Every business owner will meet a cash flow crunch at one time or another. Whether a customer takes their time to pay you, or you have grown so fast you can not keep up with the capital demands to sustain it, it is highly likely to happen. Most are well aware of alternative financing sources, and most have a bad taste in their mouth. Whether it’s the constant phone calls, unsolicited emails, texts, mail, or pushing ads in your face on social media, you are well aware money is out there. Most of the clients we speak with all have at least one negative story to share, mainly having to do with the behavior and lack of professionalism of the person who attempted to get a working capital program in place for them. So they keep trying, encountering the same behaviors, bait & switch, and sometimes far worse. When we started Strong Capital Funding, we were well aware of these issues, and have focused on doing our part to change the perception, one client at a time. Here is what you most likely do not know or realize about looking for a capital provider.
NEWS FLASH, YOU ARE TALKING TO A BROKER
There are 10s of thousands of funding companies to choose from. There are funders, lenders, and brokers. A funder provides merchant cash advances, a lender provides business loans, and a broker is a consultant in the middle that is supposed to help determine what your best chance of success is to obtain the best terms tailored to your type of business. I hear this literally every single day…. “We are a direct lender”. First of all, if you are doing merchant cash advances, you are not a lender and the statement is false. Brokers love to tell their prospective clients they are lenders, funders, direct, etc. Most will claim they will do it in house, or if it does not meet their risk parameters, they will use a “partner”. 99% if not 100% of their files are sent to a series of funding sources, typically with no understanding of where you have the best shot to get the right options. Our website specifically states we are not a lender, funder, or originator of money, something I have not seen anywhere else. You need to realize that this broker can do one of two things. #1. They can work hard with no bias to anyone to get you the best deal that makes the most sense for your business. #2. Come up with a game plan to make the highest amount of money from you, putting your business potentially in a dangerous position. You very well may be talking direct to a funder or lender, but you can be assured there is a level of bias on what program to offer you.
WITH 10s OF THOUSANDS OF COMPANIES, WHO IS RIGHT FOR ME?
To most business owners, this can be a daunting task. Calls, emails, mail, ads, all constant. Many will just pick whatever comes right when the need arises. When you are talking initially to a funding company, the first thing to watch for is what they say. Does the conversation start with talking about rates? Are they listening to your needs? Do they sound like they belong in an overseas call center? First impressions are key in life, and this is no different. If they are doing all the talking trying to “educate you”, just hang up. A professional consultant will be asking a few questions, and spending most of their time with you simply listening and taking note of every aspect of your scenario. You need to analyze the person you are talking to, and make that determination if you even feel comfortable with them. Here is the bottom line, we all have access to MOST of the same products, the one difference you are going to get is the person you work with. I have met some incredibly amazing, honest people in this industry. They spend considerable time listening, they are honest and tell people they do not qualify for something if they do not, rather than take it and offer something else. They teach you how to put your business in the best position to get what you want, and what not to do to damage your chances moving forward. On the flip side, most will put their pockets first, making false promises to get you funded. Like a construction company that comes in to fix another persons bad work, this is something we see every single day, and we do that repair work. If you encounter the following, you have a bad one:
1.They sound highly unprofessional on the phone
2. They do not get back to you promptly when you call or email
3. They talk about “rates that start at 3.25%”. Sorry, they do not, and they will claim later its “3.25% per month” when called out
4. They are consistently pressing for bank statements before telling you what types of programs you will be expected to qualify for in detail
5.They promise the terms you initially asked for if you abide by their terms first for a set period of time to get there
SO WHAT DO I DO THEN?
What is important, is simply screening the company. Google their name, look the owner up on Linkedin. These two steps alone can tell you 75% of what you need to know. If a company has no online footprint, they may be brand new and starting off. There is nothing wrong with that, there was a time we were brand new, and on day one. Most of the time, it is because they burn and turn branding names to cover their tracks on past negative chatter. Just ask. Maybe they are new, and they do deserve a chance to serve you if they can do a fine job. If they have numerous business listings online, positive reviews, a highly professional website, an owner on Linkedin proud to attach his or her name to it, that is a great start. Make sure to digest reviews for what they are, every business gets a bad review from time to time, but it is important to understand why. A highly respected company I will not name, mails around 1 million advertisements a month. They have plenty of negative reviews, but it is over their mail. You engage a million people, some are going to be very unreasonable about it. Simply reading and understanding is key here, run away from reviews that talk of bad business practices, like charging fees, abusing credit, or other customer service related items. Give them a call, watch for the five points above, and use your judgement to determine if this is a good person or company to work with. Once you find that long term working capital partner, you never need to worry about any of this ever again. The best relationships are built by highly professional brokers to the funding sources (this makes a massive difference company to company in terms you may receive), and they will forever be able to connect you to the best sources of capital, so you can grow, expand, and hit your dream goals in your business.
Want to talk about this stuff more? Want to see your options or where you stand? Want us to check the work of someone else for you? Reach out, one of our top of the line funding professionals will give you the cleanest, most honest rundown you have received to date, guaranteed.