Bank Financing

I am not typically a fan of reality TV. The Bachelor quite literally makes me sick (how can you sincerely fall in love with more than one person at the same time) and I don't think The Apprentice accurately or even interestingly portrays anything. Undercover Boss might be a different story.

Chicago's CBS affiliate recently covered an episode taking place in the city. The owner of White Castle went to work in one of his South Side locations and discovered an entrepreneur.

Jose Gonzalez, a White Castle employee, is shown in the episode to be an extremely hard worker with entrepreneurial spirit and a mind whose wheels never quit turning. My reaction, what a refreshing depiction and discovery.

Gonzalez wants to become a chef and takes culinary classes at his high school and brings his homemade salsa prototypes to the restaurant for co-workers to sample and weigh-in on whether or not he should add more jalapenos. He picks up as many shifts as possible and is thorough while on the job.

All of this caught the eye of CEO David Rife who has awarded Gonzalez with a college scholarship and introduced him to various Chicago culinary professionals all in an effort to make his dream of owning and operating his own restaurant come true.

Yes, entrepreneurs are born from fast food joints. Yes, fellow entrepreneurs who have achieved success have a responsibility to give back. And yes, not all reality TV is terrible.

I believe being an entrepreneur comes with a certain amount of responsibility to help others achieve just as we seek to achieve. It's a small community that contributes so much to the community, nationally and globally. At Milestone Advisors, we recognize this responsibility and seek to do our part by marrying great ideas with the proper bank financing or financial models that will attract investors, etc. Whatever we can do to help others achieve, we do.

And thanks to Rife putting himself in the shoes of his employees and deciding to give something back, Gonzalez now has a world of opportunities open. He may be competition for Rick Bayless in 10 years when Chicagoans are seeking authentic Mexican. He may become a mogul, dispensing business strategy or brand marketing strategy to more young entrepreneurs - all because one entrepreneur gave back. Think about it.

Great News! 

The effective rate for bank loans funded in February is 5.55%, a slight reduction from the January rate.  Why are we excited? Those are historically low rates that can help you, our clients and other small business owners secure bank financing or funding.  On another note, there is media discussion about enhancements to SBA loan programs, including a refinance program, for owner occupied commercial real estate loans coming due in the next few years.  These program enhancement proposals are currently in Senate and House legislation. The refinance program is not yet available. 

We would say now is the ideal time to start a business. We'd love to see Indianapolis and businesses everywhere taking advantage of these low rates and other opportunities. And we'll be here to assist in developing your financial model, build a business plan and a go to market strategy so you're prepared to visit the financial institution down the street and secure bank financing for your startup.

In recognition of Black History Month, Entrepreneur has compiled a list of the most iconic black entrepreneurs in history and dubbed it 'The Soul of Small Business'.

1. Oprah Winfrey (this should have been blatantly obvious)
Her story is incredible, her beginnings meager and her success unprecedented. Oprah reinvented daytime TV and transformed her personality into a brand with sheer innovation.

2. Berry Gordy
Gordy transcended racial lines of jazz, R&B and soul music when he developed the interracial 'Motown Sound' later leading him to found the iconic Motown Records.

3. Madam CJ Walker
The daughter of slaves and no stranger to personal tragedy, Walker developed her own product (a scalp conditioning/healing formula) and became the first female, self-made millionaire in the U.S.

4. John Johnson
The founder of Ebony and Jet magazines, Johnson provided African Americans with their own mainstream media outlets.

5. Cathy Hughes
Hughes developed and grew Radio One to the tune of 65 stations after being denied financing by 32 banks.

6. Russell Simmons
Simmons is an icon and attributed with making hip hop an acceptable and often applauded part of America's mainstream pop culture.

7. Magic Johnson
Yep, he's a basketball star. But he's also a smart investor. He's developed movie theaters, restaurants and coffee shops in urban areas in an attempt to revitalize their neighborhoods.

8. Tyra Banks
Beautiful to look at and smart too. Banks has become a media mogul, developing wildly successful TV shows, dabbling in music and movies and creating camps to teach young girls self-worth.

Here's what to take away from their examples.

Oprah is a marketing machine and it's all based on who she is, inserting bits of yourself or your personality into your company's marketing communication strategy or marketing strategy plan may give you that slight edge.

Both Walker and Johnson created something brand new. Innovation will help you lead the way in your industry accompanied by a product development business plan.

Cathy Hughes struggled to secure bank financing and won the battle. It's not an easy process but you only need one yes.

Venture capital is alive and well (and it can do good!), we know this thanks to Magic.

As for Tyra and Russell Simmons, they welcomed new technologies and adopted advancements in the media to launch their brands.

The best place to learn can often be the past.

The reality is that fraud does exist in today's business environment, with potentially devastating effects. Uncovering and unwinding fraudulent activities in a company's financial accounting department can be very difficult and many times the business owner will not recoup their losses. How can a small business owner prevent and/or detect fraud? How can fraud be prevented in circumstances where one person is responsible for the finances? How can a business owner safeguard the company's assets?

There are a few steps that business owners can take to reduce the risk of fraud:

• Lock your valuables such as check stock, cash, signature stamps, and physical inventory.
• Segregate accounting duties such as check writing and signing, receiving and counting inventory, and depositing checks and reconciling the bank statements. If this isn't possible with your current staff, you might consider a part-time cfo, controller or bookkeeper to segregate the duties.
• Review third party back-up when authorizing transactions, such as reviewing original invoices before signing accounts payable checks.
• Perform background checks and/or check references on all employees and prepare performance reviews to monitor the employees activities.

Unfortunately fraud will always exist in the business world, but with the right business strategy the risk of fraud can be greatly reduced.

Running a business is hard. Developing an original idea and building an organization upon it requires passion, dedication, time and creativity. Not only that, those four intangibles must flow forward continuously, providing you with a steady stream of inspiration and motivation. This doesn't leave a lot of time for all the additional nuts and bolts of running a company including hiring, firing and communicating with employees, managing vendor relationships and (many entrepreneurs least favorite task) balancing the books and projecting future growth.

Odds are, you don't have time handle all your company's finances. Maybe you have time to cut checks and perform a daily assessment of your bank account. Maybe you have time for more than that. The bottom line remains, more often than not, entrepreneurs are idea people, not numbers people.

Even if they do enjoy calculations and percentages, odds are they don't have the level of expertise that will allow them to compare their company to current market research and trends, build a sustainable financial model and project for the future (creating reports that enable you to make decisions that will ultimately allow your company to grow).

Many startups and small businesses can benefit from using the services and expertise of a part-time CFO. They can provide you with important information and advice to aid in decision making that leads to growth, avoid numerous business accounting pitfalls and aid in problem solving efforts positioning your operations for as much success as possible.

Do you cringe when the time rolls around to deal with your company's numbers? Do you have a vague or general understanding of terms like accounts receivable and payable, inventory and equity but if you needed to pull together a comprehensive analysis of all of them combined you might be lost?

Many managers and entrepreneurs who run their own businesses face this issue - an overall deficiency in basic financial knowledge that prevents them from fully contributing to any discussion that takes on a financial tone or deals with financial strategy.

It may be a good idea to try and increase your financial literacy - taking a course in corporate finance or asking someone who you trust and may be more financially savvy to mentor you. Another idea is to find others within the organization who may need to build the same skills, you may be able make taking a class a company-wide event (it won't hurt for everyone within your company to have a working understanding of these concepts).

The other option is to bring in someone who can offer that C-level expertise as a CFO. Renting a CFO can allow you to benefit from someone else's years of experience dealing with corporate finance, bank funding, financial forecasting and finance models - without the large price tag of hiring a full time executive.

Regardless of the solution you opt for, it's important to boost your financial IQ or bring someone else aboard who can help you do so.

When first starting a company, figuring out your brand identity is a key step in the process. You need to have a clear vision of who you are, who you want to be in the future and what your desired goals are as a part of a business strategy plan. A clear BRAND identity is also essential in securing bank financing and investors for an endeavor. The people lending money need to feel that you're comfortable with who you are and have clear goals set, using that identity as a foundation.

It may be useful to first visit what the word brand actually means to you. Seth Godin defines it as:

A brand is the set of expectations, memories, stories and relationships that, taken together, account for a consumer’s decision to choose one product or service over another. If the consumer (whether it’s a business, a buyer, a voter or a donor) doesn’t pay a premium, make a selection or spread the word, then no brand value exists for that consumer. 

A brand's value is merely the sum total of how much extra people will pay, or how often they choose, the expectations, memories, stories and relationships of one brand over the alternatives.

What do you think?

You may have a strategic HR plan in place at your company, but does it take you, the CEO, owner or leader into account? How often do you analyze your role within the company and how you affect such encompassing issues a program management plan down to the smaller matters of how you influence employees.

Entrepreneur has compiled a list of characteristics that define what it means to not be a good leader, but a superior leader. Below are some of my favorites:

Competency: You must be seen by your advisors, stakeholders, employees, and the public as being an expert in your field or an expert in leadership. Unless your constituents see you as highly credentialed--either by academic degree or with specialized experience--and capable of leading your company to success, it will be more difficult for you to be as respected, admired, or followed.

Communication skills: It does little good to have a strong mission, vision, and goals--and even a solid budget--if the executive cannot easily and effectively convey his ideas to the stakeholders inside and outside of the organization. He must regularly be in touch with key individuals, by email, v-mail, meetings, or other forms of correspondence. Of course, the best way to ensure other people receive and understand the message is with face-to-face interactions.

Getting out of the office or touring different sites is an irreplaceable method of building rapport and sending and receiving messages. "Management By Walking Around," or MBWA, meeting employees at their workstations or conference rooms, or joining them for lunch are just a few of the many effective approaches leaders can use to develop positive contacts with employees.

Be sure to check out the piece to see the rest of the important characteristics - you may have to work on developing some that you lack in order to do your part to ensure success of your company. Getting bank financing in place, yes, important. Creating a company marketing plan, yes, also very important. However, the style with with which you lead everyday operation is just as important as any of the above aspects and should be given weighty consideration on a regular basis.

If you're not familiar with him already, John Mackey is the founder and CEO of organic grocer giant, Whole Foods. What started out as desire and plan to meet interesting women by living in a vegetarian co-op has blossomed into an $8 billion dollar operation.

And through it all, Mackey, who was profiled recently by Fast Company, has developed quite a theory which he has titled Conscious Capitalism. What's it all about?

"Businesses that are more conscious of making a positive difference in the world make the world a better place from just being there," says Mackey in the article. "That all results in higher profit and higher return on capital. There are no losers."

Another expert addresses the beauty of the theory being rooted in the fact that self-interest and altruism can not only coexist, they can both thrive simultaneously without government involvement.

"One of the things that I'm trying to philosophically just destroy is this bifurcation that human beings are either greedy, selfish, only in it for themselves - or they're saints," said Mackey in an old interview with Time magazine.

The whole piece on Mackey is a must-read for any entrepreneur. I took away that making money and striving to become a profitable operation is an honorable goal. We can temper our business practices with purpose.

With the right business plan, market research and bank financing in place you have the beginnings of what can be a successful venture. But if you subscribe to Mackey's beliefs, you need a purpose behind the venture so ultimately, you're doing more than making money (which is great) but building up something greater than yourself.

As I type the above title the image of Scar perched on a cliff preaching to his heard of loyal hyenas about his extensive planning and maligning to steal the throne away from Simba in the Disney classic, The Lion King instantly pops into mind.

The kind of preparation I'm talking about is slightly different. Over the course of the past two years, we have seen CEOs of private companies manage conservatively, holding back plans for expanded operations, product lines or service offerings.

Add to that how difficult it's been to secure bank financing in days of late, with lenders cautiously screening loan applicants and reluctant to doll out any amount, regardless of how small.

Scar isn't that far off, if you have grand plans for your venture as he did for his 'regime', it's going to take extensive preparation. When you want to make a move forward with plans, you'll want it to happen swiftly and effectively. The key to achieving that: be prepared.

Here are some things to do in said preparation:

1. Invest in technology
Small and inexpensive improvements (particularly with all the free technology available today) may help your company run more efficiently, equipping you to handle increased business when you roll out new offerings.

2. Snap up talent on the cheap
We're all aware that with the economy in its current state there is a surplus of great talent in the job market who need jobs, turn the positive into a negative and hire these individuals at a discount.

3.Ramp up training
Take some time to evaluate current staff, give them both positive and constructive feedback and see what ways everyone can improve in anticipation of coming change.

4. From strategic partnerships
It doesn't cost much to meet other professionals for coffee once or twice a week. Dedicate some time to forging bonds with people who may be referral sources down the road.

5. Get to know prospective customers
Once again, efforts in this area shouldn't cost you much while spending time with them and getting to know their needs may allow you to tailor offerings to deliver more efficient services.

(The above points are taken from an Inc. Magazine article)

While these all sound like simple steps to take, combined, they can become an overwhelming to-do list. It's important to organize these initiatives into a strategic business plan. This preparation can also be a part of a marketing plan or product launch plan.

Scar isn't that far off. He has some big things he wants to achieve and he's cautioning others involved in his operations that they all have to have the mindset of preparation, meaning, there is a lot that needs to be done to position his plan for success just as there is a lot a company must do beforehand to prepare for good things down the road.

Who said Disney couldn't teach us lessons in good business practice?

Small business lending has been a popular topic of conversation ever since the bottom of the economy dropped out. A recent article in the Indianapolis Business Journal pin points the decrease of Small Business Administration lending in Indiana at 17 percent. In addition, SBA lending decreased by 64% at three of the four of Indianapolis' largest lenders.

The piece seeks to explain why and how this decline in lending occurred, providing more detailed answers and explanations than the standard answers that have been furnished as explanations thus far. Here are a few of the insights:

1. Banks are being conservative in their lending practices. After all, the current economic state is in part due to banks doing the exact opposite and approving loans much too freely.

2. Another potential explanation -- small businesses themselves are being more conservative by not taking as many risks (expanding operations, launching new products etc.) therefore the overall demand for small business loans isn't as high as usual.

3. Some small business' credentials have taken a hit along with the economy. Many companies who could have qualified for an SBA loan three years ago can't get anywhere near the front door of the bank, nor are they interested in trying.

Many Indiana banks expect SBA loans to increase over the course of the coming fiscal year. A trend that would bode well for the local as well as the national economy. These banks also say they're anxious to receive an influx of small businesses seeking their backing. However, some local companies say otherwise.

The IBJ interviewed one small business owner who said his requests for start-up funds was met with little enthusiasm and what he deemed were unfavorable terms. The challenge that we've seen at Milestone is that banks typically haven't been interested in discussing additional debt for businesses with or without the SBA credit enhancements.

It's our hope here at Milestone Advisors that small business lending will experience an upturn in the next few months. We hope to have many conversations with small business owners in the near future who are seeking bank financing for a new start-up, to expand operations or support a whole new brand. We can't wait to help you get started, determine the best corporate finance strategy for you, discuss how best to navigate through the SBA loan process in Indiana and the best ways to put funding to work for you.

It's official, CNNMoney.com is reporting that all of the $375 million designated to buoy the Small Business Administration's lending programs has been completely tapped out. Part of the Recovery Act, the funds were designated to help banks guarantee loans for small businesses. Now the current 148 loans waiting to be processed may not be approved.

With the above help from Congress, the SBA had been able to guarantee up to 90 percent of a defaulted loan, making banks far more comfortable with extending the loans. The aim of the program being to increase small business lending in general and stimulate the economy.

Although the money train coming to a stop is a surprise to no one, it wasn't projected to do so this quickly. We referenced the decrease in SBA loans in Indiana in an earlier post. Now there are $80.3 million in loan applications waiting to be processed and without the government guarantees from the SBA - they may never be approved.

The good news - representatives from the SBA say they're in talks with Congress to generate additional funding that will allow for continuation of the increased guarantee amounts and decrease in application fees etc.

Should the SBA succeed, are you in a position to benefit from what will be newly available funds for small businesses? If not, you should begin conversations that address bank financing and how to attract investors. Start to look at your current business strategies, conduct some market research or market forecasting, try to determine the best corporate finance strategy and discuss how best to navigate through the SBA loan process. This way, when the opportunity presents itself, you can be the first in line.

Indiana National not only recognized the signs and restructured their business, they did so and thrived. Are you recognizing the changes required in your business? Following the example of Indiana National, now is a great time to formalize your strategic plan and emphasize innovation to set your company far ahead of your competitors.

...who do you guys serve?

We serve the people who drive our economy and job creation. They are thought leaders, innovators, family businesses and people with dreams. In other words, CEOs of entrepreneurial start-ups.

The process of starting a new venture is embodied in the entrepreneurial process, which involves more than just regular problem solving as it is fraught with both fresh and charted challenges. An entrepreneur must identify, evaluate and cultivate opportunity by navigating through all the forces that regularly stand in the way of creating something new and unique.

At Milestone Advisors, we break this process down for you into four clear phases:

1. Identification and thorough evaluation of the opportunity at hand
2. Development of a realistic and actionable business plan
3. Determination and acquisition of required resources
4. Management of the resulting enterprise or business

These four steps can become a highly-involved and sometimes difficult process. We built Milestone Advisors with the idea to help entrepreneurs, small business owners and start ups evaluate themselves, build a realistic and comprehensive business plan or business strategy and secure bank financing that will allow these ideas to come to fruition and experience success.

We believe the small business owner with his/her drive and spirit is what forms America's economic foundation. We exist to serve those who buoy the economy, create jobs and believe in an entrepreneurial country.

Yesterday I talked about how important it is to research what other entrepreneurs or small business owners are doing to either launch or improve operations. This is not in an effort to copy necessarily but learn by reading about their major blunders and analyzing their success. Will things they have done work for your business strategy?

A lot of these thought leaders are more than happy to share their triumphs, processes and struggles in hopes that it can positively affect other business leaders. A wonderful aspect of 21st century technology - they can share all of this online, making their expertise and acumen more accessible than ever.

I present to you Inc.'s list of 19 Blogs You Should Bookmark Right Now. Some of my favorites and regular reads include Seth Godin, Guy Kawasaki and Michael Arrington. Seth Godin usually only writes a few sentences but it's as if he has taken an industrial power flashlight and shined it through a mass of clouds. His reflections are insightful and will get those wheels in your head turning.

Kawasaki is constantly offering advice that can help you improve business, mainly in terms of marketing. Some recent posts include 'How to get found' that explains SEO and a few quick tips on implementing an SEO strategy and 'How I twitter' which gives you a look at the methods and practices Guy utilizes with this social media and the rationale behind them. I like Arrington because, well, I'm a geek for technology and he has a great sense of what is going on that realm which is always closely aligned with the latest and greatest innovations in our country.

These blogs can help spark or fuel ideas that can change everything from your current business plan, how you go after bank financing to your overall business strategy. Read about their past experience and see business through their eyes, a new perspective may work wonders.

When looking to start your own business, it's a good idea to check out some of those who have come before both in the industry you're seeking to break into as well as some that are completely unrelated. You want to get a feel for what has worked and what hasn't in an effort to put together a strategic plan to be used as a roadmap for the first few years of operation.

Here are some insights I found interesting from Fortune's interview with the founder of True Religion jeans, Jeff Lubell.

1. Don't be afraid of powerful people
Lubell shares that when launching his brand, he approached some higher-ups at Gap to obtain private funding without a real introduction. While I completely agree with the sentiment, in all aspects of life actually, I think introductions to potential investors are important, whether you're tapping private investors or securing bank financing. Yes, don't be afraid to go after the big fish but do some research regarding the proper avenues to approach them. Private funding and investors can be the key to successfully launching and sustaining your business. From the very beginning interaction with these individuals should be one of mutual respect to foster a lasting, positive relationship.

2. Skip the prototype
Instead of designing a sample line and shopping it around to various retailers, Lubell had 14,000 pairs of jeans manufactured before he had met with one potential customer. While it's clear this worked for his endeavor, I don't think it's sound advice for everyone. If you're going to be selling a product, you have to make sure you have buyers before sinking capital into production.

3. Comp the sales staff
Now here's a great business strategy. Lubell gave free pairs of jeans away to sales representatives in stores that agreed to carry True Religion on a trial basis. After they started wearing them around their respective stores, stock sold out. It's one thing to get your product into a store, it's a completely different factor to get it endorsed. And could there be a better endorsement than people actually wearing or using your product? Are you going to believe a salesman trying to sell you on the new Ford Taurus if he chooses to drive a Nissan? Of course not. But if he drives one himself, you're far more likely to listen.

Lubell has many more secrets of success that are worth taking a look at, particularly if you sell or manufacture a product. However, the main point is importance of research. Both of what other entrepreneurs are doing well and what decisions have caused them to fail. By conducting this kind of business analysis you can identify strategies you might never have thought of otherwise as potential plans that can positively affect your operations and bottom line.

If you don't have the time do this kind of industry research and analysis, I suggest hiring someone who can. The beauty of a company like Milestone Advisors is that we have been out in the field for years, observing what the Jeff Lubells of the business world have done to catapult a brand or decisions that have tanked their sales. It's this broad experience that allows us to provide clients with business planning and analysis that can position entrepreneurial operations to succeed.

The Indianapolis Business Journal featured a few "Women in Technology" in this week's issue. We have been fortunate enough to work with Ali Sales Roach, the President of Compendium Blogware. Here's a portion of the article about Ali:

Determining how much money to raise at any stage of a business is not always a crystal clear decision. There are many factors that come into play: how much money will we need until we're cash flow positive; what valuation will we receive today; if we only raise a portion of our need today, will we get a better valuation in the future; are these the right partners that can get us all the way through; do we think we can find "smarter money" down the road, are these the right terms and conditions and on and on...

CEO's are making decisions about what's best for the long-term viability for the organization balanced with the challenge of not giving up too much in return. As Yogi Berra would say, "It's 90% art and the other half is science." Or something like that.

The Wall Street Journal recently ran a story about Blowtorch Entertainment Corp, a San Francisco based company that had big plans to distribute entertainment content across the net, is nearly out of business. How could they raise $50 million last year and nearly be out of business? The answer is because their investors, largely hedge funds, are themselves going out of business or have had to pull back severely.

“Our business plan was predicated on equity and debt,” Blowtorch Chief Executive Kelly Rodriques said. “Our debt effectively went away while we were working on our first couple projects and we just slowed everything down. We’ve kept it alive, but haven’t been doing any investing.”

Blowtorch’s story is an unfortunate case in which the company’s fate belonged to financiers instead of the leadership charged with executing the vision. Click here to read the full story at WSJ.com.

How can you avoid a similar fate? When our business consultants work with our clients on fund raising activities and the development of a corporate finance plan, we first build financial projections to try to determine how much capital is needed and what structure is best suited for the business. We also consider the condition of the market, the strength of the investor(s), the cash burn in the business, and confidence that management has in the execution of its strategic and business plans.

We would also typically steer our clients away from "committed" or "pledged" funds and instead opt to bring the money into their account or into an escrow fund. This should help avoid a situation like Blowtorch that thought it had $50 million when it in fact had something significantly less and was unable to execute its plans.

If you are wrestling with these issues, contact Milestone Advisors, an Indianapolis consulting firm that provides management accounting, corporate finance, and business strategy services to CEO's just like you.
 

PriceWaterhouseCoopers  and the National Venture Capital Association (NVCA) released a MoneyTree report on Tuesday that indicated VC investments were down 51% from the same period last year.  Funding in the 2nd quarter was $3.7 billion which translates into a decrease of $3.8 billion from the prior year.  Overall funding for the first half of the year was $6.7 billion, which is the first time since 1997 that VC's invested less than $7 billion in the first two quarters of the year.

Mark Heesen, NVCA's president, released a statement saying "Halfway through 2009 we are seeing more positive signs than at the beginning of the year, including an overall increase in investment levels and an ongoing interest in seed and early stage funding.  However, until we see notable upticks in venture fundraising and exit activity--which drive investment levels--we won't expect considerable increases in the number of deals completed each quarter.

The sector that benefitted most from VC investment was biotechnology, which received $888 million.  Interest in the telecom, media and entertainment, semiconductor and internet remained weak, with investment in the internet sector down 68% from the same period last year.

This data, while certainly not positive, underscores the importance of have a solid business plan and finance model when searching for venture capital or bank financing.  The ability to articulate this information in a concise and meaningful way is also of critical importance.  In this challenging time, the time tested adage that you only get one chance to make a first impression has never been more relevant.  If you need help building a financial plan or just another set of eyes on your plan before you present, the experienced Indianapolis management consultants at Milestone Advisors are here to help you.

Click here for an chart on VC funding by quarter.  

Surprises are part of what makes life exciting. We all love being surprised on a birthday or an unexpected visit from a old friend. But financial surprises are in a whole different category. Bankers will tell you that surprises in working with companies are rarely a positive event.

We are right in line with bankers in our feelings about surprises usually being of the negative sort. One of the first questions we ask when starting to develop the financial plan to help a company obtain bank financing is, "Is there anything we need to know about that you haven't told us yet?". During one recent engagement we found out about a lien placed by the state government after receiving a commitment offer from a lending institution.

Surprises like this can easily kill a deal that would have otherwise been successful. In this particular case we were able to have the lien lifted by our assisting our client with filing the appropriate paperwork. Not being aware of this before presenting the financial package certainly damaged the credibility of all involved and significantly delayed the availability of funds.

Whether you are considering working with a consulting firm or going straight to a bank for financing, it's always better to put everything on the table and work through any potential issues together. Holding things back in hopes that they slip through without anyone noticing is never a good business strategy.