Options exist when it comes to accessing post-recession capital, as long as business owners get connected to the right resources.
That’s the message the Southwest Washington Workforce Development Council (SWWDC) and the Columbia River Economic Development Council (CREDC) want local business owners to hear, now more than ever. The organizations sought to convey that message during a Business Services Partnership meeting last month titled “Capital Access for Small Business.”
In attendance were a number of small business owners and business professionals who weren’t shy about venting their frustrations over accessing capital. On hand to hear those concerns was a panel of financial industry experts representing local and national banks, a local credit union and the Small Business Administration (SBA).
“You could see that there could be a potential cat fight breaking out between the businesses and the bankers,” said Bonnie Moore, director of business services for SWWDC & CREDC. “But I think the most important thing to drive home is that it’s important for the banking community to be aware of these struggles and not to just write it off as a business that probably has bad credit.”
Tim Barry, president of Intelligent Technologies Inc., a Vancouver-based retailer that operates a number of niche market web stores, said he tried taking his demonstrated well-planned, well-presented business model to ten different banks between May and June of 2010 in an effort to get a loan.
After applying with four banks and getting nowhere, Barry said he came to the conclusion that the banks just weren’t looking to lend.
“We’re a growing company here in Vancouver with employees and infrastructure. We’ve generated $4.5 million in total revenue,” explained Barry. “After over seven months of presentations, meetings, phone calls and updates, we got nothing.”
What might have been the most frustrating aspect of Barry’s experience, he said, was that the lenders were providing very little in terms of feedback.
“I think the banks just decided they would clamp down on the cash and not risk it,” he said.
Russ Hooker, a lender relations specialist for the SBA, said he didn’t understand why Barry had so much trouble getting a loan.
“I don’t know who you bank with, but that’s a shame because you’re banker is missing a huge opportunity in not working with you,” said Hooker.
None of the financial institutions represented by the panelists at the SWWDC/CREDC meeting had worked on Barry’s loan application. However, each panelist agreed that in today’s lending environment, collateral and cash flow are vital.
Despite Barry’s experience, both Hooker and Moore said loans are being made.
“There are deals being done every day,” explained Moore. “Whether it’s through the SBA or the Washington Small Business Development Centers, it’s important for business owners to keep trying and to get connected with the right resource.”
