Irrespective of your Middle Market firm’s size, you are likely looking to continue expanding sales, teams, and products. All of which takes ready access to capital.
Whatever your plans, having the ability to find and secure funds from lenders comes into play at some point for every organization. Even if you feel you don’t need any outside funds in the near future, the benefits of creating and maintaining processes that make your Middle Market company attractive to lenders is something you should be focusing on in the present.
Being able to secure lending should you need it lends some security to your location. You’ll need to know what lending options exist. Also, what types of lenders would be interested in your Middle Market firm. As well as, what lenders look at before making decisions.
Rating Your Company’s Attractiveness To Lenders
One of the first steps should be to take a look at your financials, structure, and overall business performance. While you might feel your company is performing well, you need to look at it through potential lenders’ eyes.
Some questions to ask yourself would be: What do you track, who tracks it, where do you make & lose money and will you meet standard underwriting requirements?
Lenders will also want to see a strong, deep management team, succession plans, an up-to-date and tailored business plan. Additionally, they’ll need to know you keep your customers, market, competition and industry in mind as you make decisions. So, if your internal teams aren’t fully versed or able to complete this evaluation, you may need help. You could consider bringing in consultants or a board with strong insights into lending and underwriting.
Becoming More Attractive
Once you’ve completed the evaluation, you should have at least an outline of the areas you might need to focus on improving to become more attractive to lenders.
– A dynamic, updated business plan that shows where your firm is now and where it intends to go is important. As your company changes, your business plans should be evolving and updated with it.
– Keeping up to date with lending options and requirements allow your Middle Market organization to take advantage of offers as they come your way and your leadership will have an easier time evaluating what solutions are best.
– Knowing where your money is won and lost is vital.
– A well-structured, high functioning management, leadership, and C-Suite is necessary to instill confidence and ensure continuity even with eventual changes.
– Having a strong, documented succession plan in place reassures lenders of a forward-thinking focus.
Building these key concepts into an on-going business plan and structure is key to becoming and staying attractive to lenders.
Clean Up As You Grow
What worked for your Middle Market firm when you were a startup or small business will likely not continue to be successful as you approach or move past Middle Market status. Intentionally designing business practices, management structure, financial recording and data capture with an eye towards lenders takes a continual focus.
As you grow, it is key to stay abreast of lending options and trends and to keep focusing on how you can become ever more attractive to lenders. Instead of waiting until you need capital, incorporating these processes and evaluation tools into your mindset early will allow you to be ready when the time comes to secure funds.
So what’s in the Mighty Middle Market for me? — get it right now at www.Go4ROI.com.