It was early January and I/WeatherVane just got rejected by two banks. The first one was Bremer Bank in New Richmond. I had been recommended to talk to them due to the relationship that they have as a Small Business Administration preferred lender. Apparently this makes the underwriting process take half as much time. I had a great meeting with the loan officer. She was extremely encouraging. Someone even interrupted the meeting to meet me. And the bank president knew the WeatherVane story. I felt kind of famous. Three days later I met with the loan officer once again and was surprised to hear that they couldn’t work with me. I had gone over all the numbers and financials at the original meeting. What happened to all of the encouragement and famousness from the other day?
The next bank was Impact Seven in Almena. Impact Seven is a Community Development Financial Institution (CDFI) that works with the Opportunity Finance Network (OFN), the company that handles the Starbucks Create Jobs for USA campaign. For those of you who don’t know, I flew out to Seattle last year and spoke with Starbucks’ ceo (sic), Howard Schultz. I got up at the shareholder meeting during the Q&A session and invited him to be an investor and mentor for WeatherVane Creamery. He connected me with Mark Pinsky, the President of OFN who in turn connected me with a few consultants. So, I leaned a bit on those folks to put in a good word for me with the loan officer, Bob, at Impact Seven. I really felt that if any bank was going to do a loan, it would be these guys. It was time to cash in my grand gesture. I drove up there and had a great meeting with Bob. It was before the Bremer bank rejection. Bob had said that maybe we didn’t even need Bremer, that Impact 7 might be able to do the entire loan. In fact, they had more money than they knew what to do with. This seemed very promising. Alas, not long after, I got word that Impact Seven was not in a position to loan to WeatherVane Creamery.
The major reason for these rejections is lack of capital. I am renting the space so all of the money going into electrical, plumbing and the sort stays behind if the business gets moved or fails and the bank can’t cash in on those things. The major investment with teeth is the restaurant equipment and that is only worth fifty cents on the dollar.
Meanwhile, during Christmas week I was working at my temporary holiday job at Eddie Bauer in Woodbury. Mark Ritzinger and his wife Jean came in. I remember Jean as a customer when I managed Whole Earth Grocery in River Falls 12 years ago. They approached me and Mark asked me how WeatherVane Creamery was coming along. He then encouraged me to stop by River Falls State Bank to talk to one of their loan officers because Mark was on their board. He even asked for a piece of paper from the register to write some names down for me. I knew River Falls State Bank to be a conservative bank and figured that if I called any of these people that the chances were slim of getting any actual loan. But I took the names and made a mental note to look into it after the New Years.
So early January I called an Advisory Team and investor conference call to deliver the news and see what we could do with the funds that WeatherVane had raised. We spoke of an online store and more fund raising efforts. I was jaded and disappointed. The thought of peddling cheese at art fairs and farmers markets making a hundred dollars at a time was discouraging. My spirits were down and I spoke of jobs that I had applied for. It was not pretty.