3 Questions Featured

8:00pm EDT April 25, 2010

Glenn Godkin, Wells Fargo & Co.’s regional president for Greater Houston, is responsible for more than 3,000 team members and more than 200 community banking stores. Godkin, a 30-plus-year veteran of the company, also spearheads a number of volunteer activities. Last year, Wells Fargo provided more than $2 million in grants to more than 181 nonprofit organizations in the Houston area.


Q. Business owners need to have adequate capital to keep their business engine running on all cylinders. Do you have any tips about raising capital in today’s tight credit market?

When approving loans, lenders increasingly rely on credit history and clear demonstration that you have the ability to repay the loan. Be open and honest about past credit issues and take the necessary steps to resolve any blemishes on your personal and business credit history. One easy way to improve your credit score is to always pay your bills on time — and online bill payment services is a great solution.

Q. Let’s assume that a business has excellent credit history. What else can the business owner do to increase the chances of raising capital?

Identifying and correcting any cash flow problems will help you trim expenses, save for your next big project and improve your ability to secure financing from lenders. Talk with your banker about financial services that can help improve cash flow. A thorough analysis of your business’s cash flow will help you identify opportunities for cost savings and pinpoint areas to improve operational efficiencies.

Q. What tips do you have for business owners who don’t have a great credit history?

Ask your lender about the possibility of alternative financing through micro-lenders, the U.S. Small Business Administration, or state or municipal government agencies. You should also check with your local SBA office to see which lenders are SBA preferred lenders and which have qualified for SBA Express status — which allows the lender to offer SBA Express loans, which are often easier to obtain for small businesses.

If you aren’t able to raise the capital you need through a loan or alternative financing, consider partnering with another investor or establishing a joint venture to inject capital in your business.