Last month's column generated several calls from people with words of encouragement and advice. Every bit of input from folks who have "been there" is welcome. The search for money is never ending and is a bigger part of the entrepreneur's job than I had imagined.
It seems that there is a lot of money "out there" looking to be put into good projects. The problem is proving that your deal is a good deal. Presently we are applying for an SBA guaranteed loan that will ease the pressure for a while. The terms are excellent and our chances seem fairly good also since we can show a history of growth as well as proof of ongoing business. We are keeping our fingers crossed.
We carry on our efforts, however, as if we will be denied the SBA-backed loan. To guarantee our future, we need to guarantee that we can get money from somewhere so we try to find several sources and choose the best deal should we be fortunate enough to convince more than one lender that our deal is a good one.
We have looked into factoring and have not ruled it out. It is expensive but beats going out of business. For a company that is struggling with cash flow and profitability, it seems to be a step in the wrong direction. However, some of the discounts are not too bad. It pays to shop around. The May 23 '94 issue of Crain's Detroit Business had a good article on factors on page 12.
As a rookie dealing with investment brokers, bankers, private investors, etc., I found that I would have a better feeling about the whole process if I knew more about the rules and regulations in the "money" industry. There are licensing requirements, I'm sure, and I'm guessing people who charge for certain services are under some guidelines. I would like to see an article in this newsletter that explains the various financial companies and services and the rules they are supposed to operate under.
Meanwhile on the sales and marketing front, we just received our first order from a major retailer. We have been selected to be in another retailer's executive gift catalog. We have sent samples to a national upscale catalog company and our product has passed QA for one of the home shopping channels. So much opportunity, so little time!