Business Funding: Disappearing VC, the Microloan, and Impressing the Loan Officer

The business funding world has literally been turned on its ear by the current economic situation. Venture capital opportunities are vanishing before our very eyes. But microloans are on the rise and dazzling your loan officer increases your chances of getting one.

Venture Capital Funding on Life Support
Cnet news reveals a stark impression about the absence of venture capital for businesses from start-ups to the majors. According to Dow Jones VentureSource, venture capital investment in US companies is down nearly 50 percent in a single year--from $7.78 billion to $3.90 billion. The IT industry has been hit particularly hard, with its VC at the lowest point since 1997. In effect, interest in unproven business models just isn’t there.

The Microloan Makes a Comeback
Financial guru Pat Gage, author of The "10 Steps To Money®" system and expert on acquiring business funding for small businesses, raves about this type of loan vehicle for start-ups and expansions. Microloans typically come in amounts of between $13,000 and $35,000--and entirely backed by the Small Business Administration. Support from the SBA gives you much more clout when dealing with traditional banks and lenders.

How to Impress Your Loan Officer
This is critical. So much so the US News and World Report offers some basic advice on what to do--and not to do--when you walk into the loan application meeting.

• Come Well Equipped. Have your finance package filled out completely and bring a copy of your business plan
• Have the Numbers. Be ready to present financial projections and explain how you got them
• Get Your Financial House in Order. In order to get business funding, you’ll have to show that you can manage your own personal finances