For entrepreneurs, starting and running a business is not only a lot of work, it’s expensive. There’s financing available for startups and small businesses, but some entrepreneurs don’t know what’s available or how to approach securing it. This is why Geordan Robertson, Director of Small Business at Meridian Credit Union, joined iF on May 26th to lead a Lunch ‘n Learn session on The Fundamentals of Financing Your Business.
Geordan started off the session by giving the audience an overview of the financing landscape. He pointed to the following as options for entrepreneurs to consider: savings, credit cards, lines of credit, friends or family, business partners, financial institutions, government grants, non-profits, angel investors, and crowdfunding. For friends/family and business partners specifically, Geordan encouraged entrepreneurs to “get it in writing”; put together a repayment agreement or a partnership clause so that everyone is on the same page expectation-wise.
He then spoke to the perception that banks are risk averse, especially when it comes to small businesses as they can be risky to finance. Geordan noted that often people are surprised how much more success they can have with a credit union, which is built on cooperative principles and more inclined to help support community initiatives like small businesses. For example, at Meridian, they make most decisions locally on financing, lines of credit and sponsorships, which often bodes well for small businesses getting their start.
What does a startup founder or small business owner need when approaching a financial institution for financing? A solid business plan and a strong application. For applications, Geordan pointed to making sure entrepreneurs highlight the five C’s: Character, Collateral, Conditions, Capital and Capacity. In addition, he stressed the importance of having all the company’s paperwork in order and ready (credit reports, notices of assessment, financial forecasts, etc.), as well as knowing your credit history and any red flags you may need to explain, having your elevator pitch prepared, and above all showcasing your passion.
Geordan encouraged entrepreneurs not to lose faith if their financing application is not immediately approved, and to work with their bank/credit union to improve the application, fill in the gaps in their business plan and to try again. You can view Geordan’s full slide deck here and photos from the event here.
At each month’s Lunch ‘n Learn we also feature an interesting iF client to share a 5-minute highlight of their business. This month’s Factory 5 was Arvid Rimkus of Winona’s Harvest, a local Stoney Creek producer of the wildly successful Pretto’s Pasta lasagnas which were sampled to guests right after the Lunch ‘n Learn. Thanks to both Geordan and Arvid for sharing your stories (and lasagna) with us!
Our Lunch ‘n Learn events are a great way to get out and network while enjoying a free lunch and learning something new! Make sure to keep checking our event calendar for upcoming Lunch ‘n Learns and other events in the ecosystem.