Over the last few years as I learned to run my firm, I've learned a lot. Like "It's tough to run a business when you have to start every year with no money in the bank."
Lots of people don't know that many small businesses can't keep money in the bank overnight on December 31; if our law firm has money in its bank account at midnight on December 31, we face a 40% tax on that money -- money we need to pay employees or to run our business, money that will eventually be taxed on sales taxes or income taxes as payroll.
So we have to pay it all out by the end of the year, and we do: we pay expenses and give large employee bonuses and get equipment and otherwise empty our reserves by December 31, and that leaves us short on money when the new year begins, which can put you in a bind if, like this year, there is a payroll three days into that new year and you have 35 employees.
That's where companies like Five Point Capital come in. I didn't know about Five Point Capital until just now, or the last few weeks might have been easier to navigate. Five Point Capital is a small business lending/leasing company. It's been around since 1999 but in the last year, under new management, it really came into its own by providing cash advances, working capital loans, and other small business lending services.
According to one source, up to 90% of all small business loans are denied by banks; we represent small businesses who have bank trouble, so I know that. That's why it's great that there's a company like Five Point Capital to help businesses get across cash-flow gaps and to expand without using up valuable cash reserves. I've added them to my list of contacts, and if you own or help run a small business, you maybe want to, as well. At the least, check out that link for more info.
Under new management in 2012, Five Point Capital was started in 1999.
Originally just a leasing company, Five Point Capital has since expanded
its product line to include merchant cash advances, small business
loans and working capital loans. “I think that recent research shows
that nearly 90% of small business lending requests were denied by banks
in 2011,” adds Tom Brainerd, VP of Marketing for Five Point Capital. “We
have been able to meet the needs of business owners who are frustrated
by the lack of credit availability. They have almost given up on finding
credit. Our programs offer an alternative source of financing for this
type of small business,” Mr. Brainerd said.