A man who called into The Ramsey Show shared how his dream of opening a community arcade turned into a financial nightmare.
“People just have not showed up,” he said, reflecting on what went wrong.
Speaking with hosts Ken Coleman and Jade Warshaw, he explained how unexpected costs, poor foot traffic, and a lack of marketing left him nearly $70,000 in debt.
The caller and his wife started a small business in their local area, hoping to bring something fun and fresh to the community.
“We started a business, my wife and I… something for the community, like an arcade,” he said.
They partnered with people who supplied the games, while the couple provided the space.
Things seemed promising at first, but problems quickly stacked up. As they moved forward, he said they decided to branch out and buy their own arcade equipment.
That move added debt, and the returns never came.
“We were unaware of some of the startup costs from the bank to obtain the debt,” he admitted.
“By the way, here’s some additional fees that need to get paid… it ended up chewing up all of our marketing and advertising budget.”
The original plan included spending around $2,000 a month on marketing.
But when those funds got redirected to cover surprise fees, they had no way to attract customers.
“There’s no sign on the building,” he told the hosts.
Wrong Place, Wrong Time
The arcade’s first location was in what he called a high-traffic area. But without advertising or even a proper sign, barely anyone knew it was there.
Eventually, the couple had to close the location and move the games into a different space.
They opted for a profit-sharing model by placing the machines inside a bowling alley and restaurant.
But the revenue barely made a dent in what they owed.
“Now I’m just getting a cut off of whatever they make,” he said. When asked if that arrangement could support him, he answered simply: “No.”
Mounting Debt and Misplaced Focus
The arcade itself accounts for about $25,000 of their total debt.
But with other obligations added in, their full debt load is just under $68,000.
The caller’s wife earns about $75,000 a year and has been using her entire income to try to keep the business alive.
Meanwhile, the caller is self-employed but said his main business suffered as he focused too much on trying to save the arcade.
Coleman was direct. “This is not a viable business,” he said. Warshaw agreed: “You need to cut your losses here.”
Despite the caller asking if bankruptcy might be the right path, both hosts advised against it.
Warshaw said she initially thought $25,000 in debt might be manageable, but after hearing the full picture, “now what you’ve told me with the $68,000, I think that you need to… cut your losses here.”
Coleman pushed even further:
“You need a full-time job. I’ll just throw that out there.”
What’s Next
With the arcade now functioning as a side-hustle at best, the caller’s only option is to rebuild his financial life.
The hosts recommended shutting down the venture completely and throwing all income at the debt.
“You’re not going out to eat. You’re not doing anything,” Warshaw said. “You’re selling a car if you need to.”
The story is a tough reminder that good intentions aren’t always enough to make a business succeed.
Poor planning, underestimating startup costs, and overconfidence can result in lasting consequences.
Now, with the business no longer operating and the machines barely paying for themselves, the couple is left to pick up the pieces.
For others considering starting a small business, especially one dependent on physical foot traffic, the message is clear: know your costs, don’t skip marketing, and never assume things will just work out.