In this episode of The Compassionate Capitalist™ Show, I’m joined by Dominick Wallace, a business lending expert, to answer key questions many entrepreneurs face: Should you borrow? What kind of funding? When’s the right time?
We cover the three types of money businesses use to grow: investor capital, revenue, and debt. While investor funding often feels like the best route, we explain why smart use of debt can actually cost less in the long run and help you stay in control.
Dominick and I talk about how using business credit, instead of your personal credit can make a big difference when applying for loans. And for those who already raised capital, using those funds to unlock a revolving credit line can give your business a cushion when cash flow dips.
The truth is, another economic storm is coming. Don’t wait until it’s too late. Preparing now could be the difference between staying afloat and shutting down, just like many businesses experienced during the pandemic.
If you're thinking about funding options or want to prepare for the unexpected, listen to this podcast and feel free to send in your questions.
Takeaways
Debt serves a critical function when raising capital.
Understanding different types of debt is crucial for entrepreneurs.
Cash flow management is essential for business success.
SBA loans can provide significant support for startups.
Creative financing strategies can help overcome funding challenges.
Establishing business credit is vital for future financing opportunities.
Franchises often have more predictable revenue models.
Insurance options are available for large orders to mitigate risk.
The more risk involved in a deal, the higher the expected yield.
Building a strong credit history can facilitate access to capital.
Episode Chapters
00:00 Understanding Access to Capital
02:50 The Role of Debt in Business Growth
05:30 Case Study: Financing Challenges and Solutions
08:16 Job Costing and Profitability
10:20 Improving Business Credit and Financial Health
13:33 Purchase Order Financing Explained
16:16 Navigating Contracts and Agreements
19:07 Risks in Purchase Order Financing
21:42 Insurance and Risk Management in Financing
25:12 Understanding Insurance in Sports and Business
26:13 Navigating SBA Loans for Startups
28:15 The Importance of Debt Service Coverage Ratio
33:37 Challenges with Government Debt and SBA Loans
35:26 The Role of Government Guarantees in SBA Lending
41:57 Franchises vs. Startups: Financing Perspectives
47:32 Creative Financing Strategies for Real Estate
53:50 Building Business Credit for Future Success
About Dominick Wallace
Dominick Wallace is the Managing Director at Wallace Capital, where he helps entrepreneurs and business owners secure the funding they need to grow and scale. With deep expertise in commercial lending and strategic financing, Dominick guides clients through the smart use of debt, business credit, and capital planning. He’s committed to making access to funding clear, achievable, and aligned with long-term business success.
About Karen Rands
I'm Karen Rands, founder of the Compassionate Capitalist Movement. I help entrepreneurs prepare to raise capital the smart way and guide investors in identifying startup opportunities that build wealth and make a difference. This show is your roadmap to funding success—from pitch deck to public offering.
📅 Want expert feedback on your pitch? Consult with me: bit.ly/KCHcalendar
🔗 Learn more: karenrands.co
🎧 Catch more episodes: thecompassionatecapitalistshow.com
📘 Free eBook: The 4 Ws of Crowdfund Investing, join the Academy: bit.ly/CA-prelaunch
