In April, the New Orleans-based culinary start-up Dinner Lab abruptly pulled the plug, ceasing operations in its markets across the country despite attracting some $10 million in venture capital and drawing lots of national attention. (See the New Orleans Advocate story on the closing here.)
In a statement announcing its closure in April, Dinner Lab said it was unable “to turn the corner on creating a profitable enough enterprise to support our ambitions.”
In the Forbes.com interview, Bordainick goes into more detail:
“We were trying to scale a business that was very logistically complicated and we were always screwing up. It was also really challenging to get solid, consistent margins. We stacked the deck against ourselves,” Bordainick told Forbes.
Dinner Lab sold memberships to attend special pop-up-style dinner events with up-and-coming chefs in unconventional locations, from rooftops to former churches.
It had grown rapidly from New Orleans to start operations in more than two dozen cities. In an interview with the New Orleans Advocate, Tulane University finance professor described it as “one of the shining stars in the entrepreneurial community” of New Orleans.
Bordainick told Forbes Dinner Lab’s original concept was to fill a void for late-night fine dining in New Orleans but, he said, this “proved to be a terrible idea.”
“At midnight people were typically pretty drunk. It made more sense to do the meals earlier in the evening,” Bordainick told Forbes.
As the business evolved, the model was “(t)o sell memberships, sell events and use the membership to generate a profit. The membership would subsidize the overhead on the corporate side and we thought we could make a profit on the meals as well.”
That model ran into problems because “(w)e were constantly creating new concepts and hosting in new venues and taking all the ticket risk for those new concepts. It was like going through a restaurant opening every single time.”
Part of the Dinner Lab plan was to gather detailed feedback on its dinners and events from attendees. Bordainick told Forbes that the company “never monetized that data,” however.
“We operated under the assumption that the information we gathered was extremely valuable. But it turned out most restaurants have menus they’re already happy with,” he said.
On the positive side, Bordainick told Forbes that Dinner Lab raised the profile of some of its guest chefs and also produced some intangible successes.
“Tons of friendships, business relationships and a few marriages came out of Dinner Lab. In an overwhelmingly digital world, people are striving for human connections. We did a terrific job of that,” he said.