1 00:00:07.860 --> 00:00:09.920 Hi everyone, and thank you guys for joining us today. 2 00:00:10.300 --> 00:00:14.680 I'm very excited because I am talking to a veteran of the equipment finance 3 00:00:14.730 --> 00:00:17.000 world and he is gonna bring us a wealth of knowledge. 4 00:00:17.370 --> 00:00:21.320 Steve has been in the industry for over 30 years. Steve, 5 00:00:21.370 --> 00:00:24.320 thank you so much for joining us. Why don't you go ahead and, 6 00:00:24.320 --> 00:00:28.680 and introduce yourself and the title of your company and the role that you play 7 00:00:28.680 --> 00:00:29.420 in your company. 8 00:00:29.420 --> 00:00:34.360 My name is Steve Geller. My company is Leasing Solutions llc. Uh, 9 00:00:34.360 --> 00:00:38.880 it's a company that I formed in 2001 to work with, uh, 10 00:00:38.950 --> 00:00:43.120 with brokers to assist brokers in getting transactions funded. 11 00:00:43.340 --> 00:00:44.560 So, for those watching, 12 00:00:44.860 --> 00:00:49.520 can you kind of explain to us in a sentence or two your exact position and how 13 00:00:49.520 --> 00:00:51.400 exactly do you work with brokers because you, 14 00:00:51.400 --> 00:00:53.000 cuz you have a very unique position. 15 00:00:53.150 --> 00:00:58.040 Sure, sure. So I came up with this plan to, uh, 16 00:00:58.900 --> 00:01:03.880 to do broker deals with funding sources and reveal to the funding source 17 00:01:03.950 --> 00:01:08.320 that there was a, another broker involved. For the most part, these were, 18 00:01:08.780 --> 00:01:12.680 uh, funding source friends of mine, and they said, go ahead. If you, 19 00:01:13.100 --> 00:01:16.640 if you qualify the broker, were okay with moving forward. 20 00:01:17.220 --> 00:01:19.640 So is it okay to say you're a broker's broker? 21 00:01:20.550 --> 00:01:23.600 It's fair to say I think of myself as an intermediary. 22 00:01:24.110 --> 00:01:27.320 What is the thing that you would say is, uh, 23 00:01:27.540 --> 00:01:30.880 the one biggest challenge that brokers nowadays are facing? 24 00:01:31.230 --> 00:01:35.120 Finding the right funding source. Uh, knowing, 25 00:01:35.150 --> 00:01:39.080 knowing which funding source to send a deal to, and, uh, 26 00:01:39.190 --> 00:01:40.360 accepting the results. 27 00:01:40.830 --> 00:01:43.600 That is the biggest challenge that you see brokers facing. 28 00:01:43.670 --> 00:01:47.840 What is the biggest mistake brokers make that you've seen 29 00:01:49.000 --> 00:01:49.750 recently? 30 00:01:49.750 --> 00:01:53.840 Well, definitely trying to put a, uh, round peg in a square hole. 31 00:01:54.740 --> 00:01:55.800 Uh, you know, 32 00:01:55.800 --> 00:02:00.560 sending the wrong deal to the wrong funding source and not understanding the 33 00:02:00.560 --> 00:02:04.560 requirements of the funding source, what niches they're in, what they like, 34 00:02:04.560 --> 00:02:08.720 and what they dislike. Uh, geographic restrictions, rates, 35 00:02:09.540 --> 00:02:13.400 uh, that will, uh, allow you to close the deal with the, 36 00:02:14.110 --> 00:02:18.960 with your customer. If the rate's too high, the customer might say, 37 00:02:19.100 --> 00:02:24.080 I'm not signing with you. After spending all that time on an approval, uh, 38 00:02:24.080 --> 00:02:27.440 with the funding, with the funding source charging too high a rate, 39 00:02:28.180 --> 00:02:32.120 you walk away without, without a deal because the customer won't accept it. 40 00:02:32.940 --> 00:02:36.440 So I, I want to elaborate a little bit more on that, but before we do that, 41 00:02:36.530 --> 00:02:40.400 let's talk a little bit more about the size of these deals, 42 00:02:40.540 --> 00:02:43.600 the range that you work with. What does that range look like? 43 00:02:43.700 --> 00:02:47.920 Are we talking $50,000 in equipment financing? Are we talking about 5 million? 44 00:02:48.390 --> 00:02:49.240 What is the range? 45 00:02:49.660 --> 00:02:54.600 No, no. My range is, uh, at a low end I can do $5,000 deal. Uh, 46 00:02:54.620 --> 00:02:59.200 and I usually do up to two, 2 million at maximum. 47 00:02:59.620 --> 00:03:02.880 But, and it depends on the amount of work involved. 48 00:03:02.950 --> 00:03:05.400 Like I tell my brokers if I can, 49 00:03:05.900 --> 00:03:10.520 if I can take a $5,000 deal from you and just put it in the, uh, 50 00:03:11.060 --> 00:03:15.360 you know, as a pdf, send it to a funding source without not a lot of work, 51 00:03:15.820 --> 00:03:20.400 and I get an answer easily that I make a few hundred dollars on a, 52 00:03:20.700 --> 00:03:23.960 on a deal that makes sense for me. You know, I'm not a, 53 00:03:24.160 --> 00:03:28.680 a shop that grinds out every deal that's gotta pump out the business. 54 00:03:29.460 --> 00:03:32.280 Uh, I can do a small deal and, you know, 55 00:03:32.580 --> 00:03:35.200 and if there's a minimum amount of work, uh, 56 00:03:35.420 --> 00:03:40.360 and I can do a large deal to put the work into it to make sure it 57 00:03:40.360 --> 00:03:42.200 Fits. There's so many funders out there. 58 00:03:42.300 --> 00:03:45.160 How do you shop for the right ones for your, for your business? 59 00:03:46.670 --> 00:03:50.160 Well, you have to get to know what the funding source likes, 60 00:03:50.380 --> 00:03:54.160 go on their website, attend, attend conventions. 61 00:03:55.050 --> 00:03:59.000 There were zoom sessions, there were meet the funder sessions. 62 00:03:59.870 --> 00:04:00.680 Well, let me ask you, 63 00:04:00.680 --> 00:04:04.120 there's a lot of people that they think equipment financing, you know, 64 00:04:04.660 --> 00:04:06.000 is just like heavy machinery. 65 00:04:06.330 --> 00:04:08.840 Could you walk me through the different branches if you, 66 00:04:08.840 --> 00:04:12.040 if you want to call it that, of equipment financing and, you know, 67 00:04:12.550 --> 00:04:17.360 knowing that it's just not heavy, heavy equipment machinery? 68 00:04:17.470 --> 00:04:17.760 Well, 69 00:04:17.760 --> 00:04:19.080 It's technology equipment. 70 00:04:19.220 --> 00:04:20.053 We got technology, 71 00:04:20.440 --> 00:04:25.400 Computers, uh, there's a healthcare marketplace, medical, dental, 72 00:04:25.940 --> 00:04:30.600 and a specialty retail, uh, restaurant financing, you know, 73 00:04:30.600 --> 00:04:31.800 franchise financing. 74 00:04:32.230 --> 00:04:35.000 What do you look for when you're looking for funders? 75 00:04:35.830 --> 00:04:40.080 Well, the funders will generally list what industries they like, 76 00:04:40.670 --> 00:04:43.640 what industries they don't like, and what industries are forbidden. 77 00:04:43.860 --> 00:04:46.120 So you have to look at the keywords on the website. Right, 78 00:04:46.210 --> 00:04:49.880 Right, right. Well call up the broker rep and say, 79 00:04:49.910 --> 00:04:54.720 will you do restaurants? Will you do computer equipment? Will you do trucks, 80 00:04:54.880 --> 00:04:55.713 trailers? 81 00:04:56.420 --> 00:04:58.240 And that seems something so simple to do. 82 00:04:58.260 --> 00:05:02.160 But you've seen the problem with brokers that people don't really do that. 83 00:05:02.470 --> 00:05:03.440 Correct. Right, 84 00:05:04.290 --> 00:05:05.123 Right. 85 00:05:05.310 --> 00:05:07.360 It's something that seems logical. 86 00:05:08.110 --> 00:05:08.943 Elemental, 87 00:05:09.150 --> 00:05:12.480 Elemental. That's a, that's a great word. Right. But people don't do that. 88 00:05:12.650 --> 00:05:13.030 Right. 89 00:05:13.030 --> 00:05:16.400 What else should people be doing in order to be successful in this industry in 90 00:05:16.400 --> 00:05:19.640 order to find the right funding source in order to build that relationship, 91 00:05:20.380 --> 00:05:24.400 in order to make money? What el what should other people be doing? 92 00:05:24.750 --> 00:05:28.320 Well, you should have a number of different funding sources. 93 00:05:28.820 --> 00:05:31.200 So a number of different funding sources is number one. 94 00:05:31.300 --> 00:05:36.040 And, and you should have more than one funding source in each niche. 95 00:05:36.710 --> 00:05:39.080 Okay. More than one in each niche. Right, right. 96 00:05:39.110 --> 00:05:39.550 Okay. 97 00:05:39.550 --> 00:05:44.000 Because what happens if you have a repeat customer and the first funding source, 98 00:05:44.020 --> 00:05:47.720 you're, you have a, your prior deal at, 99 00:05:48.270 --> 00:05:49.600 they may be up to the maximum. 100 00:05:50.420 --> 00:05:54.760 So you need another funder with similar taste in deals to take, 101 00:05:54.980 --> 00:05:59.760 to take the second, second transaction. And you also want to protect yourself, 102 00:06:00.290 --> 00:06:04.120 especially in this marketplace, if a funder pulls back, 103 00:06:05.100 --> 00:06:06.640 you, you don't want to be relying on, 104 00:06:06.820 --> 00:06:11.480 on one funding source if all of a sudden the bank has liquidity problems and 105 00:06:11.480 --> 00:06:13.960 they're gonna say, we're growing too fast, or, you know, 106 00:06:13.960 --> 00:06:18.520 we have to slow down and, you know, and some brokers have been cut off. 107 00:06:18.790 --> 00:06:23.520 Give me three tips on how a broker could build a relationship with a 108 00:06:23.520 --> 00:06:26.800 funder for their deal, whether it's now or in the future. Well, 109 00:06:26.970 --> 00:06:31.000 Again, you know, conventions, phone calls to broker reps, 110 00:06:31.940 --> 00:06:36.880 to the funding source reps, uh, talk about what they like and what they dislike, 111 00:06:37.350 --> 00:06:37.910 size, 112 00:06:37.910 --> 00:06:42.400 size of the deal they wanna look at if they have those kind of 113 00:06:42.480 --> 00:06:45.120 transactions, try out the funding source 114 00:06:46.390 --> 00:06:48.760 When it comes to the smaller deals, uh, uh, 115 00:06:48.780 --> 00:06:51.240 for someone that that's just starting in the industry, 116 00:06:51.750 --> 00:06:56.200 what would you say is the best piece of advice for them to continue to, to, 117 00:06:56.300 --> 00:06:57.640 to build, uh, 118 00:06:57.640 --> 00:07:00.680 their portfolio and continue to build their relationships with others? 119 00:07:01.220 --> 00:07:03.040 How do you do that? How do you maintain the momentum? 120 00:07:04.470 --> 00:07:05.000 Well, just, 121 00:07:05.000 --> 00:07:09.000 you have to have a source for that business to get deals approved for a vendor 122 00:07:09.620 --> 00:07:11.960 and get the vendor on your side referring that, 123 00:07:12.110 --> 00:07:14.920 that business to you as a broker. And, uh, 124 00:07:16.060 --> 00:07:19.440 and make sure you send it to the right funding source. Uh, 125 00:07:19.580 --> 00:07:22.680 get 'em turned around fast, get 'em approved, get 'em documented, 126 00:07:22.980 --> 00:07:23.813 get 'em funded. 127 00:07:24.620 --> 00:07:27.000 Let me ask you this, from start to finish, from when, 128 00:07:27.030 --> 00:07:30.240 when a broker starts the deal, they have the right funder. 129 00:07:30.510 --> 00:07:34.120 They ha they understand the funding source from start to finish. 130 00:07:34.180 --> 00:07:35.240 How long should it take? 131 00:07:37.620 --> 00:07:39.960 Uh, no more than a week. 132 00:07:40.710 --> 00:07:44.040 I've talked to a lot of people and they've told me anywhere from three to five 133 00:07:44.040 --> 00:07:48.360 years is when you fully start understanding a specific niche when 134 00:07:48.600 --> 00:07:50.000 someone's just starting out. I'm 135 00:07:50.000 --> 00:07:52.040 40 years and I'm still learning it. Exactly. 136 00:07:52.440 --> 00:07:53.240 I think that's, that's, 137 00:07:53.240 --> 00:07:55.640 that's a great perspective to give the people viewing this. 138 00:07:55.860 --> 00:07:59.720 But for people that are just starting out and they're trying to understand 139 00:07:59.720 --> 00:08:03.960 everything, walk us through why it's important to find a niche, 140 00:08:04.310 --> 00:08:08.720 find the funders of that niche and really start creating your business around 141 00:08:08.720 --> 00:08:10.480 that versus trying to learn everything. 142 00:08:12.220 --> 00:08:13.600 The key is to find a mentor, 143 00:08:15.060 --> 00:08:19.160 to find another broker in the business, uh, 144 00:08:19.460 --> 00:08:20.520 who you get friendly with. 145 00:08:20.520 --> 00:08:24.480 Maybe someone you've gone to a convention and met and chatted with and, 146 00:08:24.700 --> 00:08:28.840 you know, pick up the phone and call and say, Hey, I have X, X, Y, 147 00:08:28.920 --> 00:08:33.520 Z transaction. Uh, what, what can I do with it? 148 00:08:33.520 --> 00:08:38.360 Or what do I need to know about it? Or who does these types of deals? You know, 149 00:08:38.380 --> 00:08:42.920 and, and, and why, why should I go here or not there on a, 150 00:08:42.980 --> 00:08:45.520 on a transaction? You know? And it, 151 00:08:45.900 --> 00:08:49.760 we have a very friendly industry and, uh, you know, 152 00:08:49.760 --> 00:08:51.560 if you make the right friends and mentors, 153 00:08:52.710 --> 00:08:54.200 they'll lead you in the right direction. 154 00:08:54.260 --> 00:08:58.480 So for those guys that are just starting out in regards to the size of the 155 00:08:58.570 --> 00:09:02.120 deals, what should they be focusing on? 156 00:09:02.120 --> 00:09:05.560 Because I know everyone wants to make money and everyone wants to make the big 157 00:09:05.560 --> 00:09:06.393 bucks. 158 00:09:06.540 --> 00:09:10.800 So what would you say is the range that they should start focusing on to start 159 00:09:10.800 --> 00:09:11.633 making money? 160 00:09:12.790 --> 00:09:13.080 Well, 161 00:09:13.080 --> 00:09:16.240 it's a tough question to answer because there are a lot of different funding 162 00:09:16.240 --> 00:09:19.200 sources that look at, again, look at different size deals, 163 00:09:20.020 --> 00:09:22.120 and it depends what you, uh, 164 00:09:22.830 --> 00:09:26.080 what the broker feels comfortable getting involved in. 165 00:09:26.220 --> 00:09:30.280 If he likes complex transactions, do a million dollar deal and, you know, 166 00:09:30.280 --> 00:09:34.000 and make a few points on it, that's a healthy commission as well. 167 00:09:34.460 --> 00:09:39.040 But there's more work involved on a small transaction, you know, 168 00:09:39.060 --> 00:09:43.680 $25,000, $50,000 deal. You can do some work on it, 169 00:09:43.790 --> 00:09:45.080 send it in and, you know, 170 00:09:45.180 --> 00:09:48.600 and get it done faster than a million or $2 million deal. 171 00:09:49.450 --> 00:09:53.120 Let's talk commission for someone that's starting out, 172 00:09:53.180 --> 00:09:58.120 for people that are new to the industry and they want to have a solid, 173 00:09:58.120 --> 00:10:01.760 healthy commission their first year, what does that range look like? 174 00:10:01.760 --> 00:10:02.593 What have you seen? 175 00:10:03.830 --> 00:10:07.600 Well, I, you know, on a smaller transaction, you can make 10 to 15 points 176 00:10:09.460 --> 00:10:12.280 And on a bigger transaction, on the bigger deals, well, 177 00:10:12.620 --> 00:10:16.160 Uh, two or three points, you know, a million dollars, 178 00:10:16.180 --> 00:10:20.320 you can make two or three points, not, not an unhealthy amount as well, 179 00:10:21.100 --> 00:10:21.820 but, but if, 180 00:10:21.820 --> 00:10:25.760 but if you have a million dollar deal and you try to make eight points on it, 181 00:10:27.220 --> 00:10:30.560 you know, and you could sell a customer on it, you got a weak credit, you gotta, 182 00:10:31.710 --> 00:10:35.640 it's, it's indicative that there's a problem in the, 183 00:10:35.860 --> 00:10:40.600 in the transaction that may be the funder who approved it doesn't 184 00:10:40.600 --> 00:10:41.433 realize 185 00:10:42.710 --> 00:10:46.360 because a customer who's willing to pay that high rate, 186 00:10:47.580 --> 00:10:49.360 uh, could be desperate for the money. 187 00:10:50.660 --> 00:10:55.160 So when it comes to points and when it comes to understanding, uh, 188 00:10:55.390 --> 00:10:58.920 what someone can expect their first year, um, in commission, 189 00:10:59.440 --> 00:11:02.280 I guess like their salary, you know, obviously this is a commissioned job. 190 00:11:02.750 --> 00:11:05.960 What would you say that magic number is between what range? 191 00:11:06.550 --> 00:11:10.520 Well, there's some, some guys who are making in the, uh, uh, 192 00:11:10.850 --> 00:11:14.160 close to a hundred thousand dollars if they pick the right, 193 00:11:14.940 --> 00:11:19.600 if everything pans out right, you can start pumping out deals and, uh, 194 00:11:20.660 --> 00:11:21.493 and do pretty well, 195 00:11:22.070 --> 00:11:25.200 Inflation is big right now. Um, that's, 196 00:11:25.200 --> 00:11:26.920 a lot of companies are worrying about that. 197 00:11:28.350 --> 00:11:32.280 What impacts have you seen impacting the equipment financing world? 198 00:11:32.390 --> 00:11:36.400 Well, I'm seeing tougher approvals, uh, more, 199 00:11:36.630 --> 00:11:39.920 more declines on good transactions. 200 00:11:40.260 --> 00:11:42.120 So for someone that's seen, how do you maneuver that? 201 00:11:42.180 --> 00:11:43.880 How do you maneuver this type of environment? 202 00:11:44.170 --> 00:11:48.640 Those of us who have lived through past events like this, you know, it's, 203 00:11:49.300 --> 00:11:52.200 you know, you ride with the punches. If you're a new broker and you see this, 204 00:11:52.200 --> 00:11:56.240 you think it's the end of the world. And, uh, you know, 205 00:11:56.950 --> 00:12:01.440 it's tough to get, get beyond that. I mean, we, we spoke about recently at a, 206 00:12:01.980 --> 00:12:05.560 at a conference that, uh, you know, 207 00:12:05.560 --> 00:12:08.000 the new brokers don't know that this, 208 00:12:08.030 --> 00:12:11.760 that there are cycles and this is just another business cycle. 209 00:12:12.650 --> 00:12:16.440 Steve, could you give us tips about maneuvering this type of cycle? 210 00:12:16.750 --> 00:12:18.160 What tips do you have 211 00:12:20.860 --> 00:12:24.480 Now? Look into different niches. Uh, 212 00:12:24.540 --> 00:12:29.280 if you get comfortable in a niche that lenders don't want to, uh, 213 00:12:29.280 --> 00:12:32.920 don't want to partake in, you're gonna have to find another niche. 214 00:12:33.340 --> 00:12:37.800 So defensively, you gotta always be looking at different niches. 215 00:12:37.800 --> 00:12:42.640 Don't get comfortable in, in one, in one type of financing. In, 216 00:12:42.700 --> 00:12:47.160 in one, one niche. Don't, don't do wall bowling alleys, 217 00:12:47.780 --> 00:12:52.160 you know, because the bowling alleys, uh, go away, which they have, 218 00:12:52.580 --> 00:12:53.560 you know, then you're stuck. 219 00:12:53.700 --> 00:12:58.080 Any other tips on understanding funding sources and building a relationship with 220 00:12:58.080 --> 00:13:00.400 funding sources? Any tips for that? 221 00:13:02.260 --> 00:13:07.040 Invest in conventions. Visit funding sources, which, uh, a lot of, uh, 222 00:13:08.510 --> 00:13:09.800 many brokers don't do. 223 00:13:10.710 --> 00:13:14.440 They get on with the funding source and don't visit, and, 224 00:13:14.780 --> 00:13:16.040 and if they go to conventions, 225 00:13:16.040 --> 00:13:20.440 they only meet the top two or three people from that funding source. 226 00:13:20.440 --> 00:13:23.560 They're representative, but on a daily basis, 227 00:13:24.470 --> 00:13:28.000 they're dealing with the, with the person and credit, 228 00:13:28.310 --> 00:13:31.760 they're dealing with the documentation people they're dealing with, 229 00:13:31.760 --> 00:13:34.800 the funding people. Most of these people don't go, 230 00:13:34.890 --> 00:13:39.200 don't generally go to conventions. If you show up and visit a funding source, 231 00:13:39.580 --> 00:13:43.960 you're gonna meet all these people that, that are just voices over the phone. 232 00:13:45.060 --> 00:13:49.680 And likewise for them, they get to meet you and, and understand, 233 00:13:50.580 --> 00:13:52.000 you know, your, your abilities. 234 00:13:52.570 --> 00:13:55.120 Steve, thank you so much for your time. Thank you. I appreciate it. Yeah, 235 00:13:55.120 --> 00:13:55.560 thank you.