Commercial Banking and The Nature of Being an Entrepreneur

The nature of being an entrepreneur means that you fully embrace uncertainty and are comfortable with being challenged regularly. Especially when having to go out for startup fundraising. Choosing this career path is completely irrational because the odds of succeeding are dismal, but most succeed because of their unwavering belief, laser focus on delivering and persistence.

What are your entrepreneurial ambitions?

“The best way to predict the future is to create it.”  – Peter Drucker

“If you fail to plan, you are planning to fail.   -Ben Franklin

What Is Your Plan?

  1. Create a business plan – your absolute best chance at success starts here
    1. Small Business Development Centers
    2. SCORE
    3. SBA
  2. Understand your cost of entry
  3. Detail a Financial Plan
    1. Revenue projections
    2. Cost of Sales
    3. Expenses- payroll, marketing, cost of debt, utilities, insurance, etc.
    4. Net profit- distributions and retain
  4. Finding Funding Source
  5. Surround yourself with advisors:
    1. Bank
    2. Attorney
    3. Insurance
    4. Trusted planners
  6. Pricing/Sales

How to get startup funding

  1. Self-funding – savings, all those below will want to know what your cash equity in the game is.
    1. No investors to contend with
    2. No interest cost
  2. Investors – angel investors, loved ones
    1. Principal and interest payments
    2. Some investors may want to take an active role or business equity
  3. Loans – small business loans
    1. Allow you to keep control
      1. SBA – competitive rates, low fees, longer terms
        1. Microloans – Working Capital, inventory, FFE up to $50,000
        2. Community Advantage – underserved communities up to $250K
        3. SBA 7A – working capital, equipment, supplies up to $5M
        4. SBA Express – term loans and lines of credit up to $350,000
        5. SBA 504- RE, machinery, major purchases $5M
      2. Microlenders
        1. Urban Redevelopment
          1. Minority and women owned
        2. Chambers of Commerce
        3. Regional Development Funding Corporations
  4. Personal Business Loans
    1. Secured or unsecured based on you credit history
    2. Home Equity Lines of Credit
  5. Small-Business Grants – not loans
    1. Private foundations
    2. Government agencies- local, state and US
      1. Veterans
      2. Women’s
      3. Minorities
    3. Credit Cards -also allows you to use your personal credit history
      1. Capital One
      2. Chase Ink Business
    4. Crowd Funding
      1. Kickstarter
      2. Indiegogo

Best Practices to Keep in Mind

  • Banks are not investors for a Start Up Businesses, but we can give you the guidance you need to be successful.
  • Maintain your Credit Score
  • Seek good council
  • Join industry groups, chambers, and networking groups
  • Learn how to ask for a referral
  • Get good at social media
  • Stay informed – read and become a leader, Ted Talks, Books
  • Emotional Intelligence is as valuable or more valuable than IQ
  • Give back to your community