Episode•November 21, 2024•21 min

How to Secure a Business Loan with Craig Calafati | Ep. 355

In this episode of Money Talk With Tiff, Tiffany Grant sits down with Craig Calafati, an experienced small business lender. Craig brings over 30 years of experience in lending to small businesses, sharing invaluable advice on what successful business owners do and don't do. This episode is packed with insights on the importance of networking with successful entrepreneurs, coming prepared to financial meetings, and understanding the intricacies of business lending. Check out the full show notes: https://moneytalkwitht.com/podcast-show-notes/successful-small-business-loans/ Key Takeaways Networking and Mentorship Surround yourself with successful entrepreneurs. Seek advice and learn from others who have been in similar situations. Preparation for Lending Know exactly how much money you need and why. Be able to clearly articulate your business needs and repayment plan. Business Plans and Financials Have a detailed business plan, whether you're starting a new business or running an existing one. Ensure your financial records are accurate and transparent. Real Estate Considerations Consider leasing rather than buying property initially. Save your cash and park it for unexpected expenses rather than tying it up in real estate. Lending No-Nos Avoid starting any projects or signing leases before loan approvals. Stay open to feedback and be prepared to adapt. Tax Returns and Profitability Aim for profitability on paper when possible; tax returns are crucial for lending decisions. Engage a good accountant to maintain the integrity of your financial records. Connect with Craig EVP, Director of Lending at Arkansas Capital (CDFI) Website: arcapital.com Connect with Tiffany Grant Website: moneytalkwitht.com Social Media: @MoneyTalkWithT If you enjoyed this episode, consider subscribing and leaving a review on your favorite podcast platform. Thank you for listening, joining, and being a part of the Money Talk With Tiff podcast! This podcast uses the following third-party services for analysis: Podcorn - https://podcorn.com/privacy OP3 - https://op3.dev/privacy

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Key Takeaways

Surround yourself with successful entrepreneurs for mentorship and real-world advice

Connect with people already in your target business to learn the ups and downs before you encounter them

Use these relationships to avoid common pitfalls and gain practical insights that books can't provide

Know exactly how much money you need and why before approaching any lender

Never ask 'how much can I get?' — this signals you don't understand your own business needs

Be prepared to clearly articulate the amount needed, timing, purpose, and repayment plan

Lease rather than buy real estate in the early stages of business

Cash is king for startups — unexpected expenses will arise and you need liquid reserves

Consider a 3-year lease with an option to buy once the business proves successful and you understand your space requirements

Never sign leases or start projects before receiving full loan approval

Starting construction or committing to leases can kill deals and create title insurance problems

Have a letter of interest and reviewed lease documents ready, but don't execute until approvals are secured

Maintain accurate, transparent financial records and work with a good accountant

Lenders scrutinize tax returns and will add back legitimate expenses like depreciation

Showing profitability on paper matters — aggressive write-offs can hurt your ability to secure financing

Intro

Tiffany Grant interviews Craig Calafati, EVP and Director of Lending at Arkansas Capital, who shares 30+ years of experience helping small businesses secure funding.

Craig Calafati is an experienced small business lender with over three decades of experience. He previously owned a small business and now specializes in lending to entrepreneurs through Arkansas Capital, a CDFI.

How to Secure a Business Loan with Craig Calafati | Ep. 355

Key Takeaways

Intro

– The Power of Entrepreneurial Networks

– The #1 Mistake: Not Knowing How Much You Need

– What Lenders Look For: Business Plans & Financials

– Real Estate Strategy: Lease First, Buy Later

– The Leasing Process & Lender Review

– Lending No-Nos: Preparation & Mindset

– Tax Returns, Profitability & Working With Accountants

– Asking for Feedback After a Denial

Resources

Topics