What to ask for in startup loan

I'm starting a brick & mortar business. It will be an entertainment/sports/hobby venue (service) that also sells some products. I want to move into a location by August 1 2017, and be open for business early to mid September 2017.

I have a business plan written, that has been reviewed by a couple mentors with positive feedback. I have three years of financial projections that are based on surveying 200+ potential customers, 95% of whom are interested in my business, as well as data from competitors.

I have checked out several locations, received pricing and past utility expenses. I'm ready to pull the trigger on one once I have most of my startup financing handled.

Right now I'm working on laying out a use of proceeds so I can have all my ducks in a row when asking for money. I'm not sure what all to include in this.


I currently have the following:

Financial Need

  • Organizing Expenses: $210 (paid for already)

  • Equipment: $17,700

  • Build-out expenses: $17,300

  • Launch advertising: $1,900

  • Inventory: $15,500

  • Overhead expenses until cash-flowing: $8,150

  • Total: $60,760

Source as of May 2017

  • Owner investment: $5,000 / 8.23% (this will increase to $10k in June)

  • Friends & Family: $0 / 0% (working on getting this to $2,500)

  • Bank Loan: $55,760 / 91.77% (becomes $48,260 / 79.43% if above goals met)


Here are my questions:

Do I include inventory in this? Is it better to finance that with a line of credit? The truth is, product sales are a very small percentage of projected net profit. We can operate without any inventory, based on just the service sales. Product sales are more to convert potential customers into buying our service, and retention.

Can I request funding until I'm showing positive cash-flow? I don't see why not— it's expected for a business to lose money the first few months, but not sure if I will be expected to fund that out of pocket.

What am I missing? I don't know what I don't know.

Thanks in advance!

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