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Thread: Small Business Financing

  1. #11
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    I have borrowed in better and worse ways, mainly to get through a tough stretch. Luckily I am able to make up the difference fairly quickly. I have never borrowed from friends or family, other than very short term. Never took on equity financing either. Just loans. Hate to borrow money, but it's better than running out of cash.
    Brian Satterlee - Satterlee Group, Inc. - Blog -

  2. #12
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    Quote Originally Posted by Harold Mansfield View Post

    Thinking that i would get a loan just because I had a good idea. That's a big lie that has been perpetrated for a long time and it gives people a false sense of how things really work.
    I couldn’t possibly agree more with all of Harold’s comments! So many inexperienced wanna be entrepreneurs have no idea of what they are doing. Many think there is a simple “formula” to raising capital and starting a business. Have an idea, write a boilerplate business plan and get money. There are already 100’s of relatively useless guides for raising capital.

    Banks have absolutely NO INTEREST in startups! That is reality # 1. They are in the secured loan business, not the risk business. Real investors know how to assess risk and reward. They are typically not interested in meager returns with risk in common run of the mill businesses.

    New entrepreneurs are at a great disadvantage primarily because they don’t know any real investors. There are many of them BUT if you can’t find them what good are they. They usually don’t even consider proposals from unknown people. It usually takes an introduction to even get a meeting. They often see hundreds of proposals a year and discard 99% of them. They often make an investment not only on the idea, but on the person running it. Without a track record of success chances are slim.

    There are of course friends and relatives, but, as Harold mentioned, it is a very touchy situation. You can get lucky sometimes, but that is the exception to the rule.

  3. #13
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    here are my answers to your questions

    (1) What are some small business financing mistakes that you personally experienced?
    Not focusing enough on the working capital side of things (i.e. not negotiating enough on the payment terms, which eventually got a lot of capital tied up in invoices).

    (2) What online resources/websites provided information that really helped finance your business? What are some websites that did not help as much?
    What are your thoughts on the SBA?

    In Sweden I would say there is, which is helpful for getting governmental funding.

    (3) What are some of the best ways to finance a business when loans are not an opinion? ( Ex. bad credit scores, recent startups, or poor revenue)
    How did you overcome?

    Then I'd focus on getting paid by your customers upfront (credit card, Klarna, cash, etc.) and negotiating for payments through invoices with your suppliers, whilst keeping your inventory at an absolute minimum. That way you can get a negative working capital

    (3) What are some experiences with borrowing from friends? Did you use a promissory note? why or why not?

    I have avoided it, as it is way to risky for the relationships.

    (4) What was your experiences with merchant cash advance?

    Works well in my opinion.

    (5) what are some specific advice for certain types of business ( Ex. restaurant, hair salon, bars, consulting, etc. )

    Consumer facing businesses should focus on getting cash payments / credit card payments, whilst B2B businesses should negotiate for short payment terms with their clients.
    Last edited by vangogh; 03-14-2018 at 02:33 PM. Reason: removed links
    We help Swedish SMEs to get the right financing at the best rates at - Check out our public business loan comparison at jämför företagslån - Read more about financing in Sweden at Företagsfinansiering

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