Business Experience

Banks want to lend money to established businesses with a track record of experience. The reason is pretty simple: you have proven that you can achieve certain results which make your future projections less risky. If you can show that you have done it before it is easier to have faith that you can do it again compared to a startup with no experience.

Banks prefer companies that have been around for 10 years or more. These companies:
� Get rejected for loans over 50% less frequently than inexperienced firms
� Pay around 0.4% less interest on their loans

If you do not have 10 years of company history, as most entrepreneurs do not, point to your other experiences that will help give you credibility. Maybe you worked as an employee in a small company and helped double their sales. Perhaps you ran another small business and made it profitable within 6 months. When you do not have the company track record, the banker immediately flags your business as having an increased risk of not being able to pay back the loan. You need to show whatever experience you can from related jobs or companies to reduce the banker�s perceived risk and maximize the chance of you securing the loan.

For more information, visit www.EvanCarmichael.com.