Less than a month ago we got word from one of our members that they had secured a business loan, and lease on their first retail location. Very soon Seattle Thread Company will be gracing the shores of Lake Washington in Kirkland at 9 Lake Street. We thought that this would be a great opportunity to hear straight from the horses mouth how it was navigating the process for obtaining a business loan. Here is what Seattle Thread Company founder Konstantin Gorshkov had to say about the SBA loan process.
SFI – Give us some background on how you got your loan?
Seattle Thread Company was put into contact with Roland Chaiton, a VP and a loan officer with Seattle Community Capitol Development, thanks to SFI. We provided CCD with our Business Plan and Financial Plan documents, and then proceeded through CCD’s loan application process. Although we didn’t have adequate collateral to back the entire requested loan amount, CCD was able to offer us an SBA-backed loan. The entire loan process involved many forms and spanned several months, however we were happy to get this much-needed financing to help with our start-up costs.
SFI – So what kind of paperwork was involved in the process?
Here are some of the documents that CCD required:
– Business Loan Application
– Business Plan
– Financial Plan (Profit & Loss, Cash Flow, Balance Sheet, and more)
– Personal Financial Statement
– Tax Returns for 2009, 2010, 2011
– WA State Business License
– Recent Credit Score & Credit Report
– Several SBA forms
SFI – You mentioned you didn’t have adequate collateral. How was it that CCD was able to secure financing for you then?
Since CCD is a stakeholder in STC until the loan is paid in full, there were CCD requirements for the lease terms and the business insurance terms. We’ll also need to keep CCD updated with periodic financial statements. There are also various constraints and recommendations regarding what can and cannot be done with the business while CCD is a stakeholder.
SFI – What are some lessons you took away from the process?
Fear No Form – if you hate filling out and signing forms, you better get over it.
Digitize – We used various computer apps and utilities to help navigate the various forms – exporting from Open Office to PDF format, filling out forms digitally, and learning how to efficiently print and scan docs. No fax was ever sent – everything was emailed as an attachment and is now archived and accessible.
Follow up – People are busy, so keep on top of your own needs. Your business is your responsibility.
We’d like to thank Konstantin for taking the time to share his experience with us. We look forward to continued success stories from Seattle Thread Company in the future, and we’ll be sure to keep you up to date on the grand opening of their Kirkland store.