Minnesota attorney Aaron Hall speaks with Venture Bank vice president Nathan Urfer about some of the lending issues businesses may face.
VP & Commercial Loan Officer
6210 Wayzata Boulevard
Golden Valley, MN 55416
Phone: (763) 398-3333
Fax: (763) 398-3323
Aaron Hall: Nate, what kinds of problems are your new customers experiencing out there which leads them to you.
Nathan Urfer: You know, prospects are seeing a lot of…their current bank not being able to help them with certain regulations that had been placed upon the bank or unwillingness whether it’s certain industries that they’re in regards to that.
Aaron Hall: So just the banks won’t lend to them but Venture Bank can work with these individuals.
Nathan Urfer: Absolutely we can. Another thing is they’re seeing…there’s a lot of inconsistencies that they’re seeing with their current bank where one time, they’re happy with them. Six months later, financially we’re doing better, but now we don’t have that feel good relationship.
Aaron Hall: So let’s say you have a high-risk customer…well, from a high-risk industry such as commercial real estate come to you. How is the way you look at them going to be different from how another bank looks at them?
Nathan Urfer: Really, we come in with the attitude. Let’s meet. We can’t just go out there and shoot out emails. Let’s meet.
Aaron Hall: You don’t judge them by the numbers. You sit down with them.
Nathan Urfer: Absolutely. Sit down. The first thing we ask them, very important, “How can we help you? How can we help?” Because we built this bank one customer at a time. When we enter into an agreement, a relationship, people are banking with us for their relationships. We want to be there for them and everybody wants to be your bank when times are good, but when times are bad, that’s when you need your bank to be there for you. We sit down. “How can we help you” is the first thing we ask. Sometimes, it’s “Hey, help me help you. We need to do this. We need to do that.” but have that relationship.
Aaron Hall: What problems are they bringing to you that you then help them with? It sounds like they’re always money problems. Is it they’re trying to expand? They’re dealing with debt? What scenarios are common among your clients?
Nathan Urfer: I think there’s a lot of again inconsistencies that they’re seeing with their current bank. A lot of customers…a lot of business owners don’t know what banks are thinking, and that’s why we try to in our initial meeting explain to them. If they’re not bankable today, we explain to them, “Here’s what the bank looks like, looks at.“ So you can understand as a business owner, where you need to be.
Aaron Hall: We work with one of the big banks. One thing that’s frustrating is every four to six months, there’s a new business banking manager in there. So even though we try to build a relationship so that when weird things come up, you have somebody that knows the business that can help you through that. They continue to rotate human resources in that bank. How many Venture bank locations you have?
Nathan Urfer: We have three locations: Bloomington, Gold Valley, and Eagan. A lot of our lenders are long-term lenders. I’ve been with the bank seven years. Bank’s been around ten years. We have a number of lenders that were original members of that original team, but that’s a good point. We are seeing a lot of that. Business owners are tired of telling their same story over and over again to a new lender.
Aaron Hall: What advice do you have for business owners when they’re preparing to meet with a banker?
Nathan Urfer: A good solid business plan is very important.
Aaron Hall: Formally written out?
Nathan Urfer: Formally written out. Understanding your financials as well. It’s not always the cheapest but surround yourself with good people whether it’s a good CPA, a good attorney, a good advisor. That’s going to help you. Going to an initial meeting, you have good financials. You have a good business plan but if you don’t really understand your financials, bring your CPA with you to that initial meeting.
Aaron Hall: If somebody doesn’t have a good CPA, can they contact you. Do you know some throughout the Twin Cities?
Nathan Urfer: Absolutely. A good referral source of our bank are CPA’s and vice versa. We can reciprocate that referral. That’s great.
Aaron Hall: That makes sense.
Aaron Hall: Nate, when you’re meeting with these frustrated business owners, what types of questions are they asking, and what are you telling them?
Nathan Urfer: Well, the first phone call…the first thing they usually ask is, “Are you actively lending today?” and yes, we are. All banks are actively lending out there. We need loans. Venture Bank, the greatest growth we’ve had was during the reception. We’ve never stopped lending. Lending is very important. We need loans today so yes, we are actively lending. Another one is, “What’s the process? What’s the decision making authority?” They’re really frustrated with the lender goes out there, their previous relationship sells it but then, he’s got no control. He’s got no decision making authority. The board is not local. It’s out of state. They don’t know the customer. They want to deal with those decision makers, and we have a local board that meets here. We have easily accessible upper management so that’s important.
Aaron Hall: What is the process for the bank analyzing a certain business and the amount of money it seeks to borrow?
Nathan Urfer: Money to borrow, that’s all across the board depending on what the need is.
Aaron Hall: So they turn in the loan application. What happens internally in the bank with that application?
Nathan Urfer: First of all, we meet with the client again. We’re a relationship bank. We want to meet with the people that are going to pay us back. We can go through the numbers and all that but when it comes down to it, it’s the individual that’s going to find a way to pay back. We want to meet with those individuals. There’s a process. If it’s a SBA loan, it will say, “Venture Bank is a preferred SBA provider” which is important where we can make those decisions on those SBA’s. We don’t have to package that up and send that out. Historically, Venture Bank has been on the top 5 of our peers in SBA lending so we do a lot of SBA loan