Business Credit Foundation
Once you have your business entity established, you will want to create a presence so that you can obtain the most amount of credit for your company possible. This step is where 99% of people fail when it comes to their business credit, so obviously, it is essential for success. You want to set everything up correctly and make it look attractive to lenders. You want to make it very easy for lenders to find you in order to have a low-risk rating with each bank to fit within their lending requirements.
This is my proven process for LLCs to make sure that a business is presented to the creditors in the best possible light, and that they will feel comfortable lending to you. If done correctly, the sky's the limit for the funding you can get and what you can do with it to start, grow, and/ or scale your business.
SET UP YOUR BUSINESS ADDRESS - You do not want a PO Box, nor do you want to have a virtual office address. The reason is that you will be denied or worse; blacklisted. Lenders want to call or do a google search to see where your business is located. A true “brick and mortar” office is best but not necessary. Especially after Covid, many businesses are home businesses now but you will want to add “Suite number or letter” such as “Suite A” or “Suite 3” to the address for a home or an apartment business address.
CREATE AN EXPERIAN & EQUIFAX BUSINESS ACCOUNT - These are the business credit accounts and you want to make sure your entity is listed with them.
ESTABLISH A DUNS NUMBER - This takes 30 days or less for free, or you can pay for an expedited number. You’ll want to be general with the business description such as “management company,” or “holdings.” DUNS does not verify the revenue nor the number of employees, so project over $1m and over ten employees ideally for best results.
CREATE A NAV ACCOUNT - This is like Credit Karma but for business, and for $49.99/month, NAV has a Business Loan Builder, which reports to the business credit bureaus as a tradeline. You can have up to 5 businesses under the single NAV account, all with tradelines for the single account, which is well worth the monthly cost.
SET UP A BUSINESS LANDLINE - Ring central is the best; request that the number gets reported to 411, and set up a professional voicemail that includes business hours of operation. Don’t use a cell phone or google number; these are red flags to creditors.
INVEST IN MOZ LOCAL - This is a great service for building an online SEO presence. It is $199 per year but after the first year, there is a minimal additional benefit so you don’t need to renew.
CREATE A BUSINESS WEBSITE - You can pay for it or attempt it yourself, make it look nice, and present your business in a strong light. Be sure to include a few reviews.
CREATE A PROFESSIONAL EMAIL ON “G-SUITE BASIC”- This should be tied to your website; it is only $6 per month and is more professional than a Gmail account.
SET UP A BUSINESS CHECKING ACCOUNT - You want to have $10K or more in it if possible
SET UP YOUR BUSINESS ON GOOGLE - Make sure your presence is positive, set it up if not already done. https://www.google.com/business/
CREATE A YELP FOR YOUR BUSINESS - Get some reviews from friends and confirm you are listed https://business.yelp.com
SET UP A FACEBOOK BUSINESS PAGE - You want to have business pages with all social media and a few reviews.
IF YOUR LLC IS OUT OF STATE, SET UP A FOREIGN FILING - This will get you business lines of credit if done correctly.
Once you have built up an online presence and you have started some tradelines, then you will be in a stronger position to start looking for more credit.
You want to ensure that everything is common across all of the platforms “Apples to Apples” and the locations of your information. Any different phone numbers or addresses that is different from another location with other business information of yours are going to be red flags to lenders, so don’t make the rookie mistake of having your cell phone listed somewhere or your private email in another place.
Pay your business fees and your business taxes. This is essential. If you don’t, you are jeopardizing your opportunities. Think of these as a down payment for the credit that you will be able to get by doing so.
The larger the online presence you have on various social media platforms and the better the reviews you have on your website, the better it will present you to any potential lenders. You want to make them comfortable, don’t give them any reason to hesitate in making that lending decision.