The following is an interview was conducted on May 30, 2013 with Amber W. Zachery. Amber is currently an Assistant Vice President and Financial Services Manager with First Citizens Bank in Brevard, NC. She has been in the banking industry for several years and has served in her current position since September, 2010.
If an entrepreneur wants to receive financing from you financial institution what is the first thing you ask to see from them?
I want to see a business plan. If they don’t have a business plan it shows me that they are probably only in the beginning stages. It also might mean that they are first time business owners and perhaps do not have financial backing from other sources. When they don’t have a business plan or don’t know how to start one I suggest they do some research. I also encourage them to work with the SBA (Small Business Association). Additionally, Blue Ridge Community College has a team of experts, most of whom are retired business individuals, who volunteer their time to help people write business plans. The other place I ask people to visit is Mountain Bizzworks (http://www.mountainbizworks.org). There are a lot of resources out there in our local community for entrepreneurs to tap into.
If they do have a business plan I look to see if it is well thought out and organized. Do they make reasonable assumptions and do their initial numbers look reasonable?
So let’s say that they have a good looking plan what is the next thing you are concerned about?
I need to know how much money they want. That’s really why they have come to the bank to get money to finance their business.
But there is more to it than just that. I ask them if they have any experience in the field or industry they are trying to get a foothold in. I need to know if they have a location in mind of where the business is going to be set up. Will the individual have a store front or is it a home based business. If they are going to have a location that is not their home, will they rent, lease, or own the building or property they occupy. I prefer they either purchase or own the property.
Are there any financial records that you need to see to make your decision to give them a loan?
Of course that paperwork might vary depending on the amount of money requested.
Is it easier to get financing if the entrepreneur is purchasing an existing business that is currently in operation?
Even if buying a currently operating business we will consider the new owner a startup unless they have an established business already in the same field.
If the business is approved for financing and there are multiple members or shareholders of the company who needs to sign the loan agreement?
Any member of the business, who has twenty percent or more ownership of the company, whether it’s an LLC, S-Corp, or another business structure, must sign.
Do you have any words of wisdom for an entrepreneur who might just be starting out?
Absolutely, don’t just assume the bank is going to loan you money. Consider getting other investors interested in your business. Someone who is willing to step out on a limb to give you money or at least partner with you will help out a lot. Ensure that you have a solid business plan before you go shopping around for a loan or even investors. Consider working with a small business incubator group to get a solid foundation before you enter the market place.
