That’s the phrase one of my oldest and closest banker friends always used – he became the President of a major division of a major bank before he retired. You may not know that word – and it’s at least a “50-center”, maybe more, but he loved it and used it on me all the time.

… pause … have you looked it up yet or are you waiting for me to tell you? … come on ….

Yeah, that’s what I thought. Okay. It means charitable, as in “we’re not a charitable organization” … meaning we do have a few basic rules:

• We expect to get paid … so we’d like to confirm that your projections provide sufficient free cash flow so you can actually pay us back.
• We like to have some collateral in case something goes wrong.
• We’d like to see some owners’ capital invested in the business so we know we’re in this together.
• We’ll probably ask for your personal guaranty, too, to be sure you’re dedicated like the “bacon” and not just committed like the “egg”.
• It would be nice if you had some kind of demonstrable track record and relevant management experience so we can assess whether you know what you’re doing in the business you’re in now.

Those are the basic rules … which is why I’m getting pretty tired of the endless news articles and blog posts about the lack of adequate capital for small business. (more…)