Comstock's magazine 0219 - February 2019 - Page 77

SPECIAL PROMOTIONAL SECTION friends and credit cards,” says Fleming. “Not with us.” Leslie of the SBDC agrees. Whether the money comes from self-financing or equity on a balance sheet, “the banks are looking to see if you have skin in the game. If you are asking the bank to take a risk, they want to see that you are taking a risk, too.” For budding entrepreneurs whose wal- lets are a bit thin, Ciaran McMullan, CEO of Suncrest/Community Business Bank, sug- gests obtaining a loan from an online lender. “There are many around the country and some are better than others,” he says. “They are usually good for smaller loans between $5,000 and $250,000 and often are good for businesses, like startups, that can’t meet lending hurdles from banks.” LEVERAGE YOUR ASSETS McMullan notes that one of the most chal- lenging times for financing is during the transition from a startup to medium-sized business. “That’s when the visionary who started the company needs to become a manager. It’s critical to develop proper re- porting and accounting systems. As the business grows and you accumulate more capital, the bank expects more information.” As a company grows, the structure of its financing will depend on its needs. As a company gains assets, it can leverage them to meet its financial needs. A startup that wants to buy a building it has been leasing, for example, can use up to 75 percent of the building’s collateral for a long-term, fixed- rate loan. A line of credit for day to day op- erating expenses can be secured with a per- centage of inventory or accounts receivable. As much as 80 percent of the cost of new equipment can be used to secure a loan to buy it. n Bill Sessa is a Sacramento-based freelance writer. Contact him at bsessa1064@aol.com. Live Here. Bank Here. Grow Here. Strong communities are built on successful businesses. We’re here to support both by providing more of what your business needs to thrive. • Experienced local business bankers • A full range of business & personal banking products • Custom loans & local decisions • Sophisticated cash management tools • Competitive commercial & agricultural financing solutions • Commitment to building strong local economies (916) 830-3560 SuncrestBank.com Member FDIC | EQUAL HOUSING LENDER © 2019 Suncrest Bank. All Rights Reserved. February 2019 | comstocksmag.com 77