I have a very good friend who works for financial lenders Sertant Capital and it is his role to assess suitability of the people who come in looking for loans for their equipment hire. Slots every day my buddy has a story about some of the people who come in to see him, who have clearly very little idea what lending actually looks like. In some cases you feel sorry for people as they perhaps don’t know better, in other cases you have to laugh because of the absurdity of what people ask for or the way that they present themselves. 

The one overwhelming point which my mate always talks about is the importance that before any business owner goes out looking for investment or loans for their business, that first they speak to a business accountant financial advisor, and here is why. 

Business Valuation 

If you have ever watched Dragon’s Den or Shark Tank then you will have some experience of seeing people wildly exaggerate their company’s valuation. This is the first thing which will set alarm bells ringing in the heads of an investor. If you have $250k worth of turnover and $10k of profit, your business is not worth $2.5 million. This is the first reason why you need to get an expert in, so that they can give you a more accurate figure. 


The amount of people who sit down in front of my friend and ask for money, let’s say $10k, and then when asked why they want the money they will reply something like ‘business costs’. This of course is incredibly obvious and what lenders and investors are actually looking for is a detailed breakdown on what exactly you want the money for and where it will be spent. This again is why you need to have an expert on board how will be able to help the business break down why it needs money, how much it needs and then of course where that money will be spent. 


There are 2 types of business owners in this world, those with a financial brain and those without. Now in most cases those without a financial brain are equally as brilliant at running a business, although they lack a certain characteristic which is essential to the survival and to the success of their business. These are the people who will come in asking for some pie in the sky amount of money which they promise to repay over the course of the  next 25 years, which of course is absurd. This, once again, is exactly why business owners should speak with a professional in the financial services to offer up a reasonable and comfortable repayment term, which will ensure that money is repaid in a timely fashion at minimal inconvenience to the business. 

Always consult an expert before asking for any funds from investors or lenders.