All Forum Posts by: Karen Schimpf

The Cash Trap: How a Startup Franchise Owner Learned the Hard Way About Business Financing

When John and Lisa Martinez sold their home in California for nearly $1.2 million, they felt like they were making the smartest move of their lives. Tired of the high cost of living, endless traffic, and rising taxes, they decided to head to Texas, where they could pursue their dream of owning a business. After months of research, they invested nearly every dollar they had into buying a franchise of a popular fast-casual restaurant chain.

They thought they were doing everything right. They had the capital, the enthusiasm, and a business model that had proven successful elsewhere. What could possibly go wrong?

The mistake wasn’t in their choice of business — it was in how they handled their cash.

Instead of using a portion of their sale proceeds as a down payment and seeking financing for the rest, John and Lisa paid everything upfront: the franchise fee, the build-out, the equipment, the initial inventory, and even the first few months of operating expenses. They wanted to avoid debt, believing it would make their business healthier.

For the first few months, everything looked good. Sales were steady. Customers loved the food. They were breaking even — even pulling a small salary. But about a year in, they saw an opportunity: a second location just a few miles away became available. The expansion made perfect sense — same customer base, brand recognition was growing, and they had operational experience under their belt.

Excited, John and Lisa went to the bank to ask for a loan to fund the second location.

That’s when reality hit them like a brick wall.

The bank, polite but firm, explained that John and Lisa weren’t ready for expansion financing.

They needed to show:

• Two years of successful operating history

• Full year-end Profit & Loss statements

• Corporate and personal tax returns demonstrating profitability

• A business debt schedule

• Strong cash flow sufficient to cover the new debt payments

They didn’t have it.

At barely twelve months in, the business had positive momentum but no true track record. Without two full years of tax returns showing solid profits, no traditional lender would offer them the cash they needed to grow.

Even worse, because they had spent all of their available personal cash up front, they had no reserves left to bootstrap the second location themselves.

The very money they could have used to secure their expansion — or survive a rough patch — had been tied up completely at the beginning, leaving them no flexibility.

The Lesson: Secure Financing Before You Need It

What John and Lisa didn’t realize is what many new entrepreneurs and franchisees overlook: cash is king, but liquidity is everything.

When you start a business — whether it’s a small independent operation or a franchise — you should aim to preserve as much of your personal capital as possible.

The smartest path is often to:

• Use a loan or financing to fund the bulk of the startup costs.

• Keep your personal cash as working capital reserves.

• Use financing as a tool, not a burden — so that you have flexibility to expand, survive unexpected costs, or cover slow seasons.

Banks are much more willing to lend to a borrower before the business opens or in the first months of operation, when projections and personal financial strength are still the basis of approval. Once you’ve launched and are operating, lenders shift to requiring historical performance — typically two full years — to consider you for financing.

John and Lisa’s story isn’t unique. It’s one of the number one mistakes startups and franchisees make: thinking that paying cash up front is the “safe” route. In reality, it often leaves them stuck — unable to grow, vulnerable to unexpected challenges, and without the cash cushion every business needs.

If you’re starting a business or buying a franchise, remember:

Get financing early, even if you don’t think you “need” it. Your future self — and your future business — will thank you.

Give us a call today to discuss your commercial finance needs or get started by filling out this form!

Karen Schimpf

(512) 358-1511

[email protected]

www.ApplyCommercialLoans.com

P.S. We now have a FAST close business-only loan of up to $500,000. IT is an SBA loan so it has the longer amortization and lower payment and we can close in less than 30 days. We just need 2 years of your business tax returns, credit and a personal financial statement to get a quick approval. Give us a call today to discuss your loan scenario at 512-358-1511 or click here.

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Karen Schimpf

Commercial Capital, Ltd.

O: 512-358-1511

E: [email protected]

w: www.linkedin.com/in/karenschimpf/

blog: http://bizloansconnections.com/

website: http://applycommercialloans.com

P.S. Our private money fund has a LOT of money to lend out. We can go from $100,000 to $100,000,000. We can go to tertiary markets, we can go to commercial properties that are special use, like hotels, memory care, assisted living etc. to apartments. We have money to lend guys…send us your deals. I will underwrite it quickly and give you an approval or tell you why we can’t within 72 hours. We give every deal a serious look…the keys to us are the asset, the story and the exit strategy. So send us the deals you need to close quick or the ones that are just a little too hairy for the banks and we will try to help YOU get it done!

Call Me today to run your deal by me at 512-358-1511 or go here to get started https://applycommercialloans.com/apply-now/

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I know what it feels like, you think you are doing everything right, and then stuff you can not control trips you up. A market starts to crash and you see your money dwindling and that fear that you haven’t felt in a while comes creeping back in. I want to encourage you today with a couple of truths:

1. Don’t react, respond. In other words, don’t make hasty decisions because things are going the wrong way, stay calm, remember who is REALLY in control, and respond from a position of strength.

2. It is NOT as bad as it seems in those fearful moments. There is a lot of strength in our economy, and I speak to hundreds of businesses. Most are very optimistic about the next 6 months, even if they had a rough first quarter. Drive around, and look at all the drive-thru’s still full and the restaurants still full, construction happening everywhere, there is a LOT of money in America and it has not fallen off a cliff. Business is still working!

3. Remember who you are. Not the negative stuff the devil is trying to convince you of, the good stuff. Remember the good things you do, remember that God loves you-yes you, just as you are. Cling to that truth when things get tough and scary…you have to KNOW it deep in your bones.

4. Give thanks. Remember all your blessings. Everything matters so much until your health goes, and then nothing else matters. Thank God today for your health. For your life, for I promise you, many people would love to be in your shoes.

Life is not a destination, it’s a journey. And sometimes, the road is rocky, but stay on it…for a smooth road may be right around the corner.

Give us a call today to discuss your commercial finance needs or get started by filling out this form!

Karen Schimpf
(512) 358-1511
[email protected]
www.ApplyCommercialLoans.com

P.S. We now have a FAST close business-only loan of up to $500,000. IT is an SBA loan so it has the longer amortization and lower payment and we can close in less than 30 days. We just need 2 years of your business tax returns, credit and a personal financial statement to get a quick approval. Give us a call today to discuss your loan scenario at 512-358-1511 or click here.

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Look, there are a lot of things that are very messy about America right now. Anyone can see that. But I deal every day with something that is VERY COOL about America. NO OTHER COUNTRY has the same upward mobility potential as America. Here in America, you can open a business, with a unique edge, or better service, or hit the right market at the right time and you can become wealthy. Or become better off at least.

We have the highest GDP per Capita in the world-higher by far than any other country in the world. In America, you can start a business and become rich. Still, right now, today. Regardless of race-I know MANY minority-owned businesses with owners who are well off. I helped some of them get started! Yes, rates are higher now, but there is no cap on ingenuity. I can get a client 80% of the total cost of opening a restaurant from scratch. Yes, the rate is a lot higher than a year ago. But if the payment is affordable, and they succeed, they can make many TIMES their money back. With franchising, you can start something that has a proven track record with proven success and they have to report the averages…so you can even plan effectively.

Let’s say opening an XYZ franchise costs $250,000. You invest $50,000 and borrow $200,000-I can do that loan. Let’s say that the franchise averages $500,000 in first-year sales and 20% profit margins. That is a $100,000 profit in year one if you hit their averages. THAT IS A 100% RETURN on the $50,000 you invested! Yes, you borrowed at prime +2.75% or 11% but you made 100% on the bank’s money. Not bad. Sweet leverage is almost 10 to 1. This is being done right now, in America, every day.

Almost half of my loans are SBA and half of those are start-up loans. People are starting businesses, they are succeeding, right now, today. In America, all you need is a little money saved, a willingness to work, and a passion for what you do and YOU CAN RISE FROM THE ASHES. After my parents divorced, we pretty much became lower-income people with a single mom just trying to make it. All three (3) of us kids went to college (we all had to pay our way), we all ended up doing well financially, and all of us make above average. You don’t have to come from wealth to make it. Does it help? Sure. But here in America, there is nothing stopping you from crashing the wealth party….not that money is all that matters…but if you want to earn more income...if you want to go to the next level, it is there for you. There is no better place to start a business and thrive than right here. What opportunities are around you today? Keep your eyes open, they just may be right around the corner. Have a great week!!!!!

Give us a call today to discuss your commercial finance needs or get started by filling out this form!

Karen Schimpf

(512) 358-1511

[email protected]

www.ApplyCommercialLoans.com 

P.S. Our private money fund has a LOT of money to lend out. We can go from $100,000 to $20,000,000 but we are most aggressive under $2 Million where there is much less competition. We can go to tertiary markets, we can go to commercial properties that are special use, like hotels, memory care, assisted living etc. to apartments. We have money to lend guys…send us your deals. I will underwrite it quickly and give you an approval or tell you why we can’t within 48 hours. We give every deal a serious look…the keys to us are the asset, the story and the exit strategy. So send us the deals you need to close quick or the ones that are just a little too hairy for the banks and we will try to help YOU get it done!

Call Me today to run your deal by me at 512-358-1511 or go here to get started https://applycommercialloans.com/apply-now/

P.S.P.S- Need speed? Our Bridge Construction loans over $20 million with up to 80% TTV can close in as fast as 45 days. Let’s make it happen.

When David showed up at the battle and went out to meet Goliath, he was simply being bold in his faith in God. His brothers criticized him for essentially being cocky and thinking he was something he was not. Boldness, especially for God, is often misconstrued.

Why do I share this? Because long ago I trusted God with my business, He is the source of my cash flow. So, I will brag on my Lord for a minute-the MBA’s Commercial Mortgage Origination Rankings for 2024 just came out. My company ranked #39 on the list with 114 closings last year! The companies that ranked above us are names you know, Wells Fargo, Chase, Bank of America, and JLL. These are companies with thousands and often tens of thousands of agents. Companies that closed fewer loans than us you also probably heard of, TD Bank, Barclays, New York Life, State Farm Life, and many more. That’s right, I singlehandedly closed more commercial loans than TD Bank or Barclays- entire banks! WOW. Praise the Lord!

When I say Commercial Capital Ltd. is the number 1 closer of commercial loans in the country, I don’t know how it can be disputed. In numbers of loans, not volume, no one beats us.

Now if you go by origination volume we are down at 111, still in the top 125 out of the thousands of banks and mortgage companies in America but that is because the average loan size of these other firms above us is north of $10 Million per loan. We average under $1 Million per loan. YES, you make 10 times more money for the same work doing the larger loans, so most borrowers with a smaller loan are disregarded by the big banks. But we ARE a small business and we still FIGHT for small businesses. Of the 111 loans we closed, 80% of them tried somewhere else first and after many weeks, got denied and got referred to us. All of our loans are referrals, you won’t see a billboard with my face on it.

Often we closed these denied loans at the same rate or better. If they would have come to us first, they would have saved themselves 6 weeks of anguish. We give approvals in 72 hours and my follow-up is legendary. I grew up in CO and I remember all the pizza places had the same delivery box, it was white corrugated cardboard and it said, “You tried all the rest, now try the best”. Well guys, you can refer your customers to the rest, or you can simply try the best. Run your deal by us today.

Give us a call today to discuss your commercial finance needs or get started by filling out this form!

Karen Schimpf

(512) 358-1511

[email protected]

www.ApplyCommercialLoans.com 

P.S. Our private money fund has a LOT of money to lend out. We can go from $100,000 to $20,000,000 but we are most aggressive under $2 Million where there is much less competition. We can go to tertiary markets, we can go to commercial properties that are special use, like hotels, memory care, assisted living etc. to apartments. We have money to lend guys…send us your deals. I will underwrite it quickly and give you an approval or tell you why we can’t within 48 hours. We give every deal a serious look…the keys to us are the asset, the story and the exit strategy. So send us the deals you need to close quick or the ones that are just a little too hairy for the banks and we will try to help YOU get it done!

Call Me today to run your deal by me at 512-358-1511 or go here to get started https://applycommercialloans.com/apply-now/

A friend of mine Brian wrote the following article and I though I would share it with you.

The Disease of Me

There are many things I enjoy about technology—it has greatly improved our quality of life, especially when you consider how people lived and worked 2,000 years ago. However, I can't shake the feeling that something else is at play, something not entirely good. I believe technology is fueling what I call the "Disease of Me."

When we sit looking at reels and looking at the things we want to look at, the algorithms keep feeding more and more things that we like. So our phones and tablets become a “feeder” for things we like. And that keeps us focused on ourselves. If we are not careful, we may spend our days focused on just ourselves, what we like, who we like, and we can lose sight of the fact that we are not on this planet for us. The world does not exist for us, individually. Never has. We try to teach our kids that the whole world does not revolve around them, but in our quiet times and our adult lives, how much time are we spending thinking only about us, what we want and how we can get it? This focus on self actually goes against what the greatest teachers and prophets and preachers and even God Himself says should be our focus.

Jesus gave the great commandment and in a nutshell it said, “love God, love others”. There is no “self” in that statement. In fact, His main message was “die to self” if we really study seriously what He said. WHAT IF WE DID IT? What if we wake up in the morning asking God what HE wants from us. What if we drive to work and let people cut in front of us because we are more concerned about them getting to work on time then ourselves? What if we seek to meet EVERYONE else’s needs and just let God take care of our needs? What if we really lived this way? The world would be a different place if we all did it. And that is Pollyanna to think that the whole world will do that at the same time, but what if WE live our lives that way?

What if we really lived the ways Jesus told us to live, loving God first and others second. Not on a cute key chain but actually in our actions, the little things, all day long. I tell you, you will feel much more fulfilled and joyful. Focusing on ourselves has never been the best thing for us. We teach it to our kids, but go out as adults and do it just the same. Check yourself today, how much time and mental energy do you spend on things that matter to you and how much time do you spend thinking of others first and seeking to help them. Why not try that for a week. Cut off the reels for one week and focus on others…it might just change your life! God bless….

Give us a call today to discuss your commercial finance needs or get started by filling out this form!

Karen Schimpf

(512) 358-1511

[email protected]

www.ApplyCommercialLoans.com

P.S. Our private money fund has a LOT of money to lend out. We can go from $100,000 to $20,000,000 but we are most aggressive under $2 Million where there is much less competition. We can go to tertiary markets, we can go to commercial properties that are special use, like hotels, memory care, assisted living etc. to apartments. We have money to lend guys…send us your deals. I will underwrite it quickly and give you an approval or tell you why we can’t within 48 hours. We give every deal a serious look…the keys to us are the asset, the story and the exit strategy. So send us the deals you need to close quick or the ones that are just a little too hairy for the banks and we will try to help YOU get it done!

Call Me today to run your deal by me at 512-358-1511 or go here to get started https://applycommercialloans.com/apply-now/

Running a small business means constantly balancing growth and day-to-day operations. At Commercial Capital, we understand that having access to extra cash can make all the difference. That’s why we offer flexible funding options tailored to meet your needs — because no business ever failed from having too much capital.

Here’s how we can help you secure the cash your business needs:

SBA Working Capital Loans

Get up to $150,000 in working capital and close in just 2 weeks! If your business is at least 2 years old, with a credit score of 680+ and 30% of gross revenue, we can help you access the funds you need to grow.

Start-Up Funding (Non-SBA)

Starting a business is tough, and getting funding can be even tougher. That’s why we offer non-SBA loans with rates between 7% and 21% for businesses less than 2 years old. Borrow up to $300,000 with terms of 5 or 7 years. If you have a credit score of 680 or higher, an income of at least $50K in the last two years, and a manageable debt ratio, we can help you get the cash you need — without relying on merchant accounts receivable loans.

Unsecured Business Lines of Credit

For businesses over 2 years old, with owners who have a credit score of 700 or higher, we can secure unsecured lines of credit up to $150,000. With rates ranging from 7% to 21%, these aren’t credit cards — they’re old-school lines of credit with a checkbook, giving you the flexibility to access funds whenever you need them.

We’re committed to helping small businesses thrive by providing fast, reliable, and flexible funding options. Whether you’re looking to expand, cover unexpected expenses, or simply keep operations running smoothly, we have the resources to support your success.

Ready to take your business to the next level? Let’s get started — contact us today to explore your funding options!

Give us a call today to discuss your commercial finance needs.

Karen Schimpf

Commercial Capital, Ltd.

O: 512-358-1511

E: [email protected]

w: www.linkedin.com/in/karenschimpf/

blog: http://bizloansconnections.com/

website: http://applycommercialloans.com

P.S. Don't forget - We are still actively funding on our other loan programs - Fast Close Bridge and SBA loans for business only or Real Estate. We also can fund some smaller construction loans with our other programs like the $20 Million ground-up hotel deal we recently funded.

It's tax time again! While you might be looking forward to getting money back, some people try to steal others' tax information. Here's how to keep your information safe and protect yourself from scammers.

Key Ways to Stay Safe

1. Lock Your Credit

The best way to protect yourself is to lock your credit with the three main credit companies - Experian, Equifax, and TransUnion. When you do this:

• No one can check your credit or open new accounts without your permission
• Your personal information stays safer
• You control who sees your credit information
• You can unlock it when you need to apply for a loan or credit card

2. Protect Your Online Information

Keep your information safe online by:

• Making a special email account just for your financial accounts
• Using two-step verification (like getting a code on your phone)
• Using strong passwords for each account and a password manager to remember them
• Using secure internet connections with VPN
• Checking your accounts often for anything strange

3. Spot Common Scams

Be aware of these scams (hang up and call the official business number):

• Fake emails or calls pretending to be the IRS
• Messages asking for personal information
• Dishonest tax preparers
• Fake job offers and W-2 forms
• People asking for donations during tax time
• People impersonating your bank
• People impersonating County Sheriff's Department claim missed jury duty, have warrants for your arrest.

What to Do If Someone Steals Your Information

If you think someone is using your information:

1. Call the IRS's special identity theft unit
2. Report it to the Federal Trade Commission
3. Tell your bank
4. Call your local police
5. Write down everything that happens

Keeping your information safe takes some work, but it's worth it. These steps might seem like a lot, but they're much easier than fixing problems after someone steals your information. Taking these simple steps now can save you from big headaches later.

Give us a call today at 512-358-1511 to discuss your commercial finance needs or click here get started by filling out this form!

Karen Schimpf

(512) 358-1511

[email protected]

www.ApplyCommercialLoans.com

P.S. We help your business secure $150,000+ in working capital for restaurants, retail, hotels, IT companies, assisted living facilities, and medical practices. Whether you’re expanding, managing inventory, or covering unexpected expenses, we provide tailored solutions to keep your business thriving. Call me today to access the funding you or your clients need at 512-358-1511!

P.S.S Don't forget - We are still actively funding on our other loan programs - Fast Close Bridge and SBA loans for business only or Real Estate. We also can fund some smaller construction loans with our other programs like the $20 Million ground-up hotel deal we recently funded.