Building Your Business in a tight Economy

“Black Wall St” and More. Visit www.Recovery.Gov to check out the options for your business including contracting opportunities. During these times of consolidations, failures and more, it can be difficult to determine where to establish a banking relationship.

Last month I reminded readers to visit  www.Recovery.Gov to check out the options for your business.  I received emails from some of you requesting more information on financing for your ventures.  I also received an inquiry on how to best establish a banking relationship. I will address these questions and more, as well as share insights from my visit to Washington, D.C. for the Black Caucus.

I was able to investigate and turn up additional information that may be useful to many of you.  However, before I get into those details, I must share that while at the Black Caucus, I had the opportunity to view a DVD – sharing the story on the Black Wall Street in Tulsa, Oklahoma.  This powerful piece of history told how a community of Black Americans formed and became a self-sufficient affluent business center in the early 1920s.  The families owned grocery stores, theaters, hotels, shoe repair, medical facilities, and was home to prominent doctors and lawyers.  Unfortunately, in Tulsa, the Anglo community decided to attack this community and take over the families businesses, and wealth.  This was following an alleged attack by a young man providing shoe shining services, on an elevator operator at the end of his shift.  Sadly the events following this alleged crime led to the complete destruction and theft of land, homes, and businesses and basically were noted as a significant race riot to rid Tulsa of these affluent Black American families.  The impact of this destruction is evident today, with the survivors never being properly acknowledged, nor their land or assets restored.

I urge you to learn more by checking out the DVD “Before They Die” at  Please check out this story; you will be enlightened and encouraged when you know that our ancestors working with fewer resources and advanced technologies managed to emerge from slavery and cultivate a community where the dollar circulated over 20 times within the community!

Also, while at the Caucus, I attended several sessions.  One that stood out for me was on the Department of Transportation.  This discussion focused on the amount of stimulus dollars allocated towards transportation and infrastructure improvements.  Further, it was shared that in this pool of allocated funds, specific requirements to allow participation by small minority firms.  In essence, specific spending goals were established to ensure equal access and participation by smaller firms.  I urge you to investigate the www.Recovery.Gov site to identify contracting opportunities for your firm.

Returning to the opening questions: (1) How to identify a business bank?  During these times of consolidations, failures and more, it can be difficult to determine where to establish a banking relationship.  Here are some suggestions: Check out the SBA list of banks that have successfully supported the loan guarantee programs for small businesses.  Ask for recommendations from other business owners.  Check out your local business and trade associations for possible bank executives involved with and supporting business efforts. Lastly, create a short list of potential banks and go in and discuss with the Branch Manager your firm and the goals for your business.  Determine if this institution is a good fit.  Different banks have industry preferences; evaluate the bank by the areas of specialty.  Also, consider if you require a local, regional or national bank.  I recommend that you build more than one relationship.  This will give you an opportunity to compare and contract services.  Remember, your firm has a value, and you are in the position to negotiate with the bank for the services you require.

Another reader inquired about locating capital for an existing venture.  I would like to restate that when seeking investment, you will need to have several documents and information available for review: (a) Business Plan – The business plan must provide a complete view of your firm, its current state of operations, marketing, management team, track record, operations and financial plans.  The financial plan must detail the cash-flow, as well as debt service.  This plan should detail projected [Pro Forma] income and expenses, as well as provide historical details on past performance.  If you are seeking debt financing – the plan should illustrate clearly how you plan to service the debt.  If you are seeking equity financing – the plan should detail the amount of equity on the table [e.g., if you are seeking more money from an outside investor than you have invested, expect to explain how you have valued your ownership position, versus the equity available to the investor].  Also, with an equity investor, it is essential to include an exit strategy, buy sell agreements, and other details pertaining to how the equity will enter and exit the venture.

Again, if you have specific questions regarding raising capital, equity and debt financing, or other concerns, please send me an email.

Until next time, prosper!

Image from

Leave a Reply