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Getting a small business loan/finding investors

Posted on 11/10/11 at 10:51 am
Posted by Fratagonia
Saints Fan
Member since Mar 2009
391 posts
Posted on 11/10/11 at 10:51 am
MT ballas,

A) What do I need to present to a bank when trying to acquire a small business loan?
B) What's a great bank to start with?
C) How do I "pimp" the idea to investors/find the investors?

Thanks.
Posted by reb13
Member since May 2010
10905 posts
Posted on 11/10/11 at 11:01 am to
I have never done this before but I can guess you are going to need:
1. A good idea
2. Said idea has an untapped market
3. A business plan
4. ????
5. Profit
Posted by simonizer
no
Member since Oct 2008
1697 posts
Posted on 11/10/11 at 11:14 am to
ability to repay the loan, and/or secure the loan with collateral/personal guarantee.
Posted by yellowfin
Coastal Bar
Member since May 2006
98750 posts
Posted on 11/10/11 at 4:06 pm to
down payments/collateral
business plan
resume
references
anything else they ask for
Posted by RedStickBR
Member since Sep 2009
14577 posts
Posted on 11/10/11 at 6:48 pm to
Are you trying to become the world's next billionaire T-shirt chairman?
Posted by jonboy
Member since Sep 2003
7438 posts
Posted on 11/10/11 at 8:26 pm to
Be sure and say "pimp" and "ballas" alot when talking to the bank. Sure fire way to get them behind your plan.
Posted by simonizer
no
Member since Oct 2008
1697 posts
Posted on 11/10/11 at 8:41 pm to
oh and in your business plan make sure to say you will give free chicken wings to all of your best customers.
Posted by TRUSAINT21
Bourg, La
Member since Dec 2007
91 posts
Posted on 11/11/11 at 8:11 am to
I am currently going through this process with the owner of the business I currently work for to start up another business where he will take me along with him, so I am very involve with this deal. This is how this is working.

The owner and I met with the Area President, Credit Analyst, and VP of commercial lending. We pitched the business plan, showed projections for year 1, and provided financials for his current business venture with more positive projections on bid jobs we have recently secured. We also had to show/explain losses on certain bid jobs of the current company. The package was submitted to the board and we should hear of the approval on Monday.
This owner has been dealing with this same bank / commercial banker for approx. 20 years so he has a proven track record of success, but he still has to come up with the initial working capital from personal funds, put a down payment on the loan, and maintain a certain $ amount in liquidity which coincides with the debt to equity ratio figured. The liquidity amount required will step down as the debt to equity ratio lowers closer to industry average.
The bank did offer a six month interest only period on the loan to assist the new company in stocking up its own working capital.
Posted by Fratagonia
Saints Fan
Member since Mar 2009
391 posts
Posted on 11/11/11 at 2:18 pm to
quote:

Are you trying to become the world's next billionaire T-shirt chairman?
Whoever you are, you are correct.
Posted by Fratagonia
Saints Fan
Member since Mar 2009
391 posts
Posted on 11/11/11 at 2:18 pm to
quote:

Be sure and say "pimp" and "ballas" alot when talking to the bank. Sure fire way to get them behind your plan.
Really
Posted by Fratagonia
Saints Fan
Member since Mar 2009
391 posts
Posted on 11/11/11 at 2:19 pm to
quote:

free chicken wings to all of your best customers.
Posted by Fratagonia
Saints Fan
Member since Mar 2009
391 posts
Posted on 11/11/11 at 2:20 pm to
quote:

TRUSAINT21
Thanks for info
Posted by VABuckeye
NOVA
Member since Dec 2007
38283 posts
Posted on 11/11/11 at 5:09 pm to
1) You need a solid business plan.
2) It will help if you have potential (sold) business.
3) An investor is going to want a percentage of your company. The more they invest, the higher the percentage.
4) Bank lending and credit lines will be based on your personal credit and assets. You're going to have to personally guarantee any debts. If you don't have great credit and good assets you aren't going to get a loan.

Best of luck to you. I've been self-employed since 2000 and I can't imagine working for someone else again.
Posted by The Les Miles Bowl
West Monroe
Member since Dec 2010
247 posts
Posted on 11/12/11 at 10:42 pm to
Bain Capital
Posted by shutterspeed
MS Gulf Coast
Member since May 2007
70632 posts
Posted on 11/12/11 at 11:09 pm to
quote:

C) How do I "pimp" the idea to investors/find the investors?


If you're talking about soliciting investors from the public, then you do so with a seasoned business/tax attorney so you don't run afoul of SEC regulations (or tread at your own risk).
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