April 19, 2025 • 46 mins
Unlock the secrets to funding your franchise dream! 🚀 In this full Franchise Freedom episode, Giuseppe Grammatico interviews Mike Minitelli, funding expert from Benetrends. Deep dive into ROBS (using retirement funds), SBA loans, combining strategies, HELOCs, portfolio loans, and crucial advice on timing and financial planning. Essential listening for aspiring franchisees!
DISCLAIMER: The information on this podcast is for general information purposes only. Franchising involves risk and careful consideration should be given before making any decisions.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
I've moved up in several rolesat Benetrends and now I get to
(00:02):
lead the sales team and, youknow, work with people like you
and different franchiseconcepts.
And it's exciting, man.
I never get bored and it's greatto let people know that they
have options out there, right?
When it comes to lending.
I think one of the biggestmistakes Giuseppe people make is
going into thisundercapitalized.
But you can't predicteverything, right?
(00:23):
So it's always, I always tellpeople, get more than you need.
And if you don't use it, great,you can throw it back to the
principal of the loan or put itback into retirement, however.
Welcome to the Franchise FreedomPodcast, where you can escape
the corporate trap throughfranchise ownership.
Here's your host, Giuseppe gr,the franchise guide.
(00:50):
Welcome to the Franchise FreedomPodcast.
I'm your host, GiuseppeGrammatic, your franchise guide,
this show where we helpcorporate executives experience
time and financial freedom.
Thanks for joining us today.
We have a really excitingepisode.
You guys had looked one guestyou were sick of hearing from
me, so.
We're bringing on some greatguests, some professionals each
in different fields.
We just had kit Higgs on, wetalked about a franchise
(01:13):
attorney review, and today wehave Mike Minitelli from
Benetrends and we're gonna talkall things funding.
So Mike, welcome to the show.
Thank you, Jaap.
I appreciate you having me, man.
I appreciate it.
This is awesome.
I've been looking forward tothis.
I we recorded a show.
With with Jen back a couplemonths ago and I wanted to do a
little bit deeper of a dive inall the various funding options
(01:34):
'cause we've been getting a lotof questions or if there's been
changes and updates.
So, before we dive into that, ifyou could give the audience a
little bit of background whoMike is and how did you get into
the Benetrends and funding.
Yeah.
Yeah.
My my name's Mike Minitelli.
I'm actually a Chief DevelopmentOfficer here at Benetrends
Financial.
Benetrends Financial is a fullservice funding company.
We're based in Lansdale,Pennsylvania.
(01:55):
It's about, you know, 45 minutesfrom Philadelphia.
And we're actually best knownGiuseppe for something that you
know, and.
Very popular.
Our industry, something called aRob's plan.
Our founder, Len Fisher, is theoriginal architect and creator
of that funding strategy.
Rob's is the acronym that standsfor Rollover as Business
(02:17):
Startups.
This is a funding strategy thatmost people have no ideas at
their disposal.
It allows people to utilizeretirement funds without tax or
penalty to start their business.
Purchase their business or incases like this, purchase their
franchise.
Super, super popular infranchising.
But Berend also does moretraditional lending options,
(02:38):
right?
And SBA loans, equipmentleasing, unsecured lending.
And really the role of myselfand my team is educating
potential entrepreneurs on whatoptions they have.
It's to your point earlier.
There's the lending environmentis always changing and adapting,
and things do move in different,you know, directions.
(03:00):
So it's good for candidates tohave an expert you know, guiding
them through the process.
And that's what we do atBenetrends.
We've been doing it for quitesome time.
I very much like you and a lotof the people you know, you work
with.
I was a, you know, a corporatetransplant.
You know, I spent my first 15years as a.
You know, business developmentindividual in different sales
(03:22):
roles from a company calledCintas Outta College.
Then I got into technology andsoftware and a friend of mine
actually introduced me to thefranchise space in funding and.
I honestly, I fell in love withour industry.
I fell in love with what I wasdoing as far as, you know, I did
(03:42):
like exiting the corporate worldand finding this space.
I, I found that the franchiseworld is a really nice balance
of, I.
The billion dollar headquartersand backings of these great
brands.
And then the, you know, the momand pop that are looking, mom
and pop that are looking to, youknow, open one, two locations
locally in their community.
(04:03):
So, I mean, I kind of fell intoit by accident.
I wish I was doing it the firstyou know, stage of my career.
But, you know, we all have adifferent path and.
I've moved up in several rolesat Benetrends and now I get to
lead the sales team and, youknow, work with people like you
and different franchiseconcepts.
And it's exciting, man.
I never get bored and it's greatto let people know that they
(04:23):
have options out there, right?
When it comes to lending.
That's awesome.
Yeah.
And congrats on the recentpromotion.
That's that's awesome.
It's well, well deserved.
You definitely put the the timein there.
Thank and yeah, there, there is,there's so many different
options.
And you know, for example I gotit to franchising 20 years ago.
I.
No one ever told me that you canuse retirement assets.
(04:43):
And looking back, I'm like, Ihad to, I got denied from a
bank.
I had to get a personal loanfrom my grandparents, and I
don't remember my coach evertelling me o of this option.
Let alone speaking with withBenetrends or any company I
didn't even know I had thoseoptions, so.
Yeah.
And you and honestly, Giuseppe,you shouldn't.
Right, right.
Like, it's not a mainstreamproduct that most of us are
(05:06):
familiar with.
And you know, to your point,like we're all pretty
conditioned early on in yourprofessional career.
Hey, don't, you know, don'ttouch retirement funds, right?
Put money away, you know, stockit away pre-tax.
Let your companies match it, butdon't access it because if you
do, you're gonna be hit withsome pretty substantial taxes
(05:27):
and penalties, sometimes up to30 to 40% of the, that total
amount.
And, you know, we all don't workso hard in our daily jobs to, to
lose that money.
However, through the Roth plan,you can literally.
Access to that dollar fordollar.
And to your point you know, alot of people that are exiting
the corporate world or havespent, you know, 15, 20 years in
(05:49):
a specific career, noteverybody's got money sitting in
checkings and savings, right.
But they do have substantialamount of their assets.
In retirement accounts IRAs, 4 01 Ks.
So, it, I, you're not the onlyperson to say I had no idea that
this existed when I started adecade ago.
And I had the privilege of, youknow, talking to the creator of
(06:11):
this had Benetrends and kind ofexplain how it came about.
So yeah, it's still a hidden gemout there for most people.
It is.
I would say most people, I wouldsay.
Nine, not even nine, outta 10, Iwould say 9.9 outta 10.
I have no idea.
Have no idea.
Which yeah it's the value wecould bring to the table.
I wanna come back to the to theRobs because I wanna dive a
little bit deeper and I wannadive into, you know, the common,
(06:33):
what you're seeing.
But one thing I like to I wannanote is.
When you're looking to work witha company like Benetrends, my
recommendation, the way I lookat it, is kind of like buying a
home.
You don't just start looking at,well, I'm gonna look at million
a hundred thousand dollars homeand$5 million homes.
You wanna make sure that, youknow, what are my options and up
(06:53):
to what can I get afford?
What can I afford?
Excuse me.
You know, kind of get thatpre-approval.
So I recommend.
After having an intro call andhaving someone say, yeah let's
move forward.
Let's, what are the next steps?
I think that is, is the perfecttime start, because it's not
like this thing, you snap yourfingers and it's done.
It's a conversation.
It may be some time gatheringfinancials.
(07:14):
Would you agree that the soonerthe better just to have Yeah.
An idea of kind of what theexpectation is, what the options
are.
Would you agree there?
I, a hundred percent.
I mean, I have the privilege ofworking with.
Hundreds, if not thousands ofdifferent franchise concepts,
networks, people that are, refertheir clients to us.
And a lot of them ask thatquestion.
Giuseppe, when should somebodylook at funding?
(07:37):
And to your point, I usuallyrecommend after that first call,
right?
Because, you know, a, you wannamake sure they're serious and
you want to give them a littlebit light education.
But b the funding and thefinancial side of it.
Arguably is the most importantpart of it, right?
Right.
You could be sitting across fromthe best suited candidate for a
specific brand, but if theydon't have the financial
(08:01):
wherewithal or profile to moveforward, then you could be
wasting both people's time,right?
So letting them know they haveoptions, letting them get
educated and more comfortablewith the process about funding,
getting them pre-qualified earlyon in the process is better for
the candidate.
It's better for the consultant,the brand, everybody along the
(08:23):
process.
And I use the same analogy asyou do.
'cause I, you know, most of usthat we speak with have went
through the real estate homepurchasing process, but not
necessarily I.
You know, purchasing a businessand it's not terribly different,
right?
You do want, just like you golook for homes, right?
You speak to a mortgage broker,you get prequalified, you wanna
(08:45):
see what you're comfortable withspending, and then you look for
homes that fit in that range,right?
The last thing you're gonna dois, you know, get prequalified
for$300,000 and then startlooking at million dollar homes
or vice versa.
So, the more.
Education the candidate hasaround options.
And they were like, oh, wow.
Because again, to your point,hey, they didn't know Rob's
(09:07):
existed, right?
They might not know that theycan utilize equity in home.
There's all these differentthings people don't realize.
And all of a sudden they thoughtthis was a pipe dream and
they're like, oh, wow, I can dothis reality.
Yeah.
Yeah.
It's a reality man.
So the earlier they realize thatthe better for everybody
involved in the process.
I, yeah.
And that's it.
And then and it really helps to.
(09:28):
Narrow the search based off ofwhat you can get approved for.
And just because you're gettingapproved for a larger amount
doesn't mean you have to max itout.
It could be obviously be muchless, but it's good.
You know, some people will sendfinancials and say, well, I have
this much cash and this muchequity in the home.
And it's like, no, I need, youneed the whole picture because
there, there's so many otheroptions.
So, all right.
So let's, one thing I like aboutyour organization is that you're
(09:50):
able to really, it's a holisticapproach.
You're looking at all aspects.
It may make sense to, and I'm,we're gonna dive deep on the
Rob's plan.
Maybe a combination of Robs,maybe there's a home equity line
of credit.
Makes sense as well.
Yeah.
Not that you offer, you know,the line of credit or in that,
you know, you would go back tothe to the loan to the to the
bank, excuse me the mortgagecompany.
(10:12):
Yeah.
But you would, you can makethose suggestions, even though
that's not a product that, orservice, I should say, that you
offer.
So that's one of the things Ilike it, it's, let's look at all
the options.
Maybe, you know, option B makesbetter sense.
Maybe it's a combination.
So, with that being said youknow, top ways that you're
seeing today.
Funding loans.
The Robs is number one.
So for everyone listening andfirst time listeners, rollover
(10:34):
business startup, right?
ROBS.
So y the first thing I hear is,you know, is that legal?
Which, why the hell would I evenbe bringing it up?
But I just find that kind offunny.
But it was actually a Benetrendsthat developed this, I believe,
was it the late seventiesdirectly with the IRS?
Yeah.
40, 45 years ago our founder,Len Fisher.
(10:54):
Who was an ERISA attorney bytrade came up with this process.
He was working with one of hisclients who had most of his
assets in a retirement account,and Len utilized the IRS code
and you know, tax.
You know, all the informationthat the IRS lays out and
realize, Hey, you can do this ifit's done properly.
(11:17):
So it kind of happened byaccident and he created this
this process and 45 years later,you know, 50,000 plus clients
later, we've really created awhole industry around that
product.
So, yeah, it's very much, legal,it's very much blessed by the
IRS, I think Giuseppe the first15 years of us kind of in
(11:41):
business, it was a lot more, youknow, lobbying, you know, with
the IRS to get their blessing onthis.
Right.
But you know, they have sincegiving us the kind of green
light and nod that, you know,what Robs is, something that's
gonna be here and here to stay.
And you have our blessing aslong as you have an organization
like Benetrends or some of ourcompetitors that are doing it
(12:02):
properly and managing thoseaccounts.
So, yeah man it's again, just anoption.
Most people don't realize it'sat their fingertips.
And honestly, man, it's not verycomplicated.
I think a lot of people, to yourpoint, like.
I think it's like, I've neverheard of this.
So it gives them a natural kindof, hesitation.
(12:24):
But it's really no differentGiuseppe of the rollovers most
of us have done in our corporatelife.
Right, right.
So I had very, I was kind when Isat across Len 10 years ago when
he explained this to me.
He explained it to me in a waythat it made sense to me.
And I do that a lot with ourcandidates because they do come
(12:46):
from corporate backgrounds,right?
So we're both New Jersey guys,right?
We got a, you know, hundreds ofdifferent pharmaceutical
companies here, right?
So let's just say I'm, you know,an analyst at Johnson and
Johnson, right?
And I have a 401k with j and j.
Let's say there's$300,000 inthere.
And I get an opportunity to gowork for Pfizer.
Right.
(13:06):
Typically what we do inscenarios like that is I'll take
my j and j 401k with$300,000.
I'll roll that out into an IRA,or I can just roll that into
Pfizer's new 401k, right?
And going from one qualifiedretirement plan, you never pay
taxes and penalties on thattransaction.
All of us have done that incorporate life, right?
(13:28):
You have 300, you move 300.
Super simple.
When I'm at Pfizer and I'm goingthrough all my onboarding and
training and they're setting meup with my benefits and, you
know, fidelity 401k or Schwab,whatever they set me up with,
and I'm going through investmentoptions within that 401k
Giuseppe.
A lot of times one of thoseinvestment options is purchas
(13:49):
purchasing company stock.
Right.
So again, something I know I didin my technology career, you've
probably done it.
Most of the people that we workwith have done it.
At the time I didn't realize itwas kind of setting off a chain
of events, right?
So if I look at that 300 k and Isay, you know what, I'll take a
hundred of it and invest it inPfizer, I can do that.
(14:11):
Then what happens is my 401kjust now owns the amount of
shares that I just purchased forPfizer, and that a hundred
thousand dollars that I used topurchase it.
It doesn't remain in my Fidelityaccount.
It doesn't float.
In financial purgatorysomewhere.
It goes to Pfizer in one oftheir many corporate checking
(14:32):
accounts that company could nowuse for whatever legitimate
business expense that they want.
Right?
R and d product, salaries, realestate, anything.
So what Len figured out and whatwe do at Benetrends is literally
that same exact chain of events,but instead of doing it for
Johnson or Pfizer or Amazon, weset up Minitelli Enterprises,
(14:57):
right within MinitelliEnterprises.
We set up a qualified customizedretirement plan, and then we can
take that same$300,000 for myold j and j, 401k.
We roll it into MinitelliEnterprises.
New qualified retirement plan,and just like before going from
one qualified plan to the next,no taxes and penalties.
(15:18):
And then what happens is.
The retirement account thatBenetrends created for me is now
just gonna purchase privatelyheld stock in that Minitelli
Enterprises, and then throughthat privately held stock
purchase.
Giuseppe the retirementaccounts, gonna own privately
held shares$300,000.
(15:39):
Now goes to Mike Minnelli'scorporate checking account that
I could now use for anylegitimate business expense.
So that can be the franchisefees.
That can be a build out of mylocation if I'm having a brick
and mortar trucks equipment.
It can also be used to payyourself a salary, which is a
lot of times very hard to getfrom a loan.
(16:00):
And it can also be combined withSBA or another form of.
Funding to get additional fundsto help secure you know, your
investment.
So yeah, again, that, thathelped make sense to me 10 years
ago.
And when I try to explain itthat way, Giuseppe, it does seem
to resonate.
It does actually, with thepeople that have done it in
(16:20):
their corporate life, right?
It absolutely does when you kindof say it that way.
And that explanation actually isreally helpful because people
start getting into the weeds onthis, and I go I'm not the
expert in this area.
You know, we work with Berend,we work at Jade.
We work with Jade every singleday, you know, back and forth.
We, there's always this you'veprobably never heard of this
scenario.
It's always one of thoseconversation starters, but she's
(16:43):
been really helpful in, in, instarting that.
So, so that is, I guess abenefit there is, I'm looking at
it, it seems like it's yourmoney, so you get access to the
funding quicker and you don'thave to worry about note
payments every month, right.
It's just you got a newbusiness, right.
Yeah.
Yeah there's a lot of advantagesto it.
It is, to your point, a veryquick way to get, you know,
(17:04):
funding right from start tofinish.
You're looking at usually threeto four weeks from engagement to
that money sitting in yourcorporate checking account.
Even Giuseppe for the peoplethat have cash and liquidity and
they learn that this is anoption they quickly say to
themselves.
Well, if it's sitting in cash,that means I've probably already
(17:24):
paid my taxes on it, right?
Cash is good to have for yourday-to-day life, right?
You know, Becky needs braces.
Johnny's going to college.
Tree trees fell down on myhouse.
You know, cash is always good tohave.
So once they realize I canaccess my pre-tax dollars in
sometimes an underperformingretirement account.
(17:45):
I'd rather keep my cash here,right?
And then access these pre-taxdollars to, to help fund the
business.
So, you have the aspect of usingprevo versus post-tax.
Some people like thediversification of it, right?
If you have somebody that hassubstantial amount of money
within the IRAs and retirementaccounts, if they have a million
(18:08):
dollars and they can just pull200 of it.
Take it out of Wall Street andthe market and say, Hey, now I'm
investing it in Giuseppe and mybusiness.
It's diversified, right?
So it's not tied to Wall Street.
It's tied to me.
And then you have the individualGiuseppe that just likes
control, right.
Maybe there's some distrustabout Wall Street and you know,
(18:29):
the market and they say, youknow what?
I want to have control over mymoney and my destiny.
God forbid it doesn't work out.
There's nobody to blame but meand myself, I want to invest and
bet on me, which is anotherthing that people, you know,
like to do.
So it, there's a lot ofdifferent ways that, that people
view this.
And again, to, to our point,most people go into this
(18:53):
conversation not even knowing orrealizing that this is an
option.
Awesome.
No, that's that, that is reallyhelpful and, for anyone that
wants to learn a little bitabout, about, about the Robs or
any, anything we're talkingabout today, we're definitely
sharing this episode since youdo a much better job in
explaining it.
Yeah, especially when thequestion started started popping
up.
So this is one avenue of manytalk to us about, you know,
(19:16):
another, product or service isthe SBA loan.
So what is that?
What does SBA stand for?
For someone that's listening forthe first time and you know,
what does that process looklike?
And maybe even, you know,compare the two, maybe some
differences, obviously one'salone, but if there are
differences is what you can usethe funds for.
Yeah.
SBA Giuseppe is small businessadministration.
(19:39):
It's our government backedentity supporting small business
and entrepreneurship in the usRight?
You know, at the end of the day,I.
These are just banks lending themoney.
What the SBA does is incentivizebanks to lend to Michael, to
Giuseppe, to anybody out thereby guaranteeing a certain
(20:02):
percentage of that loan.
I talk to people all day, everyday, and sometimes I ask, Hey,
why do you wanna look at A anSBA loan?
And they say, well, it'sguaranteed.
Yeah.
While that's true, it's notguaranteed to the borrower, it's
guaranteed by the bank that'slending it.
Right.
So, you know, I also get thequestion pretty frequently of,
(20:22):
well, why do I need an SBA loan?
Why can't I just get something,you know, traditional or
conventional?
And the short answer is they'rejust harder to come by.
Banks like to follow the SBAprocessing guidelines because
they know at the end of the day.
Up to 75% of that loan can beguaranteed by the federal
(20:43):
government, right?
So the banks have protection.
Knowing that they have thebacking of the US government,
right?
If they do somethingconventional or traditional,
that risk is entirely on them,right?
So they like to follow thisprocess because again, it gives
the banks a level of protectionand it's kind of a safety net,
right?
And, you know, it's still a verypopular way people get into
(21:07):
business.
All of these banks are verydifferent in the types of loans
they have appetites for, andthose appetites change as they
become you know, you know, indifferent industries and
different thresholds once theyhit.
So what Berend does is wepartner with 60, about 60
lenders across the country, and.
(21:29):
We take 45 years of experienceand we're gonna walk a client
through from prequalification togoing directly to those lenders
that we know, love, fitness, orwe know love, service based or
health and wellness or quickfood service, and then try to
get the best potential ratethat's out there for the client,
(21:51):
right.
Because these are governmentbacked loans, though, gi, that
the banks do have to followspecific guidelines and
criteria.
So, if you don't mind, I'd loveto kind of just give you the
basis of what they look for,right?
Yeah.
They wanna know that theindividuals, you know, just to
outstanding, you know, UScitizen, right?
Clean record, you know, thingslike that.
(22:14):
Then they look into the creditprofile.
Usually anything from a six 70or above from a credit score
perspective will qualify.
And then the banks start to gothrough the the numbers, right?
So, regardless of the investmentrange that a client may be
looking at, typically what thebanks would like to see come
(22:36):
from the borrower.
Is anywhere from 10 to 20% ofthat total investment come from
them.
Right?
That's gonna be their skin inthe game.
And then the bank lends theremaining portion of the loan,
right?
The bank wants to know thatagain, you know, Joe or Mary
Smith you know, have funds goingtowards the project.
(22:57):
Gotcha.
Other things the banks want tosee is something we call
post-closing liquidity and realsimple GI epie.
What that means is, hey, after Icome to that table with 20%, do
I have sufficient?
Cash reserves and assets tocontinue to support my debt to
(23:18):
income ratio and livingexpenses, right?
They wanna make sure somebody'snot over leveraged, just coming
up with that 20%, right?
So they're gonna wanna see alittle bit of a runway, right?
I.
Sometimes the banks wantpersonal collateral, not all the
time, but as the investments getlarger, sometimes the banks do
wanna, you know, see collateralnine times outta 10, that's
(23:41):
gonna be a second position lienon a primary or investment
property.
Not always the case, it's alwaysdone on a lender decision.
But those are the typical sortof requirements that the banks
look for.
When lending money to anindividual or a partners.
So that's a huge advantage.
I didn't realize you work with,you said 60 lenders.
Yeah, 60 lenders across thecountry.
(24:02):
Yeah.
So I hear are people saying,well, I, I'm, can I just call
the lender directly?
And yes, I'm assuming you can,but you know, you have a company
like Benares number one, lookingat the whole picture to see
which products Yeah.
And services make sense, butalso to shop the lenders and see
which.
Who has the best terms, who hasthe best rates lines of credits.
(24:22):
I've heard I, if I understoodcorrectly, have also been added
as opposed to getting a separateproduct on an SBA loan if I
understood that correctly.
Yeah.
And if I'm wrong correctly, butI thought I heard that, that one
of the someone got an a line ofcredit, which was one less thing
they had to worry about.
Is that Yeah.
Well, we see that veryfrequently where they'll go to
us or our lender directly.
Get an SBA loan and in additionto that SBA loan, they have a
(24:46):
line of credit that they canutilize, right?
They don't have to utilize it,but it's there for working
capital for break glass in caseof emergency.
So, yeah.
A lot of times lenders willoffer a line of credit for one
of their borrowers as well on,on top of the SBA loan.
Gotcha.
The rates are typicallyvariable, is that correct on?
Yeah.
Yeah.
Great question.
(25:06):
It's obviously a, you know,something that a lot of people
wanna know about the terms ofthese SBA loans.
GI sete, relatively standard,right?
Typical SBA loan is going to bea 10 year term.
They're not gonna be anyprepayment penalties though.
And really what that means.
cause sometimes people don'trealize pre prepayment penalties
are a thing, but banks andlenders and funding make money
(25:28):
on interest.
Right.
And sometimes there's banks andlenders out there that if you
choose to pay off that loan.
Early.
You have to pay thousands andthousands of dollars on
prepayment penalties.
However, through an SBA loan,you can pay a loan off early at
any point with zero prepaymentpenalties.
Huge advantage for some people.
Yeah.
When borrowing, even for thepeople that can use cash,
(25:50):
because they can borrow it, theycan see if this thing has legs,
if it takes off, and then whenthey realize, oh wow.
I have something here, they canpay off that loan early and
limit their interest exposure.
Gotcha.
From an interest standpoint.
They're not technically fixed.
Okay.
SBA loans are always gonna betied to the prime rate.
So wherever the Fed dictatesprime is essentially where your
(26:15):
rate would go.
The maximum that one of theselenders would be able to charge
would be Prime plus two andthree quarters.
Perfect.
And it's not like Prime chapeople ask me, does that mean my
every month, my interest and mypayment's gonna change?
Not by any means, right?
Typically the Fed will look at,you know, prime quarterly.
(26:37):
Sometimes there's no change atall.
And then usually it's a quarteror a half a point, you know,
difference from an adjustmentperspective.
So you're not gonna see thesemassive fluctuations, GI, epie,
I mean, again in 2023.
It didn't change at all, right?
So there was no change.
The last 12 months we've seenthree rate reductions.
(26:58):
So everybody has saw theirpayments go down.
So I just tell people andpreface, Hey, no matter what,
it's gonna be tied to that primerate right now.
That was really really helpful.
And obviously, you know, kind ofcomparing the Robs to the SBA
the SBA is gonna be alone, but.
What are maybe some differencesor maybe limitations, I dunno if
(27:23):
limitations is the right word,but you can't just, as you
mentioned with the Rob, since itis your money, you're able to
pay yourself a salary.
Yeah.
Maybe you bought multipleterritories.
And what would be differences asfar or restrictions in the in
the SBA loan?
SBA doesn't have a ton ofrestrictions as long as it's
going towards the business,okay?
Usually paying yourself areasonable salary is okay?
(27:45):
But sometimes peopletransitioning out of a corporate
job that need a little bit more,you know, they're limited to
what they can pay themselves,right?
And that's where the Robs canreally come into play, where
they can, you know, paythemselves a salary even prior
to them opening, right?
If you're, if you have a yearlong build out.
You're still working in thebusiness, we're meeting with
contractors, meeting witharchitects, making, you know,
(28:07):
doing goodwill through thecommunity to spread the word
about your business.
You know, with the SBA it's verylimited when it comes to that,
right?
You know, a huge advantage,which quite frankly, it all
depends on how you view moneyand debt.
It's not your money, right?
You're borrowing it, right?
So some people just like, youknow what?
I want my money here.
And everybody views finances anddebt and interest different.
(28:28):
So some people just have thislike, Hey, I wanna borrow money
and.
And do that and, you know, notutilize my, my you know, my own.
I will say this very commonly,robs and SBA are combined.
Most people use Robs for that 15to 20% equity injection, and
(28:49):
then they borrow the rest.
So one of the things I alwayslike to tell people is.
Again, if you never looked atthis you don't really realize
it, but you could combinefunding strategies, right?
I've seen people combine 2, 3, 4different ways and kind of
piecemeal, I kind of call itlike Frankenstein funding,
right?
You take a little bit of this, alittle bit of that, and you kind
of put it all together.
(29:10):
You know, sometimes you don'twanna see one asset completely
kind of deteriorate.
So maybe I take a little bitfrom retirement.
Maybe I borrow some money fromthe SBA, maybe I use a little
bit of cash.
I'm a home equity line of creditthat I can use as an emergency.
So there's so many differentways that people can leverage
their assets.
But, you know, again, somepeople just like to borrow and
(29:34):
I, I understand why, right?
They want to utilize it.
So, but they're always gonnahave that interest payment as
long as that SBA loan is inplace.
Gotcha.
Yeah, it's not what's the bestoption.
It's what you're, you need to beeducated.
You need to figure out what'sthe best fit for you, and more
importantly, if you are using Ilearned this years ago if you're
gonna use a strategy, robs andSBA, sometimes it makes a
(29:56):
difference the order that you dothings in, depending on if
you're leaving the employer ornot, if you've just been with
maybe one employer.
So, that's one of the otherbenefits is like, let's put
together a plan.
Start off with the SBA Robs orvice versa.
Let's fi let's figure out whatthat, that plan looks like.
So I do like that because it isthere, there's some strategy
planning in there as well.
(30:17):
Sometimes the best plan and thisis one of the, you know, the
reasons why I love how weapproach this.
Sometimes the best plan is notto utilize us at all.
Right.
Like our job as fundingconsultants is to educate the
individual on their options.
Sometimes the best option forthem, GI Epi.
Isn't in Rob's plan.
It isn't an SBA loan, right?
(30:39):
It's leveraging other assetsthat we don't offer products
for, right?
So whether it's utilizing homeequity, right in their, in a
line of credit through an eloc,whether it's utilizing cash,
right?
Sometimes people just have a tonof liquidity that they can
leverage another strong optionthat a lot of people don't
realize.
Is leveraging a investmentaccount, right?
(31:01):
Most people's initial reactionis, Hey, I can sell off some of
my investments, create someliquidity, and use that towards
the venture, which is very true,right?
You always have that option.
But you're then creating ataxable event, right?
And you're paying taxes andcapital gains on any of the
increases that you've seen.
But a lot of times, Giuseppe,those financial institutions.
(31:23):
Offer portfolio loans, right?
Or securities backed line ofcredit, which I compare to an
eloc.
But instead of using the equityin your home is collateral
you're using, the value of yourportfolio is collateral.
And the beauty of that is you'renot selling off those
investments in those stocks forthese Fortune 50.
500 companies, wherever it'sinvested in, you still hold
(31:44):
those and you're able to borrowat a pretty competitive interest
rate sometimes, you know, youknow, and leverage your
portfolio.
So there's a lot of times whereI see what somebody can get from
a an interest rate on aportfolio loan.
And I say, you know what, man?
That could be, if you'recomfortable with it.
It could be a better option thangoing SBA.
So, you know, sometimes the bestcandidate is the one I kind of
(32:06):
guide away from using Benaresbecause it makes more sense for
them.
I like the idea of just havingand having that kind of full
review of everything and theportfolio loan.
I haven't seen many peopleactually move forward with that,
which is actually surprising.
But to your point, yeah, nobroker or financial advisor
commissions, you're taking aloan on your own on your own
money.
Keep in mind if you're fullyinvested in one company and that
(32:29):
company I'm not gonna namenames, but it has been a company
in the news that maybe has justshot down, of course.
And value, you know, you alwaysrisk a margin call.
But yeah, it is it is a quickway to get funding.
But yeah I haven't seen manypeople actually move forward
with that idea.
So we got portfolio loans, wegot SBA, we got Rob's, what else
do we have?
Home?
Home equity, lines of credit,home equity.
(32:51):
I mean, you know, we've seen,you know, people listen, home
values are crazy right now,right?
So a lot of the people that wework with do have some
substantial equity in theirhomes, right?
And again, sometimes they wannaleverage that equity in their
home to help themselves get intobusiness.
So.
You know, again as logical as itseems, sometimes people don't
(33:13):
realize they can use thattowards, you know, getting into
business.
And you know, the, again, theonly silly question is the one
that's not asked, but you know,again, if you haven't looked at
it, then why would you knowthat?
But we certainly have seen a lotof people leverage that in some
capacity to help themselves getinto business, or at least have.
An open line through their,through, through their home
(33:35):
equity as again, working capitalis expansion, you know, things
like that.
So, you know, I think one of thebiggest mistakes Giuseppe people
make is going into thisundercapitalized.
A lot of times, you know, the,in, especially in franchising,
there could be a big.
Gap and what that range can looklike depending on how many
(33:57):
territories, geographical areas,construction, all these
different things.
And people always want to cometo that left side and the lower,
which I get.
You never wanna spend more thanthan you need to.
But you can't predicteverything, right?
So it's always, I always tellpeople, get more than you need.
And if you don't use it, great,you can throw it back to the
(34:19):
principal of the loan or put itback into retirement, however.
But, you know, sometimes thesethings don't work out and it's
not because the phone's notringing or people aren't walking
through the door.
Sometimes they don't havesufficient capital to support
that growth.
So, I, again, everybody viewsmoney differently and nobody
wants to spend more than theyneed, but I always recommend
trying to get a little bit morethan you think you need.
(34:42):
For that rainy day fund.
I agree.
It's the buffer.
The business may take it, youknow, the cost, it costs more
than anticipated, right?
The expenses are high took alittle bit longer.
Something personal came up, youended up getting laid off, and
you expect it to have that job.
So, yeah, you know, in the eventyou do leave the job, just say
to run the business, who'spaying your mortgage?
Who's paying your student loansand everything else, yep.
(35:05):
Utility bills and things likethat.
So you need to have that buffer.
Yeah.
Take, you know, take as big of aloan not the largest loan you,
yeah.
You can get, but have thatbuffer.
Because the reality is that ifyou are short you know, business
is okay, but you need to doubledown on, on marketing and you
need extra funds.
This is not an overnight thing.
Like, all right, you know what?
I need an extra 25,000.
I'm just gonna pull it from,well, there's nowhere to pull it
(35:27):
from.
There's a separate, I don't evenknow, actually, I don't know how
that would even work.
I guess there's options.
Maybe it's.
Pulling from equity to the home.
I don't know if the SBA, youknow, if you want to go back to
the SBA and you need an extra.
20 or 30,000.
You know what, I guess wherewould, what, what would happen
in that case?
You could always go back to thebank where your loan is with and
see if you can get additionalfunds.
(35:48):
Again, some banks will offer aline of credit on top of that
loan.
Sometimes people come back to usafter they get their s, they
just did an SBA loan and theysay, you know what?
I do want to utilize myretirement funds to as like a
capital injection.
That's certainly good.
Sometimes if for the personthat's continuing their W2 job,
(36:08):
which a lot of people are I can,I recommend doing a loan, a
distribution loan on theirretirement account, right?
If they're employed with thecompany that holds their
retirement and they wanna borrowup to$50,000 if their employer
allows it.
A lot of times people can dothat.
Right?
Right.
So even for somebody that sellsRob's plans, sometimes I tell
(36:29):
them, Hey, you can borrow up to$50,000 from your existing, your
current 401k.
And the beauty of that is youpay yourself back the interest.
Not a bank, not a lender.
So sometimes people utilizethat.
So there's all different wayspeople can inject capital.
Sometimes it's family, friends,partners or different lines of
credit that are out there.
(36:50):
Love it.
And that, and the moral of thestory is you have options and
the best thing you could do,obviously.
You wanna find the type ofbusiness, but you know, not
limit yourself.
Let's see what that the fundinglandscape looks like.
What are your options?
Do you qualify for the Robs atthis point?
If you've worked for a oneemployer, one retirement do you
have all traditional IRAs?
(37:11):
These are the questions.
That way you can put that alltogether and you can plan
accordingly.
So when you do leave the job,you know that Rob's option's
gonna open up.
Maybe you wanna expand.
Buy equipment, buy anotherfranchise, buy another another
territory.
So, there's a lot here, but getyour financials in order, you
know, get all those accounts.
I, I create a.
A spreadsheet that I literallyupdate monthly.
(37:32):
Just your cash and all and, andall the savings and checkings
account.
Your, all your investments.
Quick value of the home updateon the mortgage.
I do that actually on a monthlybasis.
I'm a finance geek yeah, Googlespreadsheet.
I just so I know where I'm at ona monthly basis.
And if you can get into thathabit, it's gonna make business
ownership a little bit easier aswell.
'cause you need to have all yourfinancials in order.
(37:53):
What didn't we.
Talk about any other options.
Obviously we talked about bestpractice and how to go about
this, but any other options youcan think of?
I mean, that really covers quitea bit.
I mean, there, there's unsecuredlending that, that you know,
Benetrends offers outside of theSBA.
You know, this is, you know, notthrough again the SBA process
(38:15):
usually a pretty quick.
Quick process compared to SBA,but a much higher interest rate.
You know, so if somebody mightnot qualify for SBA or, you
know, there's unsecured lendingoptions.
Again, higher interest, butcould be potential for people to
utilize.
There's good old fashioned cashand liquidity.
(38:35):
There's people borrowing from.
Friends and family, rich, uncle,mom and dad, whomever.
But the moral of the story,Giuseppe, is honestly like, do
your research, understand youroptions and just figure out, you
know, what's at your disposaland what you can utilize.
And honestly, sometimes we haveto have the tough conversation
(38:57):
is, Hey, you don't qualify rightnow, and that's fine.
Like, you know, but this is whatwe try to do is give them a
roadmap to, you're here today.
If you can get here, you'regood.
Right.
And I'm sure you've seen this inyour line of work.
I know I have.
I have seen people come by, comeback 10 years later and say, you
know what, now's the time.
(39:17):
Right.
So the more you can just educateyourself on options and you
know, leveraging your personalassets and financial situation.
I think the better off it is,whether it's today, whether it's
next year or five years down theroad.
It's always good to educateyourself on what's out there.
Yep.
I like that.
And the proactiveness is bigbecause, you know, you've been
denied for the SBA Great, whywas I denied and what's the
(39:41):
plan?
Is it.
We, I had someone get deniedyears ago when I first started,
and no explanation.
Working with a small I forgetthe name of the company.
Not to mention on the show, butyeah.
Yeah, they got denied.
And I'm like, well, did you findout why?
They said No, we just gotdenied.
So we called back and it wassimply the credit score.
I.
The credit score need, need,needed to increase.
There was actually something onthere that actually was a
(40:02):
mistake that happens all time.
And it's just like they didn'trun their scores.
They had no idea they had,everything else was fine.
So, okay.
You know what?
They made some recommendations.
Maybe call credit repaircompany, make these changes,
contact the credit bureau.
Let's get that back up to speedand.
I forget how many months, threeto six months that score got
back up and they were approved.
(40:23):
But, you know, being proactiveabout it as well, because
everything has to line up.
You know, you have to, theexpectation on the business, but
on the financials, you know, ifthe timing isn't right, okay
what's missing?
Credit score is great, but youhave, your liquidity's a little
bit light.
If you get it up to, you know,another 20 or 30,000, we can
probably get you approved.
And that goes a long way.
'cause now I have a map, I havesomething to work off of instead
(40:46):
of just saying, okay, do I justcall you in a year and cross my
fingers?
So I.
And that, that's also thebenefit of working with a
Benetrends or a company like us,right?
We do soft credit polls, we dobackground checks.
We can help the client withbusiness plan writing if they
are doing an SBA loan, right?
There's a big package that goesinto putting together, you know,
an SBA loan.
(41:06):
And that includes a businessplan.
It includes, you know,financials.
Sometimes the client can do iton their own.
Sometimes they don't have thebandwidth or knowledge to do it,
so we can help them with it,right?
So.
When I do talk to somebody thatsays, Hey, I'm gonna go to my
local bank.
I recommend that all the time.
Fine, go talk to somebody.
But they're not gonna get thehandholding that they will from
us or somebody in our spacethat's gonna walk them through
(41:30):
every stage of the lendingprocess.
So it's good to have, I tellpeople all the time, surround
yourself with experts, right?
To, you know, when you talk toyour clients, you say, Hey, I
know enough to be dangerous.
But talk to Beran, talk to Mikeand having a resource with you.
It certainly helps because stuffpops up.
Yeah.
And not everybody can, iscapable of doing it on their
(41:50):
own, and it needs somehandholding and there's nothing
wrong with that.
I agree.
You you know, take advantage ofthe resources.
Best part is that there's nocost for the initial
consultation, so.
You get a review you're gonnalearn something, you're gonna
get some options.
There's no cost unless you moveforward with any of the of the
services that Benares has tooffer.
Even get the benefit of a creditcheck, a soft credit check.
(42:12):
This is something that, thatcomes up.
Well, what does that even mean?
So sometimes I have to take astep back'cause people are like,
you talk about soft creditchecks.
What's the difference between asoft check and a hard check?
Yeah.
Well, a soft check is, it won'thit your credit score.
It won't affect it in any way.
So, you know, those arequestions that come up.
So I realize I, I have to getinto, explain things a little
bit more for first time businessowners, but you take advantage.
(42:33):
You say, okay, you know what'sin line.
Sometimes the credit score I,you know, this is another thing
maybe doesn't match up with thecredit score at home.
And there's a difference thatyou get maybe from TransUnion
and the banks use, I guess adifferent system.
So.
You have an all-inclusive youget a plan, you get a roadmap.
So timing isn't right.
This is what you need.
The timing is right.
Okay.
These are, you know, some of theplans and are some of the
(42:55):
options that that you qualifyfor.
And now you're like, oh, wait asecond.
I can get a loan up to four or500,000.
I may wanna look at brick andmortar.
I may wanna look at a physicallocation with a build out.
So, this has been awesome.
This has been, truly helpful.
I'm gonna, I'm gonna put you onthe spot now.
I ask this to all my guests.
Fun fact, if you can off the topof your head, fun fact about
Mike and we'll wrap up the keepit clean too.
(43:18):
So, as I jokingly say, fun factsabout Mike.
We've had some interesting we'vehad some interesting, you know,
it was related to this person wejust had kit Higgs on the show.
He was in a movie with De Nirorecorded the whole day and he
said he got about one second onthe movie.
So listen man, one second.
Sometimes all it takes to, Ithought that was kind of cool.
(43:39):
So.
I don't have anything fun.
I'm a boring guy, but I mean, Iplay, you know, I was a college
basketball player.
I a lot of people see this shortItalian from New Jersey like I
did when I was, you know, 18.
But, you know, I.
Played, played collegebasketball.
You know, I'm just kind of anormal guy.
I'm blessed with two beautifulchildren, gi, lovely wife
(44:02):
Larissa, who works at ey and youknow, Michael and James, my, my
two and 7-year-old.
But no man, I wish I had alittle bit more excitement.
I fun to, to tell you, butthat's a little bit bas the
basketball thing was coolbecause you're not a tall guy as
I am.
No.
I certainly don't look like abasketball player, that's for
sure.
And especially at 42, you get.
(44:22):
You get that dad belly and thatdad bot and you know, that's why
we keep the cameras here up, youknow, we don't go anywhere.
Exactly.
Yeah.
I could pull my hamstring justjumping out of bed in the
morning.
So, tho those days are farbehind me, man.
But No, this is great and Iappreciate you having me
Giuseppe.
Again, you know, we're reallylucky at what we do and working
in this industry, and I love thefact that I get to educate
(44:44):
people and.
Helps people get into businessvery much like you do.
And you know, for a lot ofpeople that come talk to us with
Benetrends, they go into thisthinking this, Hey, this is a
long shot, this is a shot in thedark.
And then they have that freeconsultation.
They're like, oh my God, I havemore options than I thought.
So, you know, what's better thanthat than helping somebody kind
of chase their dreams ofbusiness ownership.
(45:05):
So thanks for having me, man.
I appreciate it.
And if I could ever be aresource for any of your
candidates or anybody out there.
Feel free to reach out.
Appreciate that.
Yeah.
All it takes is an investment ofan hour of your time to, to get
a better picture of where youfinancially stand.
So Awesome.
I appreciate it.
I know it's been this has beenone of the, in, in the works in
the making for a while, but Iappreciate the insights.
(45:26):
We got into a lot more detail,so I.
Anyone that, you know, some ofthe comments were, I want a
little bit more detail.
Or how do the plans compare?
You know, what's the differenceif I go direct or with
Benetrends?
We covered it all and, and ifyou wanna revisit we'll
definitely make theintroduction.
We work with Jade you know, wehave a great relationship with,
and.
I partner with Jade on anyonethat we start working with.
(45:47):
She's usually the second calland she'll go through that full
review, everything we talkedabout today to help you figure
out what are all your financeand funding options.
So thanks again, buddy.
It was it's been fun and we'lldefinitely have you back on the
show hopefully with some, maybesome cool updates or products or
services.
So, appreciate it.
Again, we have some stuff in theworks that hopefully I'll be
able to talk about on the nexttime I visit your show, man.
(46:09):
I didn't know that.
So, all right.
Well, I wanna know before, butyes we'll definitely discuss it
on the show, but again, soundsgood, man.
Thanks for tuning in if you wantto learn how to make the
transition from corporate toowning your franchise.
Join Giuseppe on the nextepisode.
You can also follow on allsocial media platforms and
(46:31):
achieve financial and timefreedom today.
I've moved up in several rolesat Benetrends and now I get to
(00:02):
lead the sales team and, youknow, work with people like you
and different franchiseconcepts.
And it's exciting, man.
I never get bored and it's greatto let people know that they
have options out there, right?
When it comes to lending.
I think one of the biggestmistakes Giuseppe people make is
going into thisundercapitalized.
But you can't predicteverything, right?
(00:23):
So it's always, I always tellpeople, get more than you need.
And if you don't use it, great,you can throw it back to the
principal of the loan or put itback into retirement, however.
Welcome to the Franchise FreedomPodcast, where you can escape
the corporate trap throughfranchise ownership.
Here's your host, Giuseppe gr,the franchise guide.
(00:50):
Welcome to the Franchise FreedomPodcast.
I'm your host, GiuseppeGrammatic, your franchise guide,
this show where we helpcorporate executives experience
time and financial freedom.
Thanks for joining us today.
We have a really excitingepisode.
You guys had looked one guestyou were sick of hearing from
me, so.
We're bringing on some greatguests, some professionals each
in different fields.
We just had kit Higgs on, wetalked about a franchise
(01:13):
attorney review, and today wehave Mike Minitelli from
Benetrends and we're gonna talkall things funding.
So Mike, welcome to the show.
Thank you, Jaap.
I appreciate you having me, man.
I appreciate it.
This is awesome.
I've been looking forward tothis.
I we recorded a show.
With with Jen back a couplemonths ago and I wanted to do a
little bit deeper of a dive inall the various funding options
(01:34):
'cause we've been getting a lotof questions or if there's been
changes and updates.
So, before we dive into that, ifyou could give the audience a
little bit of background whoMike is and how did you get into
the Benetrends and funding.
Yeah.
Yeah.
My my name's Mike Minitelli.
I'm actually a Chief DevelopmentOfficer here at Benetrends
Financial.
Benetrends Financial is a fullservice funding company.
We're based in Lansdale,Pennsylvania.
(01:55):
It's about, you know, 45 minutesfrom Philadelphia.
And we're actually best knownGiuseppe for something that you
know, and.
Very popular.
Our industry, something called aRob's plan.
Our founder, Len Fisher, is theoriginal architect and creator
of that funding strategy.
Rob's is the acronym that standsfor Rollover as Business
(02:17):
Startups.
This is a funding strategy thatmost people have no ideas at
their disposal.
It allows people to utilizeretirement funds without tax or
penalty to start their business.
Purchase their business or incases like this, purchase their
franchise.
Super, super popular infranchising.
But Berend also does moretraditional lending options,
(02:38):
right?
And SBA loans, equipmentleasing, unsecured lending.
And really the role of myselfand my team is educating
potential entrepreneurs on whatoptions they have.
It's to your point earlier.
There's the lending environmentis always changing and adapting,
and things do move in different,you know, directions.
(03:00):
So it's good for candidates tohave an expert you know, guiding
them through the process.
And that's what we do atBenetrends.
We've been doing it for quitesome time.
I very much like you and a lotof the people you know, you work
with.
I was a, you know, a corporatetransplant.
You know, I spent my first 15years as a.
You know, business developmentindividual in different sales
(03:22):
roles from a company calledCintas Outta College.
Then I got into technology andsoftware and a friend of mine
actually introduced me to thefranchise space in funding and.
I honestly, I fell in love withour industry.
I fell in love with what I wasdoing as far as, you know, I did
(03:42):
like exiting the corporate worldand finding this space.
I, I found that the franchiseworld is a really nice balance
of, I.
The billion dollar headquartersand backings of these great
brands.
And then the, you know, the momand pop that are looking, mom
and pop that are looking to, youknow, open one, two locations
locally in their community.
(04:03):
So, I mean, I kind of fell intoit by accident.
I wish I was doing it the firstyou know, stage of my career.
But, you know, we all have adifferent path and.
I've moved up in several rolesat Benetrends and now I get to
lead the sales team and, youknow, work with people like you
and different franchiseconcepts.
And it's exciting, man.
I never get bored and it's greatto let people know that they
(04:23):
have options out there, right?
When it comes to lending.
That's awesome.
Yeah.
And congrats on the recentpromotion.
That's that's awesome.
It's well, well deserved.
You definitely put the the timein there.
Thank and yeah, there, there is,there's so many different
options.
And you know, for example I gotit to franchising 20 years ago.
I.
No one ever told me that you canuse retirement assets.
(04:43):
And looking back, I'm like, Ihad to, I got denied from a
bank.
I had to get a personal loanfrom my grandparents, and I
don't remember my coach evertelling me o of this option.
Let alone speaking with withBenetrends or any company I
didn't even know I had thoseoptions, so.
Yeah.
And you and honestly, Giuseppe,you shouldn't.
Right, right.
Like, it's not a mainstreamproduct that most of us are
(05:06):
familiar with.
And you know, to your point,like we're all pretty
conditioned early on in yourprofessional career.
Hey, don't, you know, don'ttouch retirement funds, right?
Put money away, you know, stockit away pre-tax.
Let your companies match it, butdon't access it because if you
do, you're gonna be hit withsome pretty substantial taxes
(05:27):
and penalties, sometimes up to30 to 40% of the, that total
amount.
And, you know, we all don't workso hard in our daily jobs to, to
lose that money.
However, through the Roth plan,you can literally.
Access to that dollar fordollar.
And to your point you know, alot of people that are exiting
the corporate world or havespent, you know, 15, 20 years in
(05:49):
a specific career, noteverybody's got money sitting in
checkings and savings, right.
But they do have substantialamount of their assets.
In retirement accounts IRAs, 4 01 Ks.
So, it, I, you're not the onlyperson to say I had no idea that
this existed when I started adecade ago.
And I had the privilege of, youknow, talking to the creator of
(06:11):
this had Benetrends and kind ofexplain how it came about.
So yeah, it's still a hidden gemout there for most people.
It is.
I would say most people, I wouldsay.
Nine, not even nine, outta 10, Iwould say 9.9 outta 10.
I have no idea.
Have no idea.
Which yeah it's the value wecould bring to the table.
I wanna come back to the to theRobs because I wanna dive a
little bit deeper and I wannadive into, you know, the common,
(06:33):
what you're seeing.
But one thing I like to I wannanote is.
When you're looking to work witha company like Benetrends, my
recommendation, the way I lookat it, is kind of like buying a
home.
You don't just start looking at,well, I'm gonna look at million
a hundred thousand dollars homeand$5 million homes.
You wanna make sure that, youknow, what are my options and up
(06:53):
to what can I get afford?
What can I afford?
Excuse me.
You know, kind of get thatpre-approval.
So I recommend.
After having an intro call andhaving someone say, yeah let's
move forward.
Let's, what are the next steps?
I think that is, is the perfecttime start, because it's not
like this thing, you snap yourfingers and it's done.
It's a conversation.
It may be some time gatheringfinancials.
(07:14):
Would you agree that the soonerthe better just to have Yeah.
An idea of kind of what theexpectation is, what the options
are.
Would you agree there?
I, a hundred percent.
I mean, I have the privilege ofworking with.
Hundreds, if not thousands ofdifferent franchise concepts,
networks, people that are, refertheir clients to us.
And a lot of them ask thatquestion.
Giuseppe, when should somebodylook at funding?
(07:37):
And to your point, I usuallyrecommend after that first call,
right?
Because, you know, a, you wannamake sure they're serious and
you want to give them a littlebit light education.
But b the funding and thefinancial side of it.
Arguably is the most importantpart of it, right?
Right.
You could be sitting across fromthe best suited candidate for a
specific brand, but if theydon't have the financial
(08:01):
wherewithal or profile to moveforward, then you could be
wasting both people's time,right?
So letting them know they haveoptions, letting them get
educated and more comfortablewith the process about funding,
getting them pre-qualified earlyon in the process is better for
the candidate.
It's better for the consultant,the brand, everybody along the
(08:23):
process.
And I use the same analogy asyou do.
'cause I, you know, most of usthat we speak with have went
through the real estate homepurchasing process, but not
necessarily I.
You know, purchasing a businessand it's not terribly different,
right?
You do want, just like you golook for homes, right?
You speak to a mortgage broker,you get prequalified, you wanna
(08:45):
see what you're comfortable withspending, and then you look for
homes that fit in that range,right?
The last thing you're gonna dois, you know, get prequalified
for$300,000 and then startlooking at million dollar homes
or vice versa.
So, the more.
Education the candidate hasaround options.
And they were like, oh, wow.
Because again, to your point,hey, they didn't know Rob's
(09:07):
existed, right?
They might not know that theycan utilize equity in home.
There's all these differentthings people don't realize.
And all of a sudden they thoughtthis was a pipe dream and
they're like, oh, wow, I can dothis reality.
Yeah.
Yeah.
It's a reality man.
So the earlier they realize thatthe better for everybody
involved in the process.
I, yeah.
And that's it.
And then and it really helps to.
(09:28):
Narrow the search based off ofwhat you can get approved for.
And just because you're gettingapproved for a larger amount
doesn't mean you have to max itout.
It could be obviously be muchless, but it's good.
You know, some people will sendfinancials and say, well, I have
this much cash and this muchequity in the home.
And it's like, no, I need, youneed the whole picture because
there, there's so many otheroptions.
So, all right.
So let's, one thing I like aboutyour organization is that you're
(09:50):
able to really, it's a holisticapproach.
You're looking at all aspects.
It may make sense to, and I'm,we're gonna dive deep on the
Rob's plan.
Maybe a combination of Robs,maybe there's a home equity line
of credit.
Makes sense as well.
Yeah.
Not that you offer, you know,the line of credit or in that,
you know, you would go back tothe to the loan to the to the
bank, excuse me the mortgagecompany.
(10:12):
Yeah.
But you would, you can makethose suggestions, even though
that's not a product that, orservice, I should say, that you
offer.
So that's one of the things Ilike it, it's, let's look at all
the options.
Maybe, you know, option B makesbetter sense.
Maybe it's a combination.
So, with that being said youknow, top ways that you're
seeing today.
Funding loans.
The Robs is number one.
So for everyone listening andfirst time listeners, rollover
(10:34):
business startup, right?
ROBS.
So y the first thing I hear is,you know, is that legal?
Which, why the hell would I evenbe bringing it up?
But I just find that kind offunny.
But it was actually a Benetrendsthat developed this, I believe,
was it the late seventiesdirectly with the IRS?
Yeah.
40, 45 years ago our founder,Len Fisher.
(10:54):
Who was an ERISA attorney bytrade came up with this process.
He was working with one of hisclients who had most of his
assets in a retirement account,and Len utilized the IRS code
and you know, tax.
You know, all the informationthat the IRS lays out and
realize, Hey, you can do this ifit's done properly.
(11:17):
So it kind of happened byaccident and he created this
this process and 45 years later,you know, 50,000 plus clients
later, we've really created awhole industry around that
product.
So, yeah, it's very much, legal,it's very much blessed by the
IRS, I think Giuseppe the first15 years of us kind of in
(11:41):
business, it was a lot more, youknow, lobbying, you know, with
the IRS to get their blessing onthis.
Right.
But you know, they have sincegiving us the kind of green
light and nod that, you know,what Robs is, something that's
gonna be here and here to stay.
And you have our blessing aslong as you have an organization
like Benetrends or some of ourcompetitors that are doing it
(12:02):
properly and managing thoseaccounts.
So, yeah man it's again, just anoption.
Most people don't realize it'sat their fingertips.
And honestly, man, it's not verycomplicated.
I think a lot of people, to yourpoint, like.
I think it's like, I've neverheard of this.
So it gives them a natural kindof, hesitation.
(12:24):
But it's really no differentGiuseppe of the rollovers most
of us have done in our corporatelife.
Right, right.
So I had very, I was kind when Isat across Len 10 years ago when
he explained this to me.
He explained it to me in a waythat it made sense to me.
And I do that a lot with ourcandidates because they do come
(12:46):
from corporate backgrounds,right?
So we're both New Jersey guys,right?
We got a, you know, hundreds ofdifferent pharmaceutical
companies here, right?
So let's just say I'm, you know,an analyst at Johnson and
Johnson, right?
And I have a 401k with j and j.
Let's say there's$300,000 inthere.
And I get an opportunity to gowork for Pfizer.
Right.
(13:06):
Typically what we do inscenarios like that is I'll take
my j and j 401k with$300,000.
I'll roll that out into an IRA,or I can just roll that into
Pfizer's new 401k, right?
And going from one qualifiedretirement plan, you never pay
taxes and penalties on thattransaction.
All of us have done that incorporate life, right?
(13:28):
You have 300, you move 300.
Super simple.
When I'm at Pfizer and I'm goingthrough all my onboarding and
training and they're setting meup with my benefits and, you
know, fidelity 401k or Schwab,whatever they set me up with,
and I'm going through investmentoptions within that 401k
Giuseppe.
A lot of times one of thoseinvestment options is purchas
(13:49):
purchasing company stock.
Right.
So again, something I know I didin my technology career, you've
probably done it.
Most of the people that we workwith have done it.
At the time I didn't realize itwas kind of setting off a chain
of events, right?
So if I look at that 300 k and Isay, you know what, I'll take a
hundred of it and invest it inPfizer, I can do that.
(14:11):
Then what happens is my 401kjust now owns the amount of
shares that I just purchased forPfizer, and that a hundred
thousand dollars that I used topurchase it.
It doesn't remain in my Fidelityaccount.
It doesn't float.
In financial purgatorysomewhere.
It goes to Pfizer in one oftheir many corporate checking
(14:32):
accounts that company could nowuse for whatever legitimate
business expense that they want.
Right?
R and d product, salaries, realestate, anything.
So what Len figured out and whatwe do at Benetrends is literally
that same exact chain of events,but instead of doing it for
Johnson or Pfizer or Amazon, weset up Minitelli Enterprises,
(14:57):
right within MinitelliEnterprises.
We set up a qualified customizedretirement plan, and then we can
take that same$300,000 for myold j and j, 401k.
We roll it into MinitelliEnterprises.
New qualified retirement plan,and just like before going from
one qualified plan to the next,no taxes and penalties.
(15:18):
And then what happens is.
The retirement account thatBenetrends created for me is now
just gonna purchase privatelyheld stock in that Minitelli
Enterprises, and then throughthat privately held stock
purchase.
Giuseppe the retirementaccounts, gonna own privately
held shares$300,000.
(15:39):
Now goes to Mike Minnelli'scorporate checking account that
I could now use for anylegitimate business expense.
So that can be the franchisefees.
That can be a build out of mylocation if I'm having a brick
and mortar trucks equipment.
It can also be used to payyourself a salary, which is a
lot of times very hard to getfrom a loan.
(16:00):
And it can also be combined withSBA or another form of.
Funding to get additional fundsto help secure you know, your
investment.
So yeah, again, that, thathelped make sense to me 10 years
ago.
And when I try to explain itthat way, Giuseppe, it does seem
to resonate.
It does actually, with thepeople that have done it in
(16:20):
their corporate life, right?
It absolutely does when you kindof say it that way.
And that explanation actually isreally helpful because people
start getting into the weeds onthis, and I go I'm not the
expert in this area.
You know, we work with Berend,we work at Jade.
We work with Jade every singleday, you know, back and forth.
We, there's always this you'veprobably never heard of this
scenario.
It's always one of thoseconversation starters, but she's
(16:43):
been really helpful in, in, instarting that.
So, so that is, I guess abenefit there is, I'm looking at
it, it seems like it's yourmoney, so you get access to the
funding quicker and you don'thave to worry about note
payments every month, right.
It's just you got a newbusiness, right.
Yeah.
Yeah there's a lot of advantagesto it.
It is, to your point, a veryquick way to get, you know,
(17:04):
funding right from start tofinish.
You're looking at usually threeto four weeks from engagement to
that money sitting in yourcorporate checking account.
Even Giuseppe for the peoplethat have cash and liquidity and
they learn that this is anoption they quickly say to
themselves.
Well, if it's sitting in cash,that means I've probably already
(17:24):
paid my taxes on it, right?
Cash is good to have for yourday-to-day life, right?
You know, Becky needs braces.
Johnny's going to college.
Tree trees fell down on myhouse.
You know, cash is always good tohave.
So once they realize I canaccess my pre-tax dollars in
sometimes an underperformingretirement account.
(17:45):
I'd rather keep my cash here,right?
And then access these pre-taxdollars to, to help fund the
business.
So, you have the aspect of usingprevo versus post-tax.
Some people like thediversification of it, right?
If you have somebody that hassubstantial amount of money
within the IRAs and retirementaccounts, if they have a million
(18:08):
dollars and they can just pull200 of it.
Take it out of Wall Street andthe market and say, Hey, now I'm
investing it in Giuseppe and mybusiness.
It's diversified, right?
So it's not tied to Wall Street.
It's tied to me.
And then you have the individualGiuseppe that just likes
control, right.
Maybe there's some distrustabout Wall Street and you know,
(18:29):
the market and they say, youknow what?
I want to have control over mymoney and my destiny.
God forbid it doesn't work out.
There's nobody to blame but meand myself, I want to invest and
bet on me, which is anotherthing that people, you know,
like to do.
So it, there's a lot ofdifferent ways that, that people
view this.
And again, to, to our point,most people go into this
(18:53):
conversation not even knowing orrealizing that this is an
option.
Awesome.
No, that's that, that is reallyhelpful and, for anyone that
wants to learn a little bitabout, about, about the Robs or
any, anything we're talkingabout today, we're definitely
sharing this episode since youdo a much better job in
explaining it.
Yeah, especially when thequestion started started popping
up.
So this is one avenue of manytalk to us about, you know,
(19:16):
another, product or service isthe SBA loan.
So what is that?
What does SBA stand for?
For someone that's listening forthe first time and you know,
what does that process looklike?
And maybe even, you know,compare the two, maybe some
differences, obviously one'salone, but if there are
differences is what you can usethe funds for.
Yeah.
SBA Giuseppe is small businessadministration.
(19:39):
It's our government backedentity supporting small business
and entrepreneurship in the usRight?
You know, at the end of the day,I.
These are just banks lending themoney.
What the SBA does is incentivizebanks to lend to Michael, to
Giuseppe, to anybody out thereby guaranteeing a certain
(20:02):
percentage of that loan.
I talk to people all day, everyday, and sometimes I ask, Hey,
why do you wanna look at A anSBA loan?
And they say, well, it'sguaranteed.
Yeah.
While that's true, it's notguaranteed to the borrower, it's
guaranteed by the bank that'slending it.
Right.
So, you know, I also get thequestion pretty frequently of,
(20:22):
well, why do I need an SBA loan?
Why can't I just get something,you know, traditional or
conventional?
And the short answer is they'rejust harder to come by.
Banks like to follow the SBAprocessing guidelines because
they know at the end of the day.
Up to 75% of that loan can beguaranteed by the federal
(20:43):
government, right?
So the banks have protection.
Knowing that they have thebacking of the US government,
right?
If they do somethingconventional or traditional,
that risk is entirely on them,right?
So they like to follow thisprocess because again, it gives
the banks a level of protectionand it's kind of a safety net,
right?
And, you know, it's still a verypopular way people get into
(21:07):
business.
All of these banks are verydifferent in the types of loans
they have appetites for, andthose appetites change as they
become you know, you know, indifferent industries and
different thresholds once theyhit.
So what Berend does is wepartner with 60, about 60
lenders across the country, and.
(21:29):
We take 45 years of experienceand we're gonna walk a client
through from prequalification togoing directly to those lenders
that we know, love, fitness, orwe know love, service based or
health and wellness or quickfood service, and then try to
get the best potential ratethat's out there for the client,
(21:51):
right.
Because these are governmentbacked loans, though, gi, that
the banks do have to followspecific guidelines and
criteria.
So, if you don't mind, I'd loveto kind of just give you the
basis of what they look for,right?
Yeah.
They wanna know that theindividuals, you know, just to
outstanding, you know, UScitizen, right?
Clean record, you know, thingslike that.
(22:14):
Then they look into the creditprofile.
Usually anything from a six 70or above from a credit score
perspective will qualify.
And then the banks start to gothrough the the numbers, right?
So, regardless of the investmentrange that a client may be
looking at, typically what thebanks would like to see come
(22:36):
from the borrower.
Is anywhere from 10 to 20% ofthat total investment come from
them.
Right?
That's gonna be their skin inthe game.
And then the bank lends theremaining portion of the loan,
right?
The bank wants to know thatagain, you know, Joe or Mary
Smith you know, have funds goingtowards the project.
(22:57):
Gotcha.
Other things the banks want tosee is something we call
post-closing liquidity and realsimple GI epie.
What that means is, hey, after Icome to that table with 20%, do
I have sufficient?
Cash reserves and assets tocontinue to support my debt to
(23:18):
income ratio and livingexpenses, right?
They wanna make sure somebody'snot over leveraged, just coming
up with that 20%, right?
So they're gonna wanna see alittle bit of a runway, right?
I.
Sometimes the banks wantpersonal collateral, not all the
time, but as the investments getlarger, sometimes the banks do
wanna, you know, see collateralnine times outta 10, that's
(23:41):
gonna be a second position lienon a primary or investment
property.
Not always the case, it's alwaysdone on a lender decision.
But those are the typical sortof requirements that the banks
look for.
When lending money to anindividual or a partners.
So that's a huge advantage.
I didn't realize you work with,you said 60 lenders.
Yeah, 60 lenders across thecountry.
(24:02):
Yeah.
So I hear are people saying,well, I, I'm, can I just call
the lender directly?
And yes, I'm assuming you can,but you know, you have a company
like Benares number one, lookingat the whole picture to see
which products Yeah.
And services make sense, butalso to shop the lenders and see
which.
Who has the best terms, who hasthe best rates lines of credits.
(24:22):
I've heard I, if I understoodcorrectly, have also been added
as opposed to getting a separateproduct on an SBA loan if I
understood that correctly.
Yeah.
And if I'm wrong correctly, butI thought I heard that, that one
of the someone got an a line ofcredit, which was one less thing
they had to worry about.
Is that Yeah.
Well, we see that veryfrequently where they'll go to
us or our lender directly.
Get an SBA loan and in additionto that SBA loan, they have a
(24:46):
line of credit that they canutilize, right?
They don't have to utilize it,but it's there for working
capital for break glass in caseof emergency.
So, yeah.
A lot of times lenders willoffer a line of credit for one
of their borrowers as well on,on top of the SBA loan.
Gotcha.
The rates are typicallyvariable, is that correct on?
Yeah.
Yeah.
Great question.
(25:06):
It's obviously a, you know,something that a lot of people
wanna know about the terms ofthese SBA loans.
GI sete, relatively standard,right?
Typical SBA loan is going to bea 10 year term.
They're not gonna be anyprepayment penalties though.
And really what that means.
cause sometimes people don'trealize pre prepayment penalties
are a thing, but banks andlenders and funding make money
(25:28):
on interest.
Right.
And sometimes there's banks andlenders out there that if you
choose to pay off that loan.
Early.
You have to pay thousands andthousands of dollars on
prepayment penalties.
However, through an SBA loan,you can pay a loan off early at
any point with zero prepaymentpenalties.
Huge advantage for some people.
Yeah.
When borrowing, even for thepeople that can use cash,
(25:50):
because they can borrow it, theycan see if this thing has legs,
if it takes off, and then whenthey realize, oh wow.
I have something here, they canpay off that loan early and
limit their interest exposure.
Gotcha.
From an interest standpoint.
They're not technically fixed.
Okay.
SBA loans are always gonna betied to the prime rate.
So wherever the Fed dictatesprime is essentially where your
(26:15):
rate would go.
The maximum that one of theselenders would be able to charge
would be Prime plus two andthree quarters.
Perfect.
And it's not like Prime chapeople ask me, does that mean my
every month, my interest and mypayment's gonna change?
Not by any means, right?
Typically the Fed will look at,you know, prime quarterly.
(26:37):
Sometimes there's no change atall.
And then usually it's a quarteror a half a point, you know,
difference from an adjustmentperspective.
So you're not gonna see thesemassive fluctuations, GI, epie,
I mean, again in 2023.
It didn't change at all, right?
So there was no change.
The last 12 months we've seenthree rate reductions.
(26:58):
So everybody has saw theirpayments go down.
So I just tell people andpreface, Hey, no matter what,
it's gonna be tied to that primerate right now.
That was really really helpful.
And obviously, you know, kind ofcomparing the Robs to the SBA
the SBA is gonna be alone, but.
What are maybe some differencesor maybe limitations, I dunno if
(27:23):
limitations is the right word,but you can't just, as you
mentioned with the Rob, since itis your money, you're able to
pay yourself a salary.
Yeah.
Maybe you bought multipleterritories.
And what would be differences asfar or restrictions in the in
the SBA loan?
SBA doesn't have a ton ofrestrictions as long as it's
going towards the business,okay?
Usually paying yourself areasonable salary is okay?
(27:45):
But sometimes peopletransitioning out of a corporate
job that need a little bit more,you know, they're limited to
what they can pay themselves,right?
And that's where the Robs canreally come into play, where
they can, you know, paythemselves a salary even prior
to them opening, right?
If you're, if you have a yearlong build out.
You're still working in thebusiness, we're meeting with
contractors, meeting witharchitects, making, you know,
(28:07):
doing goodwill through thecommunity to spread the word
about your business.
You know, with the SBA it's verylimited when it comes to that,
right?
You know, a huge advantage,which quite frankly, it all
depends on how you view moneyand debt.
It's not your money, right?
You're borrowing it, right?
So some people just like, youknow what?
I want my money here.
And everybody views finances anddebt and interest different.
(28:28):
So some people just have thislike, Hey, I wanna borrow money
and.
And do that and, you know, notutilize my, my you know, my own.
I will say this very commonly,robs and SBA are combined.
Most people use Robs for that 15to 20% equity injection, and
(28:49):
then they borrow the rest.
So one of the things I alwayslike to tell people is.
Again, if you never looked atthis you don't really realize
it, but you could combinefunding strategies, right?
I've seen people combine 2, 3, 4different ways and kind of
piecemeal, I kind of call itlike Frankenstein funding,
right?
You take a little bit of this, alittle bit of that, and you kind
of put it all together.
(29:10):
You know, sometimes you don'twanna see one asset completely
kind of deteriorate.
So maybe I take a little bitfrom retirement.
Maybe I borrow some money fromthe SBA, maybe I use a little
bit of cash.
I'm a home equity line of creditthat I can use as an emergency.
So there's so many differentways that people can leverage
their assets.
But, you know, again, somepeople just like to borrow and
(29:34):
I, I understand why, right?
They want to utilize it.
So, but they're always gonnahave that interest payment as
long as that SBA loan is inplace.
Gotcha.
Yeah, it's not what's the bestoption.
It's what you're, you need to beeducated.
You need to figure out what'sthe best fit for you, and more
importantly, if you are using Ilearned this years ago if you're
gonna use a strategy, robs andSBA, sometimes it makes a
(29:56):
difference the order that you dothings in, depending on if
you're leaving the employer ornot, if you've just been with
maybe one employer.
So, that's one of the otherbenefits is like, let's put
together a plan.
Start off with the SBA Robs orvice versa.
Let's fi let's figure out whatthat, that plan looks like.
So I do like that because it isthere, there's some strategy
planning in there as well.
(30:17):
Sometimes the best plan and thisis one of the, you know, the
reasons why I love how weapproach this.
Sometimes the best plan is notto utilize us at all.
Right.
Like our job as fundingconsultants is to educate the
individual on their options.
Sometimes the best option forthem, GI Epi.
Isn't in Rob's plan.
It isn't an SBA loan, right?
(30:39):
It's leveraging other assetsthat we don't offer products
for, right?
So whether it's utilizing homeequity, right in their, in a
line of credit through an eloc,whether it's utilizing cash,
right?
Sometimes people just have a tonof liquidity that they can
leverage another strong optionthat a lot of people don't
realize.
Is leveraging a investmentaccount, right?
(31:01):
Most people's initial reactionis, Hey, I can sell off some of
my investments, create someliquidity, and use that towards
the venture, which is very true,right?
You always have that option.
But you're then creating ataxable event, right?
And you're paying taxes andcapital gains on any of the
increases that you've seen.
But a lot of times, Giuseppe,those financial institutions.
(31:23):
Offer portfolio loans, right?
Or securities backed line ofcredit, which I compare to an
eloc.
But instead of using the equityin your home is collateral
you're using, the value of yourportfolio is collateral.
And the beauty of that is you'renot selling off those
investments in those stocks forthese Fortune 50.
500 companies, wherever it'sinvested in, you still hold
(31:44):
those and you're able to borrowat a pretty competitive interest
rate sometimes, you know, youknow, and leverage your
portfolio.
So there's a lot of times whereI see what somebody can get from
a an interest rate on aportfolio loan.
And I say, you know what, man?
That could be, if you'recomfortable with it.
It could be a better option thangoing SBA.
So, you know, sometimes the bestcandidate is the one I kind of
(32:06):
guide away from using Benaresbecause it makes more sense for
them.
I like the idea of just havingand having that kind of full
review of everything and theportfolio loan.
I haven't seen many peopleactually move forward with that,
which is actually surprising.
But to your point, yeah, nobroker or financial advisor
commissions, you're taking aloan on your own on your own
money.
Keep in mind if you're fullyinvested in one company and that
(32:29):
company I'm not gonna namenames, but it has been a company
in the news that maybe has justshot down, of course.
And value, you know, you alwaysrisk a margin call.
But yeah, it is it is a quickway to get funding.
But yeah I haven't seen manypeople actually move forward
with that idea.
So we got portfolio loans, wegot SBA, we got Rob's, what else
do we have?
Home?
Home equity, lines of credit,home equity.
(32:51):
I mean, you know, we've seen,you know, people listen, home
values are crazy right now,right?
So a lot of the people that wework with do have some
substantial equity in theirhomes, right?
And again, sometimes they wannaleverage that equity in their
home to help themselves get intobusiness.
So.
You know, again as logical as itseems, sometimes people don't
(33:13):
realize they can use thattowards, you know, getting into
business.
And you know, the, again, theonly silly question is the one
that's not asked, but you know,again, if you haven't looked at
it, then why would you knowthat?
But we certainly have seen a lotof people leverage that in some
capacity to help themselves getinto business, or at least have.
An open line through their,through, through their home
(33:35):
equity as again, working capitalis expansion, you know, things
like that.
So, you know, I think one of thebiggest mistakes Giuseppe people
make is going into thisundercapitalized.
A lot of times, you know, the,in, especially in franchising,
there could be a big.
Gap and what that range can looklike depending on how many
(33:57):
territories, geographical areas,construction, all these
different things.
And people always want to cometo that left side and the lower,
which I get.
You never wanna spend more thanthan you need to.
But you can't predicteverything, right?
So it's always, I always tellpeople, get more than you need.
And if you don't use it, great,you can throw it back to the
(34:19):
principal of the loan or put itback into retirement, however.
But, you know, sometimes thesethings don't work out and it's
not because the phone's notringing or people aren't walking
through the door.
Sometimes they don't havesufficient capital to support
that growth.
So, I, again, everybody viewsmoney differently and nobody
wants to spend more than theyneed, but I always recommend
trying to get a little bit morethan you think you need.
(34:42):
For that rainy day fund.
I agree.
It's the buffer.
The business may take it, youknow, the cost, it costs more
than anticipated, right?
The expenses are high took alittle bit longer.
Something personal came up, youended up getting laid off, and
you expect it to have that job.
So, yeah, you know, in the eventyou do leave the job, just say
to run the business, who'spaying your mortgage?
Who's paying your student loansand everything else, yep.
(35:05):
Utility bills and things likethat.
So you need to have that buffer.
Yeah.
Take, you know, take as big of aloan not the largest loan you,
yeah.
You can get, but have thatbuffer.
Because the reality is that ifyou are short you know, business
is okay, but you need to doubledown on, on marketing and you
need extra funds.
This is not an overnight thing.
Like, all right, you know what?
I need an extra 25,000.
I'm just gonna pull it from,well, there's nowhere to pull it
(35:27):
from.
There's a separate, I don't evenknow, actually, I don't know how
that would even work.
I guess there's options.
Maybe it's.
Pulling from equity to the home.
I don't know if the SBA, youknow, if you want to go back to
the SBA and you need an extra.
20 or 30,000.
You know what, I guess wherewould, what, what would happen
in that case?
You could always go back to thebank where your loan is with and
see if you can get additionalfunds.
(35:48):
Again, some banks will offer aline of credit on top of that
loan.
Sometimes people come back to usafter they get their s, they
just did an SBA loan and theysay, you know what?
I do want to utilize myretirement funds to as like a
capital injection.
That's certainly good.
Sometimes if for the personthat's continuing their W2 job,
(36:08):
which a lot of people are I can,I recommend doing a loan, a
distribution loan on theirretirement account, right?
If they're employed with thecompany that holds their
retirement and they wanna borrowup to$50,000 if their employer
allows it.
A lot of times people can dothat.
Right?
Right.
So even for somebody that sellsRob's plans, sometimes I tell
(36:29):
them, Hey, you can borrow up to$50,000 from your existing, your
current 401k.
And the beauty of that is youpay yourself back the interest.
Not a bank, not a lender.
So sometimes people utilizethat.
So there's all different wayspeople can inject capital.
Sometimes it's family, friends,partners or different lines of
credit that are out there.
(36:50):
Love it.
And that, and the moral of thestory is you have options and
the best thing you could do,obviously.
You wanna find the type ofbusiness, but you know, not
limit yourself.
Let's see what that the fundinglandscape looks like.
What are your options?
Do you qualify for the Robs atthis point?
If you've worked for a oneemployer, one retirement do you
have all traditional IRAs?
(37:11):
These are the questions.
That way you can put that alltogether and you can plan
accordingly.
So when you do leave the job,you know that Rob's option's
gonna open up.
Maybe you wanna expand.
Buy equipment, buy anotherfranchise, buy another another
territory.
So, there's a lot here, but getyour financials in order, you
know, get all those accounts.
I, I create a.
A spreadsheet that I literallyupdate monthly.
(37:32):
Just your cash and all and, andall the savings and checkings
account.
Your, all your investments.
Quick value of the home updateon the mortgage.
I do that actually on a monthlybasis.
I'm a finance geek yeah, Googlespreadsheet.
I just so I know where I'm at ona monthly basis.
And if you can get into thathabit, it's gonna make business
ownership a little bit easier aswell.
'cause you need to have all yourfinancials in order.
(37:53):
What didn't we.
Talk about any other options.
Obviously we talked about bestpractice and how to go about
this, but any other options youcan think of?
I mean, that really covers quitea bit.
I mean, there, there's unsecuredlending that, that you know,
Benetrends offers outside of theSBA.
You know, this is, you know, notthrough again the SBA process
(38:15):
usually a pretty quick.
Quick process compared to SBA,but a much higher interest rate.
You know, so if somebody mightnot qualify for SBA or, you
know, there's unsecured lendingoptions.
Again, higher interest, butcould be potential for people to
utilize.
There's good old fashioned cashand liquidity.
(38:35):
There's people borrowing from.
Friends and family, rich, uncle,mom and dad, whomever.
But the moral of the story,Giuseppe, is honestly like, do
your research, understand youroptions and just figure out, you
know, what's at your disposaland what you can utilize.
And honestly, sometimes we haveto have the tough conversation
(38:57):
is, Hey, you don't qualify rightnow, and that's fine.
Like, you know, but this is whatwe try to do is give them a
roadmap to, you're here today.
If you can get here, you'regood.
Right.
And I'm sure you've seen this inyour line of work.
I know I have.
I have seen people come by, comeback 10 years later and say, you
know what, now's the time.
(39:17):
Right.
So the more you can just educateyourself on options and you
know, leveraging your personalassets and financial situation.
I think the better off it is,whether it's today, whether it's
next year or five years down theroad.
It's always good to educateyourself on what's out there.
Yep.
I like that.
And the proactiveness is bigbecause, you know, you've been
denied for the SBA Great, whywas I denied and what's the
(39:41):
plan?
Is it.
We, I had someone get deniedyears ago when I first started,
and no explanation.
Working with a small I forgetthe name of the company.
Not to mention on the show, butyeah.
Yeah, they got denied.
And I'm like, well, did you findout why?
They said No, we just gotdenied.
So we called back and it wassimply the credit score.
I.
The credit score need, need,needed to increase.
There was actually something onthere that actually was a
(40:02):
mistake that happens all time.
And it's just like they didn'trun their scores.
They had no idea they had,everything else was fine.
So, okay.
You know what?
They made some recommendations.
Maybe call credit repaircompany, make these changes,
contact the credit bureau.
Let's get that back up to speedand.
I forget how many months, threeto six months that score got
back up and they were approved.
(40:23):
But, you know, being proactiveabout it as well, because
everything has to line up.
You know, you have to, theexpectation on the business, but
on the financials, you know, ifthe timing isn't right, okay
what's missing?
Credit score is great, but youhave, your liquidity's a little
bit light.
If you get it up to, you know,another 20 or 30,000, we can
probably get you approved.
And that goes a long way.
'cause now I have a map, I havesomething to work off of instead
(40:46):
of just saying, okay, do I justcall you in a year and cross my
fingers?
So I.
And that, that's also thebenefit of working with a
Benetrends or a company like us,right?
We do soft credit polls, we dobackground checks.
We can help the client withbusiness plan writing if they
are doing an SBA loan, right?
There's a big package that goesinto putting together, you know,
an SBA loan.
(41:06):
And that includes a businessplan.
It includes, you know,financials.
Sometimes the client can do iton their own.
Sometimes they don't have thebandwidth or knowledge to do it,
so we can help them with it,right?
So.
When I do talk to somebody thatsays, Hey, I'm gonna go to my
local bank.
I recommend that all the time.
Fine, go talk to somebody.
But they're not gonna get thehandholding that they will from
us or somebody in our spacethat's gonna walk them through
(41:30):
every stage of the lendingprocess.
So it's good to have, I tellpeople all the time, surround
yourself with experts, right?
To, you know, when you talk toyour clients, you say, Hey, I
know enough to be dangerous.
But talk to Beran, talk to Mikeand having a resource with you.
It certainly helps because stuffpops up.
Yeah.
And not everybody can, iscapable of doing it on their
(41:50):
own, and it needs somehandholding and there's nothing
wrong with that.
I agree.
You you know, take advantage ofthe resources.
Best part is that there's nocost for the initial
consultation, so.
You get a review you're gonnalearn something, you're gonna
get some options.
There's no cost unless you moveforward with any of the of the
services that Benares has tooffer.
Even get the benefit of a creditcheck, a soft credit check.
(42:12):
This is something that, thatcomes up.
Well, what does that even mean?
So sometimes I have to take astep back'cause people are like,
you talk about soft creditchecks.
What's the difference between asoft check and a hard check?
Yeah.
Well, a soft check is, it won'thit your credit score.
It won't affect it in any way.
So, you know, those arequestions that come up.
So I realize I, I have to getinto, explain things a little
bit more for first time businessowners, but you take advantage.
(42:33):
You say, okay, you know what'sin line.
Sometimes the credit score I,you know, this is another thing
maybe doesn't match up with thecredit score at home.
And there's a difference thatyou get maybe from TransUnion
and the banks use, I guess adifferent system.
So.
You have an all-inclusive youget a plan, you get a roadmap.
So timing isn't right.
This is what you need.
The timing is right.
Okay.
These are, you know, some of theplans and are some of the
(42:55):
options that that you qualifyfor.
And now you're like, oh, wait asecond.
I can get a loan up to four or500,000.
I may wanna look at brick andmortar.
I may wanna look at a physicallocation with a build out.
So, this has been awesome.
This has been, truly helpful.
I'm gonna, I'm gonna put you onthe spot now.
I ask this to all my guests.
Fun fact, if you can off the topof your head, fun fact about
Mike and we'll wrap up the keepit clean too.
(43:18):
So, as I jokingly say, fun factsabout Mike.
We've had some interesting we'vehad some interesting, you know,
it was related to this person wejust had kit Higgs on the show.
He was in a movie with De Nirorecorded the whole day and he
said he got about one second onthe movie.
So listen man, one second.
Sometimes all it takes to, Ithought that was kind of cool.
(43:39):
So.
I don't have anything fun.
I'm a boring guy, but I mean, Iplay, you know, I was a college
basketball player.
I a lot of people see this shortItalian from New Jersey like I
did when I was, you know, 18.
But, you know, I.
Played, played collegebasketball.
You know, I'm just kind of anormal guy.
I'm blessed with two beautifulchildren, gi, lovely wife
(44:02):
Larissa, who works at ey and youknow, Michael and James, my, my
two and 7-year-old.
But no man, I wish I had alittle bit more excitement.
I fun to, to tell you, butthat's a little bit bas the
basketball thing was coolbecause you're not a tall guy as
I am.
No.
I certainly don't look like abasketball player, that's for
sure.
And especially at 42, you get.
(44:22):
You get that dad belly and thatdad bot and you know, that's why
we keep the cameras here up, youknow, we don't go anywhere.
Exactly.
Yeah.
I could pull my hamstring justjumping out of bed in the
morning.
So, tho those days are farbehind me, man.
But No, this is great and Iappreciate you having me
Giuseppe.
Again, you know, we're reallylucky at what we do and working
in this industry, and I love thefact that I get to educate
(44:44):
people and.
Helps people get into businessvery much like you do.
And you know, for a lot ofpeople that come talk to us with
Benetrends, they go into thisthinking this, Hey, this is a
long shot, this is a shot in thedark.
And then they have that freeconsultation.
They're like, oh my God, I havemore options than I thought.
So, you know, what's better thanthat than helping somebody kind
of chase their dreams ofbusiness ownership.
(45:05):
So thanks for having me, man.
I appreciate it.
And if I could ever be aresource for any of your
candidates or anybody out there.
Feel free to reach out.
Appreciate that.
Yeah.
All it takes is an investment ofan hour of your time to, to get
a better picture of where youfinancially stand.
So Awesome.
I appreciate it.
I know it's been this has beenone of the, in, in the works in
the making for a while, but Iappreciate the insights.
(45:26):
We got into a lot more detail,so I.
Anyone that, you know, some ofthe comments were, I want a
little bit more detail.
Or how do the plans compare?
You know, what's the differenceif I go direct or with
Benetrends?
We covered it all and, and ifyou wanna revisit we'll
definitely make theintroduction.
We work with Jade you know, wehave a great relationship with,
and.
I partner with Jade on anyonethat we start working with.
(45:47):
She's usually the second calland she'll go through that full
review, everything we talkedabout today to help you figure
out what are all your financeand funding options.
So thanks again, buddy.
It was it's been fun and we'lldefinitely have you back on the
show hopefully with some, maybesome cool updates or products or
services.
So, appreciate it.
Again, we have some stuff in theworks that hopefully I'll be
able to talk about on the nexttime I visit your show, man.
(46:09):
I didn't know that.
So, all right.
Well, I wanna know before, butyes we'll definitely discuss it
on the show, but again, soundsgood, man.
Thanks for tuning in if you wantto learn how to make the
transition from corporate toowning your franchise.
Join Giuseppe on the nextepisode.
You can also follow on allsocial media platforms and
(46:31):
achieve financial and timefreedom today.
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