1. During the past decade, the size of seed rounds has remained stagnant and number of deals have decreased. To the untrained eye, it seems that there is more competition for seed dollars. Below the surface, however, startups are recycling founders experience. The reason why the number of deals has decreased is that teams are…
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In our home we try to get the children to help out. One day our youngest son came into the living room and asked, “Does anyone want a cup of coffee?” “Yes, please!” we said. He replied, “What kind of coffee do you want? Capitated or decapitated?” This old blog article about the commercial loan…
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The Big Boys, the ladies and men who make and arrange the really huge commercial real estate loans, have their own specialized language.  You can think of it as advanced commercial mortgage-ese.  Today we’ll discuss one of their underwriting terms, mark-to-market (MTM) accounting in real estate. Mark-to-market accounting assigns a value to real estate assets based…
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A CLE CLO stands for a commercial real estate Collateralized Loan Obligation, and it is a security that is backed by a pool of commercial loans.  The individual borrowers make their payments to the issuer – the company that made and pooled the loans – and then the issuer makes payments to the investors who invested…
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Every year hundreds of commercial property owners get conned out of millions of dollars by advance fee scammers. An advance fee scammer is a criminal pretending to be a commercial mortgage lender.  He will issue a very fancy-looking conditional commitment letter, which will call for some huge “good faith deposit” or “third-party report fee”.  Once…
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In negotiating an income property loan, the size of loan the borrower can obtain is usually more of a sticking point than the rate or the loan fee. Since income property loan sizes are generally limited by the debt service coverage ratio (i.e., cash flow), rather than the loan-to-value ratio, the operating expense figure that…
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Large scale businesses may be better of working with a private equity firm. Debt capital has principal payments that are required on a monthly basis, whereas equity financing does not have these strings attached. In some instances, you may be able to sell preferred shares of your company is going to give up a controlling…
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One of the most important concerns of people who are planning to start a business is to how are they going to fund their business. Of course, a great business plan would not work without the funds to run the idea. Some people borrow money from rich friends, some use crowd-funding technique while other loan…
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Surveys show that 94.7% of small business owners feel their only lending resources are local banks or personal credit cards. This common sense advice will help you avoid these common business loan mistakes, regardless of your personal credit history… and avoid pledging your personal property as collateral. First of all, getting approved for a commercial…
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The word “economy” seems to be a very common word in many vocabularies. Many people use the word to complain about their current economocial situation, and many people complaining in particular about their employment status. Whether having a job that one does not like, or simply not having a job at all, for those in…
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