Small Business

NYC Taxi Drivers Protest, deBanked Reporter Goes For a Ride

September 17, 2020
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Johny Fernandez Green CabOn Thursday, NYC taxi drivers shut down the Brooklyn Bridge to formally protest the financing costs tied to their taxi medallions, the certificate that allows them to operate in the five boroughs. Tensions over “Medallion loans” have been bubbling over since last year when it was revealed that many borrowers had signed a Confession of Judgment to obtain their loan, which basically waived their right to settle any disputes with their lender in court should they be unable to make the payments. Since then, COVID has completely devastated an already suffering industry…

“Before it was good, we could make $100-$150 a day,” said Mohammad Ashref, a local Brooklyn taxi driver in a video interview with deBanked reporter Johny Fernandez. “Now it’s very hard to survive, we work very hard to make 60, 70, or $80 a day, but what can I do? I have to make a living. We have no other choice.”

NYC Taxi InterviewAshref technically drives a green cab, different from the yellow cabs that were protesting on the bridge in that they’re not permitted to accept street-hails throughout most of Manhattan. Green taxis also operate through a permit rather than a medallion, a still relatively new concept that was first rolled out in 2013 to facilitate ride-hailing in the outer boroughs where yellow cabs did not spend much time.

In the interview with Fernandez, Ashref pointed out that the success of the taxi business is intertwined with the restaurant industry. Many riders in the boroughs depend on cabs to take them to restaurants or night clubs, but with the complete ban on indoor dining still in effect within city limits, that need has mostly dried up.

According to the NYC Taxi & Limousine Commission, yellow and green cabs were making as little as $314 and $210 a week respectively during the peak period of the shutdowns. In a 40 hour week, these amount to a fraction of the $15/hour local minimum wage and that’s even before factoring in driver costs like a vehicle lease, loan payments, insurance, and more.

NYC Taxi Chart

deBanked has been exploring several areas of the New York City economy over the last few months. For instance in July, reporter Johny Fernandez looked into how the pandemic was affecting a street performer in Times Square that was dressed as Batman.

“The business now is slow,” Batman said. “There’s so few people at this moment […] At this moment I see people scared, they don’t want pictures…”

Batman, like others in New York City, was hopeful that a return to normalcy was just around the corner.

NYC Restaurants Have Had Enough, Two Lawsuits Filed to Reopen Indoor Dining

September 9, 2020
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class action lawsuitThe five buroughs of New York City are still quiet. Restaurants remain closed to inside dining; gyms still await their regulars to return (beefcakes deflating with inactivity), and in-person schooling has been pushed back once again, while the districts take an extra week to prepare.

Through it all, business owners are losing money. Some have had enough.

Il Bacco, an Italian restaurant in Queens, is leading the charge. The restaurant recently filed a $3 billion class-action lawsuit against New York, signed by more than 300 restaurants. Il Bacco is a three-story eatery in Little Neck, 500 feet from the Nassau county border where restaurants can open to 50% capacity.

Another group of restaurants met separately at a rally in Staten Island to speak out against the inaction of lawmakers and to formally propose a separate lawsuit to force the reopening of restaurants.

On behalf of Bocelli, Joyce’s Tavern, and the Independent Restaurant Owners Association Rescue- (IROAR) papers were filed in Richmond County, calling for the emergency opening of restaurants throughout NYC at 50% capacity. IROAR was started last week as a confederation of 14 disgruntled restaurants. More recently the association has grown to 180 members.

Tina Maria, daughter of the owner at Il Bacco, also started an online petition with more than 5,000 signatures at writing.

On Sept 9th, shopping malls can open to 50% capacity and Casinos to 25% capacity, but restaurants like Il Bacco still struggle to make up for six months of decreased activity.

In speaking at the rally on Tuesday, Bob Deluca owner of Delucas Italian Restaurant said he and his workers have put in hundreds of hours of work a week just to see government officials keep his business from opening. Now he said, enough is enough.

“We’re being discriminated against, we’re being bullied,” Deluca said. “My mother told me to always stand up to bullies and stand up for people in need who are being bullied. Right here, this is our knockout punch.”

Deluca dropped the lawsuit on the podium, punctuating his frustration. He said he never wanted it to come to this, but it has come to it. Deluca reacted to Mayor Bill de Blasio’s comment from two weeks ago, stating restaurants were for the middle class and wealthy people.

“We are workers, it’s not a luxurious lifestyle, we are barely middle class,” Deluca said. “What about the waiters, the busboys, what about the dishwashers the bartenders, and the cooks. To say restaurants are for the middle class and wealthy is the most ignorant statement I’ve ever heard.”

What Stimulus is Next for SMBs?

September 4, 2020
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Downtown Annapolis MarylandNext week, lawmakers will finally be back from vacation, arguing over the next stimulus package. There are various proposals, and the two competing Republican and Democrat offerings are nearly a trillion dollars apart.

It’s the Senate GOP HEALs act vs. the House Democrats HEROs act. But in between, what may be getting the most support? Standalone bipartisan bills that focus on extending and forgiving PPP loans.

Ryan Metcalf, head of the office of Government affairs and Social Impact for Funding Circle, has been following conversations on The Hill closely. 

“Up until Monday, Pelosi said they weren’t even going to even put a bill forward for a new stimulus,” Metcalf said. “But then yesterday [Tuesday] Secretary Mnuchin said he was open to doing a standalone PPP loan. It’s the one that has the most bipartisan support; they can’t meet anywhere else than PPP.”

Funding Circle is one of the world’s largest online lenders, with about $10 billion in global loans to date. Metcalf said Funding Circle mostly offers US loans in the $25,000 to $500,000 range, and as a funder for PPP, offered more loans in just eight days in August than half of their total business in July. His company had to cut off funding requests, locking out some customers that needed help, simply because the deadline had ended.

“When PPP ended on August 8th, the narrative was that PPP had died out, and there was no interest in it, but that is a complete fallacy,” Metcalf said. “We were processing loans for the smallest of small businesses- 10-15 employees- well under $50,000 loans, the people still needed help.”




Steve Denis, Executive Director of the Small Business Finance Associaton (SBFA), has also been engaged in the process. He has been petitioning members of Congress on behalf of what he calls truly small business, those under 10 employees or nonemployers that still need help.

“‘Real’ small businesses: ones with under ten employees that are really grinding, like small hair salons, retail stores, and mechanics don’t really have traditional banking relationships,” Denis said.

SBA data from July found that most of the loans made (66.8%) were in the $50k range and to very small businesses, but the largest amount of capital went towards firms that applied for a $350k-$1M sized loan.

Denis said that the higher dollar amount PPP loans were more profitable for banks to make, so disproportionate funding went toward bigger businesses with pre-established finance connections. This disparity is backed up by research. Studies, like one from the National Bureau of Economic Research (NBER), found that firms with stronger connections to banks were more likely to be approved for PPP funds.

“The way fees are structured: there’s an incentive for big banks to prioritize bigger deals at [commission] rates like 3% or 5%,” Denis Said. “They’d rather make that on a $500,000 deal than on a $40,000 deal.”

Denis said the SBFA was lobbying for Congress to create a prioritized amount of money authorized only for smaller loans, under $100,000-$150,000, to focus on those really small businesses with less than five employees.




Like Metcalf, Denis sees the most likely outcome is an extension of PPP- at least until the end of the federal fiscal year budget in September. If the Fed cannot agree on a budget, the government will go into shutdown- and this year would be the worst time to shut down.

“The only thing that motivates Congress to move big legislation like this are deadlines; there’s a big deadline coming up,” Denis said. “At the end of September, the fiscal year runs out and there needs to be a budget agreement.”

SBA LoansMetcalf said that the next round of PPP programs need to make sure businesses can get their first loan if they haven’t already, and streamline the loan forgiveness process to keep the SBA from getting overwhelmed.

“We need a forgiveness bill that streamlines the process; lenders will not have the resources to process forgiveness, a first PPP and second PPP as it is,” Metcalf said. “In my call with the SBA two weeks ago, they said for processing new 7(a) lender applications and all the other business they do to resume their normal business we’re looking at six months.”

The PPP proposal that Metcalf likes the best is called the Paycheck Protection Small Business Forgiveness Act, which stipulates a one-page forgiveness form for all loans made under $150,000. Metcalf said he saw support from a bipartisan group of over 90 members of Congress.

Another opportunity is the Economic Injury Disaster Loan (EIDL) program- offering long term loans to businesses with less than 500 employees that need financial help. Both Denis and Metcalf encouraged business owners to check out the program, which offers loans directly from the government without the need to prove forgiveness.

In the end, Denis said he was interested in the Republican “Skinny Bill” that is a cheaper breakdown of the GOP HEALS Act, but he said it is all up in the air.

“This is just me guessing,” Denis said. “I have talked to these people every day, but even members of Congress on Capitol Hill have no clue what’s going to happen.”

Round Two of PPP Is Targeting Much Smaller Businesses

May 4, 2020
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$79,000. That’s the average loan size reported in Round Two of the PPP so far. The figure is about a third of the average size approved in Round 1. Some of that is by the SBA’s design. On April 29th, the SBA disabled submission access to all lenders whose assets exceed $1 billion to prioritize small lenders and their small business customers.

Though the pause button for big lenders was only in effect for eight hours that day, it was recognition that the playing field had not been level in the first round. JPMorgan Chase, the largest lender in round 1, for example, had an average PPP loan size of $515,304 in that round.

It’s a competitive process for limited dollars. 5,400 direct PPP lenders have already participated in the second round. More than 80% of those have less than $1 billion in assets. Senator Marco Rubio, a champion of PPP, called the latest figures released by the SBA as “all good news.”

Square Capital, meanwhile, has taken small to the extreme. Their average PPP loan approval as of April 29th was just $16,000, according to stats published by Square Capital head Jackie Reses on twitter. But only 2,711 of the 38,000+ approved had received the funds so far.

Still, that average is significantly smaller than the average loan size of $73,000 approved by Ready Capital in Round 1, a non-bank lender that got widespread attention for approving more PPP loans than any other lender in the country. Those record-breaking numbers, however, led to delays in borrowers receiving their funds to the point where as of April 30th, the responsibility of funding those loans had reportedly transferred to Customers Bank.

OnDeck has also played a role in the PPP, though only as an agent despite being approved by the SBA to lend. That news, which was revealed last week in the company’s quarterly earnings call, is likely due to the company’s current predicament brought on by government-mandated shutdowns.

Small Business Group Advocates For Community Anchor Loan Program (CAP) In Wake Of PPP Wind Down and Possible Refresh

April 17, 2020
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Corner of Maple Street and Main StreetAt last tally, more than 800,000 small business PPP applications have gone unfunded since the program reached its limit, many of which are genuine mom-and-pop shops that employ less than 25 people.

Congress is considering another round of additional PPP funding but Americans may be worrying that such funds will once again go into the hands of some of America’s largest chains. (44.5% of the $349B PPP funds went toward loans over $1 million)

Outspoken successful businessman Mark Cuban has proposed a solution, a lottery system next time around to improve the chances that smaller businesses get their share of the pie. While the public debates the merits of such an approach, one organization (the SBFA) is calling for something much more direct, a targeted fix via a Community Anchor Loan Program (CAP) that would appropriate $10 billion for businesses that were PPP-eligible for loans under $75,000 but did not receive funds.

Deployment of this capital under CAP can and should be administered by non-bank alternative lenders with proven success with this particular small business market, they say.

The proposal also calls for 25% of the funds to specifically be allocated for minority, women, and veteran-owned and agricultural businesses.

In a letter the SBFA submitted to Congress earlier this week, the organization said:
“Women and minority-owned businesses are historically smaller and employ fewer people and, in some communities, are under-banked without the established relationships required to secure a PPP loan. Small farms and agricultural businesses are important to communities and often have trouble qualifying for traditional financing.”

The Small Business Finance Association is a non-profit advocacy organization whose mission “is to take a leadership role in ensuring that small businesses have access to the capital they need to grow and thrive.”

Small Business Credit Survey Proves Itself to Be a Blast From the Past

April 15, 2020
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This story appeared in deBanked’s Mar/Apr 2020 magazine issue. To receive copies in print, SUBSCRIBE FREE

small business credit surveyOver a month into a nationwide lockdown and it can prove hard to remember what things were like before this. The ease of going to a restaurant and sitting in, the buzz of attending a packed concert, or even the unappreciated experience of not having to maintain six feet between yourself and whoever is beside you.

As well as these small joys, for many small business owners the prospect of growth is a memory, as the latest Federal Reserve Small Business Credit Survey highlights. Released in March, the report is a summary of how small business owners acted and felt towards credit in 2019, as well as how they viewed their future in 2020.

While that’s certainly a grim reminder, the report featured an interesting question which appears prescient in the wake of the impacts of covid-19. “What actions would your business take in response to a 2-month revenue loss” was put to the 5,514 respondents, which were composed of owners of businesses that employed between 1 and 499 employees (coincidentally the same range for PPP loan eligibility). And the answers highlight the extent of the trouble which many small business owners currently find themselves in.

33% said they would lay off employees, 34% reported that they would rely on debt, and just 37% stated that they would reduce salaries of the owner(s) or employees. As well as these hypothetical decisions, 17% of respondents said they would shut down and 47% noted that they would use the owner’s personal funds to ride out the storm, worrying numbers given the current situation.

And while these responses prove eerie in light of what was to come, other answers reflect the optimism that 2019 yielded. 69% of firms expected revenue to increase in 2020, 44% expected their number of employees to grow, and 56% reported revenue growth on from 2018.

Outdated as the report is, it acts as an artifact of sorts: reminding the industry of what can come before the fall, and how even when things are good, many businesses are a few steps removed from serious trouble.

Facebook Announces $100M Small Business Grant Program

April 13, 2020
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facebookEarlier this month Facebook announced that it will begin rolling out its small business grant program across the world to provide relief for companies affected by the coronavirus. Totaling $100 million in value, the program will provide funding to small businesses in over 30 countries via grants that are mostly cash, but will also include Facebook ad credits. The news comes one month after the tech giant launched its Business Hub.

$40 million of this will be allocated to 10,000 American small businesses. Beginning in Seattle and New York, the plan is to eventually launch the program in an additional 32 US cities.

Eligible businesses need not be active on Facebook, Instagram, or WhatsApp; however they must employ between 2 and 50 workers, have been in business for over a year, have experienced challenges due to covid-19’s impact, and be in or near a location where Facebook operates.

As well as the grant initiative, Facebook has launched a number of web resources to provide information about applying for SBA loans, how to better connect with customers at this time, and how to bring businesses more online. As well as this, it has expanded its digital services, upgrading its fundraising portal, offering digital gift cards, and enabling business pages to offer delivery and pickup.

“These are rolling out today in the US and our teams are working hard on bringing these tools to more countries, as we know they can be a lifeline for businesses to quickly get the capital they need until it is safe to open their doors again,” said Facebook COO Sheryl Sandberg in a statement. “Small businesses are the heartbeat of their communities. We are determined to help and we know the road ahead will require a lot more from all of us.”

Business can begin the application process by heading to Facebook’s site and checking whether their location will be included in the program.

Fundry Supports Jersey City Small Businesses and Local Police Departments in Response to Crisis

April 2, 2020
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Fundry, a small business finance provider, is helping to feed police officers in Jersey City. A tweet sent out by the City of Jersey City twitter account said that the company is buying meals at local small businesses to provide to police stations every day for the next 2 weeks.

Amelia’s Bistro, described as a modern American restaurant and bar in the Paulus Hook section of JC, was pictured making a delivery to the Eastern District on Thursday as part of the Fundry donation.

Cybersecurity in the Time of a Pandemic

April 2, 2020
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cybersecurityEarlier this month the FBI released a statement warning against increased instances of cybersecurity attacks on businesses and individuals during the coronavirus pandemic.

Among the Bureau’s recommendations was the suggestion to be wary of any links purporting to offer coronavirus cures, preventative equipment like N95 masks, or instant access to a stimulus package. As well as this, the statement noted that Americans can expect to see fraudulent activity from emails requesting money for charity, emergency relief, and notifying readers of airline carrier refunds. Instructing Americans to “always use good cyber hygiene and security measures,” the FBI urged computer users to be watchful.

Such warnings proved all the more relevant this week as the World Health Organization announced that it had been a target of an unsuccessful hack. Believed to be an attempt to steal information relating to the coronavirus that has not yet been released, the attacks highlights the high price that data or knowledge commands in modern life, but especially in a pandemic.

Speaking to Gene Reich, CEO of the SMB-focused IT services and cybersecurity firm Point, he explained that many hackers will strike while the iron is hot during a pandemic and seek to make money while business owners are stressed and many workers are using personal computers for professional actions.

“We’ll have more vulnerabilities because typically someone’s home computer is not well maintained or taken care of like a corporate device,” Reich explained. “There’s also a slew of new phishing emails around coronavirus that are happening. And I think there’s going to be an uptick of people taking advantage of a time where some businesses are at a disadvantage.”

The CEO warned that emails aren’t the only medium people need to be cautious of, as many phishing attempts come as phone calls. “A lot of times we talk about computers and tools, but I think that people will also be called and told, ‘Hey, this is the government, to get your stimulus package, press one,’ and then somehow they get their bank information.”

This is an example of what Reich describes as ‘social engineering,’ where someone is deceived into providing access to a network to a hacker, and that hacker may remain within that network for the short term or longer, waiting to target information or funds.

While Reich advises computer users to do the usual things of practicing caution with email attachments, links, and requests for personal information, he also mentioned one tactic that has seen complete success: shuttering the business. “Of course, there are some businesses who, unfortunately, shut the doors until further notice, and in an odd way, those people are protected, because they’re not using computers.”

$2 Trillion Senate Relief Bill to Pass Vote, Includes Small Business Funds

March 26, 2020
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Main StreetSenate leaders Mitch McConnell and Chuck Schumer have come to an agreement over a stimulus package that would inject $2 trillion into the US economy. With senators debating the bill at the time of writing, it is expected to pass. Said to be the largest and most robust rescue package in American history, the bill would see $300 billion go to the SBA for its 7A loan program.

“At last we have a deal,” McConnell said after negotiations wrapped up at 1:30am on Wednesday morning. McConnell later described the bill as “a war-time level of investment into our nation.”

According to Stephen Denis, Executive Director of the SBFA, who was closely engaged with the language being placed into the bill, certain small businesses who receive SBA loans may have their loan converted to a grant, depending upon how they aim to spend the financing. As well as this, Denis made clear that small businesses will be able to use these funds to pay any charges linked to an online small business loan or MCA.

“There’s different things that you can use the SBA money for,” Denis explained in a call. “Payroll support, obviously, including paid sick leave, medical, or family leave; costs related to health care; employees salaries; mortgage payments; rent payments; utilities. And then this is another thing that we got inserted into the bill, we wanted to make sure that businesses had the flexibility to use this funding to pay existing debt obligations that were incurred before the covered period. What this means is that if a business had taken out an MCA or a loan, that they could use this money to pay off the obligations.”

As well as allotting funds for the SBA, the bill provides for cash payments of up to $1,200 to be made available directly to individuals, $2,400 for married couples, and an additional $500 per child, which will be reduced if the individual makes more than $75,000 annually or if the couple makes over $150,000. $350 billion will also be made available to help small businesses mitigate layoffs and support payroll.

The most recent example of something akin to this bill is the Troubled Asset Relief Program (TARP) that was established to help financial institutions in the aftermath of the ’08 financial crisis. And with there being some surprise in retrospect to how TARP’s funds were ultimately used, there is concern about supervision of these funds.

When asked on Monday who would provide oversight for the program to fund businesses, President Trump replied with, “I’ll be the oversight.” However, since then White House officials have agreed in closed-door negotiations that an independent inspector general as well as an oversight committee will be instated to supervise the loans.

Despite stalling in the Senate several times throughout Wednesday, Denis is confident that the bill will be voted through the Senate, and following this, through the House.

“Never make a guarantee in Washington. That’s something I’ve learned in my career. But I think this is something that both sides, both Democrats and Republicans, recognize needs to get done right now. And I can’t imagine anymore political games after the agreement this morning.”

As well as this, Denis was eager to highlight that many funders and broker shops fall under the classification of a small business, and would be eligible for some of the funds promised by this $2 trillion bill; and that if you are wondering how you might access some of the relief package upon its passing through government, to reach out to him.

Lists of States Where Non-Essential Businesses Have Been Ordered to Close

March 24, 2020
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Make sure you know about individual state orders that could affect a small business’s ability to operate. Below is a list of states and regions that have ordered some or all non-essential businesses to close. This list may be incomplete and the details of each state’s orders could change and may have changed since this was posted. Do you own due diligence:

The Pandemic, The Economy, and The Presidential Race

March 20, 2020
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Note from the Editor: In early February, I asked one of our regular journalists, Paul Sweeney, to look into the economy and the presidential race to size up the coming election season. As he was wrapping up his interviews over the span of a month, things took a startling turn, and COVID-19 came to the forefront and changed everything. This story is an amalgamation of reporting that started one way and quickly morphed into another. In light of how fast the situation is changing, we are publishing it now rather than waiting until early April to release it in print.

masked crowd

A version of this story will appear in deBanked’s Mar/Apr 2020 magazine issue. To receive copies in print, SUBSCRIBE FREE

Chris Hurn, who heads an Orlando-area financial firm in Florida that specializes in small business lending, says he is witnessing fear and desperation among business owners whose stores, shops and enterprises have been thrown into a tailspin by the coronavirus pandemic.

“We’ve been overwhelmed with telephone calls and e-mails,” says Hurn, chief executive at Fountainhead Commercial Capital, a non-bank Small Business Administration lender which boasts more than $250 million in originations last year. “I’ve fielded over 300 inquiries from borrowers about these loans in just the last few days,” he added. “People are telling me that they’re being harmed and don’t know how they’ll make payroll. The SBA needs to act.”

What Hurn is experiencing in Florida is not just an isolated incident. Thousands of small businesses are under siege nationwide as Americans’ have gone into isolation in response to the pandemic, helping precipitate a full-blown economic crisis. As of March 17, the coronavirus – also known as Covid-19 – had leapfrogged across the globe since appearing in China in December, 2019, infecting people in 100 countries. There are now some 272,000 confirmed Covid-19 cases worldwide and close to 11,300 deaths, according to data compiled by scientists at Johns Hopkins University in Baltimore.

In the U.S., the number of cases has cleared 19,000 as of March 20, the death toll has climbed above 230, and coronavirus cases have been recorded in all 50 states. The Center for Disease Control reports that the number of cases are growing at 25-30% per day. But experts warn that, because of a lack of testing, the actual number of cases is certainly higher.

Covid-19The outbreak is drawing comparisons to the worldwide influenza pandemic of 1918. Popularly known as the “Spanish Flu,” that virus may have claimed as many as 100 million lives, according to estimates by the World Health Organization. Medical officials say that persons 70 and older and those with underlying medical conditions, such as a weakened immune system, are most at risk in the current pandemic.

“What makes this disease so lethal,” says Rachel Scott, a family physician in Austin, Texas and the author of “Muscle and Blood,” a pathbreaking study of occupational diseases, “is that people in the vulnerable population who come down with the virus are prone to contract severe acute respiratory distress syndrome. In ARDS, the virus destroys the sacs in the lungs, preventing oxygen from being delivered into the blood stream. By the time people with severe ARDS are hospitalized and treated with a ventilator, it may already be too late.”

To blunt the accelerated pace of contagion, governors and mayors are putting restrictions on citizens by curbing gatherings and monitoring interactions. Governors in 44 states have forced restaurants and bars to close shop in an unprecedented regulation of U.S. citizens. Meanwhile, millions of Americans self-quarantined and self-isolated and re-examined how they interact socially, commercially and professionally. Increasingly draconian controls to moderate the trajectory of the outbreak are not only turning cityscapes into ghost towns from coast-to-coast but throwing a giant monkey wrench into the U.S. economy.

Treasury Secretary Steven Mnuchin has reportedly warned Congressional leaders that the unemployment rate could spike to 20%.


Former Labor Secretary Robert Reich has gone Mnuchin one better amid reports that 1.2 Americans had filed for unemployment insurance. In an interview on MSNBC Thursday, Reich said he feared that the unemployment rate is likely to hit that 20% mark in the next two weeks. “Eighty percent of Americans are living paycheck to paycheck,” he declared ominously. “We’re in a national emergency.”

The pandemic and the ensuing economic crisis is also casting a giant shadow over the 2020 presidential election. “It’s a black swan event that wasn’t anticipated by any of the candidates, and the reverberations for the election are going to be huge,” said Richard Murray, a political scientist and elections expert at the University of Houston.

For the past 50 years, political analysts have generally agreed, the condition of the U.S. economy was a key predictor – if not the key predictor – to the outcome of presidential elections. President Jimmy Carter, for example, had the bad fortune to preside over a problematic economy marked by oil-price shocks and energy shortages, mile-long queues at gasoline stations, and sky-high interest rates. There was even a new word — “stagflation” – coined for the phenomenon of stagnant growth and runaway inflation, recalls David Prindle, a government professor and expert on voting behavior at the University of Texas at Austin.

There were, of course, additional negative complications to Carter’s presidency. Most notable was the “Hostage Crisis” in which Iranian students attacked the U.S. Embassy in Teheran in the fall of 1979, held 44 American diplomats and aides captive for more than a year, and made Carter look hapless and helpless. Nonetheless, Ronald Reagan, a former governor of California and longtime matinee idol, hammered Carter mercilessly on the economy, demanding: “Are you better off than you were four years ago?”


Answering that question sent Carter packing to his Georgia peanut business. “In 1980, as in every election, there were multiple causes,” says Prindle, “but the deciding factor was the economy.”

President TrumpA healthy economy can serve as a mighty bulwark against opponents in a president’s bid for a second term. In the mid-1990s, an expanding economy and relentlessly buoyant stock prices – a Dow Jones Industrial Average so robust in the mid-1990’s that Federal Reserve chairman Alan Greenspan famously admonished investors for their “irrational exuberance” – allowed Bill Clinton to sail to re-election. (The good times also buffered Clinton during the ensuing sex scandal involving White House intern Monica Lewinsky.)

As the election year of 2020 dawned, a decently performing economy seemed to be serving President Donald Trump’s cause. Before the World Health Organization declared the coronavirus outbreak a pandemic in early March, the U.S. economy was coming off 10 full years of job growth and the unemployment rate had sunk to 3.5 percent, its lowest level in 50 years. Wages were also rising by nearly 4 percent per annum, noted Aparna Mathur, a labor economist at the business-backed American Enterprise Institute in Washington, D.C. “The economy is not spectacular,” she said, “but everything is moving in the right direction.”

Since then, however, the economy has been slammed as an alarmed country reacted to the pandemic. The NBA and NHL closed down their basketball and hockey seasons. Major League Baseball called a halt to spring training. The NCAA initially declared that “March Madness” would proceed and that hoopsters would perform before empty arenas, but then it pulled the plug. Even professional golf, an outdoor sport, hung up its cleats, announcing that The Masters, played at Augusta (Ga.) National Golf Course in April and the crown jewel of professional golf, would be postponed indefinitely.

empty arenaAlmost overnight, colleges and universities shut down classrooms, emptied their dorms, and opted for online coursework. Some 33 million schoolchildren in 41 states have ceased attending school. Hundreds of companies, including Amazon and Microsoft in Seattle, a city hit hard by the coronavirus, are requiring their employees to “telecommute” by working at home on their laptops.

The CDC at first advised Americans not to cluster in groups of more than 25 people, then cut that figure to 10. Americans are being prodded to engage in “social-distancing” by avoiding shaking hands and separating themselves from others by a separation of three-to-six feet from others. San Francisco has gone still further, grounding cable cars, closing down clubs and bars and restaurants and effectively putting the city on lockdown.

The city of Boston called off its iconic St. Patrick’s Day parade, Broadway theaters dimmed their lights, and Starbucks forbade customers to sit down in its coffee shops. Major events like South by Southwest, the music and cultural festival in Austin, Texas, was canceled, depriving Texas’s capital city of some $350 million in economic activity.

Jilting the festival cuts deeper than the losses to airlines, hotels, bars, restaurants, and music venues, notes Alfred Watkins, a Washington, D.C.-based economist and chairman of the Global Solutions Summit, an international consulting firm. “You have all of these people in Austin who are running events and they’re hiring caterers for sandwiches and refreshments,” he said. “You have independent contractors like videographers and photographers, sound-equipment suppliers, Uber and Lyft drivers, hairstylists, and even freelance entertainment journalists — all of whom are no longer making money. For these entrepreneurs,” he added, “losing this event is a little like retailers missing out on the Christmas season. It’s when they make their money.”

The airline, travel, leisure, and tourism industries are in free-fall. Major cruise lines suspended bookings and cut short voyages after horrific reports of coronavirus outbreaks among passengers trapped at sea, temporarily putting a $38 billion industry in dry dock.

The conventions industry, which has come to a standstill after wholesale cancellations, remains a vastly under-appreciated sector of the U.S. economy, argues George Brennan, former executive vice-president of marketing at Arlington (Va.)-based Interstate Hotels and Resorts, the world’s largest independent hotel management company.

These mass gatherings are an unheralded engine of growth, he says, packing a bigger economic wallop than they get credit for. “Conventions typically draw anywhere from 2,000 to 25,000 people,” he said. “They run 6,000 to 8,000 attendees on average, and most can only be accommodated by the top 10-20 U.S. cities, which include Chicago, San Francisco, Las Vegas, Atlanta, New Orleans and Orlando.

“Conventions are often multi-dimensional,” he added. “Attendees usually spend three to five days in town. They often shop at clothing stores and other retailers. They’ll take in sporting events or, if they’re in New York, a Broadway play. They’ll go to attractions like the San Diego Zoo, or spend an afternoon on a golf course in Florida or California.”

Conventions generate a tremendous amount of commerce and revenues for vendors and exhibitors. As an example, Brennan cites his former employer, the hospitality industry. “At hotel conventions,” he said, “you’ll see people there selling curtains and sheets, soaps and towels.”

In addition, many trade groups – Brennan cites the National Association of Civil Engineers and the American Medical Association as examples – count on the annual convention as an important component of their organization’s annual revenues. “When you pay to attend,” he says, “a significant portion goes back to the association. The convention often covers the yearly salary for a group’s staff.”

nyseAmid the dramatic behavioral changes, the stock market registered several days of panic-selling in March, capped by a record, single-day plunge on March 16: The Dow Jones index plummeted 2,997 points, the third-worst percentage loss in history. After flirting with the level at which the Dow was reading on Inauguration Day Jan. 20, 2017, the market continued see-sawing this week, herky-jerkying between mini-rallies and skids.

Hoping to prevent a coronavirus recession, the U.S. Senate adopted by an overwhelming, 90-8 bipartisan vote a $100 billion bill sent by the Democraticac-led House that expands free testing for the coronavirus, provides for paid sick leave and medical leave for some workers, and an emergency unemployment insurance and food assistance programs. The bill was signed late Wednesday night.

Meanwhile, Congress was taking up a monumental $1 trillion economic rescue plan proposed by the White House on St. Patrick’s Day (March 17) that included a bailout for the hotel and airline industries, help for small businesses, and $500 billion in direct cash payments to Americans households.

“We’re looking at sending checks to Americans immediately,” Treasury Secretary Steve Mnuchin said in a Rose Garden press conference at the White House on St. Patrick’s Day. By immediately, he added, “I’m talking about the next two weeks.”


The Trump Administration’s proposed help for small businesses has a strong supporter in Karen G. Mills, former SBA administrator and senior fellow at Harvard Business School. During her tenure in the Obama Administration, Mills was a troubleshooter in several crises including the Great Recession and Hurricane Sandy. “In a worst-case scenario with this virus contagion, getting loans to people through banks is not going to be fast enough,” she told deBanked just before the White House drew up its rescue plan. “They’ll need direct loans to people and other aid. If we lose our small business economy, it will be catastrophic.”

So how will the pandemic and the state of the economy play out politically in the November, 2020 general election between President Trump and former Vice President Joseph Biden, the presumptive Democratic nominee? The result remains shrouded in the fog of the future, of course, but the election’s contours are coming into focus.


Having seen him through numerous scandals, impeachment, and a trial in the U.S. Senate, Trump’s political and electoral following has been put to the test. Yet his backers remain unshakably loyal in a way not seen in 80 years, observed the University of Houston’s Murray. “More people are dug in now than at any time since the 1930s,” he says, as roughly 43% of the electorate is firmly lodged in Trump’s camp. “Trump’s support has been remarkably stable.”

The business community is a key demographic in the pro-Trump cohort, notes Ray Keating, chief economist at the Small Business & Entrepreneurship Council, a Washington, D.C. advocacy group claiming 100,000 members. “We have not polled our membership,” Keating says, “but when you look at the data they overwhelmingly vote Republican. We find that support for Donald Trump is clear and substantial.”

Richard Yukes, a Las Vegas-based oilman and longtime entrepreneur who votes his pocketbook, will be pulling the lever for Trump in the November election. The reason? Trump not only presided over a robust economy for the past several years, Yukes says, but the president slashed Obama-era regulations imposed on his industry. “Government regulation and bureaucratic regulation often get mishandled and misdirected by federal bureaucrats and Trump is for less regulation,” Yukes says. “I think America works best with less regulation.”

The owner and operator of oil wells in Wyoming, Yukes benefited handsomely last year when Trump’s Environmental Protection Agency relaxed rules governing methane leaks. The oilman reckons that complying with the regulations had been costing him an extra $1,500 per well each year.

No matter how well the economy has performed in the past three years, however, the pandemic economy promises to be a “game-changer,” says political scientist Murray, and history shows that voters are likely to take stern measure of the incumbent president’s performance during any a crisis.

Trump’s initial response to the coronavirus reminds Murray of Woodrow Wilson’s reaction to the Spanish Flu pandemic in 1918 while World War I was still raging. “As the U.S. was approaching climactic battles in Europe, President Wilson suppressed the news of the flu and the story didn’t get out though eventually people knew about it,” Murray says.

Wilson’s deceit hurt Democratic candidates who were battered in the 1918 midterm elections, just a few days before the November 11 armistice. Two years later, after Wilson had a stroke, the Democratic presidential candidate got crushed in the 1920 election by Warren G. Harding, a Republican senator from Ohio.

After war and influenza, Americans voted enthusiastically for Harding’s promise of “normalcy.”

A Q&A With Viceland’s Host Of ‘Hustle’ John Henry

March 5, 2020
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John HenryEntrepreneur and investor John Henry, who also hosted TV show ‘Hustle‘ on Viceland, recently spoke with deBanked Chief Editor Sean Murray about his experience as a young successful entrepreneur (Q&A is below). Henry will be a special guest speaker at Broker Fair 2020 on May 18th in New York City. YOU WON’T WANT TO MISS IT!!!


About John Henry

Voted to Forbes’ 30 Under 30 and Ebony’s Power 100 lists – John Henry is a Dominican-American entrepreneur and investor. Henry started his first business at 18, an on-demand dry cleaning service for the Film and TV industry in New York City, with clients such as The Wolf of Wall Street, Boardwalk Empire, Power, and more. Henry led the company through its acquisition in 2014 — founding and selling his first business by the age of 21. On the heels of his first win, Henry launched Cofound Harlem — a non-profit incubator that aims to foster a robust tech ecosystem North of 96th street in New York City. Cofound Harlem has launched numerous high-growth companies in Harlem, gaining recognition from Fast Company, TechCrunch, Business Insider, and more. He is a former Partner at Harlem Capital, a diversity-focused early stage venture capital firm on a mission to change the face of entrepreneurship. Henry is also the host of VICELAND’s latest show, HUSTLE, which is Executive Produced by Alicia Keys and focused on helping scrappy entrepreneurs grow their business to the next level.


Q (Sean Murray): You started your first business at 18 but what made you want to start one?

A (John Henry): It was driven by necessity more than a desire to be an entrepreneur, but I did exhibit some of the traits that pushed me towards that path. Entrepreneurs tend to have a history of non-conformity where there’s no pre-chartered path and in an environment that demands conformity, anyone that likes to express their own views comes up against a lot of friction. So, for me it was necessity but also part of my character to do things differently.

Q: What kind of lessons did you learn from running a business at such a young age?

A: It’s a serious game and it’s full of responsibility. I was telling myself at one point that I was just 18 and so the struggles I faced running a business could be overlooked because of my age, but the world doesn’t care how old you are. If you’re running a business, there’s no way around the responsibilities it demands.

The other thing is, when you come up against really tough situations, you need to be brave and have courage to go through those moments. I’m glad I had the courage in them. Once you take them head-on, you come out feeling better on the other side.

Q: As a former partner of a Venture Capital firm, what’s the #1 mistake you saw entrepreneurs and business owners make?

A: You’ve got to have macro understanding and micro-chops. Everything is connected, it’s not just knowing your business but knowing where you’re situated in the economic or market cycle and understanding what customer sentiment is. That’s what a lot of entrepreneurs miss. Like if your idea is to make a mobile app, that’s great, but how many apps are already out there? How long have apps been part of the market already? What’s going to make your app stand out from every other app? And this doesn’t apply just to startups, but also existing companies. Every 3 months, you should be asking yourself the business question and evolve if necessary. The hardest part though is when your gut is telling you you’re right but every other person out there is telling you you’re wrong. And that’s something you’ll really have to figure out.

Q: Why has helping minority entrepreneurs and businesses been so important to you?

A: I’m not usually asked why, but I was seeing less and less minority representation among entrepreneurs that were receiving capital. There are some systemic factors that make it harder to get ahead but at the same time people can become inclusive to the point where they’re becoming exclusive. So, I think it’s about helping those that are on their way to overcoming tremendous odds to get far.

Q: Real estate, what can you tell me about your foray into that market?

A: I can say it’s the best business that I have been in so far. Real estate is the #1 fundamental building block of wealth. When I first got into it, I was shocked that you could put down 20% and the bank would put in the other 80%. This is a game of physical assets and I’m glad I came across it when I did. I’m currently building a bedrock of business around real estate, my preference being residential multi-family apartments.

Register For Broker Fair 2020

Subprime: Business Owners That Won Bitter Lawsuit Against Marcus Lemonis, Indicted

September 25, 2019
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hamburgersA pair of business owners whose appearance on CNBC’s The Profit ended in a legal battle with celebrity investor Marcus Lemonis, are back in the spotlight. Howard Mora and Alan Buxbaum, co-owners of defunct New York-based A. Stein Meat Products, Inc., were arrested Tuesday for using counterfeit USDA Stamps on their meat. A Septemer 13th indictment was simultaneously unsealed.

According to the DOJ, the pair purchased meat “graded Choice quality meat by graders employed by the USDA Agricultural Marketing Service and directed their employees to carve off the Choice markings and re-stamp them as Prime, using counterfeit stamps. The meat was then sold at inflated prices to customers in the New York City metropolitan area.”

More than 5 years ago, Mora and Buxbaum sought to save their struggling business by selling their Brooklyn Burger brand to Marcus Lemonis in exchange for $190,000. Marcus allegedly coughed up the dough but the two didn’t turn over the brand. Lemonis followed up with a lawsuit which was dismissed on the grounts that a verbal contract on a reality TV show was not valid under New York law. The feud reportedly resulted in a confidential settlement rather than get dragged on by the appeals process.

Lemonis was quick to share news of the indictment on social media despite how much time has passed.

The allegations take place between 2011-2014 during the show’s filming. Stein Meat reportedly went out of business shortly thereafter.

“The integrity of USDA’s food processing systems and the security of the nation’s food supply is of the utmost importance to the Office of Inspector General, and we will continue to dedicate resources to the investigation of matters where it is called into question,” Stated USDA-OIG Special Agent-in-Charge Dinkins.

Key Takeaways from the Q2 2019 Private Capital Access Index

July 17, 2019
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The latest Private Capital Access Index, published quarterly by Pepperdine Graziado Business School, was released recently, and with it came fresh insights into the minds of business owners. Covering companies that earn under $5 million in revenue annually, as well as those that raise between $5-100 million, the Index provides information on a wide range of business. Below are snapshots of some of the main points found within the report:

More Large Businesses Appear to be Looking for More Money

Businesses that earn between $5-100 million a year are seeking to raise more financing in 2019. Compared to 2018, many loan ranges have seen jumps: the amount of larger businesses seeking between $500,000-999,999 has over doubled in size to 39% and $1-1.999 million has more than tripled to 28%. However, outside of this range, desire has fallen for financing among larger firms.

Slight Fluctuations in How Quickly Customers Are Paying

The past year has witnessed some small changes in the speed at which businesses receive payments from their customers. With 15% of smaller businesses reporting accelerated reception of payments in the previous three months, an increase from the 11% that was stated this time last year, and an increase of 1% of larger businesses claiming a speed up, it seems at least that a small sector of fortunate vendors are benefitting from increasingly prompt customers.

Accompanying these figures are the reports of payments slowing down, that show a 2% increase amongst smaller companies and a drop to 10% from 23% for their larger counterparts. This jump is accounted for by the 81% of larger businesses which reported that the speed of payments remained the same, which is up from 70%; while the smaller firms reported 63%, down from 68% in 2018.

More Businesses Are Planning to Raise Finance

More businesses of all sizes are looking to raise capital in the coming six months compared to 2018, with 35% of small businesses and 28% of larger businesses claiming that they will be seeking financing, an increase of 5% for both. This news, coupled with the knowledge that the total number of businesses which said they will not be seeking finance dropped, may come as a gift to lenders and brokers, but it should be taken with a pinch of salt, as those who said they were unsure also rose by 4% to 35%.

Purposes for Raising Finance Remain Mostly Unchanged

Growth and expansion continue to be the primary reason for seeking finance, with an increase on last year from 58% for both the smaller and larger companies to 62% and 77%, respectively. As well as this, working capital fluctuations and refinancing existing loans/equity remain as the second and third highest reasons to raise funds, with the total of the former dropping 3% to 17% and the latter falling to 7% from 10%. Besides these motives, capital required to replace equipment or facilities unrelated to expansion saw a dip of 4% in larger businesses.

Businesses Are Optimistic

Despite over 50% of businesses saying that it is difficult to acquire both equity and debt finance, as well as 49% claiming that the current business financing environment restricts growth opportunities, businesses appear to be confident about the future, with 68% of them expecting increases in revenue over the next year. Also, respondents appear to be unconcerned by external forces, as 57% of businesses don’t believe the federal tax hike will impact them and 74% don’t expect to be hampered by severe weather from climate change. These may or may not prove to be naïve as time goes on, especially the latter, as 56% of the respondents do not have emergency funds in place should severe weather disrupt their business, but for now companies seem to be looking forward to the coming year.

The full report is available here.

WeWork, The Home Office of Small Business Finance Startups

March 20, 2019
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weworkKunal Bhasin, owner of brokerage 1 West Finance, funded three A paper deals for companies that all happened to work out of the same Manhattan office building on the corner of 42nd Street and Third Avenue. It’s actually not as big a coincidence as it sounds because it’s the same building where 1 West Finance operated out of, along with likely hundreds of others at a midtown WeWork, the giant co-working company that has 59 offices in New York City alone.

What is remarkable is that the co-working concept (where companies work alongside each other for the benefit of all) actually works. At least it did for Bhasin. Because Bhasin’s company was expanding and needed to find space very quickly, he was unable to find a larger office at that same WeWork office. And because location was critical, he relocated to a Regus right nearby. Regus, which preceded WeWork, also rents space to companies, but focuses less on encouraging resident companies to get to know each other.

“I already miss it a lot,” Bhasin said of his old office at WeWork.

Bhasin said he met his former WeWork colleagues, who became clients, at the communal coffee stations and lunch events organized by WeWork.

Kunal's team-WeWork-1
Above: Desks in 1 West Finance’s original WeWork office

Peter Graves, founder of Two Trees Funding, a one-man ISO shop, runs his business out of the WeWork office at 110 Wall Street. He said that he has gotten referrals from colleagues at other companies in his WeWork office. And he really appreciates the ability to to expand without having to change your lease.

The office culture is one of the main reasons why another company in the small business finance space loves WeWork. “Here, we engage with other people [and] we get a fresh perspective from other people, whether it’s a graphic designer or someone who works in cryptocurrencies,” a representative who asked to remain anonymous said. They also appreciate the flexibility, acknowledging that when they started with only four people, they rented month to month. Now, they have 12 people and a lease agreement for two years.

“We could have gotten a commercial space for 5 years,” they said. “But maybe we’d need a bigger space. This allows for flexibility.”

How to Turn Your Client List Into a Business Referral Network

March 19, 2019
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Left: Chad Otar, Excel Capital. Right: Lori Miller, LGC Interior Design

Excel Capital CEO Chad Otar was so impressed by a marketing company he helped obtain funding for that he turned around and emailed his other clients about the potential benefits of their service. As a result Otar said that about five of his clients actually started working with the marketing company, including Lori Miller, the owner of LGC Interior Design in Melville, Long Island. Excel Capital, in effect, started creating its own business referral network.

“[The marketing company] helped me fix my website and get me out there,” Miller told deBanked. “It helped me significantly.”

For a year, Miller worked with the company, which helped to expand her company’s social media presence, get her work into a showhouse, and get one of her rooms published in Architectural Digest. And this was all thanks to a referral from Otar.

Kunal Bhasin, owner of 1 West Finance, said that he will sometimes introduce his clients to one another. These are usually clients he has funded, but they could include a prospective client, he said.

Jonathan Casillas, founder of Casillas Capital Partners, an ISO in North Carolina, said he will refer clients to specialists that can help them. “Our direct job is to get them money…but if I see a problem, I try to fix it,” Casillas said. “And if I can’t, I point them in the right direction. I’m here to help the entire business, not just get them money.” Casillas said that startups, in particular, need a lot more than money. They often need help with structural parts of their business and Casillas said he will refer them to a lawyer or an accountant, or whoever they need to get where they want to go.

Can a Merchant’s FICO Score Increase By the End of the Day?

March 16, 2019
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credit scoringEarlier this week, Alan Hayon had a challenge – to get a merchant above a 500 FICO score in order to make them eligible for small business funding. Within 30 minutes, Hayon increased the merchant’s personal FICO score by 59 points, getting them above 500. And the deal funded the following day. Hayon is the founder and CEO of The Credit Desk, a credit repair company in Long Island, and he used Experian Boost to get the merchant’s score up. It’s a brand new product from Experian that allows you to add and get credit for bills you have been paying on time, like gas, electricity, water, TV, internet and phone.

What used to take two to three weeks is now instantaneous with Experian Boost, according to Hayon. And the potential ramifications for small business funding are quite astounding. John Celifarco of Horizon Financial Group, a brokerage in New York, said that he had never heard of credit repair happening so quickly and that if it actually works, it could revolutionize the industry.

“Every deal could move up a grade,” Celifarco said. “This could have huge effects not just on the low end. You could jump someone from mid to high credit.”

Hayon conceded that it’s much harder to get a credit score up to, say 650, very quickly. That is harder and takes a little more time. Still, the new Experian Boost product means the ability to cross a FICO score minimum threshold and move a merchant from unfundable to fundable, almost immediately.

“It’s a positive domino effect,” Hayon said of Experian Boost, and what follows. “Then they can pay their credit card bills, get caught up with vendors and improve their credit further.”

This practice, often called “rapid rescoring,” has been used in the mortgage industry for years, according to Daniel Dias, owner of Small Business Lending Source, a brokerage in San Diego. Dias said that the rapid rescoring of a FICO score for someone applying for a mortgage can take as little as a day. Pretty fast. But for his clients, which are small businesses, he always tells them to wait at least 30 days to see an increase – from 20 to 60 points – in their score. By complete chance, when asked who he directs his clients to for credit repair, he said it was Hayon. Merchants pay Hayon directly, not via the broker.

In Celifarco’s experience, credit repair generally takes three to six months, which is usually too long for the merchant to wait to improve their FICO score. So he approaches credit repair a little differently. He advises his merchants to seek credit repair services after their first funding. This way, they can improve their credit and get a better rate the second time they go for funding.

Cory Petitte, who has worked both as a broker and a funder in South Florida, cautioned against inflating FICO scores in a way that misrepresents the merchant.

“I want to make sure the merchant can handle the payment,” he said.

He thinks that rapid rescoring is not a good practice and drew parallels to the 2008 mortgage crisis.

“You had mortgages that really weren’t A paper. [Instead,] they were B, C and D paper that were being represented as A paper.”

Furthermore, he said that he has spoken to underwriter who have told him they can sometimes tell when a FICO has been rapidly rescored.

Common Mistakes Commercial Tenants Make

March 8, 2019
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Space interiordeBanked recently heard a live presentation given by Dale Willerton, “The Lease Coach.” Willerton is an expert in helping commercial retail tenants to find and negationate spaces. But much of his advice applies to commercial office tenants as well. Below are some common mistakes he urges tenants to avoid:

Not Looking at Multiple Spaces Simultaneously

You want the landlords pursuing you, not the other way around. Therefore, Willerton said that you want to see multiple spaces at once so that you have options and bargaining power. Particularly if you don’t have much time, you don’t want to be at the mercy of one landlord.


Making the First Offer

Let the landlord make the first offer, Willerton says. If you like a space, tell the broker or the landlord, “Why don’t you send me a proposal.” Otherwise, if you make the first offer, you could end up offering more than what the landlord was willing to accept.


Overpaying for Space

Commercial rent is often based on square footage. So if the space you’re looking at has an unusual configuration, or even if it doesn’t, measure it independently to make sure that you’re paying the correct amount. Even if you are already in the space, if you measure the space and see that you actually have less space than what you’re paying for, you can ask for money back from the landlord. Or at least a rent reduction moving forward.  


Telegraphing Your Feelings/Intentions

Don’t let a landlord know that you really like their space or that you really want to renew a lease. It gives them leverage. They now know that you really want what they have and that gives them more negotiating power.


Not Walking Away from a Bad Deal

Like deals that include certain personal guarantees. Some tenants require a personal guarantee and others only ask for it. Find out which and avoid personal guarantees when possible.


Looking Too Successful

If the landlord sees that you’re now driving a Porsche to work, or that your 17-year-old daughter has her own Mercedes, he or she may assume that your business is doing very well and may increase your rent when it comes time for a lease renewal. You may, in fact, be doing well. Or you may just appear to be doing well and then get hurt by a rent increase. This doesn’t mean you shouldn’t drive a Porsche if you can afford it – just to fool your landlord. It’s just something to be aware of.


Not Doing Your Homework

Just as you would do your research on a merchant before funding them, research the building and the landlord. Try to find out how long previous tenants have stayed in the building. Why did the previous tenant leave? Are they expanding, or did they have a bad experience with the building or the landlord? Is the building up for sale? If a building changes ownership, that can impact tenants down the road.  


Also, Be Mindful of Commercial Agents’ Motives

Willerton said he doesn’t believe that commercial agents are bad or are working against the tenant at all. But he said that if the agent is getting paid on commission by the landlord, it’s important to be mindful that their ultimate “boss” is the landlord and not you.    


How to Respond to Negative Press

January 3, 2019
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bad pressWondering what to do about negative press? deBanked spoke to some Public Relations professionals about helpful techniques to manage the situation.

“When it comes to a negative story, we advise our clients to bridge back to something they are comfortable talking about,” said Bill McCue, Executive Consultant at Indicate Media.

Bill-McCueBill McCue, Indicate media

McCue said this is known as “bridging.”

“If you’re asked a question about something you don’t want to talk about for whatever reason, you can use transitional phrases like ‘You know that’s an interesting point, but what the real story here is…’ or ‘What we believe is truly the most important thing to talk about is…’ And just keep bridging from a topic you’re not comfortable addressing to a topic you are comfortable addressing.”   

McCue noted that politicians and professional athletes are excellent at this. His favorite example is hockey players, who never talk about themselves. When they get a question about their own performance, they always “bridge” to something like the strength of another player or the coach or the entire team.

McCue also advises all clients, whether they’re overcoming negative press or not, to speak in simple terms, and avoid jargon or acronyms.

“Never assume that the reporter is an expert on your industry,” McCue said. “He or she might be writing about [multiple] topics throughout a given business day. Or they may have been writing about real estate last week and now they’re writing about small business lending…So never assume a certain level of expertise.”

Jason-Geller-HeadshotJason Geller, JMediaHouse

If your industry has gotten negative press, but your company in particular has not been targeted, Jason Geller, Founder of New York-based public relations firm JMediaHouse, said that no response is often the best response.

“Unless you have established clear goals and a message you must put out, or if the allegation is serious, the best response in most cases is nothing. Ignore it,” Geller said. “Don’t give the story life. By opting out you’ve robbed it of the oxygen it needs to continue on.”

Geller also said that if the reporting contained inaccurate information, then the company must first provide the correct information to the reporter or blogger. This, he said, “opens up a great opportunity to leverage the situation and strengthen your relationship with the journalist, and to allow him or her to get to know your company and clients better.”

If a given negative story is so bad that it truly warrants a response, Geller said that it’s critical first to research the writer or blogger before responding.   

“What have they written about in the past? Do they have a history of putting out negative commentary? Have they had a bad experience with your product or brand? Once you have the answers to these questions, you’ll be able put together a much more concise and educated response,” Geller said.