Senate wants to lend $30 Billion (US) to Small Businesses

From Bloomberg Businessweek Senate Clears Way for $30 Billion Small Business Fund

So let me get this straight. Let's say I have a small business, I am in dire straights, cashflow-wise, and I need money. My credit cards are maxed, uncashed paychecks sit in my safe and my three employees leave early on payday to make sure their check gets in the bank that day.

I am going to go down to my local hometown bank, sit down in front of the friendly loan officer and say "Hi. I would like to borrow $100,000 dollars from that cool $30,000,000,000 fund that the government has set up for small businesses that need funding." How is that conversation going to go?

I have a house that is still 20 years from being paid off and it has a second mortgage based on its inflated valuation in 2007, so I have -$45,000 in equity. I am the guy that needs the money. Anybody out there think I am going to get it? Especially if I am a healthy white male? (No, not a white whale... a white male.)

Memo to entrepreneurs: BANKS DON'T LEND MONEY TO PEOPLE THAT DON'T HAVE ANY. Maybe if you are in an aggrieved group you might get a little walking around money, but serious cash? Uh-uh. McFly!!! Who are you kidding?

The best bet is not to get in the position of needing fresh money just to survive. The sad fact is that if you are there, it is probably too late. The sadder fact is that I have been there and have been able to claw my way back from the precipice. It was a long, long journey and I got some help along the way but it WAS NOT from a bank. Banks have no sense of humor and very little compassion.

Yes, some businesses need cash to fund proper investments, but right now, most savvy businesspersons are sitting by and waiting to see how desperate 2011 will be (especially if the 2010 election leaves things status quo.) Hiring is not fun and firing is even less fun, so most businesses are doing with what they have.

I don't know about your business, but my business is "Stimulus-free since January 2009"

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