An Interview with Sam Giddens
AVP/Commercial Lender for United Bank's Government Guaranteed Lending
Borrowing money can be an intimidating process for anyone, especially a business entrepreneur starting out with a dream. United Bank has a long history of helping local businesses secure financing for a solid start or to continue down a path toward growth and expansion. Sam Giddens, Commercial Lender in the bank’s Government Guaranteed Lending division, shares what businesses need to do in order to secure the funding they need to thrive.
Q: As a United Bank lender, how much of your time is spent working with business owners in your community?
A: I’ve been in banking since 2014 and a member of the United Bank team since 2020. Over the course of my career, I’ve had the privilege of helping countless businesses grow and prosper. I would say that today, I spend more than 80 percent of my time in the bank doing something that works to enhance the businesses in and around my community.
Q: When businesses prepare to approach a bank to secure a loan, what do they need to have in place?
A: Business owners should be prepared to have an initial consultation with a United Bank lender to build rapport and hash out exactly what they are looking to accomplish. For the lender, I think the most important part about this phase of relationship building is asking the right questions and then simply listening. People love talking about their businesses and through these conversations, we find out where they have been, where they are now, and where they want to go. These conversations give lenders a baseline understanding of how to best aid them to achieve future success. Additionally, business owners should be prepared to talk about their personal financial position as well as the financial situation of the business. We typically require two years of historical financial statements on the business and the majority owners. If the business is a start-up, we ask them to prepare a business plan along with future projections for at least two years.
Q: For business owners who have never written a business plan, what elements should be included? What are some good resources for guidance in writing a plan?
A: A solid business plan is the most important thing a start-up business can have. It doesn’t have to be long and intricate, but the content needs to be good. It needs to give a history of the entrepreneur(s) and how they see themselves successful in the new venture. We need to see that the business owners took the time to think through the mathematics and the growth process. How will they meet sales goals and what’s the cashflow cycle for the next 24-36 months? Who are they selling to and how will those customers buy? What niche are they addressing and what’s the competition in the market? What’s the plan for net positive cash flow?
Q: How should businesses position themselves to secure financing?
A: An existing business should drill down to three things. First, the business should be turning a net positive cash flow because positive cash flows are what repay debt. Second, businesses should not already be over-leveraged, and lastly a business should be able to collateralize the new debt.
When I’m working with a start-up business, I leverage government guaranteed loan programs to facilitate solutions for those applicants.
Q: What should business loan applicants expect from the process? What's the timing? What kinds of questions do they need to have answers for?
A: Depending on the purpose of the financing and structure of the loan, applicants should expect to close on their loan and receive proceeds anywhere from a few days to up to 45 days from initial document submittal to closing. The shorter spectrum of time would refer to fixed asset purchases such as machinery, equipment, vehicles, etc. while the longer spectrum would refer to commercial real estate transactions. There are variables in the loan process that we cannot always control, such as the appraisal or evaluation of assets. That can make the cycle to closing take longer.
Government Guaranteed Loans can take up to 45 days and longer, based on complexity.
Q: What business loan options are available through United Bank for a growing business?
A: We offer conventional business loans used to purchase fixed assets or real estate, expand or construct additional real estate, plant or machinery, provide working capital lines of credit and business credit cards. We also offer government guaranteed loan programs that can help to start-up or provide capital to infant businesses, including SBA 7a, SBA 504 and USDA loans.
Q: How does United Bank differ in its approach to business loans?
A: United Bank takes a consultative approach to relationship building with all of our customers. We treat the opportunities that cross our path with honesty and integrity, and truly work to be a trusted partner in the business endeavor. Taking this approach has proven effective in building lifelong relationships and bettering the communities we serve.