Financing Your Business or Practice

Business insurance background with two peopleRainmaking.  Financing your business or practice is not just about finding money to support your development.  It also cuts to the heart of what you’re financing, why you’re financing it, and what’s the best alternative for you to pursue in your financial quest?  In other words, matching the money source to the money need.  Rainmaking.

We’ve often told clients that we can help them develop a plan whereby they can pursue a financial opportunity;  we’ve even introduced them to financial entities–institutions or individuals that could help them fund a project, concept, or development.    Sometimes we’re very successful.  Sometimes we’re able to help them achieve financing some part of the project they share with us.  Sometimes we’re not.

What Makes a Funding Opportunity Successful?

Often, a client presents us with a well-constructed, well-developed business plan that simply makes good business sense—for any lender operating in that space—to approve.  The risk is low, the opportunity high.  It may be a project that has not been developed previously, or it may be a project that has been partially developed or has been developed along a tangential development framework to what the client initially envisioned.  These projects jump all hurdles and clear financing easily.

We maintain a list of lenders we can recommend in a variety of funding areas.  Most lenders work within a fairly well defined niche comfort zone.  It’s foolhardy to present a project requiring venture capital for software development to a lender who specializes in hard money financing for real estate ventures.  Yet, many “lending sources” try to fit all types of required financing into one source.  One size does not fit all.

What If a Funding Opportunity for a Client Has Not Been Successful?

More often, however, clients bring us projects that simply can’t be funded through traditional lending sources.  These may be difficult projects to fund because the developer may not have the funds on hand to demonstrate a strong equity participation, or the plan presented may represent something that is cutting edge in development—a project that a lender simply can’t rate as to risk/reward.  The funding request may represent a challenge in that the current operations are not making money, and there is a long lead time in transition from loss of revenue to profit potential.   Challenges like these can exist in such disparate areas as real estate, pharma, medicine, IT, even franchising and licensing.  These challenges often make other Consultancies walk away from projects and tell the client that they simply don’t see a way to get the project funded.

It is in projects such as these that The Guinn Consultancy Group, Inc. assesses what is projected and suggests ways that the client can present the project, often finding ways to separate initial projects into multiple lending opportunities to spread the risk.   In a very few cases–we must simply tell the client that this project isn’t within our scope to address.   Prior to doing that, we attempt to identify the risk elements that make the project a challenge for lenders and ameliorate that risk.  Some clients grow tired of the search, or believe it takes too long, or lose interest in the process.

We are firm believers that there is funding out there for most every project although the costs of the money and the terms under which it is offered may dampen desire for the funding.


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