What does it cost to open a Chicago indie restaurant?

They say necessity is the mother of invention. When Jeremy Leven, chef and partner behind the forthcoming West Town pintxos bar Gilda was denied a bank loan, the team had to get creative.

Beverage director Ines de Haro devised a loyalty program built on community investment. Customers who donate any amount earn discounts and perks once the 44-seater opens on June 1.

All in, Leven estimated opening Gilda will cost between $120,000 (“pinching every penny”) and $180,000 (“comfortable”), but the card is a key example of how the team is trying to close a funding gap. So far, the effort appears to be paying off: Having raised more than 82% of its $20,000 goal, the restaurant’s owners hope the Compañero (“buddy” in Spanish) card builds early regulars and encourages consumer appreciation for small, independent spots.

Their experiment will be closely watched in an era that increasingly favors the corporate-backed and deep-pocketed and in a year where several local independent restaurateurs have closed, citing shaky industry economics.

“If you have a ton of money, you can throw money at your problems,” said Leven, who’s opening Gilda alongside fellow chef-partners Rafael Esparza and and Anthony Baier. “If you don't, you have to be strategic. Maybe we’re delusional or old school, but we’re betting that a community-based model and way of thinking can still succeed in the restaurant industry.”

Leven (mfk., Mama Delia) and Esparza (Momotaro, Kimski, FAFO) have collectively spent almost 40 years working in Chicago kitchens. The pair joined forces this winter with Baier and de Haro on the modern, transcultural pintxos bar, which Leven has been road-testing as a pop-up series.

They secured a lease on a 1,600-sq.-ft. storefront in January, in the former Chi-Latin Restaurant space, before they even started fundraising. With help from their families, they quickly scraped together about $70,000 — enough to cover city licenses, a modest buildout and incidentals to get the doors open.

But opening requires approximately double that, including funds for kitchen and bar inventory, staff and repayment of a few small existing loans, and a roughly four-month operating cushion. It helps that food suppliers who’ve known the chefs for years are doing what they can to work on spec for the first month.

Key to their plans was a Small Business Administration (SBA) loan, a common path for independent restaurants. In 2024 and 2023, restaurants and hotels received the highest share of SBA loans of any industry. At the same time, small business loan and line of credit rejection rates remain high since the pandemic, according to reporting by Forbes.

Compared to 2019, significantly fewer companies in 2024 were fully approved for financing: 51% compared to 62%, per the Small Business Credit Survey. In particular, SBA loan or line of credit applicants experienced a 45% denial rate in 2024 — more than double the 21% figure across all loan types.

Back in December before he’d even found a space, Leven recruited a financial strategist to help him with the notoriously tedious SBA loan application process, amassing income statements, tax returns, loan documents and licenses, squaring away taxes and paying off credit cards.

“I'll be honest, we’re not the corporate America, buttoned-up type of guys,” Leven said. “There are definitely some cultural gaps between the way we’ve lived our lives and run restaurants and the way a financial institution and the government would like to see a secured [borrower].”

They felt cautiously optimistic once the lender preapproved them without raising concerns. The lease negotiations inspired more confidence. The landlord, who knew the chefs and believed in the project, lowered their base rent and capped their monthly occupancy costs at $5,000, comparatively low for the neighborhood, Leven said. They wouldn’t be charged rent until April, giving them a bit of breathing room.

So they hired a designer and general contractor to start work on a modest, mostly DIY buildout. When the exhaust hood broke down and needed a new motor, friends connected them to contact at Granger Mechanical Co., where they secured the part at cost and installed it themselves.

They reached the underwriting phase in March and that’s when things took a turn. Their lender said they were denied pretty quickly without a chance to appeal. That day, Leven opened as many credit cards as he was allowed (four, if you're wondering), and they went back to the drawing board on how to raise at least another $60,000 in 10 or so weeks.

De Haro, working out the math on a guest check, floated an idea for a buy-in program based on a similar approach by her friend Sam Nelis. He owns Specs, an indie all-day cafe, bar and retail shop in Winooski, Vermont. As Nelis bootstrapped the space toward its final form between 2023 and 2025, he fundraised partly through offering Community Fun-Ding gift cards, which dangled a percentage extra that increased based on folks’ contributions.

“I was thinking of something where guests could buy in and keep using it over time until the amount they purchased is expended,” said de Haro. “We wanted to work a hospitality sense into it, where we keep folks coming back because there’s a variety of experiences they’re buying into.”

Customers who donate any amount (the suggested minimum is $250) in turn receive a Compañero card, which is good for a percentage off their bill every time they dine at Gilda until their full contribution is “paid back” (up to $499 gets them 8% back, $500 to $999, 10% and $1,000, 12%). The bigger the donation, the more Gilda will “give back,” not just in terms of discounts but in preferential treatment for reservations and first dibs on goings on at the restaurant.

As of April 28, about 30 donors had chipped in. Donations stalled a little following an initial post-announcement flurry, Leven said. But he’s optimistic, noting that at Gilda’s latest Monday Night Foodball popup in mid-April, they sold out within an hour and a half.

Not that they’d turn down more investment or equity injections, which they’re discussing with a handful of small and larger potential backers. In the meantime, they’re betting on their community and themselves to see it through.

“It’s always been tough to open a restaurant since they invented them,” Esparza said. “It’s an unstable, handle-with-caution kind of business. Is s— more expensive now? Absolutely. What matters to all of us is how bad do you want it? If we’re telling people to believe in ourselves, we have to believe in ourselves all the way. We’re proving it can be done this way.”