150. What you need to know about funding your business with Frank Capra

Picture this: you've finally made the brave decision to leave your corporate job behind and embark on the exhilarating journey of starting your own business. But as you dive headfirst into the entrepreneurial realm, you quickly realize that accessing necessary funds isn't as straightforward as anticipated.  In today's eye-opening episode of Life After Corporate, host Deb Boulanger is joined by her guest, Frank Capra, who takes us on a journey through the challenges of securing debt in the early stages of entrepreneurship.  From the limitations imposed by traditional banks to the increasing interest rates that send shivers down your spine, Frank divulges the inescapable realities faced by those seeking funding post-corporate life.  The landscape of lending and debt has changed dramatically in recent times, with rising interest rates and cautious lenders. But fear not, for there is a way to conquer these challenges and thrive in your post-corporate life. By strategically aligning your personal and business finances, showcasing profitability on paper, and staying mindful of your debt to income ratio, you can break free from the limitations and pave your own path of financial freedom and success. Brace yourself for some invaluable insights on how to leverage business credit cards and strategize your financial approach. This episode will encourage you to embrace the challenges, seize the opportunities, and let your entrepreneurial spirit soar to new heights. Remember, the power to redefine your life after corporate lies within your hands- it's time to make it happen!

  

[00:01- 8:02] Considerations for Starting Your Own Business  

• Focus on determining your passion and identifying the type of business you want to start.

• Develop a clear business plan outlining the steps, goals, and strategies for success.

• Seek advice and guidance from professionals, mentors, or business consultants.

• Maintain a financial safety net or savings to support yourself during the initial stages of your business.

   

[8:03 -12:00]  Importance of Being on Your Own Payroll  

• Being on your own payroll ensures that you are treating your business as a separate entity and not commingling personal and business finances.

• It provides a clear record of your income and helps establish proof of consistent earnings, which is crucial when seeking working capital or loans.

• Being on your own payroll also allows you to take advantage of certain tax benefits and deductions available to business owners.

• It demonstrates financial stability and responsibility to banks and lenders, increasing your chances of obtaining favorable financing terms. 

   

[12:01 - 18:40]  Business Credit Options   

• Adapt to market conditions and offer business credit cards

• Consider bundling multiple business credit cards for scalability and additional income

• Utilize grace periods to defer repayment and manage cash flow effectively

• Provide entrepreneurs with alternative funding options, especially in early stages or pre-revenue periods

 

[18:41 - 24:56] Financial Preparation for Starting a Business   

• Importance of preparing early and ensuring sufficient funding

• Need to have a conversation about financial readiness and create a plan

• Developing a strategy to pay down debt and improve loan eligibility

• No harm in seeking prequalification without a credit check to assess readiness and available options

 

[24:57 - 25:56] Closing Segment 

• Follow us on social media and leave a review

• Final words

 

Links Talked about on the Episode

Pre-Qualification Form (Affiliate Code)

https://preferredfundinggroup.wufoo.com/forms/s1wl3ofj1bjjzv7/

 

Go to https://lifeaftercorporatepodcast.com/ for all episodes

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109 The Cashflow Catch-22 And How to Avoid it

 

Tweetable Quotes:

“When the company doesn't look like it's making money on their tax returns, the bank is going to say, well, yeah, you're paying yourself money, but the company isn't making any money."... Frank Capra on Tax Returns and Bank Statements

 

"You really want to show that no higher than 30%. If you're putting everything on your credit cards and making that number go through the roof, they're not gonna give you more. It's just not going to happen."...Frank Capra on Credit card utilization 

 

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Get weekly tips on how to create more money and meaning doing work you love and be one of the many growing entrepreneurs in our community. Connect with me on LinkedIn; https://www.linkedin.com/groups/12656341/  or on Instagram or our website at www.lifeaftercorporatepodcast.com .