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How to Improve YOUR Chances of Getting $$$ for YOUR Business. SCORE June 25, 2015

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How to Improve YOUR Chances of Getting $$$ for YOUR Business

SCORE June 25, 2015

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MONEY IS THE LIFELINE OF ANY BUSINESS,

WHETHER YOUR BUSINESS IS:

o a Start up, or

o an Existing business

securing financing AND developing a banking

relationship is a major factor in succeeding and

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4 Ways to Improve Your Chances of Getting a Small

Business Loan

1.Provide Detailed Information – YOU WILL NEED A BINDER 2.Seek Out Help from Not for Profits in the Economic

Development Field to Help Create and Gather the Information You Will Need

3.Be Familiar with the Information You are Asked to Provide and Speak Confidently

4.The More the Merrier – Have a list of 5 Targeted Lenders -Think Local Banks/Credit Unions/Not for Profit Lenders

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Basics that you Should Have in Your

Binder

Business Plan (including Cash Flow Projections and a Budget for how you are going to spend the Loan Proceeds)

Organization “Set Up” Documents

Two - Three Years Personal (and Business) Tax Returns

2-4 Months Bank Statements

Interim Financial Statements if an existing CompanyPersonal Financial Statements (showing assets and

liabilities)

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Organizations that Can Help You

SBA www.sba.gov

New York State Small Business Development Centers

SCORE

Small Business Advisory Alliance

Procurement Technical Assistance CenterCommunity Capital New York

Women’s Enterprise Development CenterWCC- Professional Development CenterWestchester County Office of Economic

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Be Familiar with the Information You are

Asked to Provide and Speak

Confidently

Know your revenues – history and projectionsKnow your margins

Know your overhead

Be familiar with cash flow management strategyBe truthful and open

Know your personal credit score

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The More the Merrier

Start with where you personally bank

Think local and regional banks that have a vested interest in “local communities”

Target Five Banks and “go in” to their local branch and see if you can find a contact

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Some Alternatives to Bank Financing

Not for Profit LendersFamily and FriendsHome Equity LoanSelling Assets

Angel Investors

Venture CapitalistsCrowd funding

Beware of Credit Card Financing and On-Line Lenders

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Family and Friends

Choose your Financier carefully

Be clear- is it a loan or a share in your businessHave a Written Agreement in place – with a

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Angel Investment

High Net Worth Individuals- they want to invest in Early Stage, High Potential Businesses

Equity position and some management/decision making power/control

Expect 20-25% return on investment

Can serve as advisors-typically have some experience in your business type

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Venture Capital

Interested High Growth Stage BusinessesHigh Return expectations/equity position

Small Businesses beyond the Start-up phase- Have to have Revenue!!!!

Quick Way to gain “millions” of dollarsProvide professional expertise AND want

management/decision making power/controlFocus on specific industries - biotech,

nanotechnology

Beware - short leash - typically want to recover investment in 3-5 years

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Bank Loans

Micro-lenders - $1,000 - $50,000

Personal or small business loans – thru Banks or Credit Unions – Think local

SBA loans- administered thru Banks- 2 years in Business is typically required

– 7a- 10 year term – 504- 25 year term

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Crowd Funding

Defined as “The process of raising a large amount of money in small increments from a large number of people to fund the capital needs of a cause, project or enterprise.”

Targeted $ and Discrete Time Periods – “All or Nothing” OR “Keep What You Raise”

Loan (www.kiva.org) or Reward (www.kickstarter.org)

Getting some SEC attention

Great for creative or other projects that tap into a crowd’s “passion”

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Five “C’s” of Small Business Lending

• Character

• Credit

• Capacity

• Capital

• Collateral

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LOOK GOOD FROM THE GET-GO

• BE PREPARED

• BE THOROUGH

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MAKE YOUR BANKER/LENDER A

TRUSTED ADVISOR – KEEP THEM

INFORMED AND UPDATE THEM

REGULARLY. THEY ARE A MEMBER

OF

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About Community Capital New York

• Community Capital New York is the leading not-for-profit small business lender in the Hudson Valley, the Bronx and Fairfield County.

• Our lending process is personalized and intended to help those small business that need financing to launch or grow their business – but cannot meet the credit and collateral requirements of Banks.

• Rates are low, a broad range of credit scores (600+ FICO) and alternative forms of collateral are acceptable.

• On-line application with lending decisions made locally by our loan committee of lenders and entrepreneurs.

• See “Loans at a Glance” for specific loan terms and documentation requirements.

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About Community Capital New York

• Community Capital New York lends $1,000 -$50,000 to start-ups and existing businesses

• Community Capital New York is overseen by the SBA, the Treasury Department and Empire State Development

Corporation (ESDC). Loan capital is BORROWED from the SBA and ESDC.

• Community Capital New York provides over 3,000 hours a year in technical assistance to applicants, clients and local

entrepreneurs on a variety of subjects through one on one counseling, workshops, seminars, newsletter and on-line training materials.

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Contact Information:

Simone Obermaier 914-747-8020 ext 10

sobermaier@communitycapitalny.org

Community Capital New York 7 West Cross Street

Hawthorne, NY 10532

References

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