Fund • a • bil • i • ty [ adj. Fuhnd-uh-bil-i-tee ]You won't find "Fundability" on Dictionary.com, so don't bother looking.
Fundability is a phrase we've coined to describe how a business measures up in relation to the entire lending and investing community. How fundable is your business? Simply put, Fundability is a measure of how lenders, investors, vendors, insurers, and suppliers view the risk of extending credit and/or services to your business.
Let’s Break Fundability Down Into Its Parts:
Part 1 – Compliance Setting up properly and completing the 20 compliance items that most lenders require prior to a loan being approved. In terms of Fundability, this is simply saying that your business has paid attention to the details and addressed all of the items that every real business should.
Part 2 – Strong Business Credit Scores
Building strong credit scores with all three national business credit reporting agencies: Experian Smart Business, Dun & Bradstreet, and Equifax Small Business Financial Exchange.
Part 3 – Optimal Credit Usage
Establishing a 1-3-5, that is one bank loan, three business credit cards, and five vendor lines of credit that are not associated with you personally and do not show up on your personal credit reports.
Part 4 – Comparable Credit
Getting vendors or non-traditional lenders to grant your business a credit line that is comparable in size to the loan you are seeking from a bank or traditional business lender. This can be accomplished in many ways. For instance, through a vendor willing extend a $25,000 credit line to your business or through a $50,000 lease line of credit to be used for specific equipment. The bottom line is that most traditional lenders do not want to be the first to take a chance on you.
Part 5 – Business Viability
Being able to show that your business is not only credit worthy but also "viable" for its industry and market segment. This means the business model and plan you present to the traditional lender needs to make sense and show the ability to service the loan. Simply put, lenders want to know that they can get paid back.
Our Business Credit Building System guides you step-by-step through the first four parts of Fundability. Parts 1 – 4 are all about making sure your business is set up right, shows optimal credit usage, has strong business credit scores, and is given access to comparable credit. For Part 5 we provide you with our time tested workbook, “How to Prepare and Present a Successful Funding Request”. It provides all the tools necessary to test your own Business Viability and then shows you how to project that viability for lenders.
By improving the Fundability of your business, The Business Credit Building System is doing more than just helping you build strong business credit. We are improving the overall "health" of your business while greatly increasing your ability to succeed now and in the future.