Leverage: The Power of Using OTM (Other Taxpayers' Money)

Hi Oliver,

I used to manage a muti-million dollar Economic Development Fund for my local community and the money is available... but not without a few strings attached.

"If you qualify" is the key phrase when asking for government funding assistance.

The primary 'qualification' for anyone interested in funding from my department was: "How many jobs will you create and what are you using for collateral"?... Collateral usually included personal guarantees, personal and business assets and UCC filings on equipment.

Each job was equal to approx $10,000 in funding. For example, if the company needed $100,000 they needed to create 10 NEW jobs at the company within 10 months of funding or they were in default. The rates were very favorable-- usually 3%.

The funds may be used for working capital, equipment and more... as long as you meet the qualifications. We did not fund restuarants, service businesses and many other kinds of bsuinesses though by Federal regs. So it wasn't that easy to qualify.

It may be very helpful for some businesses. Look in the 'Blue' pages of your phone book and in your city listings look for the "Economic development" department.

Another interesting source of funding for larger projects ($1 Million+) was local Industrial Development Agency sponsored projects.

The company would apply for industrial bonds sponsored through a local IDA. The IDA would guaranteed the funds and the company would get the money they needed at a fantastic rate through investment banks in NYC.

This was private funding and not governement tax money, but the local quasi-government agency had to be the sponsor of the project.

There are a lot of sources of funding out there... it just depends on how much you're willing to give up in exchange for the money, how many hurdles you want to jump and how hard you look.

There are a lot easier ways to make $100,000 though that you can use to fund any business project ;-)

-Dave




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