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The Friendly Toast, a breakfast diner in Kendall square, was close to closing this past September after some financial concerns. The diner is a popular location on Sundays.
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The Friendly Toast has fallen into some unfriendly circumstances.

The funky, hipster-approved breakfast diner in Kendall Square, sister to the Friendly Toast in Portsmouth, N.H., just opened this spring to big crowds and roaring approval. It’s usually packed, and on Sundays, the wait can be over an hour long.

But in September, the Toast nearly became the latest casualty of the soggy economy. Business wasn’t as hot as expected, owner Melissa Jasper said, and they wasted over $50,000 training staff they didn’t need. Then there was the emergency over the summer, when the Portsmouth Toast had to get renovated to bring it up to code. That cost over $80,000.

Melissa and her husband Robert are now over $150,000 in debt. Banks won’t lend to them. They got behind in their taxes. They had to borrow $110,000 from Melissa Jasper’s parents. The State of New Hampshire put a lien on their house.

Through all of this, Jasper has resisted laying off staff. “I just got really creative with scheduling, so that no one lost more than one shift,” she said.

She figures with a little juggling and a bit of luck, the Toast will make it through the winter. After all, people just adore the Toast. “We have survived solely because we had so many people already familiar with the Toast,” Jasper said.

Thousands of fans gush about it on Facebook. On its fan pages, people rave about the “pancakes the size of your head” and the great coffee. Some refer to the Toast as “the best place on earth.” Some simply say: “I love you.”

When Jasper and her husband opened the Cambridge location this spring, they were startled by far-flung reach of the Toastmania. “This totally surprised me — that Cambridge was full of people who’d driven to Portsmouth for breakfast with us,” Jasper said.

The Toast’s Economic Trouble

The problems began earlier this year at the restaurant’s original Portsmouth location. After an A/C unit installation by the landlord, city inspectors discovered the establishment’s electrical work was wired illegally. Then, a plumbing inspector found multiple code violations, which Jasper claims was the responsibility of the original builders of the space more than three decades ago.

Jasper’s landlord didn’t offer to help pay for the required renovations. He told her she should move out.

Jasper couldn’t bear to do that. The Toast has been a Portsmouth landmark for 15 years.

In late July, Jasper made a desperate plea on the Toast’s Facebook page. “We are drowning in bills! These two locations are both thriving in this economy, since we are affordable, but I am going to lose both if I can’t catch up soon.”

Only a few months after opening the Toast in Cambridge, Jasper was concerned both locations would have to close after losing $83,000 in savings to the renovations.

On top of that, the business lost $50,000 to training after overestimating the amount of staff needed for the Cambridge location.

“This was particularly difficult because the recession meant no one wanted to lend to any restaurant,” Jasper said. With increasing financial pressure, she had to get creative to get back her savings.

Jasper has borrowed $110,000 from her parents’ retirement savings and dipped into her restaurant’s state meals tax money three times just to keep the Toast alive. She now owes the state of New Hampshire $33,000 and the state has issued a lien on her house.

Jasper is hopeful. She said she loves being in Cambridge and loves being close to MIT.

“My favorite thing in the whole world is The New Yorker, and in every other issue they seem to have an article about amazing, groundbreaking work done [at MIT].”

Two MIT students currently work at the Toast, and Jasper said she wants to leverage some of the bright minds nearby. “I hope to be able to draw on the brain power of the school in the future,” she said.

The Friendly Toast is located at 1 Kendall Square.