ForumsFinancing Tips

Seck305,

I have worked with many restaurants in obtaining financing for their venture. The thing with banks (you as an ex-investment banker should know), is that risk plays a large role in their lending practices. I would like to review your business venture in some greater details and perhaps help you get the financing you need. My firm works with businesses of all sizes in obtaining their commercial financing goals. My email address is d.skolnick@skolnick-associates.com.

CC08

I don't see how the concept is relevant here. I know how banks work from a merger and acquisition standpoint when Company A wants to acquire Company B for $300MM with triple A credit.

However, what I don't know is how banks view me, what they are willing to lend to a small business based on cash flow. I've come to search here to see others personal experiences, and i'm disappointed to find that thus far there are only individuals trying to promote their own businesses/products.

If you want to have success in obtaining financing, I strongly suggest that you use a lender like me who works with multiple lenders. Banks typically will not seriously discuss a loan with you unless they have a relationship with you. You're not shopping for a car loan or home mortgage, you're looking for a business lender who will take you seriously and work with you.

Based on what you wrote, I can see why you may have some problems. In addition to having good credit and adequate collateral to finance a startup, a business lender is going to look closely at your experience in the business you want to start. You cited your experience in investment banking and real estate, but you didn't say anything about your experience operating a restaurant. Either you need to have that experience or you need a partner that has the experience.

In qualifying for a startup loan, you need a solid business plan and reasonable cashflow projections. You need to thoroughly research everything and know the market and operation intimately. You'll need to provide a breakdown of the use of funds - leasehold improvements, equipment, and working capital. A lender won't be satisfied with estimates for leasehold improvements and equipment. You'll need real numbers from vendor quotations.

For SBA financing, you'll need to provide 25% to 30% of the total cost in the form a non-borrowed injection. There are other alternatives to SBA but that depends on the business.

If you would like to discuss your plan with an experienced lender, please contact me at DougA@equitycorpfinance.com or 888-498-8999 ext. 109

Doug