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Lenders who know the business?

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  • Lenders who know the business?

    After research it looks like I really need an investment company who know's the business...I need a loan for 80-100k (stationary salon) Have you guys had better luck with banks or private investors that helped you start?

    I already have a business plan, was thinking about getting the groomer in the box CD for additional insite...



    Hopefully i didnt' violate rules posting this

  • #2
    I think most of us start with nothing

    Really, I am sure there must be some investors for big money/big return deals, but a grooming shop isn't generally a quick or a high return biz, so most of us start on a shoestring.

    So I am not sure what you will find. I am not that optimistic - after being in this business, I wouldn't lend someone that much to start a shop! I'd want you to start first and then do well and maybe show me your expansion plans. Heck, even the lenders on boarding kennels want a lot of money down, and boarding has a higher rate of return/profit than grooming.

    But there are exceptions, and if there's a place to find out about them, I guess that would be here! So I will watch for other replies.

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    • #3
      Generally investors do get a percentage of the company, they invested. But why do you need an investor really, and do you know that territory?

      Making a loan is not the same thing, they are a private lender.

      It's usually better to go with loan basis. An investor may have plenty more say over what you do with the business. Of course they will usually want protection such as a limited liability situation because a lender generally doesn't face issues such as what if you accidentially harm a pet, all the negatives that could happen.

      So usually someone able to lend/invest that much is seasoned and already has an idea of the structure they expect.

      You must start thinking and using the words investor and lender differently, don't confuse the 2.

      Also your state may have legal requirements for those seeking investors, even with this little of an investment. You may need a private placement agreement, and realize that some states also say you cannot take such an investment from anyone without a net worth of 1,000,000 etc...this is all highly regulated. The investor must sign disclosures and give you their net worth, and the agreement has to be filed with your state, and you have to be careful how you even state it, promote it. Our private placement HAD to be state registered and prepared by a state SEC attorney, and costs several thousand dollars. Yours will fall into the Section 501 series most likely. Let me say it again, this is all highly regulated even for amounts that you are talking about. http://www.seclaw.com/docs/pplace.htm I suggest you review this, and then go to an attorney in your state to see IF it applies to you or not. I've done this with groomers in 25 plus states...nearly all had to use a PP agreement. It is LOTS of work and ongoing meetings with them, sharing financial updates and more.

      Moral of the story: if someone will loan you the funds, call them a lender, and just borrow it. If not, you absolutely need a company lawyer to handle an investment and to learn your responsibilities for taking investments.
      Most questions regarding GroomerTALK are answered in the Board Help Talk Forum. Thanks for coming to our community a part of PetGroomer.com https://www.petgroomer.com.

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      • #4
        Right, Loan/Investor...two totally differen't things.

        Interesting read on the link you posted, I am in WA state.

        I've dealt with Idaho Navada Financial group, they only do low interest loans in rual areas ...I've borrowed up to 680K from them on another type of business (Self storage)

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        • #5
          Small Business loans

          Try looking for one of them. My cousin took one out for 350K. She even got into more of a specialty by getting a small business loan for women. Better terms, better rate, etc. worth looking into.

          Good luck!

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          • #6
            Originally posted by 3corgis4me View Post
            Try looking for one of them. My cousin took one out for 350K. She even got into more of a specialty by getting a small business loan for women. Better terms, better rate, etc. worth looking into.

            Good luck!
            i'm not a woman though, and I believe sex changes are even more expensive...perhaps my wife could rangle it on her own

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