Wednesday, May 5, 2010
Small Business Owners and Specialty Finance Companies
I've said this before. Look at the community banks and other small, regional banks in your area. Try to determine what their loan portfolio generally consists of. Sometimes they'll tell you in their marketing collateral or on their website. Other times you simply have to call and ask. (This actually works extremely well the vast majority of the time.) Another way is to read the bios of the Board of Directors. If you notice a trend in industries, you can believe that the bank is well-represented in that industry (those industries). Why? You invest in what you know. The Board reviews the financial documents of the bank and sometimes approves loans above a certain limit.
The loan officer (remember, VP or equivalent level or higher!) will have a thorough knowledge of the industry(ies) the lending institution serves since he or she would have analyzed many of the applications and periodically reviewed much of the existing loan portfolio.
If you are a technology company or biotech/life sciences company, Silicon Valley Bank is a strong potential lender for you. I became acquainted with them several years ago during my tenure at Georgia Tech. Although they were founded in, and are based in Silicon Valley, CA, they do lend throughout the US and have offices around the country.
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