I had to legally structure the company for investors and hire new management, staff, a make lot of internal changes that had to happen as a transition for the company to include an investor.”
While both locations are currently open and doing good business, it’s not feasible to expect the shops to foot the bill on their own for a third location.
So much time and money have been spent on getting the company ready for the expansion, Scott says, there’s no reasonable way to recover that money soon enough to make a difference.
“The most responsible thing I can do, because I don’t have the capital or resources to finish the build-out in Mariposa, is to schedule a closing date. The tricky part is there are legal rules about how you attract investors. Legally, I can’t publicize that I am seeking investors for an S Corporation, a small business like ours.
“They have a family and friends clause, that you can only take on investors that you currently have an established relationship with, and you don’t have the freedom to publicly promote for investors through advertising or marketing. Investors in an S Corporation are required to sign a statement saying that they never heard about the opportunity as part of promotional activity.”
While the North Fork location has been open for more than five years, the Oakhurst shop started up just over a year ago.
“All things considered, business at Slim’s in Oakhurst is pretty good,” says Scott, 35, adding that they’ve been waiting for the hotels under construction across the street to open, which would give them an anticipated bump in sales.
“We built out to accomodate those hotels and it looks like it’s delayed for a second summer, but business is good enough that it’s not a problem.”
Slim’s is a Mecca for the community and out-of-town visitors alike, frequently hosting concerts and always home to a variety of art shows. Scott estimates that over the years, about 400 pieces of art have been sold and more than 60 concerts have taken place between the two locations.
While the disappointing news is still sinking in, Scott says he went into this deal with eyes wide open.
“This was an opportunity to expand, and there was risk involved. I wanted to go for it and I took the chance. I don’t have any hard feelings, and I’m an eternal optimist. I knew what I was doing and when things don’t work out there’s another adventure.”
He says the move to close the doors on May 26 is a back-up plan, and that his main concern right now is to handle the changes responsibly and with respect for his awesome employees and the communities who love Slim’s.
“We want to wind down the company in a responsible manner and make sure the staff is taken care of. We currently have nine employees at the two locations and I was just getting ready to take on summer hires and more staff for the planned Mariposa operation.”
The shop in Mariposa was scheduled to open June 15.
“This whole time, through all these efforts, we were part of the leading charge helping to revitalize the local economy. Now I feel like I am kind of pulling the rug out from under the community, or letting the air out of the tires. The last thing the area needs is to see another business close, especially one that’s been trying to be really creative with all our engagements, including how we approach the food, the arts and music, and how we handle the hospitality. This whole thing has only been about the community. There is no other way to make it happen — they have to be fully involved and they have been.”
Despite the setback — said to involve roughly $20,000 toward a $35,000 total cost to build the Mariposa shop — Scott is looking to the future even while reeling from the present calamity.
“I just got the news yesterday, and let the staff know about an hour ago. It has nothing to do with our sales. We will get through. I’m an entrepreneur for life.”
Written by SNO managing editor Kellie Flanagan