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20 HARTFORDBUSINESS.COM | AUGUST 9, 2021 Catching the Recovery Wave with Increased Business Capital SPONSORED CONTENT I t's coming. Not a tsunami, but a recovery wave the likes of which businesses have never seen before. "We're extremely likely to get a very high growth rate. Whether it's a boom or not, I do think it's a V-shaped recovery." - Jan Hatzius, Chief Economist, Goldman Sachs, New York Times , Which businesses catch that wave and which get washed away could be determined by moves the owners are making now to access additional capital. Decisions regarding the need for flexible or long-term capital need to be made by business leadership now and must reflect a sound strategy. If you are a business owner who predicts upswing opportunity, there are steps to take to get prepared to talk to your community banker. Don't take that last term lightly. A commercial banker from a local community bank is going to have a degree of flexibility that the out-of-town banks are not. Community bankers are the ones who hustled working nights and weekends to process PPP applications for their customers, and other businesses as well. You can continue to expect that kind of hustle from a community bank. Step One: It starts with you "To an extent, the past is a prelude to the future," explains James Cormier First Vice President/Commercial Banking at PeoplesBank. "Our bet is going to be made on you so your credit score is going to be critical. If that works, the next thing we want to know about is your business and its financial needs." You can help pave the path toward a line of credit or a term loan by putting together a brief prospectus on your ask. Your banker wants to understand what you are going to invest in. With that in mind, a summary that briefly outlines your business, the opportunity, your team and your track record will help your banker help you. If you have it, providing an updated business plan will also show that you are organized and prepared to take advantage of the opportunities ahead. Step Two: Crossing T's and Dotting I's Every bank is going to need documentation to back up your financing request. This could include a personal financial statement, personal and business tax returns, profit and loss statements, and depending on the request, other management reports such as aging reports, inventory listings, etc. You will also need to provide corporate and ownership documentation like articles of incorporation and any investment or equity that others have in your business. Contracts, leases, agreements and any other commitments you have made, or will make, to secure future opportunities will also need to be at the ready. Step Three: Make Your Bet Your financial documents may or may not explain how you intend to get a return on the investment. If they don't, you want to put together a financial projection that details what the revenue potential looks like and the timeline to achieve those results. This will help you and your banker identify the risks as well as map out the repayment terms and schedule. You should start identifying collateral that will be used to secure the financing. Banks want to bet on you and your idea, but planning for the downside will help your banker get to yes on your loan or line of credit. Final Thoughts You have the ideas and you know the opportunity is out there. Getting financing might seem complicated, but you do have resources to draw on. You accountant and lawyer can help, but you also need to know that your community banker is on your side. A community bank invests in the community and recognizes the importance of local businesses to the quality of life. Your banker will help you navigate through the business financing process from start to finish. If your banker is not on your team, start shopping for another local bank. Contact a Banking Officer today. James Cormier First Vice President Commercial Banking bankatpeoples.com/businessteam 413-538-9500