Bank Loans - Meeting the Banker

Meeting the banker for obtaining bank loans is a crucial meeting for entrepreneurs. The fact that obtaining a loan is equivalent to a sales job should be kept in mind. The entrepreneur not only needs to sell himself and herself to the banker, but the viability and potential of the business also. This is a similar situation to what an entrepreneur faces in the early stages with a venture capitalist.

Initial discussions with the banker are likely to be on telephone. The entrepreneur should be ready with a draft of the nature, age and prospects of the business venture; who provided the equity financing and how much; prior financial performance of the business; the entrepreneur's experience and background and the sort of bank financing desired. In short the entrepreneur should be completely prepared to introduce himself, his business and its past and future prospects in detail. It will be of great help to the entrepreneur if he or she can get a referral from a venture capital firm or a business associate who knows the banker.

Even before the first meeting the loan officer may ask for a summary loan proposal, business plan and financial statements to be sent ahead of time. Well prepared plans and proposals are sure to impress the loan officer. At the meeting itself the banker would be interested in meeting the management team and accessing the workings of the company's finances. Bankers might even want to meet one or more of the venture's equity investors. Basically, the meeting is the opportunity for the banker to judge the integrity and acumen of the persons who are responsible for paying back the loan.

In all meetings with potential bankers, the entrepreneur has to convey an air of self-confidence, while presenting an optimistic yet realistic view of the business venture's prospect. The aim is to favourably impress the banker by all that he reads and sees so that he initiates further meetings to discuss the amount and timing of bank loan they might lend to the entrepreneur.