A Community Banker Making a Difference—Business Fuel Podcast #49
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I’m convinced that community banks have a major role to play among the Main Street businesses in our community. They’ve long been the place small business owners have turned for the financing they need to grow their companies and fund cash flow. In recent years, many bankers (including community bankers) have moved upstream to work with bigger business to hopefully make bigger profits. As a result, many small business owners have had to turn to alternative financing for the capital they need.
Traci Flynn and Holladay Bank are a little different. During today’s podcast, Traci shares what Holladay Bank is doing to serve the small business community in her area. She shares some of the things small business owners can do to give the bank a reason to look at more than their credit rating or annual revenues. In my opinion, this is what you should be looking for in a relationship with your bank.
Information you need, the podcasts you trust, this is the PatrickWiscombe.com podcast network. Bringing you interviews with top business professionals and business financing tips to fuel your American dream. This is The Business Fuel Podcast heard exclusively on Lendio.com. And now, here are your hosts, Ty Kiisel and Patrick Wiscombe.
Sponsorship: This podcast is sponsored by Lendio.com. The online source you need to find the right business financing to grow your company. Check them out for free at Lendio.com to get your business growing right now.
Patrick Wiscombe: It is The Business Fuel Podcast. Good morning, I’m Patrick Wiscombe. thank you for tuning us in and taking us along wherever and however you’re accessing the podcast today. Coming up, we’ll be speaking with the Assistant Vice President of Holladay Bank and Trust, Traci Flynn. But before we do, let’s introduce the producer and co-host of the podcast, Ty Kiisel. How are you?
Ty Kiisel: I’m doing really good.
Patrick Wiscombe: What’s coming up in your Forbes article this week?
Ty Kiisel: It’s very much aligned with what we’re talking about today on the podcast. If you don’t have a good relationship with your banker, it’s not just your bankers fault. I outline several things the small business owner can do to get the banker to ask for more information than just your credit score, revenue, and time in business.
Patrick: Let’s bring in Traci now. It’s good to have you here.
Traci Flynn: Good morning. Thank you.
Patrick: Ty, what’s the connection between you and Traci?
Ty: In the spirit of full disclosure, Holladay Bank is one of the banks on the Lendio system. I met Traci and it was like a breath of fresh air. She is someone who is engaged and interested in making it happen for the main street businesses in her community. I was so excited about it, I wanted to bring her here and talk to her on the podcast. Traci, tell us about Holladay Bank. They’re not national, they’re not regional, they’re not even across the city. They have one branch and they focus on the businesses in their community. So tell us a little bit about Holladay Bank.
Traci: Holladay Bank was started in 1974. It was started by the senior member of the Spratling family. It has gone through the generations and our chairman today is a Spratling. I started in a big national bank, and I came to Holladay Bank in 2006. I would not trade being at a small, family bank for the world. I feel like we are a family here. We have customers that come in that have been here since the day we opened in 1974. We have an annual Customer Appreciation Day, a Shred Day, and a catered barbeque. We get to just sit down and talk with our customers.
Patrick: I think the Shred Days are an absolute help to the community.
Traci: People love them. We have people calling months in advance.
Ty: What you describe is what most people think of as a community bank. But what’s different today than maybe 10 or 15 years ago with community banking?
Traci: The hardest thing today is overcoming image. One of the biggest hurdles we have to overcome is the competition of credit unions and bigger banks. Over the past few years, there’s been so much bad press about banks and they lump all banks in general into that. So the community bank has received a bad rap for the problems the big banks created. It’s one of the hardest things we have to deal with right now.
Patrick: Do you find you have to do a lot of one on one marketing instead of plastering the airwaves with commercials?
Traci: We really don’t do large scale marketing. Our loan officers go out and talk to people. They call contractors they happen to know our see. We’ve enlisted things like Lendio where we’re given one person to see if we can meet their needs. What endears people to us is when they meet us and talk to us. That is definitely more of our approach.
Ty: Did you say that you actually go out of the bank and into the community to meet the small business owners you work with?
Traci: Absolutely. As an example, there’s a new development in Holladay that’s going up with several new businesses. We made the decision that we want to be the bank for those people. They’re here in Holladay; they’re our neighbors. One of our loan officers actually called the developer and said, “I want to meet every one of those owners.”
Ty: Years ago I had some partners in a little main street business and our banker visited us regularly. He got a real good feeling for what we were doing as a business. He became, in my mind anyway, a partner with us. I don’t even remember going into his branch office. He always came to us. One of the things I suggest in my Forbes article is that you invite the banker to come and see you in your place of business. Do you think that’s a valuable thing for bankers to do?
Traci: It’s a huge value. I can tell you I’ve had several loans before the loan committee and many of them have been restaurants. The committee members don’t want to make a decision until they’ve eaten there and seen that it’s someplace they want to eat. It’s made a world of difference. Just looking at it on paper is completely different than being there.
Patrick: That’s incredible. Most people would just look at the paperwork and make a decision.
Ty: Why is it that your bank doesn’t do that?
Traci: I think one of the reasons we take the time to investigate a little bit more is because we don’t succeed, unless that business succeeds. If that business doesn’t do well, that doesn’t do anything good for us either. We want to make sure we find a way to help them succeed. We don’t want to be in the business of setting people up to fail. Sometimes with a bigger bank, you get people who only know how to check boxes and calculate a few ratios. Our loan committee is made up of people who are out in the field, working with the businesses. These people have a knowledge of business, of people, and of what it takes to succeed.
Ty: So there are mitigating circumstances for let’s say a less than perfect credit score?
Ty: This is good for people who live in and around Holladay, but are there other places like this around the country? Is it reasonable to suggest that people should look for conditions like this in the small business bank regardless of where they are?
Traci: Yes. There are community banks all around the country, but they are dwindling. There’s a huge decline because of the huge national banks. Globalization in general has taken care of that. It’s not just the banking industry. When you google for banks in your area, don’t take the top hits. Scroll down a little bit for the smaller, community banks.
Patrick: Do you think there have been so many bad loans because the bigger banks have not taken the time to investigate like you do?
Traci: That’s certainly part of it. Unfortunately during the last several years, a lot of it has been purely economic. Even if you were doing your due diligence, people took losses. But there was a great lack of due diligence that made it worse than what it had to be.
Ty: So if you’re a small business owner and you’re looking for a bank, what should you be looking for and what kinds of questions should you be asking?
Traci: I don’t know if the questions are as important as the feel. When you go into a national bank, sometimes you just feel like a number. When you walk into a community bank, they shake your hand and ask you your name. They ask you to tell about your business, not just hand you an application and ask how much you’re looking for. That’s how you know if you’ve found someone who’s going to be there for you.
Ty: What do you need to do as a borrower as you go in and approach a banker for a loan? Is there information they need to collect? Is there a presentation they need to make? Describe for the audience what they can do to improve the odds.
Traci: The best thing you can do is have projections ready. Be realistic about them. Show that this is where you’ve come from and you’re going to slowly build back up. Some people underestimate the value of a business plan because they think it’s just words. If you just hand someone your tax returns and tell them the name of your company, it’s hard for them to see where you’re going. So if somebody came in with projections already done, that would impress me.
Ty: That is incredible advice. A business that’s looking to the future is a lot different than a business just looking to keep their head above water, right? You’ve also mentioned in the past that you look at the management team. Can you talk about that?
Traci: I do best with real world examples, so let me give you a couple. We had two ladies come in wanting to start a trendy, new fitness studio. Neither of them had experience but they enjoyed working out. They wanted a loan, but we were very suspect of it because even though you enjoy doing something, that doesn’t mean you can run a business doing it. On the other hand, I have a gentleman who owned a small business providing a certain service and then he got out of that to do something else. During those few years he was away from it, he had some trouble and ended up having a bankruptcy. Now he’s wanting to get back into that prior business. I would rather help that gentleman because I know when he was in that business before, he ran it successfully for 10 years. Despite those credit problems, he’s going back to something he knows and is good at.
Ty: I think that this is something that makes your bank unique. I like the idea that you’re looking at the business owner and what they’re capable of doing. To kind of wrap up, what advice would you give to small business owners?
Traci: My advice would be to not give up when you’ve been told no by some of the bigger banks. Don’t be afraid to give smaller banks a chance. Don’t get discouraged by the big banks. It can be a big process, but it’s worth it. If you find somebody who’s on your side, they will find a way to make it work.
Ty: Thank you very much Traci. I personally believe there is a place for community banks within the small business infrastructure. I’m glad to see there are folks like you and your bank out there. So thank you for being on the podcast. It’s been a real pleasure to speak with you.
Traci: Thank you. We appreciate the recognition of the role that community banks play.
Patrick: Ty, as we wrap up, explain to us from start to finish exactly what Lendio does. Let’s start by saying it’s absolutely free.Ty: It is absolutely free to small business owners. Basically, you visit Lendio.com and fill out a profile. Depending on your answers, you’ll be matched to a number of lenders who are anxiously interested in providing you with a small business loan. If you’re a match, those lenders will reach out to you. It’s kind of like Match.com for small business owners and banks. It’s a great tool and it allows us to use the power of the internet. So that’s what Lendio does and we’d love to have you visit us. Tens of thousands of people visit our site every month and get matched to the financing they need.
Patrick: Check it out at Lendio.com. You can also find all our past podcasts at Lendio.com/blog. Our thanks again to Traci Flynn, Assistant Vice President at Holladay Bank and Trust. How about if we give out your phone number Traci?
Traci: Absolutely. It’s 801- 272-4275. Our website is Holladaybank.com.
Patrick: So for Traci Flynn, Ty Kiisel, I’m Patrick Wiscombe. Thanks for listening. We’ll talk to you next week.
Bringing you interviews with top business professionals and business financing tips to help fuel your American dream. This has been the Business Fuel podcast, with your hosts, Ty Kiisel and Patrick Wiscombe, heard exclusively on Lendio.com