As a small business owner, you want to take advantage of any opportunity to level out the playing field of competition. Minority-owned small businesses programs designed to help get equal opportunities. Our content partner Nav explains this certificate, why you should certify, and how to do it.

As a small business owner, you want to take advantage of any opportunity to level out the playing field of competition. Minority-owned small businesses programs designed to help get equal opportunities. Our content partner Nav.com explains this certificate, why you should certify, and how to do it.

 

In 2012, the U.S. Census Bureau reported that there were 8 million minority-owned businesses in the U.S. That’s a huge number of business owners looking for opportunities to achieve the American dream and make it as a successful entrepreneur.

If you own one of those businesses, becoming certified as a minority-owned business allows you to access certain government and private-sector programs that can help support your efforts. Here are three certifications/qualifications that can help minority business owners get support for their venture.

The U.S. Department of Transportation (DOT) DBE Certification

The DOT developed the Disadvantaged Business Enterprise (DBE) Certification to assist DBE companies that wish to compete for federally assisted highway, transit, airport and highway safety contracts. Any state or local government that receives DOT funding must maintain a DBE program that conforms to DOT standards.

Eligibility standards state that you must be in a socially and economically disadvantaged group and own 51% or more of a small business. The DOT uses the definition of “presumed groups” as defined in the next section. Other individuals may prove their disadvantaged status based on the DOT standards — these are handled on a case-by-case basis and is intended for groups that have disproportionately low incomes and high unemployment rates.

Contact your state Department of Transportation to learn how to apply for DBE Certification.

The 8(a) Business Development Program

The 8(a) Business Development Program was created by the Small Business Administration (SBA) to help disadvantaged businesses compete in the marketplace. This nine-year program provides business assistance to help disadvantaged businesses succeed in government contracting and in competing for commercial business. The goal of the program is to “graduate” companies that will thrive in today’s competitive environment. Before you can apply for the program, however, you need to qualify as a socially disadvantaged individual.

Some minority groups automatically qualify as “presumed groups,” meaning they are presumed to be socially and economically disadvantaged and can apply to the program. These groups include African Americans, Hispanic Americans, Native Americans, Asian Pacific Americans and Subcontinent Asian Americans. In addition, Alaska Native Corporations, Indian Tribes, Native Hawaiian Organizations and Community Development Corporations can also apply to the program.

Besides being in a presumed group, there are other SBA requirements that must be met by the owners of the business and the business itself. You can review the steps in the application process on the SBA website. Qualifying as a socially disadvantaged individual isn’t technically a certification, but the program is large enough that we wanted to include these standards in the article.

There are a number of benefits offered by the program. For instance, participants can receive sole-source contracts and can form joint ventures and teams to strengthen their position when bidding on contracts. In addition, the Mentor-Protégé Program pairs successful firms with companies new to the program. The mentors provide a range of assistance, including technical expertise, contracting help and more.

The National Minority Supplier Development Council’s MBE Certification

The National Minority Supplier Development Council (NMSC) is a trade group that supports certified minority business enterprises in obtaining new business opportunities and connects them to their network, which includes corporate members. Their goal is to help MBEs integrate into industry supply chains and to help corporate members meet the increasing call for supplier diversity. The council’s efforts match more than 12,000 MBEs to their impressive network of corporate members.

The council’s regional affiliates coordinate the MBE certification process, and you’ll want to start your application by contacting the affiliate closest to your company’s headquarters. You can visit NMSDC Central to learn more about applying for certification and completing the MBE Certification Application.

This is not a government-affiliated program like the 8(a) and DBE certification. There is an application fee for processing the application. The application process also includes a site visit and interview. The Council’s Certification Committee will review your application, and final approval is issued by the Council’s Board after a review of the committee’s recommendations.

In general, your business may apply for certification if the company is 51% owned and operated by minority individuals who are U.S. citizens. The minority ownership members must manage the company’s daily operations, and it must be a for-profit enterprise located in the U.S. or its trust territories.

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

You want to get the most affordable loan possible to grow your small business, but your NAICS code could be hurting you. Our content partner Nav explains how and why you should look at your classification.

You want to get the most affordable loan possible to grow your small business, but your NAICS code could be hurting you. Our content partner Nav.com explains how and why you should look at your classification.

 

Even if you didn’t choose a NAICS code for your business (or have no idea what an NAICS code is), you probably have one.

North American Industry Classification System (NAICS) codes are six-digit codes used by the federal government to classify businesses into an industry. The system was created for statistical purposes but is also used for non-statistical purposes, including determining eligibility to bid on government contracts and the risk level associated with your business for some loans and financing options. There are 20 sectors and more than 1,000 industries in the U.S. NAICS system.

Because there is no agency that governs how NAICS codes are assigned to businesses, these codes are largely self-assigned or assigned to your business by an agency collecting information on businesses. For example, the U.S. Census Bureau may assign an NAICS code to your business based on a survey you took. If you applied for an Employer Identification Number (EIN) on the IRS website, information from your application can be used to assign your business a code. This code will also show up on your business credit reports.

 

How Your NAICS Affects Your Wallet

How risky your business is determines whether or not you qualify for the best loans and financing options. Some industries, as determined by NAICS codes, are riskier than others, and your NAICS code tells a lot about how risky your business is in the eyes of a lender.

There are a number of ways your industry code can cost you money.

1. By bringing down your business credit scores

NAICS and SIC codes are recorded in business credit reports. The industry in which your business is classified can have an impact on your business credit score — for example, Experian’s business credit score uses your industry code as one factor determining your score. If you are incorrectly classified in a higher risk industry than the one in which you operate, it could be bringing down your business credit scores. These scores are then used by lenders, vendors and suppliers to qualify your business for trade terms, loans, and lines of credit.

2. By lenders determining your eligibility and rates for a loan

Lenders are going to want to know your NAICS code to qualify your business for a loan. Any given lender may deem some industries too risky to work with. Typical “high risk” industries include gambling, political lobbying and businesses involved in pyramid sale distributions, but the list goes on. The Small Business Administration, for example, has a long list of ineligible businesses that they will not work with for their popular 7(a) loan program based on operating activities.

3. Determining whether your business is “small”

The SBA uses size standards to determine if you are a “small” business. Only “small” businesses can qualify for government programs designated for small business, including the SBA’s loan programs and certain government contracting opportunities.

If your business is classified under the incorrect industry, it could make a difference whether or not you are classified as small because different industries have different size standards.

For example, let’s say you are a residential remodeler, but you started your business specializing in roofing. Your NAICS code may be 238160 for Roofing Contractors, when it in fact should be 236118 for Residential Remodeler.  This might seem like it’s not worth the hassle of changing, but depending on your annual receipts, it could determine whether you are a small business. Roofing Contractors must have annual receipts of less than $15 million to be considered small, whereas Residential Remodelers can have annual receipts of up to $36.5 million.

The industry code may also determine how many opportunities are available for your business — in the case of our remodeling example, residential remodelers tend to have more opportunities available than specialized industries do.

4. Whether you qualify for contracting opportunities

Business opportunities presented by the federal government are offered to specific industries based on what the government buyer is looking for. The government uses NAICS codes to classify these solicitations for a business.

Here’s an example of where the industry code might show up on a solicitation form through fbo.gov:

This opportunity is set aside for NAICS code 236118, Residential Remodelers. If you are classified, instead, under NAICS code 236115, New Single-Family Housing Construction (except For-Sale Builders), you might miss this opportunity.

Although NAICS codes may seem a dry, complicated subject, taking the time to make sure (a) that your business has received one, and (b) that it’s accurate, could mean the difference between growing your business and being hung out to dry. You can check your business’s DUNS number, and your NAICS and SIC codes for free at Nav.

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

Corporate giants aren’t the only ones that Washington is interested in. Our content partner Nav summarizes how the CFPB is taking steps towards helping small businesses.

Corporate giants aren’t the only ones that Washington is interested in. Our content partner Nav.com summarizes how the CFPB is taking steps towards helping small businesses.

 

Small business owners and regulators are often at odds with one another, but a new move from the country’s consumer watchdog agency could have the two groups aligned in a common cause — better access to business credit.

In a new initiative announced in the early morning on May 10, 2017, the Consumer Financial Protection Bureau (CFPB) said it’s seeking comment and information from business owners, lenders and any related parties into how to better track and understand the financing needs of small businesses, particularly minority-owned and women-owned shops.

The bureau, in a white paper released later that day, estimates that small business access roughly $1.4 trillion in financing, but that the data surrounding where they access those funds, and whether there are significant differences in capital availability depending on location, gender and race, is incomplete or outdated. CFPB Director Richard Cordray said in a Los Angeles field hearing on May 10th that he has seen first-hand the struggle for many small businesses to access financing.

“When I served as the Treasurer of Ohio, we had a reduced-interest loan program to support job creation and retention by small businesses,” Cordray said. “The way the program worked was that the state could put money on deposit with banks at a below-market rate of interest, and this deposit was then linked to a same-sized loan to a small business at a correspondingly below-market rate. This so-called ‘Linked Deposit’ program had been authorized more than 20 years earlier, but had gradually fallen into disuse.”

After streamlining the program, rebranding it and moving the application process online, Cordray said it found new success.

“Only about $20 million had been allocated when we started, but in less than two years we deployed more than $350 million, helping about 1,500 small businesses create or retain approximately 15,000 jobs across the state,” he said.

Levi King, CEO and Co-Founder of Nav, is familiar with the challenge of getting a small business loan — he’s started five businesses.

“In my first year of business, I had a crash course in the importance of financing,” he said. “Regular financing eliminated my need to dip into personal funds to run my company. It enabled me to hire new employees and buy better equipment. In short, it brought order to chaos, as a surge in liquidity meant that I could react quickly to new opportunities without upsetting operations.”

The CFPB is tasked with certain oversight functions under the Dodd-Frank Wall Street Reform Act. One of those is to create regulations on small business lending data that financial institutions are required to report to the agency. May 10th’s announcement kicks off the comment period, during which all interested parties can weigh in and give the bureau advice and guidance on how to best implement and design the new regulations. The goal is to ensure any new data collected will help the agency spot any credit access issues small business owners may be facing. Once the comment period is over, the agency generally reviews the input and crafts proposed regulations. If new and better data sources are added, that data could potentially be made publicly available on the CFPB website like much some consumer lending and complaint data is currently.

The CFPB’s news comes just a few weeks after 12 Federal Reserve banks from across the U.S. released their Small Business Credit Survey, finding that most small businesses faced a financial challenge in 2016 and that the most common challenge was getting business financing when they needed it. Business owners leverage both their personal and business credit scores in order to obtain financing, with many starting with business credit cards. (You can get tips for establishing business credit and check your business credit scores for free at Nav.)

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

As a small business owner, you want to take advantage of any opportunity to level out the playing field of competition. Women-owned small businesses have a program designed to help get equal access to funding and federal contracts. Our content partner Nav explains this certificate, why you should certify, and how to do it.

As a small business owner, you want to take advantage of any opportunity to level out the playing field of competition. Women-owned small businesses have a program designed to help get equal access to funding and federal contracts. Our content partner Nav.com explains this certificate, why you should certify, and how to do it.

 

If you own a business, you’re undoubtedly always looking for ways to increase its growth. Fortunately for female business owners, the Woman-Owned Small Business (WOSB) and Economically Disadvantaged Woman-Owned Small Business (EDWOSB) certifications give you access to resources and government contracts that can help you stimulate your company’s growth.

What Is the Woman-Owned Small Business (WOSB) Certification?

The WOSB is a program coordinated by the Small Business Administration (SBA) with the goal of giving women-owned businesses more easier access to the resource they need to grow their business. The Economically Disadvantaged Woman-Owned Small Business (EDWOSB) certification is a subset of the WOSB program. These certifications offer the chance to compete fairly for federal contracts and gain access to resources tailored to promoting women in business.

Advantages of Certification

Over 20 years ago, the federal government set a goal for awarding 5 percent of government contracts to small businesses owned by women. That goal has been elusive, but was finally met in 2015 when 5.05 percent, or $17.8 billion, of all federal contracting dollars that were eligible for small businesses were awarded to WOSBs.

In addition to the contracting goal, federal contracts can be “set aside” for WOSBs in industries where WOSBs are underrepresented. This helps ensure that small businesses owned by women are competing on a more level playing field with other similar companies.

The federal government uses the North American Industry Classification System (NAICS) to classify businesses. In fact, the SBA has authorized 113 new NAICS Industry groups for WOSB and EDWOSB set asides, 92 NAICS groups have set asides for WOSBs and 21 for EDWOSBs.

Requirements for Certification

To qualify as a women-owned small business, or WOSB, your business must meet the following requirements:

  • Your company must qualify as a small business based on SBA small business size standards. The standards are usually stated in terms of employee size and/or annual revenue, and vary depending on your industry code.
  • Your company must be 51 percent owned by women who are U.S. citizens.
  • Women must manage the operations on a daily basis.
  • Women must make long-term decisions for the company.
  • A woman who works full-time for the company during normal work hours must hold the highest officer position in the company.
  • There are no rules governing time in business.

To qualify as an economically disadvantaged women-owned small business, or EDWOSB, your business must meet the WOSB requirements, and the owner of the company must demonstrate economic disadvantage in the following ways:

  • Personal net worth is less than $750,000 with some exclusions
  • Adjusted gross income averaged over three years of $350,000 or less with some exclusions
  • Fair market value of all assets (no exclusions) of $6 million or less

How to Get Certified

There are two ways to become certified. You can self-certify, or one of the organizations approved by the SBA can certify your company.

Self-Certification

You can register at Sam.gov and wait 24 hours before registering at Certify.SBA.gov to complete a self-certification. To register via these websites, you will need a DUNS number, an EIN, and MPIN. You can get an EIN now by applying online, however registering for a free DUNS number will take about 30 days.

While the self-certification process has been eliminated for contracts set-aside under the WOSB program, that change isn’t currently effective. Until the SBA implements the change, you may continue to self-certify.

Third-Party Certification

Currently, the SBA has approved four organizations as “TPCs,” or third-party certifiers:

TPCs charge a fee to provide certification and annual recertification that currently ranges from approximately $200 to $400.

Bottom Line

Once you are a certified WOSB, you can search for federal contracting set-asides on FedBizOpps.gov. Additionally, you’ll have the opportunity to qualify for grants specified for women owned businesses. (Learn more about grants for women-owned businesses here.)

A WOSB certification can help make it easier for you to grow your business. As an entrepreneur wearing a dozen different hats, anything that “makes it easier” to obtain one of your business goals is worth considering incorporating into your business plan.

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

Search engine optimization (SEO) is vital for maximum online impact for your small business. It’s also one of the hardest skills for busy entrepreneurs to master. Our content partner Nav makes it simple for you to get started with 3 easy tips for managing local SEO.

Search engine optimization (SEO) is vital for maximum online impact for your small business. It’s also one of the hardest skills for busy entrepreneurs to master. Our content partner Nav.com makes it simple for you to get started with 3 easy tips for managing local SEO.

Did you know that nearly half of all Google searches are local? Or that the 50% of consumers who perform a local search from their mobile device end up visiting that store within a day? Local search is on the rise, and for most smartphone wielding consumers, that’s probably not a surprise.

Many of us turn to our smartphones to help guide our purchasing decisions, whether that’s finding the perfect place to dine or to locate a good or service we need. Just type a few keywords into the Google search bar, and contact information, maps, reviews, and even some photos are at our fingertips, helping us decide where to go. Of course, chances are that if a business hasn’t taken the time to optimize their local search efforts, then they’ll go unnoticed by the tech savvy consumer. And that’s a shame.

Optimizing your Google local listing and capitalizing on the growing consumer base that relies on local searches is easy and yields big results, especially when it comes to foot traffic and conversions. Here’s a few simple ways to make sure your business is visible to all the customers near you.

Sign up for a Google My Business Account

In today’s mobile based economy, signing up for a Google My Business account is as important as unlocking your doors every morning or getting a telephone number. It’s essential for success.

The free service allows businesses to list all relevant details, making their info readily available for consumers searching within your geographic location. This listing includes vital contact information (address, phone number, website) as well as reviews.  It also will place your business on the map, literally, at least on Google Maps and any app that utilizes Google Maps (Yelp, for example).

Provide thorough and precise information about your business

Google uses search algorithms to serve its users with the most accurate results it can, and for those hoping to optimize their local search efforts, that means including all relevant info. Business owners must provide accurate information for their business (phone number, address, hours of operations, and any URLs available (for example, if you’re a restaurant, you’d want to link to your menu where applicable) if they want to increase the their chances of appearing in top search results.

It also means choosing terms to accurately describe your business. Take for example a furniture store that specializes in vintage or refurbished pieces. It’s not enough to simply describe your store as a “furniture store.”  Instead, specific words, like “vintage furniture” can improve search results by funneling relevant traffic to your listing, putting your store information in front of the exact consumer base you want to reach.

Be mindful of your reviews

According to a recent Pew study, 82% of consumers consult reviews before making a purchase. And almost 50% of consumers are using their mobile devices to check reviews while they’re in the store. Reviews are integral to the overall success of a business, and that’s true when it comes to attracting customers via local search results.

Remember that Google algorithm we talked about briefly above? Reviews are factored into that algorithm and impact rankings; good reviews bode well for businesses and help establish themselves as top in search results.

Great reviews do help businesses gain traction in search results, but reviews are important for another reason. Reviews create unique content that is often, by proxy, filled with keywords that help you rank better. Google sees unique and relevant content as a major plus, so reviews can help drive your campaign (so can your responses).

To leverage the power of reviews, be sure to stay engaged with your customers. You can even consider developing a campaign that incentivizes your clients to leave reviews.

I know what you’re thinking: what about bad reviews? Despite the fact that there will always be customers who are simply impossible to please, responding to poor reviews is important, and over time, customers can see that you’ve made attempts to reach out and remedy any issues (you’ll also be creating more unique content); they may even consider changing their review once you’ve addressed their concerns.

For businesses that rely on local clientele and regular foot traffic, local SEO is essential for success and must be part of long- and short-term marketing strategies.  While some facets of online marketing, particularly SEO, may seem daunting, these three simple yet powerful local SEO tips can help any business stake a claim in their local economy.

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses.  In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

Running a business is a lot of work if you are the sole proprietor. Even if you have a partner and excellent staff, sometimes you need the support and opportunities of external groups. Our content partner Nav introduces four online groups you can join to network with other small business owners and resources.

Running a business is a lot of work if you are the sole proprietor. Even if you have a partner and excellent staff, sometimes you need the support and opportunities of external groups. Our content partner Nav.com introduces four online groups you can join to network with other small business owners and resources.

 

The work of entrepreneurs and small business owners is filled with pitfalls and challenges, and sometimes you just need to talk to someone who can share a few pieces of good advice. Business networking groups are a great way to meet advisors and mentors who can help during the journey, as well as to find new professional connections, opportunities and ideas.

Whether you’re looking for suggestions for your next product, emotional support or advice on taking your business to the next level, there’s a variety of small business groups and associations willing to assist. Even better, many of them allow members to join and access resources for free. Here’s a list of four organizations with free services for small businesses that can help no matter where members are on the path to entrepreneurship.

U.S. Small Business Administration

The U.S. Small Business Administration (SBA) is an independent U.S. federal agency that aims to help people start, grow, finance and sell their small business. The agency’s website contains valuable information in written and video format about a variety of topics, from drafting a business plan and registering your business to obtaining permits and applying for SBA loans. Those who are interested in a more personal approach can visit one of the SBA’s district or regional offices nearby, as well as connect with business centers supporting female entrepreneurs and military veterans.

The SBA is also known as a great resource for business financing. The agency guarantees billions of dollars in small business loans every year and can help you understand how to qualify for an SBA-backed loan or other types of business financing (here’s a comparison chart for a quick guide). SBA loans require an established business credit score —specifically, the FICO SBSS score — to secure financing. (You can check your personal and business credit scores for free on Nav.)

SCORE

SCORE (Service Corps of Retired Executives) is a U.S. nonprofit association that provides members with free business mentoring and education, thanks to the support of the SBA and more than 11,000 volunteers who have signed up to share their expertise. The organization provides free, confidential business mentoring in person or online, as well as free resources, tips and tools through its website. Those willing to invest a little money in their education can also sign up to attend local workshops or webinars about topics as diverse as social media, taxes and branding.

Meetup

Meetup is a social network that allows members to find others who are interested in the same topics and activities and meet them for offline events and activities. To date, the website has helped organize more than 25,000 entrepreneurship meetups on six continents, from massive chapters in cities such as New York, Washington, D.C. and San Francisco to smaller and more specialized groups across the U.S. Most scheduled meetups are free to attend, with annual larger events charging admission to cover costs throughout the year. Meetups can be a great opportunity to network with other entrepreneurs, recruit from a specific talent pool or even market your business.

StartupNation

StartupNation is a website and content platform for current and aspiring small business owners that offers a wealth of information about a variety of topics, authored by industry leaders and visionaries. The community was founded in 2002 by Jeff and Rich Sloan, brothers who also host the nationally syndicated StartupNation radio program. Users who sign up for the StartupNation newsletter can receive free content such as articles, case studies, podcasts, book excerpts and webinars directly in their inbox.

Final Thoughts

Running a small business can sometimes seem overwhelming, so it’s comforting to know that these and other associations are available when entrepreneurs are looking for advice, insights or new contacts. After all, the importance of having a community where members can share experiences and knowledge with other business owners can’t be overstated.

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

Your small business is always changing to improve and adapt. You might want to change the name of your business, but doing that can be challenging. Our content partner Nav explains how a name change affects your business credit and how to protect your good standing.

Your small business is always changing to improve and adapt. You might want to change the name of your business, but doing that can be challenging. Our content partner Nav.com explains how a name change affects your business credit and how to protect your good standing.

 

Changing your business name can be a lot of work, and, quite frankly, a hassle. But can it also put your business’s credit history at risk?

Kimberly Wilson is about to find out. In 2006, she started First Step Therapy, a counseling and training business, and grew it into multiple locations. A few years ago she took a hiatus from that business to earn her doctorate degree, and now she’s ready to relaunch her business. She has chosen a new name that reflects her new vision for the company. It will be called First Step International Consulting & Counseling Services and will offer training for individuals, businesses, and professionals.

However, she’s worried about what will happen to her business credit when her name changes. “I am concerned that if I retain the same federal tax ID but change the name, I will lose my business credit rating,” she wrote in an email. “How do I prevent that from happening?”

Wilson built a positive business credit history in her first business. She established business credit by using trade credit—purchasing things she needed for her business, such as supplies or printing—with payment terms of net 30 or net 60. She paid those bills on time, and as her business credit scores improved, she was able to access even more credit. Eventually, she used business credit to finance computers and other equipment.

Older is Better

Wilson is right to be concerned about keeping her credit history, since age is a factor that often affects business credit scores. Scoring models often evaluate age in a few different ways:

  • Age of the business—How long has the business been open?
  • Time in file—When was the first account opened?
  • Age of accounts—What is the average age of all accounts?

Since small businesses often fail in their first few years, businesses with older credit histories benefit from well-established credit histories.

The good news is that Wilson doesn’t have to sacrifice her business credit history when she changes her business name. But she’s smart to be proactive, because by doing so she is more likely to ensure her complete credit file will follow her business.

Steps to Take

If you find yourself in a similar situation as Kimberly Wilson, here are several steps you can do to help the process move smoothly:

Submit a name change to the Internal Revenue Service if necessary. You’ll find instructions and guidance on the IRS website.

Update your name with state and local agencies as required. If you have registered your business with your state Department of Corporations, for example, and/or you must have a local business license, you may need to update your business name with either or both.

Notify your creditors. Let your creditors know about your name change so when they report your account in the future, it will be reported under your new business name. Hopefully this will also help associate your old credit history with your new business, although that is not guaranteed. Do the same with companies through which you process payments, such as credit card processors, your bank or credit union, etc.

Notify the credit bureaus, as necessary. We asked the major commercial credit agencies to clarify their policies and procedures regarding a business name change, and here are their responses:

  • Dun & Bradstreet does not require business owners to notify them of a name change unless it involves a change of ownership. If it does, visit Dun & Bradstreet’s free company update page here.
  • Experian recommends small business owners visit BusinessCreditFacts.com to update their reports.
  • Equifax does not require a business owner to report a name change. As long as the business uses the same credit accounts and does not use a different tax ID number, the reporting members will report the credit history using the new name. The business credit report will also reflect the previous name (similar to how a former name is reflected on an individual’s credit file).
  • LexisNexis does not require a business owner to report a name change.

“Information on small businesses is in constant flux as they change or add locations, evolve into new entity types (e.g., from sole proprietor to LLC), change leadership, grow their assets, and more,” says Ben Cutler, Senior Director of Small Business Risk with LexisNexis. “It’s even common for a small business to change its DBA and/or its name. But these activities leave ‘footprints’ in the data ecosystem, and LexisNexis Risk Solutions relies on its Big Data technology and sophisticated, statistically based record linkage models to uncover and combine these footprints across billions of data records.”

Check and monitor your business credit reports. Review your business credit reports before your name change to see which accounts report, then continue to monitor them afterward to see whether those accounts are reported under your new name. If not, you can contact your creditors and ask them to make sure your accounts continue to be reported under your new business name.

There are many more steps you need to take to successfully navigate a business name change, but with the right planning, you should be able to keep your credit history intact.

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

Stuck with a bad business partner? Our content partner Nav offers advice for how to find out if you need to buy out your partner and how to protect yourself from future problems.

Stuck with a bad business partner? Our content partner Nav.com offers advice for how to find out if you need to buy out your partner and how to protect yourself from future problems.

 

Businesses fail for a variety of reasons and many times the reason for failure had nothing at all to do with the market, the products, lack of capital, a bad location, nor any of the other “major” reasons for failure, but many times the reason for failure was due to the bad dynamics between the owners themselves.

Let’s face it, people change.

You meet them one day and they are a smart, intelligent, competent, responsible, respectful, and ambitious person—just the type of person (you think) that you would like to form a partnership with to build an enterprise. But for reasons beyond your control, this partner changes down the line into a sneaky, lying, con-artist that’s sucking money out of the business and about to cost you the time, energy, and investment you’ve put into the business.

So how do you get out of this situation? How do you buy-out a current bad partner, and avoid signing on with another bad partner in the future? Here are some ideas.

Determine If A Buy-Out Is Needed (Hire An Attorney)

Before you do anything, make sure you have the proper legal representation working on your situation because your Attorney can determine if a buy-out might be in your best interest.

The cost of an attorney of this nature might cost you a couple thousand dollars, but they would be well worth the investment if they can make sure everything is sorted, organized, and efficient in relation to the buy-out procedure (again, if a buy-out is even the best option). Your attorney can review partnership agreements, ensure compliance with state/local laws, and more.

For example, if you have a good partnership agreement drafted, you might be able to dissolve the partnership without a buy-out, or you might be able to change the weight of ownership within the partnership agreement giving you more control without having to buy-out the other partner’s equity.

If Going Forward With The Buy-Out

If you are indeed going forward with a buy-out, here are some procedures you want completed:

  • File all paperwork and transfer accounts: All paperwork needs to be filed properly and the other partner’s name needs to be removed from your business accounts. More likely than not, this would mean that you might have to establish new business accounts in which the other partner doesn’t have access to said account numbers, passwords, etc. Your hired Attorney and CPA/Accountant should be able to assist with this process.
  • Complete an efficient business valuation: In addition to hiring an Attorney and bringing in a CPA/Accountant, you also want to hire an Independent Consulting Firm to provide a business valuation which will give you the full value of the business (including the worth of your brand). This will help you decide if buying out your business partner is a good investment or not.
  • If needed, seek the right funding: This can include a variety of sources, such as your personal savings or debt financing options such as a business loan, line of credit, or business credit card. Before you spend your time searching for financing, check your personal and business credit scores with a free Nav account—our financing marketplace uses your business and credit data to match you to financing offers you’re more likely to qualify for.

Protect Yourself In The Future

If you are going to bring on a prospective business partner again in the future, you should approach the situation as if you are entering a marriage and structuring a pre-nup.

While similar to a marriage, your prospective business partner might inform you of how they “don’t believe in a break-up and would never leave you”, and while they might have every intention of never leaving you, sometimes disagreements about how to conduct business can unfortunately lead to a disastrous business partnership.

Before you bring on any prospective business partner, make sure you hire an attorney to draft up your Partnership Agreement to outline investments, responsibilities, and a dissolution process that provides an outlined exit strategy that everyone agrees to upfront. This allows you to negotiate the exit strategy at the beginning while everyone has good feelings towards each other, rather than at the end.

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

The way credit agencies report public records is changing this summer. Our content partner Nav explains what is changing and how it might help your credit score!

The way credit agencies report public records is changing this summer. Our content partner Nav.com explains what is changing and how it might help your credit score!

 

A slew of changes to how credit reporting agencies will handle public records could help millions of Americans improve their credit scores this summer.

For decades, the major credit bureaus — Experian, Equifax and TransUnion — have included public records like parking tickets and fines in consumer credit reports. But, as a result of a settlement with the New York Attorney General in 2015, the bureaus announced plans to update and modify their data collection and dispute processes to improve credit report accuracy.

Changes under the National Consumer Assistance Plan actually began rolling out in September 2015, with another round of changes taking effect September 2016 and the final round occurring on July 1, 2017. This final group of reforms mainly pertains to public records like tax liens and civil judgments. It includes two major policy shifts:

  1. Public records will now be required to list the name, address, Social Security number and/or date of birth of the consumer.
  2. The records will need to be updated every 90 days in order to remain on consumers’ credit reports.

The Consumer Data Industry Association, a trade group representing the major credit bureaus and other data companies, estimates that this change could result in the removal of 96% of civil judgments and 50% of tax liens currently appearing on consumer credit reports due to insufficient personal identifying information (PII) under the new standards. Bankruptcy records will not be impacted by the data standard changes as they already comply with these policies.

This isn’t the only consumer-friendly credit reporting shift that’s happened recently, though. The July 1 shift has been planned for a while, but, as we first reported on Nav, consumers got an additional boost late last year from a handful of major debt collection companies who decided to stop reporting on paid collection accounts after 2 years, or to not report collection accounts that were paid in full or on a payment plan if the consumer started paying within 3 months of the initial collection notice. Though not all collection agencies are following this policy, it’s a major shift for one of the top credit report issues — unpaid collection accounts — and one source told Nav that the decision has already removed more than a million derogatory accounts.

The impact of the CDIA changes in July compounded with the recent debt collection shift means millions of Americans could see a credit score lift in 2017. The impact goes beyond just consumer credit scores as well — while businesses have their own credit scores, nearly half of small business owners use their personal credit scores to secure business financing (many business credit cards, for example, require a personal credit score to get approved). So a major lift to a personal score could make a big impact on small business owners looking to secure business financing in the future as well as under the July changes. (You can check your personal and business credit scores for free on Nav.)

 

This article originally appeared on Nav.com and was re-purposed with their permission.

For information about Opportunity Fund’s small business loans, please contact us at 866-299-8173 or loans@opportunityfund.org.  For questions about your existing loan or other customer service questions, please contact us at 866-299-8173 or sbhelp@opportunityfund.org.


Opportunity Fund is California’s largest and fastest-growing nonprofit lender to small businesses. In FY16, we made $60M in loans to help more than 2,200 small business owners invest in their businesses.  Opportunity Fund invests in small business owners who do not have access to traditional financing. As a founding member and signatory to the Borrower’s Bill of Rights, we believe in the important role small businesses play in our community and the economy, and we aim to help owners financially succeed.

Visit us online at http://opportunityfundloan.org and follow us on Facebook and Twitter

Opportunity Fund. Working Capital for Working People. opportunityfund.org