Government Grants for All

9 Things You Must Do to Maximize Your Chances of Obtaining a Small Business Loan & Alternative Venture Finance: Federal Grants and Loans

To get approval for your small business loan application, you must be able to meet the lending criteria set down. Some organizations are more risk averse than others, and will therefore have more stringent criteria.

To vastly increase your chances of a successful funding application, you will need to present the following information:

1. The reason for the loan. The lender will be looking for something that fits within the normal range and expertise of your business. The amount may cover a number of items, so you will need to cover each.

2. The amount required, and the repayment term of the small business loan you want. (e.g. ,000 term 5 years, payable quarterly).

3. Details of how you will repay the amount borrowed. For example, “From the increase in profits of reduced running costs of the Whizz-bang Go4It”

4. Details of security you will be able to offer to the lender. This will act as reassurance for the lender. If you’re not prepared to put up some aspect of security, then why should they?

5. You will need to include your business plan which will serve to answer essential questions relating to management capabilities, information about the market you operate in. What kind of business you are in etc.

6. 3 Years financial statements. You will need to present quality financial information from your accounting software, preferably signed off by your accountant or tax advisor.

7. Latest Set of Management accounts. Again produced from your accounting software.

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8. Accounts receivables (debtors) and payables (creditors) ageing reports.

9. Principals financial statements. – Particularly required if some form of security is necessary.

While most companies seeking venture capital initially think about angel investors and venture capitalists, a large alternative source of financing is federal grants and loans. The two largest federal grant programs are run by the Small Business Administration (SBA), and by Small Business Investment Companies (SBICs).

An SBA loan, regardless of whether it is a direct loan from the SBA, or, as is more common, a bank loan guaranteed by the SBA, is essentially a bank loan. The benefit of it versus a traditional bank loan is the rate. SBA rates are typically much less than traditional business loan rates.

In most cases, in a guaranteed SBA bank loan, the SBA guarantees 90 percent of the loan will be repaid to the bank. As such, banks are at much less risk than in most other loans, and are a bit more flexible with regards to who they offer these loans. However, the SBA usually requires the founders of the company to personally guarantee the loans, which makes them risky should the venture collapse.

Alternatively, Small Business Investment Companies (SBICs) are privately organized corporations that are licensed and regulated by the SBA. Small or emerging businesses which qualify for assistance from the SBIC program can receive equity capital and/or long-term loans from these companies. Essentially, these companies provide their own capital, which is supplemented by federal funds, to the companies they fund.

Interestingly, U.S. taxpayer’s benefits from the SBIC program as tax revenues generated from successful SBIC investments have more than covered the cost of the program. Likewise the program has created hundreds of thousands of jobs.

In summary, SBA and SBIC financing are viable alternatives to financing from angel investors and venture capitalists and should be considered in the capital raising process. Similarly to angel and VC financing, companies seeking SBA and SBIC financing need a strong management team and value proposition, and a highly professional and compelling business plan in order to raise the capital they need.

If you are a new company, the emphasis is going to be on your business plan, and the security (also called collateral) you or your business can provide against the loan.

You must take the time to practice presenting your case to the bank or lender to iron out any glitches. Practice on your colleagues and family (you never know, they might be so impressed, they’ll invest or lend!). It may help to role play the lender and come up with as many pointy questions as possible. The more time you take the better your chances will be. (But remember; don’t fall into the analysis paralysis trap!)

Tags: Alternative, Business, Chances, Federal, Finance, Grants, Loan, Loans, Maximize, Must, Obtaining, Small, Things, Venture

Maximize Your Credit Card Services with Small Business Loans

Since June 15, 2009, the United States Small Business Administration has been processing deferred payment small business loans of as much as ,000 to be given out to 10,000 small businesses. This is covered by the SBA’s America’s Recovery Capital (ARC) Loan Program.

To qualify, companies should be private enterprises that are for-profit. They should have up to five hundred employees only and should be at least two years old. Furthermore, they should be able to prove financial need with a twenty percent decrease in sales, revenue or working capital. On the other hand, they should be able to prove that one of their two years in business has been profitable, and that with the infusion of cash they will be able to meet their existing and future debt obligations. This means positive cash flow projections. The ARC small business loans are intended to be used to pay outstanding debt such as payables to vendors.

For this batch of small business loans, there are no fees or costs involved, except if the borrower defaults on the loan later. In that case the SBA-approved lender can charge costs for securing and liquidating collateral.

The ARC small business loans also do not charge interest. Actually, the SBA pays the interest for the borrowers. Disbursement of the loan can take as much as six months but payment of the principal is also deferred for the next 12 months. After that, the borrower has five years to repay the loan principal.

Each small business can only avail of one ARC loan. SBA-approved lenders will offer the loans until September 30, 2010 or until available funds run out, whichever comes first.

There are, however, an estimated 30 million small businesses in the United States and only 10,000 of them can avail of the government’s small business loans. What if you do not happen to be among the 10,000 lucky recipients? How will your small business survive?

There are even doubts being raised on whether as much as 10,000 businesses can indeed avail of the ARC loans. There are fears that there may not be enough lenders willing or able to participate in the program. Lenders will have to advance the full amount of the loan, will not receive payment on principal for a full year, and will not be able to charge any fees, thereby absorbing all administrative costs. This may be too steep for many lenders. They may not be able to afford to participate at all.

This is where you as a small business owner can and should maximize your credit card services. We are not talking about your personal credit card services here. Instead, we are referring to the merchant services that enable your small business to receive credit card  and debit card payments. Surely, any business these days avails of these types of credit card services. After all, more people pay by credit card or debit card rather than cash.

Most credit card services offer small business cash advances that can be as substantial as small business loans. These small business loans do not require any collateral because they are secured by your company’s future credit card receivables. This is even more convenient for your business because repayment is also built into those receivables. Credit card services automatically deduct a percentage from your income to go toward loan repayment. For as long as you have incoming sales, you can support your loan. Interest rates are often quite affordable considering how the loan can help your business.

Small businesses should therefore look into maximizing these credit card services for small business loans. The survival of your business could hinge on this.

Tags: Business, Card, Credit, Loans, Maximize, Services, Small

Scholarships for Dads Let Men Maximize Their Potential!

The new scholarships for dads let men maximize their potential through a combination of learning new skills and gaining new knowledge about their chosen field of expertise. This brilliant new addition to the already generous federally backed student loan-and-grant program places helping dads acquire additional knowledge to enhance their value to their employers.

By developing this way of supporting the nation’s dads through his stimulus package, the Government has placed emphasis on helping America’s traditional bread winner and the head of the traditional family. That help sends a positive indication of the President’s support of home and family values at a time when those values undergo daily attacks from popular culture.

By pumping additional money into the economy in order to strengthen the nation’s employment situation as well as to provide a way for dads to increase their earning potential, the President seems to have identified a win-win situation all the way around. By improving the job skills of fathers who have a realistic need to support their families, the program addresses two issues at one time: job performance and the support of our nation’s children.

Applying for one of these scholarships is simple for dads to complete. The process is free to dads of all types, from all walks of life and job status, and may be started by securing one of the applications at participating websites.

This educational opportunity can be used to learn additional things, or to enhance already-existing job skills to enable the dad to advance in his job and have a more secure place in the workforce. Upon winning the scholarship, the funds may be expended for either school-related costs or living expenses.

One of these student scholarships is awarded to one of the applicants each calendar month. Because this operates as a grant, the money will not need to be repaid as a student loan would need to be. The funds must be used at one of the participating schools according to the terms of the program.

All dads desiring to improve their educational credentials should apply for this great scholarship program. At that time, in coordination with a participating school, it would be prudent to investigate other academic programs and additional scholarship availability. Checking into these programs is free and there may even be another program more closely suited to you than this stimulus program scholarship program!

Did you know you can get a substantial amount in scholarships and grants for dedicated dads toward any school without having to pay anything back? Apply right now for free: Scholarships for Dads.

Tags: Dads, Maximize, Potential, Scholarships, their

Top 7 Ways to Maximize Your Exit Strategy Now for Maximum Profit

Leading financial researchers report that 75 percent of U.S. businesses do not sell. It dismays me to see entrepreneurs receiving so little in return for all their years of hard work. Or, having to shut their doors with no buyers in sight. It’s even more disappointing, since businesses can easily take steps to achieve maximum perceived value for a potential buyer. It just takes a little planning, know-how and application to take a $100,000 a year profit generating business and sell it for either $200,000 or for over a million bucks? Do the math! Multiply your profits by two and by ten. That’s the range that you can sell your business for when you follow advice I give to MaximizeYourExit.com clients including these seven steps to maximum profit.

My Top 7 Ways to Maximize Your Exit Strategy Now & Sell Your Business For Maximum Profit

When it’s time to sell, you must ask an all-important question: “What am I doing to increase the asset value of my business?” To prepare for your sale, start with these pointers:

1. Quantify Your Business Value

No one will price your business without knowing its exact worth. You need to identify which assets to include or exclude from the sale. You also have to list your risks. Then you’ll have a better idea of the value of your business. It may not be worth as much as you’d like, but now you have a realistic idea about price expectations and goals to meet.

2. Eliminate Worthless Inventory and Debtors

No one wants a business with out-of-date stock. So, get rid of it. Same with long-term non-payers. Make them an offer they can’t refuse or write them off. Both outdated inventory and debtors weigh down a sale.

3. Straighten Financial Records

Buyers want the facts, and they will be asking scores of financial questions. You must be prepared to answer everything and anything about the reporting end of your business. This includes balance sheets, assets and liabilities and the taxation position. All clean and ready to view.

4) Audit Your Books

More specifically, your CPA needs to audit your business records to include extensive verification, confirmation, and performance. An evaluation of internal controls can be considerable help to both you and the buyers.

5) Strengthen Legal and Contractual Affairs

Buyers will also have many legal questions. What is the ownership and structure of your business? Have you been compliant with the regulations for your particular business? What contracts do you have with customers and vendors? What is their status? What is outstanding?

6) Install and Improve Systems

Owners are the main source for daily operations. Unfortunately, such details are often only stored in their brains. A big plus is writing up department manuals. These how-tos do not have to be long and complicated. You need just enough to cover the basics and relieve your potential buyers’ anxieties about your absence. You can also use videos using software like Camtasia.

7) Prepare Your Management Team

Even better than the written manuals is having someone in place who can personally answer questions. In larger firms, the buyer wants to know what manager(s) will help with the transition. Who will be the knowledge bank? How long will this source(s) be staying?

This is one of the most critical times in your life. It’s essential to be prepared and ready for any prospect who may come through your door.

The seven steps described above is just the beginning. It’s a start in the right path toward higher profits. If you want to sell your business for maximum profit, then you need to start planning your exit strategy now.

World-leading business exit strategist, Harvey Zemmel has helped thousands of business owners just like you sell their businesses for the maximum price. Now, he reveals how you can sell your business for at least 5 times more, in minimum time… and be in the elusive 1% Club. Get his FREE Special Report “7 Shocking Mistakes You Must Avoid When Selling Your Business” now at:http://www.maximizeyourexit.com/report2B.php

Tags: Exit, Maximize, Maximum, Profit, Strategy, Ways

What Rent Should The Manager Charge To Maximize Revenue?

The manager of a large apartment complex knows from experience that 100 units will be occupied if the rent is 372 dollars per month. A market survey suggests that, on the average, one additional unit will remain vacant for each 6 dollar increase in rent. Similarly, one additional unit will be occupied for each 6 dollar decrease in rent. What rent should the manager charge to maximize revenue?

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81 units @ $486 each

Tags: Charge, Manager, Maximize, Rent, Revenue, Should