Is the capital you are looking for going to be clean fuel or bad debt.

Before I go any further, I’d like to remind borrowers of the golden rule. What is the “golden rule”? Those with the gold make the rules.

Many non-bankable borrowers want and expect bank rates. That isn’t going to happen. If you are bankable, go to your bank and get capital. Otherwise, you will be looking at alternative funding sources or non-bank options. Most business borrowers fall into this category.

During our funding consultations, we often are able to present multiple funding options to borrowers. A few of those options are quickly dismissed as being “too expensive.” This is often by borrowers who have no real plan in place.

We believe when a borrower is looking for capital, they need to have a plan in place. Calculate their return on investment (ROI). You need to make money with the money you are borrowing. If you do, I call that “clean fuel” for your business. Funds that will fuel your business growth. If you are not going to increase revenue substantially with these borrowed funds, don’t do it. That’s called bad debt.

Don’t dwell on the cost of funds. Dwell on what you are going to use the funds for. Ask yourself the question? Is the capital you are looking for going to be clean fuel or bad debt? Again, if your answer is bad debt, don’t do it. But if it will be clean fuel, what are you waiting for? Let’s implement your plan and grow your business!