How to De-Risk the Personal Guarantee

I think just to take a step back, we are not going to be able to reduce the risk to zero. And the best advice I ever heard in this world was from a close friend in Charlottesville, was you need to be able to sit at the dinner table, sit across from that owner and trust them with everything you possibly can. And if you don't trust that owner, no contracts or anything is really going to be able to…

And to be totally clear on your example, our policy is claims made and so exclusions apply. There's details, we're happy to review that with everyone. But if you've got our policy in place and the actual lenders coming after you for your personal assets in that period, we've got coverage in place.

And so anytime anyone's pushing against a non compete, you want to walk away Any butterflies you have in your stomach that you don't trust this person, you just walk away. There's lots of incredible entrepreneurs out there and a lot of opportunities, but that's where really people go wrong, is when you've got the wrong individual you're sitting across from and no amount of contracts or anything…

Let's do a couple examples, guys. Can we do that? Do you have a couple that you brought with you?

Yeah, we've. So we've had a number of conversations. We've talked to a lot, a lot of borrowers. We, we spoke to, you know, Brian mentioned kind of in non specifics borrower spoke to in the last couple weeks who has been going through this process for a couple years.

They, like many people in this space, have a very supportive spouse that is helping their family stay afloat as they have left their job and focused full time on DTA journey. And despite this support from the spouse, it's still tough to wrap your head around putting the house that you and your spouse live in on the line. And you feel this guilt inside because of the weight that you're kind of…

And then your mind starts to wander and you think, if I buy a company, it goes bad, the weight's going to be worse that I put on this family. The guilt's going to be incredible. How am I going to, how am I going to do this?

And without risking everything that my spouse and I have built. And this is the type of person that has really been waiting for a policy like this to be, to be available to him. And that's the type of person.

There's many different types of people that we're trying to support, but someone who's really feels the weight of entrepreneurship and the guilt of potentially causing their family to be in trouble is the kind of person that we want to really encourage to wrap their head around the risk that they're taking and reduce that risk in a way that they can go full bore into the, you know, business…

I think the thing that was really ironic about that was it was a second generation entrepreneur in Oregon and his parents had initially used SBA loans to build out their family's wealth. And I think it was actually through some restaurant franchises and some lodges and the parents, their whole family's net worth before they came over here was initially, many years ago, built on the SBA program.

And the story that's really sad was he didn't want to put Everything that his parents had earned. He was 40, 50 now. He didn't want to put all that hard earned wealth back on the line for his SBA loan. And it was just a really interesting story of how this can empower, you know, first generation families.