December 5, 2014
Invaluable Advice from a Banker
By Kelsey Gallagher
“What does and entrepreneur and an umbrella have in common? There will be a lot of pressure and stress on an entrepreneur, but much like an umbrella, entrepreneurs are able to repel and shield themselves from the bad days and continue on”. – Brad Sandstrom
This Friday, the Laval Entrepreneur Mentor Program had lunch catered from the Lyles Center’s very own Marisela Hamm, owner of Casa De Flores Catering. She brought fresh homemade tamales, rice, and salsa. If anyone is in search of great tamales for the holidays, Casa de Flores is the place to look!
To start off this week’s meeting, Chather Phillips and Maci Stienhauer gave presentations about their entrepreneurial journeys from their early childhood to future goals. They were followed by a presentation by Brad Sandstrom, Senior Vice President and Relations Manager with Citibank’s Business Banking group. Mr. Sandstrom was last year’s Laval EMP “Mentor of the Year”. He brings over 30 years of banking experience in both the consumer and business banking marketplace. He has banking relationships with all 111 of his clients from Bakersfield to Sacramento. One of the things he emphasized about success was the importance of knowing your clients and being available whenever they have needs. He said, “When the client calls the banker, it is important to the client, but when you as the banker call the client, it is not always important to the client”. He gave some very valuable advice on managing your money and the best places to look for money when funding a business. Throughout the presentation Mr. Sandstrom kept us engaged with his humor and his passion for banking.
Mr. Sandstrom began his presentation by walking up to each student and handed them a $1 bill. He said to the students with a chuckle, “Now, none of you can ever say bankers don’t give people money!”
Mr. Sandstrom discussed the forms of funding. As young entrepreneurs, this will be one of the first challenges we will be faced with when starting a business. He asked the students, “Where will you get the money to start a business?” He said the main forms are family, friends, fools, partners, investors, and financial institutions. He went on to further discuss these in detail:
- Family - They believe in each other and in their ideas and this relationship is the
strongest. Family is all about support. In most cases, family either gives you the
money needed or they give you a longer amount of time to pay it back with little to
no calculated interest.
- Friends. - They support you and you endeavors and want to see you succeed. When
borrowing money from friends, they do expect it back. As a result, sometimes relationships
can become tense and often can suffer.
- Fools - This is someone who hears your idea and jumps without looking into the consequences.
- Partners - They want to be involved in your business, have a say, and gain a part
of the profit. In choosing a partner, you have to have different strengths in order
to be a well-rounded team. At the same time, you need to have many common views for
the business to continue to move forward without constant disagreements.
- Investors, Venture Capitalists - They invest large amounts of money while gaining
back some return or portion of the profit. They can also have a say in decision making.about
- Financial Institutions (banks) - A thorough investigation of all financial history is required. Interest rates vary. Banks do not have a say in the business decisions.
Mr. Sandstrom advised the students the best way to get what you want in business lending is to know your company and every aspect of its finances. He also gave the students a list of everything they would need in order to apply for a loan. He wanted each student to understand what to expect in obtaining a loan and to be fully prepared when the day comes. “The key to any loan request lies truly in the hands of the business owner sitting across the desk of the banker”.
Mr. Sandstrom supplied us with contact for a local small business support in the Fresno area. He also walked us through how to successfully complete a loan application and what we will need to have at hand.
To end his presentation, Mr. Sandstrom asked the group, “What does an entrepreneur and a basketball have in common?” He replied, “Much like a true entrepreneur when it falls it bounces right back up”. He then asked, “What does an entrepreneur and an umbrella have in common?” His answer was, “there will be a lot of pressure and stress on an entrepreneur, but much like an umbrella, they are able to repel and shield themselves from the bad days and continue on”.