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Would like to ask the established internet marketers - how did you source finance?

by John Romaine
14 replies
Today unfortunately I was declined a $20K loan to invest towards my IM business. This money was to be distrubuted amongst contractors, and outsourcing, along with other essential business expenses such as tax, book keeping and so forth.

I am absolutely stunned that I was declined for a number of reasons.

1. Firstly, I have been with this particular bank for over 10 years.
2. I have NO DEBTS - none!
3. My living expenses are minimal - absolute essentials only
4. I have had over 7 loans with this bank and paid them all out early, and never defaulted on a repayment.
5. Im making better money now than when i was employed!

All this and still the answer is no. Their reason...they see internet business as HIGH RISK! "

Repayments on the loan are less than $100 a week!

Sorry to rant guys - but Im really cheesed off.

However I wanted to ask, because I recall hearing that John Reese maxed out over $100,000 on credit cards, how on earth (for all of you like Brad and Jerermy and Steve etc) how you managed to get finance to get your business ventures underway????

Im annoyed!
#established #finance #internet #marketers #source
  • Profile picture of the author jazbo
    As you know the credit rules have been tightened right up now. banks are reluctant to lend, and I would think especially for something that is a non-tangible business.

    My advice - try the stealth approach of getting a home improvement or car loan!
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    • Profile picture of the author John Romaine
      Originally Posted by jazbo View Post

      As you know the credit rules have been tightened right up now. banks are reluctant to lend, and I would think especially for something that is a non-tangible business.

      My advice - try the stealth approach of getting a home improvement or car loan!
      I agree with you - but its that "non tangible" mentality that the banks have that is holding me back!

      As already said, Im making more now than when I was employed. I just checked another lenders website and they refer to small business expenses as "machinery, office space, etc etc"

      Is it just me or are we still in 1982?
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      • Profile picture of the author Michael Oksa
        Originally Posted by ramone_johnny View Post

        I agree with you - but its that "non tangible" mentality that the banks have that is holding me back!

        As already said, Im making more now than when I was employed. I just checked another lenders website and they refer to small business expenses as "machinery, office space, etc etc"

        Is it just me or are we still in 1982?
        No offense, but it's not the banks that are holding you back. As the caption under your user name says: "No excuses - Just do it"

        I'm guessing it feels like you just can't get a break. I certainly agree that banks can be goofy, and don't always look at things from the right perspective.

        What about finding a venture capitalist, or "angel" to lend you the money?

        What else can you do to ramp up your income to earn the capital you need?

        Is this a critically time-sensitive loan?

        It sounds like you are already doing well, and it's great to hear that your income is higher than when you had a boss.

        Out of curiosity, did you have a well put together business plan when you went in to ask for the loan? That may have helped.

        This may be a temporary setback, but it also may be a positive thing in the long run.

        All the best,
        Michael
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        • Profile picture of the author John Romaine
          Originally Posted by Michael Oksa View Post

          No offense, but it's not the banks that are holding you back. As the caption under your user name says: "No excuses - Just do it"

          I'm guessing it feels like you just can't get a break. I certainly agree that banks can be goofy, and don't always look at things from the right perspective.

          What about finding a venture capitalist, or "angel" to lend you the money?

          What else can you do to ramp up your income to earn the capital you need?

          Is this a critically time-sensitive loan?

          It sounds like you are already doing well, and it's great to hear that your income is higher than when you had a boss.

          Out of curiosity, did you have a well put together business plan when you went in to ask for the loan? That may have helped.

          This may be a temporary setback, but it also may be a positive thing in the long run.

          All the best,
          Michael
          Thanks Michael, I value your opinion mate.

          Im certainly not making excuses, Im just annoyed and I guess, well maybe it was just my turn to whinge

          I tried putting it through as a personal loan, but decided against that as they needed actual evidence of what was being purchased. Infact, when I first enquired about putting it through as a small business loan I was advised NOT to do this due to it being such as small amount, $20K. They advised putting it through as a personal loan?

          I am doing well, but would like to accelerate things a little quicker. (I say this because I feel im beginning to really gain traction) I even suggested lowering the amount to $10K but they werent interested.

          As for an actual business plan, no Michael, I didnt put one together, however I *did* satisfy the banks criteria by submitting two years tax returns and a letter of projected earnings by my accountant for the next financial year.

          Put simply I did everything they asked and they said no.

          Its not a critically time sensitive loan, however I would like to have some money to put aside to continue working over xmas - Im sure this period will be quiet.

          Its just the fact that I *thought* I was positioned well, and they declined it. Ill be trying more lenders tomorrow first thing, Im just concerned by being declined that it may set off alarms with other lenders.
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      • Profile picture of the author Dean Martin
        Originally Posted by ramone_johnny View Post

        I agree with you - but its that "non tangible" mentality that the banks have that is holding me back!

        As already said, Im making more now than when I was employed. I just checked another lenders website and they refer to small business expenses as "machinery, office space, etc etc"

        Is it just me or are we still in 1982?
        No matter what your payment history or credit rating - banks are running so scared right now that the only thing they'll lend money for is tangible property (something they can sell should you go under).

        Much like the home mortgage crisis and real estate bust of last October - there is a purported 2nd wave coming in commercial real estate that will make it look like childs play.

        I have a couple friends in commercial banking, used to have a $50k credit line, personal loans, etc. - no more. The Feds have tightened up the regs so much they have no discretion anymore to go outside the written policy.
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  • Profile picture of the author Danny Cutts
    tell them you want to open a shop....lol selling bread and milk to the elderly!

    cant you just get a personal loan?

    The best way i have found in the past to get more credit is to max out a couple of credit cards and pay them back slower as they make more moeny from you that way!

    Or

    Try and get inverstors into the idea!

    Good luck I personally hate banks really do hate them!!

    Danny
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  • Profile picture of the author DogScout
    "A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain."
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  • Profile picture of the author matts5150
    It's next to impossible to get a loan right now unless you put up collateral. Last year with perfect credit the bank I've done business with for 15 years took away my line of credit and lowered my credit card limits to where they were almost maxed out and I had perfect. Probably the easiest way if you have good credit is to get a personal loan from prosper or lending club. I'm not saying to lie, however when applying I wouldn't tell them it's for Internet Marketing as most people don't understand. Just tell them you have a great idea you need to put into action but needs funds to invest to grow it.
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  • Profile picture of the author Brad Gosse
    You start with a very small pebble by friend and let it grow.

    I am coaching someone right now who started with just $20 in seed money. You can turn that into a million, you just have to jump through more hoops.

    It feels WAY better when you do it on your own. Who needs a bank?

    Having said that there are other avenues you could consider. Licensing the idea to another product creator for instance.
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    • Profile picture of the author John Romaine
      Originally Posted by Brad Gosse View Post

      You start with a very small pebble by friend and let it grow.

      I am coaching someone right now who started with just $20 in seed money. You can turn that into a million, you just have to jump through more hoops.

      It feels WAY better when you do it on your own. Who needs a bank?

      Having said that there are other avenues you could consider. Licensing the idea to another product creator for instance.
      It does feel better yes, but it certainly takes longer. I plan on $100K a month. Thats going to take a LOT of work.

      Im already putting in 16 hour days - I need to outsource otherwise Im going to burn out.
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      • Profile picture of the author Daniel E Taylor
        Originally Posted by ramone_johnny View Post

        It does feel better yes, but it certainly takes longer. I plan on $100K a month. Thats going to take a LOT of work.

        Im already putting in 16 hour days - I need to outsource otherwise Im going to burn out.
        It takes smarter work. Not really ALOT of work.

        Good luck,
        Daniel
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  • Profile picture of the author Popstar
    Originally Posted by ramone_johnny View Post

    This money was to be distrubuted amongst contractors, and outsourcing, along with other essential business expenses such as tax, book keeping and so forth.
    You answered your own question. The way you were going to spend the money gives them nothing to collect against if you can't repay the loan.

    It may not feel fair, but they don't care about fair or unfair. They care about getting paid.

    Your past accomplishments help to establish your credibility, but they do nothing to assure that you can repay this loan in the future.

    By the way, I'm not questioning your credibility. Just calling it as I believe the banks will see it.

    Debbie
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  • Profile picture of the author uncle randy 71
    As a former banker, I will agree with all of the previous comments about the current state of banks.

    I would also like to add a different perspective: Instead of starting out with the $10,000 loan could you scale back your plans, borrow $2,500, use that and pay it back in a few months, and then return to the bank to borrow $3,500? This would not get you to the $10,000 amount, but it could get you over half way there in a short amount of time.

    Just one opinion.
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  • Profile picture of the author nicholasb
    I started with literally zero money, I didnt even have a credit card debit card or even a bank account,

    I set up a squidoo lens put some affiliate links in there and slammed out 10-15 articles a day and made 500 my first week.

    I then took that money got a an autoresponder service and hosting total of around 300-400 dollars

    and turned it into a 6 figure per year business, it did take alot of hard work, so I am not gonna lie and say I did it in an hour a day it was more like 16 hours a day

    and even now I still work around 8-10 hours a day because I want my business to do millions per month, everything has a price.
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