byJen Zelen

Community Based Lending programs in the Portland Metro Area

In the Portland area, Craft 3 is one of the main community based lenders. Craft 3 combines funds from government agencies, non profits and accredited investors in order to lend to both businesses and individuals for the following purposes

• Small business startups and expansion
• Food and ag businesses
• Clean energy projects by businesses
• Community services
• Tribal community projects
• Land conservation

They even lend to individuals for financing weatherization, clean water projects and ADU’s, among other projects.

Craft 3 makes loans in both Oregon and Washington. The process to apply is similar to that of applying for an SBA loan, only the borrower starts the process on the Craft 3 website. A Craft 3 staff person reviews the loan application, and if the borrower and stated purpose appear viable, they will work with the borrower throughout the application process. Similar to an SBA loan, the business owner must sign a personal guarantee for the loan.

Specific to new or existing businesses, uses of capital can include:

• Start-up or acquisition
• Working capital or inventory
• Equipment
• Real estate
• Debt restructure

Loan amounts are allowed up to $3,000,000 with a maximum terms of 72 months; other terms of repayment vary and can be negotiated. Other information can be found at

Another option for non bank lending is Community Lending Works (CLW), with offices in Oregon City, Springfield and several other cities in the state. CLW makes small business loans ($300 - $100,000) for seasonal and other working capital purposes, all of which are due within six months. Ideal for makers, growers and those who sell at other market type venues.

Prosper Portland (formerly Portland Development Commission) also offers a variety of loans and financing options to businesses within city limits. Prosper Portland has four priorities in its mission:

• Growing family wage jobs
• Advancing opportunities for prosperity
• Collaborating with partners for an equitable city
• Creating vibrant neighborhoods and communities

The agency offers many different small business loans, which cover a variety of needs such as acquisition, making improvements in a leased space, buying real estate and more. There is a focus on promoting business development in certain parts of the city, as well as a focus on providing opportunities and additional support for minority business owners. In addition to financing, there is technical assistance available, and staff also connect business owners to other resources or programs that may meet their needs.

If you are looking to grow your business or meet cash flow needs on a seasonal basis, these organizations are there to help.

byJen Zelen

Small Business Lending
SBA Loans

Does your small business need funding? Maybe you’re thinking, “It’s summer, and time to head to the beach, or better yet, take a few days off and head to the Cascades or Central Oregon for some off-the-grid camping..”

That said, summer and its slightly slower pace can also be a great time to re-evaluate your business and look at new possibilities, such as

• Expansion or the next location
• A new product line
• Equipment to increase productivity or automate processes

In many cases, what your business needs right now is funding. This post is one of three outlining some funding options and related resources specific to the Portland, Oregon metro area; some are available in other parts of the country as well. This first post covers loans by the Small Business Administration.

I hope to illustrate the fact that there are many alternatives to bank lending, even for newer businesses and those whose founder may have a less than perfect credit history. As the story goes with much bank lending, if you qualify for the loan, then you probably have enough collateral, cash and financial standing that you almost don’t need it; if you really need money, the bank won’t lend to you.

One of the most popular choices for small business lending are SBA loans, of which there are several programs available. The SBA 7(a) loan is even available to startups, although most companies that qualify for these loans have been in business for at least two years. A few of the features of this loan include

• Can be used for a variety of funding needs- payroll, supplies, buying inventory or equipment
• Business owner(s) must have strong personal credit
• Business owner(s) sign a personal guarantee and may be required to put up collateral
(such as real estate)
• The owners must put up some of their own equity (in the case of startups)

It is important to note that the SBA is not providing the funding; a local bank is doing that. However, the SBA, once it has evaluated your business plan, guarantees the loan, which allows the bank to extend the credit when on its own it might deem your project or business too risky.

How to start?

Read up on loan FAQs at, and if you would like more information, find a loan specialist to talk to at a bank near you. In the Portland area, there is a substantial list of banks that have SBA loan specialists.

If you are ready to apply, it is a good idea to meet with a minimum of three such specialists- not because they can offer very different terms, but because you will be working with this person closely in the process (and after) and want to make sure you are a good fit for each other in work style and even personality.

Once you have done your research and found an SBA lender that feels like the right person, you will get a list of needed documentation and will also need to prepare a business plan. There are many good templates; I have used one provided on the SCORE website. Part of the business plan is a spreadsheet detailing three years of financial projections, on a monthly basis, and should include pro forma (projected) statements such as

• Profit and Loss
• Balance Sheet
• Cash Flow Statement

Your SBA specialist will work with you to get the application ready for official submission to the SBA; once this part of the process is complete, the approval by the SBA takes about ten days, because all the hard work has been done ahead of time.

Next up, community based lending programs in the Portland Metro Area..

byJen Zelen

Know your value and don’t undercharge

One of the biggest issues I see as I talk to new business owners is the tendency to underestimate the value of their work, and therefore charge too little to clients. There are a variety of reasons this happens, and here are a few of the common ones:

• You feel like you’re charging a lot vs what you used to earn at your job doing the same thing
• Charging a lot feels unfair to the client, as they might not be able to afford your product or service
• Wanting to earn more money goes against your values- isn’t it evil to want to be rich? Or to want/love/expect more money? (yes, I have seen and heard this philosophy)

Let’s be blunt- we need to look at these issues one by one and examine why they’re wrong and what to do about it.

The first statement, that it feels weird to charge 3-4 times or more as an hourly rate (or rate that is combined into a lump sum charge per month or per project, which are much better ways to invoice anyway), is incorrect on a number of levels.

First, as a business owner you have many expenses to cover as well as time spent that isn’t compensated. Expenses include rent for an office or space used in your home, supplies, computer, insurance, travel and so on, many of which you were not responsible for when employed at someone else’s company.

Second, there is all the unpaid time that goes into networking, interacting with potential clients, and then preparing estimates and proposals. A business owner isn’t on the clock.. yes, you might have a salary coming out of the company, but the ability to pay that salary comes directly from your company revenues. Another way to look at how much to charge clients is to compare the money the client is spending on the project to increased revenues that they’ll realize, or, costs they’ll be able to cut by hiring your company. When looking at it this way, you quickly realize that what might seem like a high rate is in fact a great deal for the client: a project completed efficiently, professionally and at a cost that is budgeted and agreed upon.

Not only that, but the client’s use of your company lets them avoid hiring an actual employee, training said employee and providing a salary and possibly benefits. I can speak to this in my own financial consulting business: when I find ways to streamline business processes, save money on bank fees and finance charges, save my clients from fraud by improving accounting systems (and the list goes on from here!), both the client and I easily recognize that the savings realized/revenues achieved far outweigh what they’ve spent with me.

There are also many ways to leave a client with benefits that last, whether it is in teaching them to utilize new processes and methods, or providing a product or service ongoing that becomes a time and money saver, or boosts their company revenues into the future.

Another downside to charging too little is the impression it makes on clients- if you are that cheap, then maybe you get what you pay for? Going too low is not going to help you pay the bills, and it’s not going to make you look good either.

If this isn’t convincing enough, just remember that a potential client that balks at the cost of a project or monthly service just might not be a great client in other ways. Maybe the client’s company isn’t far enough along to really use your service, or really does not have the funds to pay for much of anything in the given moment.

Whatever the reason, it is better to turn away a client that can’t or won’t pay than to cave and do work for cheap, leaving you struggling to cover the costs of running your business and feeling frustrated in the process. Not only that, but you’re setting a precedent- and potentially creating a situation where that same client recommends you to their colleagues who might also want quality work done for cheap!

Finally let’s address whether or not wanting money is evil.. this is easy, it isn’t. If people didn’t want to earn money doing what they love, they wouldn’t (or shouldn’t) become business owners in the first place. Charging appropriately and being able to afford your life are good reasons to run a business, and there is more.. once you actually have something, you then have the luxury of deciding to give back.

In my own business I’ve set up recurring donations to several causes that are important to me: funding college scholarships at Portland State University, saving the environment through Oregon non profits and others. I also donate my time and have served on multiple non profit boards as well as donated accounting software to non profit organizations. I can only do this because I make enough money in my business and am not scrambling to add in billing hours at a rate that would be unfair to me.

If you are setting up a new business or maybe restructuring your current one, just think carefully about why you chose to go into business in the first place. We all deserve a fair wage: we deserve to be paid for our skills, our years of experience and our willingness to go out and take risks as business owners each and every day. Know your value!

byJen Zelen


Why Quickbooks?

Part of my business has always been to recommend, set up and assist in maintaining accounting systems for business owners, and for nearly 20 years the best answer to which software to buy has been Quickbooks. Sorry if this article sounds like a free ad for Intuit, but having helped dozens of businesses get off the ground, I don’t have a different answer for you.

I can also begin this article by specifying that as of the past several years, I really only recommend QB online, not the desktop version. The benefits of cloud based software include:

• Bank and credit card feeds that download transactions for you, and in most cases recognize and categorize said transactions
• Ability for the business owner, staff and accountant to log in from anywhere
• Ability to limit certain users’ access to parts of the system such as payroll
• Easy and efficient invoicing and tracking of project costs
• Reporting that can be customized to allow for in depth financial analysis of your business

There are alternative software platforms out there, such as Xero and Freshbooks. Xero is more expensive than QB, however, and certain software such as Freshbooks can do invoicing but cannot take the place of true accounting software, which bases transactions on double entry accounting. For this reason I don’t recommend that businesses choose these systems unless they plan to stay very small and do not need in depth financial reporting or analysis.

Great news, too- if you choose me to work with you on finding and addressing business issues, learning to read and interpret financial reports, or just set up efficient accounting systems- I will include your subscription to QB online for FREE. My accounting and finance packages always include free software for as long as we are working together, which is as much as $70.00 per month savings.

byJen Zelen

Fraud Prevention

People’s financial lives have become really complicated in recent years, and all of us are exposed to the potential for fraud on a daily basis. Being on our smartphones and computers as much as we are, criminals are more than happy to take advantage of us.

A couple of the more common sources of fraud are:
• email phishing
• phone scams
• identity theft

Email phishing is probably best known for stories like the Nigerian “prince” who emails you and asks you to receive money on his behalf, and then if you hold the money in your bank account for a short time, he’ll reward you with $10,000 as a thank you. The only catch is that you have to prove that you’re honest by first sending him $3,000 or some such sum, before he can trust you with his money.

This would be a pretty easy story to see through, for most of us anyway! But what if you get an email that looks like it came from your company IT department, and the email includes a link and a request to log in to some part of the company network, using your credentials of course, and verify your accounts? The IT folks might actually need to test parts of the system, and the request looks routine enough.

These kinds of emails can also come from spammers that appear to be your credit card company or even the IRS. Whatever the source, NEVER click on a link that appears in an email. While sometimes spam and phishing emails are apparent due to lack of logos or mis-spelled words, this isn’t always the case. One thing you can check for is to see where the link actually goes (hover over the link, but don’t click through). You might notice that the website it leads to looks real but might have one letter or digit that is not correct- the email is actually directing you to the spammer’s website. Sometimes the difference in the fake site vs. the real one is so small (using a small letter L instead of a capital I, for instance) that it is almost undetectable.

In any case, if you do get emails from your employer, your bank, the IRS or whoever, just don’t click on links. You can always go to your browser, go to the real site, and log in there if you believe that action is needed. Or call the company directly from the phone number you know to be legitimate. There is never a situation or issue that requires you to respond from inside an emailed message- legitimate companies and agencies do not do business this way.

This leads to the next scam- phone fraud. One of the more common types of fraud committed include calling and persuading you to give up personal information such as account numbers or your SSN. No real bank or credit card company will ever call you and then ask you to verify this information. If you do get a call that seems real, for instance, sometimes credit card companies will alert you to suspicious use of your card, then you should be able to ask for verification, not the other way around. And if you are ever unsure, just hang up and call back the main customer service number to find out what is happening.

A similar situation occurs when scammers call cell phones claiming to be from the IRS or another tax agency, and attempt to scare people into giving up information by threatening them with some sort of prosecution. What everyone needs to know is that tax agencies, when communicating with either businesses or individuals, will NEVER call you on the phone to initiate contact. The IRS sends letters in the mail- and while your method of response can be to call in, the agency will never use just phone or email for outreach on any issue. So if the IRS is calling and threatening to arrest you, hang up! You can always call a direct line to verify anything that is unclear about your account.

Other phone scams include a particularly scary one of late- scammers call and pretend that they’ve kidnapped your child or grandchild, and there is usually some sort of screaming in the background that makes the whole call seem urgent and frightening. Sometimes the scammer is even able to spoof the phone number of your relative, making it seem like they really have the person and their phone. Some family members have been convinced to go out and buy gift cards with cash and leave these in specified places, only to find out later that the supposed kidnappers were fake and that their family member was safe all along. If you get this type of threatening call, hang up, check on your family member, call police- just don’t follow scammers’ directions. These kind of calls in fact come from outside the country and frequently from prisons!

Identity theft is one more way that financial fraud occurs, and the most common way is when someone gets hold of your SSN and other personal information. Scam emails and phone calls are often the way this happens, so be aware of any communication that asks you to provide personal information, if you are not the one that initiated the call, for example.

Using updated virus protection software on your computer as well as firewalls can help protect you from identity theft, and not using the same password for multiple accounts is a good idea. Since we all have many, many online accounts needing passwords, sometimes buying a password manager program such as Dashlane or LastPass is a good idea. They generate and store complex passwords for you and are typically easy to use. Another good idea is to check your credit report once a year; this is completely free to do. Several years back, I hadn’t checked mine for a while, and when I did do that, I found that while there were no actual fraudulent entries, what had happened was a person with a name similar to mine had entries on my report. It took a phone call to the credit agency to sort out which were my entries and which were not, and I was really glad I took the time to find out that information and get it corrected.

To get your free credit report, search online for “free credit report” and select one of the main credit reporting agencies of which there are three- Experian, Equifax and TransUnion. Any of those sites offer credit reports for free once per year; just be sure you are not entering a credit card number or signing