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Secret Service

A stint in the underground can provide valuable training for restaurateurs.

One of the hottest trends in restaurants these days isn't a type of cuisine; it's a mode of operation. At underground restaurants, a mouth-watering dinner is served at someone's house . . . or a cool loft . . . or a converted 1950s creamery. The restaurant's location is always changing because, like prohibition-era speak-easies, underground restaurants are fly-by-night operations, skirting the law to provide divine cuisine. For entrepreneurs hoping to launch full-scale restaurants, the underground can be an excellent training ground. Dissident Chef, the 43-year-old proprietor of San Francisco-based SubCulture Dining, found that the underground was a way to indulge his passion for cooking while he got the plans for his traditional brick-and-mortar restaurant off the ground.

Dissident Chef, as he's known in the underground scene, has found many benefits to SCD, which he launched in March 2006. Not only is he cooking, but he's also using his enterprise to build his staff. "I'm able to take raw, talented kids and teach them and train them--to nurture their skills and build that infrastructure for myself," he says. SCD has even become a place for him to meet investors for his full-blown restaurant, planned for late 2007.

Though it may be useful for building a menu, says Bill Guilfoyle of the Culinary Institute of America, a part-time underground restaurant can't fully prepare you for the demands of an everyday operation.

In addition, an underground restaurant has its risks: Operating sans health permits, skirting taxes and such, these roving enterprises are vulnerable to law enforcement shutdowns. So consider getting a temporary permit or having events at a catering facility that already has a license or health permit. "The costs to do that aren't expensive," says Dennis Gemberling, principal of The Perry Group International, a restaurant and hospitality industry consulting firm in San Francisco. "[An underground restaurant] is a good idea for testing the concept and getting investors interested, but the way you go about it could easily destroy you as well as promote you." By staying on the right side of the law, you can still have your intimate, creative dining experience--without putting your future at risk.

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This article was originally published in the May 2007 print edition of Entrepreneur with the headline: Secret Service.

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