When I received the final rejection from Chase I knew I had to act fast to obtain our additional financing. At the time we had conference called the lease to death and the landlord was preparing documents for execution. I called on a few bankers I had spoken with earlier in the Summer and asked them to tell it to me strait. They confessed that despite the guarantee perks from the SBA they had ceased nearly all small business lending. Even established and fully collateralize ventures failed to get through, much less a start-up. My general contractor roommate, trying to get his third townhouse up in the booming Washington Ave. corridor, confirmed the rumors. It seemed my only choice was to seek equity investors.
Then I discovered Acción Texas, the local branch of a global micro lender specializing in start-ups and other high risk organizations. There was one key problem to pursuing a loan through Acción: their maximum amount was less than half of what we had originally intended to borrow. It’s okay, I convinced myself. I can go another year without a salary. Disposable income is overrated. I have enough fat on my hips and shoes in my closet to last several more years without discretionary spending (seriously, I spend all my money on food).
We received a quick response to our initial online application. The process was formal and streamlined, so no more waiting on ephemeral underwriters. Cleared for pre-approval based on the business summary and credit rating, we begin the submission process for what seemed like an infinitely long list of paperwork. I dropped off a brief case full at the organization’s office on the first meeting along: the business plan, several years of tax returns, assorted business documents, pay stubs, receipts, vehicle titles and bank statements. Yet the requests just kept coming.
I was impressed by the woman who had been assigned to our file, a passionately diligent French expat who toiled over paperwork well into the evenings and weekends. Since it has been my experience that non-profits usually shut down at 5pm prompt, I was surprised when I kept receiving emails at 11pm on a Friday night asking for clarification or more paperwork. Naturally, the drought in traditional bank lending had crowded Acción’s files and they were backed up in a way they’d never seen before. Still, they meticulously analyzed every piece of paper that came through the door.
We spend many hours on the phone explaining everything from fluctuations in my bank statements (I transfer money between accounts quite a bit due to the crazy volatility we’ve had) to detailed equipment budgets listing purchases right down to the sheet pan. We received a few bizarre requests, like proper minutes documented by the State Comptroller, but were, with some effort, able to finally explain that an LLC was not an actual corporation and did not file such documentation. All the while our dutiful expat file-manager appeared to be receiving constant demands from a head office in San Antonio that often failed to make any sense to be understood by anyone. Actually, even the person who made the demands didn’t quite understand what he was asking. When I finally spoke to him regarding final issues of contention he simply admitted a few misunderstandings and voided the requests.
This was an interesting process, indeed. Yet, despite all of the paperwork and phone calls, it was comforting to know that throughout the process at least someone was actually looking at my file!

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