9 Strategies for Making an Impression on your Banker

Unless you have more cash on hand than you know what to do with, establishing and maintaining a positive partnership with a banker is a key element to your business success.

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When CollegePlus first started out, we had no credit history and since we were a service organization, we didn’t have a lot of hard assets such as equipment to use as collateral. Needless to say, we were not an ideal candidate for a new line of credit. I struck out on my first few attempts at obtaining a line of credit. However, I am grateful to say that Tom, who remains a key partner with us to this day, was willing to take a chance on us.

Below are nine keys for managing your banking relationship:

  1. Leverage your network - When possible, obtain an introduction through a mutual friend or colleague. I was introduced to Tom by Rick, our CPA. Rick is COO at our community’s leading CPA firm. Tom didn’t know me from Adam, but through the introduction, I was able to leverage Rick’s reputation in this new relationship.

  2. Shower and shave – You don’t have to wear your Sunday best, but you don’t want to look like you just crawled out from under a rock either. Think of it like a job interview and dress according to the culture at the bank, which might be different from your day to day working environment.

  3. Relationship not Transaction – Remember, business is about relationships not transactions. Bankers are people too. When establishing a banking relationship, look for someone who can not only provide your financial needs today, but someone with the heart and experience of a mentor, who can provide strategic insight into your business tomorrow. Use this same philosophy when seeking out a CPA or attorney as well. Find people who are interested in you and your business, people you would respect enough to seek out for advice down the road.

  4. Share your vision – When first establishing a banking relationship, be prepared to share why your company exists and what your vision is for the future. It is important that you view your banker as a key partner in helping you to achieve your vision. If she doesn’t express an interest, she probably isn’t the right partner.

  5. Know your stuff – preparation is the key. Anticipate the questions  your banker will have. If finances aren’t your strong point, find a CPA or bookkeeper with which you can role-play. It’s better to have a CPA drive a truck through the holes in your logic than it is for your banker to do so.

  6. ALWAYS tell the truth – never, ever, lie to your banker – don’t even stretch the truth. More than anything, your banker is basing her lending decision on  trust. In the end, she’s not evaluating you based on how slick your presentation is or how sharp you look (although these things can certainly help) but on the answers to two questions. First, do I believe this person/business has a high likelihood of success? And second, can I trust him?

  7. Beat her to the punch – Remember how it was always better for your parents to hear bad news from you rather than from your teacher? In this way, bankers are much like parents. If you had a bad quarter, be upfront and clearly provide your banker with the information and your plan to fix it. Don’t make her go hunting through your financials hoping she won’t discover your poor performance. She’s a trained professional, and her success depends upon her ability to read financial data and smell a rat. She’s going to find it, you might as well use this as an opportunity to build trust by being upfront.

  8. Underpromise and overdeliver – Never give your banker the best case scenario, but rather, manage their expectations. If you publish your stretch goal of $100,000 of topline revenue and achieve $95,000, your banker will be concerned. If you publish your budget goal of $85,000 then go on to achieve the same $95,000, your banker will be ecstatic and have even more confidence in your future projections.

  9. Understand who you’re dealing with – Most bankers are wired totally differently than most entrepreneurs when it comes to risk tolerance. They tend to be risk averse and attracted to a low risk/low payoff opportunity over a high risk/high pay off opportunity, that’s why they’re in banking and not venture capital. That’s also why they are still in business! Your job is to show them why you are low risk.

What have you seen as the keys to your banking relationships? What mistakes have you made? Share with us below and let’s learn together. I’ll do my best to answer your questions if you have them.


2 thoughts on “9 Strategies for Making an Impression on your Banker

  1. I’m interested in the relational emphasis of your strategies. Seeing the building blocks of the relationship laid out in specific points is helpful. I especially like the reminder that bankers are people too.

    • Adam – thanks for the comment. Yes, relationships are key to almost all of business. Having a focus on relationships versus simply transactions will give anyone a tremendous leg up on the competition.

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