Glossary of Terms for Small Business Owners
SmartBiz Advisor™ is the first, AI-driven online education tool to make financial insights and analysis provided by a typical CFO available to small businesses at no cost.
With SmartBiz Advisor, small business owners can learn whether their small business is likely to be approved for a low-cost SBA loan before they apply and monitor the financial health of their business over time.
Here are elements that help explain SmartBiz Advisor as well as terms you’ll come across on your SmartBiz Advisor dashboard.
AI (Artificial Intelligence)
This is a machine’s ability to keep improving its performance without humans having to explain how to accomplish tasks. The SmartBiz Advisor tool uses artificial intelligence and machine learning to calculate data from thousands of small business owners to determine the likelihood of being approved for an SBA loan.
Learn more in this article penned by SmartBiz president and co-founder Sean O’Malley: http://www.smarthustle.com/can-ai-stop-business-failure/
Business Credit Score
Your FICO SBSS score, also known as a business credit score, is calculated by reviewing personal and business credit history. Other business financial information also comes into play like the age of your business, number of employees along with financial data.
Business Debt Coverage
Business Debt Coverage is a ratio that measures your company’s ability to repay business debt, providing a snapshot of the overall financial health of your business.
Business Debt Usage
Also referred to as the debt-to-equity ratio, business debt usage compares your total outstanding business debt to annual business revenue or total business assets.
Business Revenue Trends
Simply put, the Business Revenue Trend is a percentage that reflects the revenue growth of your business over time. It illustrates how your sales have increased (or decreased) over your years in business.
Combined Debt Coverage
This ratio adds together your annual personal and business cash flow and compares them against your combined annual personal and business debts.
Commercial Real Estate Loan
SmartBiz Loans offers low-cost SBA 7(a) commercial real estate loans for the purpose of refinancing or purchasing commercial real estate where you operate your business.
A valuation performed by lenders that determines the possibility a borrower may default on his debt obligations. It considers factors, such as repayment history and credit score.
Debt Refinance Loan
SmartBiz Loans facilitates SBA loans so business owners can refinance or pay off existing high interest debt.
Learn what types of debt are eligible here: https://www.smartbizloans.com/debt-refinance
Fair Isaac Corporation, the largest and best known of several companies that calculate credit scores.
The SmartBiz Advisor tool acts as an Intelligent CFO™ to help a business owner understand factors a bank would use to evaluate their business and how their business rates against these factors in a personalized way.
Key Bank Criteria
Each of the key areas that banks use to evaluate your business like debt coverage, debt usage, credit and business revenue trends.
Loan Ready Score™
The SmartBiz proprietary Loan Ready Score™, built by analyzing thousands of small business financials with our intelligent platform, helps you learn how your business stacks up to get a low-cost SBA Loan.
The concept that a computer program can learn and adapt to new data without human interference. The SmartBiz Advisor educational tool uses machine learning to calculate data from thousands of small business owners to determine the likelihood of being approved for an SBA loan.
Personal Credit Score
Your personal credit score is a number that represents your creditworthiness and tells lenders how likely are you to pay back the money you’ve borrowed.
Personal Debt Usage
This ratio compares the total personal debt you owe to the total limits on your credit accounts. It’s an important indicator to banks of personal liquidity should unexpected expenses occur.
Preferred Bank Partners
SmartBiz Loans has a marketplace of SBA preferred banks. We match you with the lender most likely to fund your loan, getting you to a “yes” easier.
Learn more about how it works on the SmartBiz Loans website: https://www.smartbizloans.com/
The Small Business Administration is a government agency founded in 1953 and created to support entrepreneurs and small business owners in the United States.
A Small Business Administration loan. The “gold standard” in small business loans due to low rates and long payback terms. Get all of the details about the SBA and their loan programs here: https://blog.smartbizloans.com/blog/fast-facts-what-is-the-sba-what-is-an-sba-loan/
The Small Business Scoring Service. This score is one factor that helps lenders determine how likely your business is to make timely loan payments and ultimately pay back the loan in full.
SmartBiz Advisor helps you learn how banks typically evaluate your business and recommends ways to increase your likelihood of approval when applying for the low-cost funding you deserve.
Learn more: https://www.smartbizloans.com/advisor
Working Capital Loan
A working capital loan is a loan that has the purpose of financing the everyday operations of a company. You can use the funds in a variety of ways. Learn how funds can save you money and grow your business here: https://www.smartbizloans.com/working-capital
Not sure if you qualify for an SBA loan? Try the new SmartBiz Advisor™ online, educational tool to learn about how you can get your business SBA or bank loan ready before you apply – no cost involved. You can assess key criteria banks consider and where your business stands on each. Learn more about SmartBiz Advisor here.