Close The Deal Podcast with Dan Pace

CEO- First Financial

In this Close The Deal Podcast special episode of "Your First Franchise," host Ewell introduces his guest Dan Pace, the founder of First Financial, which specializes in financing for franchises. 

Dan, who has a background in football and currently enjoys cycling, shares his journey from being an athlete to a financial expert helping entrepreneurs.

Dan opens the discussion by highlighting the importance of mentorship in his life, attributing much of his success to the guidance he received from family members and industry mentors. He emphasizes how his uncle Dino, a lifelong entrepreneur, taught him crucial lessons about business and finance.

Dan transitions into the core of the podcast, discussing the financial services offered by First Financial. He explains the company's specialization in Small Business Administration (SBA) loans, particularly beneficial for franchisees. Dan describes three main loan products: the Express Loan, the Dream Loan, and the Big Ticket Loan.

1.         Express Loan: This loan, up to $150,000, is designed for working capital and is popular among new franchisees. It requires minimal down payment (around 10%) and has no prepayment penalties. The approval process is swift, typically within 24 hours, and funds can be available in 12 to 30 days.

2.         Dream Loan: Ranging from $150,000 to $500,000, this loan also requires no collateral and is geared towards larger franchises or those needing more equipment. It includes interest-only periods and a down payment of 10-20%, with the franchise fee counting towards the down payment.

3.         Big Ticket Loan: For amounts over $500,000, this loan is suitable for significant investments like buying buildings. SBA guidelines necessitate additional collateral, usually in the form of real estate. The loan is amortized over 25 years, making it feasible for large-scale projects and property acquisitions.

Dan discusses the growing trend of franchise resales and how these loan products facilitate such transactions. He also highlights the benefits of owning real estate for business operations, noting that it can often be more economical than leasing. SBA loans can be used to purchase properties, with the requirement that the business occupies at least 51% of the space.

Dan touches on the current high-interest rates, which are at a 22-year peak, and the anticipation that rates may decrease later in the year. Despite high rates, there hasn't been significant hesitation from entrepreneurs seeking to start or expand their businesses.