Over the last year, I have spoken to a ton (many dozens) of people who have connected with me about the idea of starting their own cycling studio from scratch. If you and I have spoken, you have probably heard me discuss what the 3 critical “phases” of studio development (before launch).
1) Business plan….answers key questions like how much do I need to get going?, how much can I make?, what are the operations and marketing issues around getting going?, do I really want to do this?
2) Funding…a few folks are self-funding with savings, most want to borrow money to get going. How does this work, what do you need?
3) Real Estate….finding the right space in the right demographic location at the right price is critical to making these work. Lots of issues around this as many can attest.
Today, I want to say a few brief words on funding, funding, funding, and especially the idea of borrowing money from a bank. Is it possible? Yes. Is it difficult? Yes. Is having a great idea that you KNOW will work enough to convince a bank? No.
I am going to make a gross generalization and there are always exceptions but there are 3 things a bank cares about.
1)Is the business a good idea with a good plan
2) Is the entrepreneur or team a good credit risk?
3) Has the owner demonstrated a strong commitment by putting their own money at risk?
Here is a quote from the SBA (Small Business Administration) website. The SBA is one of the major lenders to startup small businesses
“…Sufficient equity (investing your own cash) is particularly important for new businesses, to convince the lender you are serious…”
Having a good idea and a good plan? Good.
Having a good plan and a good team? Better
Having a good plan, good team committed and motivated? Best
Feel free to call to call anytime and discuss these or other marketing issues facing your studio! Bill email@example.com – 781-254-3677 – skype: spynergy1