Identify and Contact Prospective Lenders
The process of identifying Lenders begins with the online BorrowPQ Lender Directory. There you will find Lenders who have identified their lending criteria for BorrowPQ customers.
Through BorrowPQ you can selectively and discretely contact prospective Lenders to ascertain, on a preliminary basis, whether there is a good fit between your needs and the Lender’s criteria. If there is a match, you can submit your teaser to the chosen lender(s)
Consider different types of Lenders and how well they match up with the objectives you identified in Step 1 for financing your business. BorrowPQ provides access to a verified network of lenders, including:
- Commercial Banks – in general the most conservative lenders requiring the most security and usually higher rates on loans
- Specialty Lenders – typically take on higher risk ABL and charge highest rates. Often these lenders constitute a “lender of last resort”
- Family Offices – willlend money to achieve a higher rate of return with more security than might otherwise come from other alternative investments, e.g. minority equity investments in privately owned companies, venture capital, or publicly traded equities.
- Insurance Companies – tend to focus heavily on ABL with a concentration on commercial property assets. However, they should be considered as significant players in the ABL marketplace. They are conservative and often resemble commercial banks in terms of the risk profile they are willing to consider.
- Private Equity Firms – In most cases they are lending
your company to achieve a targeted financial return. They also want to gain
insights into your company as a prospective acquisition for their portfolio.
Some of the characteristics of private equity firms are:
- They are financial engineers – allegedly “smart money” knowing what operating adjustments are needed, when to finance or purchase to maximize their return
- These types of lenders typically have a surplus of cash, but you must be careful of complex lending/purchase structures
- Primarily concerned with return on investment
- Usually plan to hold and finance again – or pursue a significant ownership position
- Business Development Company (“BDC”) – BDCs are investment companies that invest in small and mid-sized businesses. This form of company was created by Congress to provide small and growing companies access to capital and to enable private equity funds to access public capital markets. A BDC must invest at least 70% of its assets in nonpublic US companies with market value less than $250M. BDCs are similar in risk profile and investment characteristics to private equity funds.
In addition to BorrowPQ’s directory and network, there are many industry-by-industry directories available to you to expand your list of Prospective Lenders The directories will also provide contact information. Click through on the respective links to search for additional candidates:
- Large Commercial Banks
https://www.federalreserve.gov/releases/lbr/current/
- Private Equity
https://www.privateequityinfo.com
- Family Offices
- Specialty Lenders
https://www.abladvisor.com/IndustryDirectory.aspx
- Business Development Companies (BDCs)
https://www.bdcinvestor.com/business-development-company-list
Through the BorrowPQ Community you may also work through our resources which include on-line Lender prospecting tools, Accountants, Lawyers and the expertise of Investment Bankers.
PQ also can refer you to preferred third-party advisors for this step.
Contact Us at any time for help or to provide feedback
