Hope I can get some help here! I am the female owner of a small business that I started in Feb. 2008, while still employed full-time. I redesigned my business plan, and obtained an investor and a payroll funding partner in August 2008 and began working for my company full-time with the help of a customer in which I had promise of a large contract, which would have enabled me to not only meet my first year's goals, but give me a "quick start" in obtaining other business, without having to obtain loans. Needless to say, we were doing great! Then it happened - economy downfall....my large account, was frozen! I quickly scrambled and tried to replace the business and was somewhat successful, and within 13 weeks had breakeven sales; however, then the holidays hit and layoffs. I am slowly building the business back up, and have reduced my employees salary - but am running out of capital quick. My current investor, which owns 39% of the company is a non-profit, and can not contribute any more capital and can not co-sign loans for me. My short time in business does not allow the company to stand on it's own, and my credit rating is not high enough (do to a personal bankruptcy 7 years ago) to obtain loans without a co-signer. I have talked with a couple of investors, one a competitor, but I am not sure that this is the answer. I know that every company makes this statement - We have high hopes for the future....but we really do. I do not want to loose my company. I need help. I believe that I have been a good steward with the money that our company has.
Here are some facts about my company:
- We are classified a private placement agency - licensed in the State of SC (however we do much more than traditional staffing, such as traning and translation services, construction services, exclusive job board services, marketing and sales project services)
*We are securing new contracts, but most will not begin until March - April 2009
*We have a small new construction project (sublabor only) that begins today with total revenues of approximately $9,000.00 - with a good profit margin
*I own 61% of my company and non-profits own 39%
*I am currently not taking a salary, but can not survive very long (As I do not need my personal credit situation to get worse)
*I have a "back office" funding partner, that provides advance funding (90%) on my invoices (for contract staff only), but charges me a 3.5% fee on the sales with a minimum amount of $400.00 per week.
*I have been talking with a competitor that is willing to "privately" invest in our company, and is willing to buy out the non-profits, provide the capital that my company needs, but wants to control the check book and wants 50% of the company (My concern with this is that this person does have the potential to control my growth, and could eventually take over my business.....I would then be working for him! - This person has also offered to take over my current business, and employ me, pay me a salary to do sales for his company, and do a profit split with me - of course I would need to explain this in more detail - Another problem)
*I can not get a bank loan nor can I even obtain a business credit card
*I am even finding it hard to get an SBA loan (which would be realitively small anyway)
*We lease our office, and our rent and expenses are very reasonable.
*Our company currently has no debt (other than our funding partner debt) - No company cars, etc.
Any help would be very much appreciated.