10 things to consider before opening a LBE

Carl White is a Foundations Entertainment University alumni and client living in Berlin, Germany. Over the past few years he has been working on developing an urban entertainment center there to be named FUNomenal. He occasional blogs about the challenges and frustrations he faces. His most recent blog, 10 Things to Consider before Opening a Location-Based Entertainment Center, offers some great advice for anyone thinking about or in the process of planning a center.

With his permission, we decided to reprint four of his ten recommendations on things to consider. But it's worth also reading his other six recommendations on his blog page.


The title is of course cliché but it is not only for team sports it rings true. According to Randy White the average entertainment center from planning to opening day will cost 6 to 8 million dollars. For an established veteran who is opening their second or third location the need for a strong team might not be so important. But for a newcomer to the industry, no amount of research can replace experience. If your potential location requires a build-out, find an experienced ENTERTAINMENT architect. Your wife may have excellent decorating skills for your apartment, but I'm convinced a seasoned interior designer will plan an efficient visitor flow. Michael Dell is credited with saying, “If you're the smartest person in the room, you're in the wrong room.” Use that to guide you as you work towards opening your entertainment center. If you have the most knowledge about the LBE industry in your planning sessions, then you are in serious trouble. Surround yourself with people who have experience in the LBE sector. If you were going to build a car you wouldn't bring on a bridge engineer. The same analogy applies to the entertainment field. The needs of an entertainment venue are not the same as a residential location. Find people who know the difference.


I personally believe anyone planning on opening anything more than a childcare center with a small indoor playground should hire an impartial firm to do a study for your project. As in most cases not all consultants are created equal. Any vendor that offers to throw in a feasibility study for you should never be a first option. You can pretty much guarantee their product will end up first on the list of must have attractions, even if it doesn't match your target demographic. Always investigate the firm you plan on using, thoroughly. This is why attending the IAAPA convention and networking there and on LinkedIn is so important. Operators are honest and will give you references for firms. Finding an honest, independent, knowledgeable and experienced consultant will not be easy. In the last five years I have personally had over 20 consultants offer their services for my project. For a newcomer often times price is the determining factor. I looked at a feasibility study as a means to approach a bank to get the required loan to begin my project, a third-party voice that repeated my own findings. However, after the FEU seminar program I learned the right consultant can be much more. Yes, it is a significant investment, but I'd rather spend $40,000 at the beginning to ensure the project is done right then sink $2 million into a lost cause. “Those who fail to plain, plan to fail.” Plan on getting the best consultant you can find to do your feasibility study and you will be starting out ahead.


This cannot be stated enough. Overestimate EVERYTHING. Overestimate how much time you believe you'll need to find a suitable location, to acquire the financing, to get permits, to get city planning approval, to convince your wife you're not crazy, for finding a firm for the feasibility study, for all of it. Now, part of my pessimism could be because I am located in Berlin, Germany and Germans operate from distrust of entrepreneurs. In general, I have heard that people fresh to the LBE industry underestimate the required time needed to open by at least 18 months. If you believe you will be open in 6 months, add 18 months to that. If you believe you can be up and running in 1 year, add 18 months to that. Of course there are exceptions to that rule. I fall on the other extreme. I thought I would be open in 6 months and here 5 years later I'm still at it. Again, I'm in Berlin, Germany but you get the point. It has been more expensive, time-consuming, frustrating and humbling than I ever imagined. I believe it would have been better for my peace of mind to have assumed the worst case scenario instead of best case. But we live and we learn.


I did give up once with FUNomenal. My original idea was to open an FEC that catered to everyone. Thanks to the FEU I realized how wrong I was about that business idea. The secret to success is variable, but the secret to failure for certain trying to be all things to all people. I gave up on the FEC idea and decided to focus on a concept that caters to a more discerning adult crowd. Knowing when to give up on a bad idea is the single most important thing one should know after you enter the LBE field. Give up on a location when all the figures and demographics say it won't work. Give up on an attraction that is too expensive and doesn't fit your budget.

Thanks Carl for allowing us to share your great advice about development of an LBE or FEC with our readers.