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Ross Perot once told me that when he was starting his new company, no one would invest in his idea except his wife and mother. “And that’s why I have 3.3 billion dollars!” he said, with his characteristic ear-to-ear grin. “It’s all about equity son, equity.” His risky hard work paid off, but Ross was also lucky that he had some money from his wife and mother to start out with. That’s not realistic for most people starting a new photography business. You’ll need to use other people’s money to do that, the kind you find in a bank.

In my last column I mentioned writing a business plan and getting an SBA (Small Business Association) Loan. The good news is, the Obama administration recently beefed up the SBA, and there is a new push to give out a bunch of $35,000 loans. What are you waiting for? Write the plan! You might qualify for more.

Tell Them Who You Are
One small problem you might run into is that most bankers know little about photography and are skeptical that there is much money to be made with a camera. They understand restaurants or furniture stores, but they usually don’t get many photography businesses applying for loans. (That’s probably because, unlike furniture store owners, photographers expect money to arrive via magic, without the normal agony of sweating up a five-year income projection.)

In order to overcome the banker’s doubt, your business plan has to be solid, satisfying their need to understand what you are selling, who you are selling to, and how much money you expect to make over a set period of time. They need to be able to asses the risk for the return of their loan. It will help to clarify your vision for your future to the point that you can explain it in a mission statement that is 25 words or less. Tips for writing business plans are all over the internet, especially at SBA.gov.

Show Them What You Do
When I first heard about the SBA in 1993, I was technically bankrupt, having spent my life savings on my first book project. I won’t deny that learning to create spreadsheets and to write marketing and sales stuff was a nightmare. Like being stabbed in the eye over and over.

On top of that, I felt completely out of my element as a photographer going in to meet the banker. Although I’d been trying to build a relationship him over the past few months, I was sure when I asked for this big SBA loan, he would laugh me out of the bank. But I was pretty desperate, with a mortgage, a wife and child, and a ton of debt. I had to try.

On my way out the door for my bank meeting, I did something people might laugh at: I grabbed my portfolio to show my banker. I knew my business plan might not get through, but I was pretty sure I could get his attention with my images of news events, sports, and celebrities. Turns out, I was right. A banker’s world is fairly predictable; lots of numbers. It was a welcome break to go through my work, and it gave me the chance to connect on a basic human level with this critical decision maker. I got the loan — $100K — and never looked back.

Get Them On Your Team
An important part of this story is the concept of “relationship banking.” I had gotten to know my banker over time. It’s important to identify a bank in your town that is actually supporting small business through it’s lending policies — even in this economy — and then make friends with the bank manager.

Build a relationship as you would with a picture editor you want to work with. Take out a small loan, even $5,000 and repay it regularly over three months. Take out another loan for $10,000 and repay that quickly. Build trust. Then bring in your plan, along with your portfolio, and make it happen.

After I got the SBA loan for $100K, and knowing I could get my business going with half of that money, I turned around and asked my banker to put half of it in a savings account and freeze it to collateralize a 50K line of credit. That told him how serious I was and how hard I intended to work. It also gave him another incentive to help me grow into a larger customer. And I asked him to agree that if I handled that credit line properly, that line would be unsecured in a year. He agreed and a year later I had both the SBA money and the credit line, giving me ample capital for further growth: new equipment, portfolios, and serious marketing campaigns.

I learned then that it pays off to engage everyone on my team as a partner in my success — insurance agents, lawyers, and all my labs and equipment vendors. By getting them invested in my endeavors, since they were also relying on me for their business, they all had a vested interest in my continuing success.

This seems obvious in retrospect, but so few photographers take the time to really build relationships with the people they most rely on. A few lunches, gift prints, and keeping people abreast of your new projects and successes can go a long way when times get tough. And if you can get an insurance agent excited about the photographs in your portfolio, imagine how easy that next meeting with an art director will be.