If you own a business, you’ve only got days left to apply for a Paycheck Protection loan

Posted on March 5, 2021March 5, 2021 by Franchise Strategist

If you own a business, you’ve only got days left to apply for a Paycheck Protection loan

(BPT) – by Jennifer Roberts, CEO, Chase Business Banking and Sean ‘Diddy’ Combs, Founder, Our Fair Share, entrepreneur and media mogul

In just four months last year, more than 5 million U.S. businesses received a Paycheck Protection Program (PPP) loan. That helped them pay their workers, their mortgage or rent, and their utility bills. Unfortunately, many small businesses owned by minorities, women and veterans didn’t get PPP loans last year. We want to make sure you know how to apply for the funding your business really needs.

But you need to act quickly. PPP ends March 31, but many lenders may stop accepting applications sooner so they have time to process. That means you need to get started on an application quickly for PPP funds to help with your payroll costs and other bills, to get your fair share. The Small Business Administration (SBA) and participating lenders are working hard to make these loans available to more businesses in low- and moderate-income communities. And to smaller businesses, like barbershops, restaurants, nail salons, clothing brands, bars, bodegas and independent contractors.

Here are eight facts you should know about PPP that may encourage you to apply:

1) Congress funded it with $284 billion for 2021. That’s enough for millions of more loans.

2) It’s for first-time borrowers. The SBA has already approved more than 704,000 loans for borrowers who didn’t get one last year. The SBA also has approved loans for second-time borrowers.

3) A PPP loan may be forgiven. Up to 100% of your loan could be forgiven if you qualify and meet the SBA’s requirements. That means you wouldn’t have to pay back the forgiven amount.

4) Businesses with few employees get special attention. Through March 9, the SBA is accepting applications only from businesses with fewer than 20 employees.

5) Most loans are relatively small. The average loan to first-time PPP borrowers this year is $22,000, the SBA says.

6) Smaller businesses are getting approved. 90% of Chase’s approved PPP loans in 2021 are to businesses with fewer than 20 employees.

7) Help is available to understand PPP. chase.com/ppp has a webinar, checklists and FAQs to walk you through the application process. You can also check out sba.gov/ppp.

8) It’s easy to find participating lenders. The SBA’s website — sba.gov/funding-programs/loans/lender-match — has a “Lender Match” link to help you connect to a lender near you.

The 2021 PPP is scheduled to expire March 31, but to get your application to the SBA by then, you need to act now. If you believe you are eligible, we urge you to find a lender, prepare your information and apply.

Get started now. Don’t miss out!

To learn more, or to access helpful tools and resources, please visit chase.com/ppp or ourfairshare.com.

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Tips On Raising Capital to Expand Through a Private Placement

Posted on August 27, 2020December 10, 2020 by Franchise Strategist

Today’s article by our friends at the Law Office of Spadea Lignana touches on some of the tips to know when attempting to rise money through Private Equity Placement. Tom Spadea and his staff well versed and fully equipped to advise and guide you through the process. Franchise Growth Solutions assists in the process by working with brands seeking to expand their business.

Raising Capital to Expand Through a Private Placement Raising Capital to Expand Through a Private Placement
By Staff Writer at Spadea-Lignana Law Office

Even a Deal with Friends and Family Needs Proper Documentation
If you are an entrepreneur looking to raise capital by selling shares of your company to an individual that won’t be an active partner in your business, you have to be sure you are compliant with federal and state securities laws. If you are selling a portion of your company to an investor, you are subject to securities regulations. That is, UNLESS you fall under an exemption and you properly document, and in some cases, file for an exemption. This is a trap for many unwary entrepreneurs, who think they don’t have to worry about formal documentation of their deal because they are just offering shares of their company to a few friends and family.

While the offering they are contemplating may very well qualify for an exemption, if they don’t follow the laws and regulations by drafting a formal private placement memorandum (PPM) and complying with certain filing requirements, they run the risk of personal liability. This liability could include accusations of fraud and potential civil and criminal penalties for failure to properly register securities with federal and state agencies.

Drafting the PPM
The rules and regulations are designed to avoid Ponzi schemes and other fraudulent investing activities by making the transaction transparent and well documented. The creation of a PPM is not as difficult as many law firms and pundits may make it sound. We are not talking about an initial public offering with a six figure legal cost. Our experienced securities lawyers can walk you through the process and help you evaluate your project as suitable for a PPM. In many instances we can give you a flat fee project cost for documenting your deal. We have drafted PPMs ranging in size from a startup, fast casual restaurant to a multi-million-dollar alternative energy project.

Minimizing Personal Risk
Raising equity capital from outsiders is typically done to avoid personal debt, risk and liabilities while sharing the upside with those equity investors. If the deal is not properly documented, you are potentially erasing all of those protections and neutralizing the purpose of raising private money in the first place. Put another way, a poorly documented deal leaves the entrepreneur with all of the downside risk personally, with a portion of the upside sold off to investors. That is not a good business deal.

Seek Professional Guidance
Let us help you understand the cost, time and effort that it will take to draft a private placement memorandum for your deal. Call us at 215-774-3331 for more information. Visit https://www.spadealaw.com/

Pandemic Spurs Innovation for Small- to Mid-Sized Businesses

Posted on July 1, 2020July 21, 2020 by Franchise Strategist

Set up your business in the right entity and state. Mistakes in formation or taxation can have a lasting negative impact on business growth and viability. Before starting a new business, consider the best structure for asset protection and tax minimization. For example, a limited liability company (LLC) gives business owners time to operate at a loss for the first few months and write off the loss on their individual 1040 forms against other forms of income.

Pandemic spurs innovation for small- to mid-sized businesses

By Brandpoint

(BPT) – As COVID-19 continues to disrupt normal day-to-day operations of small- to mid-sized businesses and nearly half of the U.S. workforce hangs in the balance, employers are taking creative measures to reset their go-to-market strategies and offerings. By changing their operations to meet the demands of their customers, businesses can not only stay relevant but keep their staff employed and thrive in the new economy.

This pandemic offers business owners, investors and solopreneurs the opportunity to take a critical look at their overall business model, offerings and operations and reset the entire business structure, creating new opportunities to serve and prevail. This is the perfect time to explore new legal solutions to the most common business obstacles to help companies preserve and protect their brands and prosper for generations to come. There are great examples of resets happening within many industries.

With the pandemic closing summer camps throughout the country, ACA-accredited Adventure Links, a 23-year-old summer camp in Virginia, has found a way to replace its usual summer adventure camp programs with

The CampCloud(TM) , an experiential online alternative. The company is now offering its virtual camping programs to individuals and employers to assist employees working from home by keeping their kids engaged, learning and delighted all day from virtually anywhere. The program is being offered to other camps as a customizable, online option for their campers.

Ensuring the health and safety of employers when stay-at-home orders are lifted, and business resumes, is critical. Thanks to a team of entrepreneurs, Disinfect & Shield(TM), an FDA-registered, EPA-approved and eco-friendly disinfectant used in surgical suites for the last decade, is now available to businesses worldwide to kill SARS-CoV-2, the virus that causes COVID-19 and other dangerous organisms. It works by creating a permanent anti-microbial shield, preventing the virus from attaching to surfaces where it has been applied without risk to humans, animals or crops. With Disinfect & Shield(TM), employees, customers and visitors can feel safe knowing that their space has been properly disinfected and treated for optimum health and safety.

Clint Coons, founder of Anderson Business Advisors, offers 5 financing and entity creation tips to help entrepreneurs and small business owners:

Know how to use loans: CARES Act loans have specific guidelines like having to use at least 60% of the loan within 24 weeks of receipt for payroll expenses. Concerned that money would dry up, many small business owners applied with no way of utilizing them because their business cannot reopen under the strict guidelines imposed on the industry.
Alternate cash sources: Borrow from a 401(k) or IRA to keep businesses afloat, as it does not need to be paid back for at least 3-6 years. However, pulling money out of a retirement plan comes with some risk, such as if the business does not see profitability, then retirement funds were wasted on a failed business venture.
Beware of increasing liabilities: Because insurance will not cover claims brought under COVID, reopening comes with risk and business owners are wondering how they will operate under strict COVID-19 related guidelines and still make a profit. Now is the time to pivot and reset.
Consider restructuring: Set up your business in the right entity and state. Mistakes in formation or taxation can have a lasting negative impact on business growth and viability. Before starting a new business, consider the best structure for asset protection and tax minimization. For example, a limited liability company (LLC) gives business owners time to operate at a loss for the first few months and write off the loss on their individual 1040 forms against other forms of income. There are different entity funding options with protection ramifications.
Utilize Privacy Shield Protection by creating anonymity with trusts.

COVID-19 has shown that many businesses aren’t prepared for worst-case scenarios and make common mistakes that can affect their ability to grow and borrow money. If approached strategically, small- to medium-sized businesses can take this time to implement changes and help their operations succeed and thrive.

How Do I Get The Money to Start My Own Business and How Much Money Do I Need.

Posted on May 19, 2019January 16, 2020 by Franchise Strategist

HOW TO FINANCE YOUR BUSINESS IDEA…Our friends at Benetrends have covered this topic perfectly. When you have a great idea for a business but not the cash to get it going. This article will offer helpful tools to get that business started and growing.
Photo by Mick Haupt on Unsplash

Entrepreneurial Dilemma: Do I Have Enough Money to Start My Own Business?
Author Benetrends

You have come up with a great idea for your own business, one that you are confident will be financially, personally, and professionally fulfilling. You are ready to start developing your business plan, doing market research, and testing marketing ideas.
How much money will you need to bring this idea to fruition? What kind of finances will you need to get things started and how much will you need on a monthly basis going forward?

CLICK HERE NOW: Franchise your company, expand your brand, collect your royalties!

These financial questions are often ones that keep entrepreneurs up at night, worrying about how much money they will need to be viable and successful.

It is a classic entrepreneurial dilemma: do I have enough money to start my own business?

Fortunately, most up-front and ongoing costs can be identified at the start of your ideation. Doing the work to build out your budget will bring you peace of mind and a foundation to use when pursuing small business funding. Here is a closer look at the framework you should use to determine your business costs.

What will it cost to open your business? Find out with our business planning calculator.Twitter Tweet This
Why Knowing Startup Costs Is Important

Startup costs give you and others a clear idea of what it will take to operate your business. Too many small-business owners underestimate their costs and end up playing catch up, undermining their growth or forcing them out of business. There are several benefits to projecting these costs:

Profit Analysis. Knowing what your costs are, along with your revenue projections, helps you estimate your profitability, including when you are likely to break even and how long you may be operating at a deficit.
Investor Expectations. If you are seeking investments to help finance your business, investors will want to see your startup cost analysis.
Loan Approvals. Lending officers, like investors, will want to know what it takes to open the doors and keep them open when considering your loan application.
Tax Planning. Anticipating your business costs helps you and your accountant plan your tax strategy by understanding what will be deductible when it comes time to file your taxes.
Peace of Mind. There is stress in starting a business. A clear-eyed understanding of your costs eliminates one uncertainty in the process.

Click Here to Learn about Franchising Your Business

Questions to Answer Before Building Your Cost Estimate…Read the entire article here:
https://content.benetrends.com/blog/entrepreneurial-dilemma-do-i-have-enough-money-to-start-my-own-business

6 Tips When Buying A Franchise

Posted on January 12, 2019February 8, 2019 by Franchise Strategist

Starting a business can be a life-altering event both good and sometimes not so good. One of the ways people reduce their risk is to purchase an established brand with a proven business model – a franchise.

Franchising has proved over and over again to give a new business owner the highest probability of success. If you follow the system, choose an experienced franchisor, work diligently, are appropriately funded and understand what you’re getting into then operating a franchise may be a perfect business model for you.

Selecting a franchise and purchasing a franchise combines gut reaction with solid research. Although there are many steps to buying a franchise here are my Top 6 Tips that will keep you moving forward in the process. I recommend never skipping or overlooking any of them.

Tip #1 – Begin With Some Soul Searching
Make a written list of what you believe you’re looking for in a business opportunity. However, for this exercise, you cannot put the words “make money” on your written list. The reason for that is simple. I want you to look inward at your dreams, background, hobbies, likes, dislikes, skills, social and community positions and all the elements that a business would need to deliver to you, despite the money. I know many franchisees and entrepreneurs that dread getting up every day to work their business even though are making all sorts of money. Franchisees that are great at selling or corporate engagement should seek a franchise that puts them in front of customers in a corporate environment, perhaps in the advertising business or financial business. Entrepreneurs that like to craft things or work outside or work with their hands should never seek out opportunities that land them behind a desk or stuck in a shop 12 hours a day. Although ultimately in time you will not be doing the “work of business” keep in mind that in the startup phase you may need to. Moreover, if you don’t like the work or have neither the time, desire or inclination to develop new skills you may never get to the next level in developing your business. If you can’t “see yourself” doing a particular type of work, then walk away, no matter how much money you think you’ll make. Look in the mirror and be honest when you sit down to write your list.

Tip #2 – How Much Available Capital Do I have?
Numerous business reports cite the number one reason a small business fails is that proper thought and consideration wasn’t given to the appropriate capital required to open and sustain the start-up of a small business. A lack of adequate money can destroy you before you even begin. It is crucial that you understand the numbers. Before you start your quest for a franchise, you should access your available liquid capital, your borrowing ability and the net worth necessary to collateralize a business loan. Also, there are various ways to finance your new business. That includes your savings, investments or loans from friends and family, bank loans, SBA loans and using the funds in your 401K to finance the new venture. Once you know the number, you can go shopping, or you may decide you don’t have enough money now and need to create a plan to accumulate the appropriate amount of start-up capital. Your accountant may be able to help you access your investment ability. Keep in mind many accountants (and lawyers) are not entrepreneurial minded or risk takers. Some will attempt to “protect you” by trying to convince you not to go into business. Remember you’re assessing your investing capability not looking for permission. That said, knowing how much you can invest will save you and the franchisor time. In addition, it’ll place you in a better position to succeed.

Tip #3 – Meet The “Parents”
In this case, the Franchisor. Once you’ve selected the type of industry you’d like to be in, its’ now time to search for a company that meets the criteria on the list we discussed earlier in this article. There are many ways to seek out opportunities, Franchise Trade Shows, Websites, Franchise Business Brokers and others. I’ll cover that in a subsequent article. Once you reach out to a franchisor, a franchise sales representative will most likely contact you. At this point be prepared to answer some questions over the phone. You may also be asked to fill out an application before going any further in the process. Many reputable franchisors will not engage in any serious conversation with a candidate without an application. My experience has been that franchisors willing to forgo written applications or skip asking qualifying questions at the start of the process may be desperate to “sell” a franchise. That should be a red flag for you. Beware, because it may be a sign the franchisor is undercapitalized and/or more interested in selling franchises and collecting licensing fees instead of supporting the franchisees long term by focusing on royalties from successful franchised locations.

Tip #4 – Take A Good Hard Look At All The Documentation
Once you fill out the application, the franchisor will most likely interview you over the phone or in person and then is required to issue you a Franchise Disclosure Document (FDD). Depending on the State where you live, you must have the FDD between 10 and 14 days before you can enter into any agreement or hand over any money to the franchisor. You will be asked to sign a receipt that you received the FDD and indicate the date you received it. This disclosure document has all the required information that the Federal Trade Commission (FTC) and various States require the franchisor to tell you. Please read it and reread it. Have a franchise attorney review the document and offer legal counsel regarding the franchise agreement. Then follow up with the franchisor. I would recommend that if you’re interested in moving forward, it’s now time to meet the franchisor in person (if you haven’t already) by scheduling a Discovery Day. Make a list of questions and spend the day to meet the team and get answers as well as a feel for the culture of the organization. Find out how deep the franchisor’s organization is and, please make sure you feel comfortable that the franchisor has enough experienced staff to service the franchisees.

Tip #5 – Speak With The Franchisees
Your best source of information is going to come from the franchisors customers, that means the franchisees. Call and visit as many franchisees as possible. Since many Franchisors don’t disclose Average Unit Sales and Operating Expenses in their FDD, they can not discuss it with you. Franchisors can only make claims and address financial issues published in their FDD. Be wary of the sales rep that starts telling you how much money the franchisees are making and how much money you can make. This practice of making “earning claims” not documented in the FDD is not only a violation of franchise regulation but also another red flag. However franchisees are not bound by franchise regulation and if they choose, are free to answer any question as long as they do not disclose proprietary information belonging to the franchisor, such as recipes or processes. When visiting the franchisees, build a report, let them know you’re close to making a decision and carefully phrase your questions so that they are not intrusive. I always ask about support and if they had the opportunity to “do it all over again” would they? Keep in mind there will always be a few disgruntled or struggling franchisees. Without knowing all the facts, it’s tough to condemn the system or franchisor. That said, if the majority of franchisees regret their decision or feel that the franchisor is not supportive, then you need to make further inquiries with the franchisor before signing the franchise agreement.

Tip #6 – Ready, Set, Go
Not so fast. Before the franchisor prepares a franchise agreement is it essential to discuss the best way to structure your new company. Many attornies will recommend that you not sign the franchise agreement in your name but instead set up a separate business entity such as a Limited Liability Company (LLC) or an S-Corp. Seek competent legal advice from a franchise attorney before you sign a franchise agreement or set up a new company.

Franchise ownership can provide you and your family a lifestyle that can not be achieved by working a job for a company. Building a business can be rewarding, exciting and stressful all at the same time. As an entrepreneur, I believe business ownership is the best form of work for many people.

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Photo by rawpixel on Unsplash

About the Author
Gary Occhiogrosso is the Founder of Franchise Growth Solutions, which is a co-operative based franchise development and sales firm. Their “Coach, Mentor & Grow Program” focuses on helping Franchisors with their franchise development, strategic planning, advertising, selling franchises and guiding franchisors in raising growth capital. Gary started his career in franchising as a franchisee of Dunkin Donuts before launching the Ranch *1 Franchise program with its founders. He is the former President of TRUFOODS, LLC a multi-brand franchisor and former COO of Desert Moon Fresh Mexican Grille. He advises several emerging and growth brands in the franchise industry. Gary was selected as “Top 25 Fast Casual Restaurant Executive in the USA” by Fast Casual Magazine and named “Top 50 CXO’s” by SmartCEO Magazine. In addition, Gary is an adjunct instructor at New York University on the topics of Restaurant Concept & Business Development as well Entrepreneurship. He has published numerous articles on the topics of Franchising, Entrepreneurship, Sales, and Marketing. He was also the host of the “Small Business & Franchise Show” broadcast over AM970 in New York City and the founder of FranchiseMoneyMaker.com