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Episode 12: Funding your Small Business

• American Gutter Monkeys, LLC

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 Starting a business takes more than just a good idea—you need a funding strategy that fits your goals, risk tolerance, and lifestyle. In this episode of Monkey Business Radio, we break down the four most common ways entrepreneurs get their ventures off the ground: bootstrapping with personal savings, acquiring debt, selling equity, and using a royalty-based model.

We talk candidly about the financial realities of starting small—selling off personal assets, living lean, and making trade-offs early to build long-term success. You’ll hear real-world stories, from founders who turned a few thousand dollars into multimillion-dollar companies, to legendary gambles like the FedEx founder’s last-ditch trip to Las Vegas.

We also dive into the unique appeal of royalty-based models like franchising—where you can own your business but benefit from systems, support, and a proven brand. If you’re exploring franchise ownership or looking for a smarter way to launch a service business, this episode offers practical insights, cautionary tales, and encouragement to help you make informed decisions.

Chris:

Hello, Welcome to Episode 12, Funding your Small Business. Today, we're diving into one of the biggest decisions any entrepreneur can face how to fund a startup. Taking on debt can be a powerful tool for growing businesses, but it comes with a serious risk, as we say in this episode. I think it was Dave Ramsey said you know, before you take on debt, make sure you know how you're paying it back. Huge your lender, not you owns your future. In this episode, we break down different funding strategies Bootstrapping, taking on debt, bringing in investors, royalty-based models, sharing personal experiences as well as real-world examples of businesses that made it big. Whether you're launching a small side hustle or aiming for a multi-million dollar company, this episode will help you navigate the financial choices that set your business up for success. We have a great episode for you, so grab a cup of coffee, sit back, relax and welcome to Monkey Business Radio.

Chris:

Hello everyone, Welcome to episode 11, Funding your Small Business. And, as always, I'm here with Dennis Siggins. Dennis, how are you today? Not too bad. Chris, how are you doing? Good, good, you know this is a critical subject to talk about when you're funding your small business. You know how you get started really kind of sets you for the road ahead, so I'm going to dive right into it today. There's a number of different ways of doing it. You've probably, in your career, probably experienced a number of them. I certainly have hit a couple of them myself. So why don't we just kind of dive in? What do you have in mind today? What are the different methods? We're going to be discussing A lot of different methods.

Dennis:

Probably a very common method of startup is bootstrapping. How to fund a startup is bootstrapping? It means you're basically self-funding it out of your bank account, out of your checkbook, your savings account, whatever you have. An awful lot of small businesses start that way, especially a contractor who already owns a truck. So you know he may put five or seven or maybe $10,000 of his own money into the business and he's up and running. He has to buy a few tools. That type of thing, as a sole proprietor, you can bootstrap as a partnership.

Chris:

Now, you've had a little experience with that. Of course, you've bootstrapped a number of companies, including, I believe, the Cape Cod Gutter Monkeys.

Dennis:

That was yeah, a few other methods and we'll get to them. You can acquire debt, take on a loan at the beginning to get you started. Some people can sell stock in the company before they start and there's a royalty-based model, which I have a little bit of experience in that area as well. But let's go back to the beginning and talk about bootstrapping. Yeah, I've owned several companies in my life that I've bootstrapped.

Dennis:

Yeah, including our current group of companies that started out as just the one original business, the Cape Cod Gutter Monkeys, and it's grown into many different businesses as it's grown over the years, but that's one that my partner, andy and I we had an old truck, we had about a 10-year-old truck, and I think we each kicked in six or eight grand to fund the startup bank account and we were off and running the beauty of starting, let's say, as a sole proprietor with no debt. First of all, a lot of companies, a lot of multi-million dollar, million and multi-million dollar companies, have started with little to no debt. They started from a bootstrapping model and have grown to huge amounts of annual revenue.

Chris:

Yeah, it's a great example. Are you familiar with Spanx? Yeah, spanx, she started with $5,000. Sarah Blakely, sure, $5,000. I see her on the Shark Tank Billion dollar brand. Yeah, is she on the Shark Tank?

Dennis:

She's one of the people that she's been a guest there many times, yeah, many times. Yeah, yeah, she's incredible Five grand. She started with, actually, mark Cuban. He was very critical of just this whole group of presenters on the shark tank. They come in and they just they sell stock early, they overvalue their company, they just make a lot of rookie mistakes and one time Mark commented hey, look, every one of us up here has started companies for $5,000 or less that have grown to $20, $30 million and more.

Dennis:

Yeah, taking on debt early can be good We'll get to that in a little while but, man, it's great if you can start your business with no debt. It takes the pressure off and you know, if you start with no debt and you keep the owner's salaries low for the first year or two, that creates a solid buffer against inflation fluctuations and just the normal business cycle and other economic challenges. If you start with no debt and you begin to grow, eventually you may need a line of credit and you'll be in good position to acquire that line of credit if you have no debt.

Chris:

Right. This kind of ties into the previous podcast we were doing on financial literacy. Certainly is keeping another reason why you keep your personal debt down to absolute bare minimums, because it allows you to take on a job or take on a chance like this on a new business. You can't do that. It's hard to do that. If your credit cards are maxed out, you know your personal finances are a mess.

Dennis:

In fact, when we started the gutter monkeys, I sold my Harley and I sold my boat. And it's not that I needed the money, it's that I knew my bike and my boat would be a distraction. And when you're first starting a new company, you got to be there 80 hours a week and I don't want to be looking at that beautiful 2003 Heritage Softail looking at me every day in the garage and I know I can't take that to work and my boat's just going to be sitting in dry dock. So yeah, actually when we started the gutter monkeys, I sold the Harley and I sold the boat.

Dennis:

And I often recommend to our franchisees and other businesses that I consult on get rid of all that extra stuff, get rid of the extra car. Cancel the country club membership, because that's revenue that could even if it's personal revenue, that's revenue that can be channeled to the company if needed. But also, if you're out fishing or if I'm out riding my bike or you're out golfing at the country club, it's costing you money to be out there. It's also keeping you away from your business. So I like to get lean and light.

Chris:

Yeah, yeah, I experienced that a bit. I haven't started a company bootstrapping, but certainly joining startups from ground up certainly is sort of like that and that's we had kind of experienced. My wife, Sandy, quit her job for us to be able to do that, so we lost half our salary and of course that ended the trip down to Florida to play golf with my buddies and the cruises that my friends would take with their families and stuff like that. But it did pay off in the end. But yeah, you got to make that commitment. Financially it can be pretty difficult. I remember coming home quite a few times frustrated on a Friday night saying, oh, that's it, let's all go out to dinner and da-da-da-da and go away for the weekend. And Sandy would be like have you checked the?

Dennis:

checkbook lately.

Chris:

That's not going to happen. So, yeah, it's very difficult to do. It's very difficult to do.

Dennis:

When my wife and I were very young, we became innkeepers. We bought an inn up in the White Mountains and we were flipping houses. I mean, it was easy to do in the 80s. We had it down and we also had purchased a company that was struggling. We purchased it for very, very little money and when we finally found the inn we wanted to buy, we sold everything I sold in the eight months six months prior to buying the inn and the six months after that one-year window. We sold all five of our properties that we owned, including a house that we lived in. Yeah, we sold five pieces of real estate and I sold a startup that I had bought.

Dennis:

While I had bought it, rescued it and I didn't even know the value of it. We ended up making some good money but, yeah, I sold everything. We just cleaned the clock, sold everything we owned to buy the end inn and it worked. It wasn't really a true bootstrap because I did have to have some bank assistance along the way, but I didn't want any distractions. So I didn't want to be flipping houses during those first three or four years getting into the hospitalities, because I know how many hours it takes. So, yeah, we just cleaned everything. We had nothing left except the inn. We really did put all our eggs in one basket, but again, the moral to that story is get rid of everything that might become a distraction and turn it into cash.

Chris:

Yeah, there's a great quote, you know, see if I can get it right here. Entrepreneurship is living a few years of your life like most people won't, so you can spend the rest of your life living like most people can't.

Dennis:

And it changes the way you think. Yeah, you know, as you go through your life and I've often said this you know the best day ever is the first day you start your business and the next best day is five, seven, eight years later when you sell it. But you get addicted to the process.

Chris:

Yeah, those tough years. But we look back on them. Sandy and I both look back on it, and still with a lot of fondness, because they were good times as well, some joy in the struggle, so bootstrapping it's easy, it's a great way to start a small business.

Dennis:

You can transition from a bootstrap model to taking on debt later down the road. But bootstrapping either as a sole proprietorship or bootstrapping with a partner is a very common method of starting a business. And I'll just sort of close this one out by saying if you have a partnership, you know you really want to first of all make sure that you and your partner are 100% trusted by one another. This is a tough one. Number two is how much cash does each partner contribute? And I would always recommend that you look at one another, you and your potential business partner. You kind of want to have a similar philosophy, but it's great if you have different skill sets. Yeah, two guys with the same skill sets, two girls with the same skill sets may not be as complimentary to one another as two business partners with opposing skill sets. You know the Ben and Jerry story right A little bit. I don't know a lot of it, but I've been there. I've been to the place up in Waterbury, vermont.

Chris:

Yeah, where they started out. They started out selling ice cream out of a I think it was a gas station, and it turns out they were making ice cream and Ben has no sense of taste or smell. So they were having a lot of issues coming to terms on what was, you know, constituted good ice cream. They kind of figured it out, but what that led to because they had such different abilities what it led to was a version of ice cream that was more flavorful and more textual. So that's why you have Chunky Monkey and all these things in there, because that's what Ben liked, because he couldn't pick up as much, and so the two of them. As a result of doing that, it became a hugely popular ice cream.

Chris:

And it was that combination of the two of them. They both didn't have the same taste, they both didn't have the same sense of smell. A perfect example. Yeah, I think they ended up doing 12 grand. I think four grand of each of their money and four grand from an investor or family or something like that, and they built Ben and Jerry's.

Dennis:

Yeah, it's probably a billion dollar business to this day.

Chris:

I have a question for you, though Interesting one, about going into business with friends. Now you went into business with, actually, two of your college roommates, long-time friends, I mean. When it comes to trust and things like that, I mean, who can you trust better than longtime friends? You understand each other have the same goals. But you also risk friendships. I know in person. You know I've done a couple of startups where that became a big problem where it doesn't work out well and you can loom friendships.

Chris:

So that's kind of a one of the things that I kind of thought about, what's kind of struck me when we get into this discussion of partnerships.

Dennis:

Well, andy and I, when we started this current company, which has grown to be Cape Cod Gutter Monkeys, american Gutter Monkeys and all of our affiliates, it was just he and I, and he came from a corporate world. He was the CFO, you know, the vice president of finance, of a large company. I came from a background of being self-employed, especially in the hospitalities and the trades, and I had a few short-term goals, and number one was friendship can't be compromised. Number two is Andy cannot miss a salary. He's never been self-employed, so I didn't ever want to have a bad month where Andy wouldn't draw his salary. That month.

Dennis:

Third was we wanted to get to the point where our salaries would match the salary that Andy left behind, so that maybe after two years we could get to that point. And each of those was very important and I can tell you Andy and I, I could trust him with my life. Every now and again there'll be a little minor thing going on and Andy will come into my office and say hey, here's what happened. One of our coworkers ran into a little tough time and the company loaned him $5,000 and just wants you to know that and he'll just make a schedule. So our coworker ran into a hard time. We're just paying back on a regular schedule.

Chris:

We would never do anything like that without telling the other one and we trust each other implicitly on that. Yeah, yes.

Dennis:

Communication is so important with, and you can't let tough times in business come between friends. Yeah, and Barbara and I were business partners for a lot more than 40 years and when you're married to your business partner man, I mean I think it's great. It was great for us our whole lives. It was great. But I've seen other situations where it didn't work out that way.

Chris:

Yeah, Especially in the startup world. I know I have a couple of different startups. It's tough on marriages, really tough on marriages. Fortunately for me, my wife, Sandy, decided to stay with the kids and that allowed me to like throw all my weight behind the startup. So we weren't, like you know, both coming home at 11 o'clock at night or something like that. So that really kind of made it. You know, she made it easy on me, but yeah, it's very tough.

Dennis:

I've seen that Some businesses can start up by acquiring debt. They might need debt. Taking on debt early can be risky. Taking on early debt can definitely put an added strain on the startup. Taking on early debt can also help the company grow in ways that bootstrapping maybe can't, and there's a lot of considerations to this.

Dennis:

Let's say, for example, you're going into the hospitalities like a hotel or a restaurant or an inn. Or let's say you want to open up a theme park or you want to buy a ski resort. You're not going to bootstrap that. There's some businesses that are just too big that the average person, or even above average person, wouldn't be able to bootstrap it. So there are some businesses, some startups, you just got to take on debt. In a much more realistic format, most startups are small businesses and may or may not need to take on debt. But there's different ways to take on debt if you have to.

Dennis:

Let's say there's a young guy who wants to start a landscape company and he doesn't have any money. Maybe he has five grand. It's hard to do that. You need to buy a truck, you might need to take out a loan of some sort, and let's say you need $50,000 to start this landscape company. Do you want to apply for an SBA loan or do you just want to go purchase a truck and finance the truck? It's much easier and you're going to get a lower rate if you just finance a truck and if you have another five to 10 grand that can purchase your tools and equipment to get you started, whereas if you apply for an SBA loan, there's a lot of compliance, a lot of hoops to jump through and expenses right. It can take months and there's always startup fees. There's financing fees to access the SBA loan.

Chris:

That always seems so weird to me and I didn't know about this. This is not my area of expertise and we were talking about this in a previous podcast. It just seemed counterintuitive that an SBA loan would be very expensive for a small business to actually get. It just seems like it's counterintuitive.

Dennis:

Why is it like that? One of the buildings we were selling a couple of years ago it was before we were in this building here was being purchased and our attorney that was doing the closing he wasn't doing their closing, but there was another closing he was doing that involved each of the two parties the buyer and the seller were each working through an SBA loan process and our attorney just said you guys are so fortunate that you're not going through that. The time it takes it's months and months and there's a lot of compliance, dotting the I's and crossing the T's, and then there's the upfront expenses that is necessary to get an SBA loan. It's very difficult and very time consuming. So if you need $50,000 to buy a truck, tools and equipment, consider just purchasing the truck and getting the truck loan from the dealership and you probably get a better rate with little to no compliance, and you can take that extra maybe five or 10 grand that you have and go buy that first lawnmower and the string trimmer and a couple of rakes. There's other ways to fund your startup.

Dennis:

If you own a home and let's say you don't have a mortgage or your mortgage is paid down so you have very little mortgage, you can consider getting an asset-based loan, a line of credit on your home.

Dennis:

I've done that before. Sometimes I don't even use a line of credit because oftentimes there's no fees associated with it. So you can set up a $100,000, $150,000 line of credit against your home if you've got enough wiggle room, if you've paid down your mortgage and you have enough equity in your home that you've got enough wiggle room, if you've paid down your mortgage and you have enough equity in your home that you can do that. And oftentimes the banks can set that up for little to no money. I've done a couple of those over the years, especially when we were flipping houses and you need some quick money. It's almost like a swing loan. So if you keep an open line of credit on your own home, you can pull 80 grand out, use it to help fund a house that you're flipping and you pull it back out three months later and you just pay the interest on the three months. Yeah, that's the great thing about it.

Chris:

So it's really not a mortgage, Right. You're only paying interest if you use it. That's exactly right. So it's just laying there open.

Dennis:

And then you put that money back in and there it sits for two more years, whether you need it or not, and it's costing you nothing. So if you've got enough equity built in your home, it's not a bad way to fund a startup. If you need a little extra money, it's a very low interest rate because they're holding the line of credit against your home. So the bank is secure and it's quick and easy. Little to no startup fees. I actually have two clients that I recommended to within the last two, three months and one of them told me I think there was a hundred dollar fee with his bank. That's it. And the other one set his up and there were no fees associated with it. These are two young companies that are a little bit past the startup process, but it just coincidentally happened within the last four to five months with each of them and they each got back to me on that and it worked out very well.

Chris:

So that's a good possible way for you to fund your startup, if those are options for you and of course, there's one we talked about that actually surprised me I didn't know about as well is 401k. So you can actually borrow against your 401k. I never knew that. Of course, that would be a. I don't know if you'd consider it more risky, but certainly a more non-traditional way of doing it, I guess.

Dennis:

Banks have a lot of tools that we don't know about. Erin Frost, who's the manager of my bank, rockland Trust, over in Sandwich here on the Cape. It's amazing, and when I talked to her the tools they have available, she made a recommendation to me about a couple of months ago on a format that they can package a loan together and she gave me three or four thoughts and I said whoa, hold off, tell me about this one. And she did, and it was a perfect fit for what my client needed. It's amazing what banks can and will do for you. That's why you always want to be on a good relationship with your banker. There's a lot of rules and regulations that surround the 401k and I don't know all the details, but I do know that 401k money can be used in many ways either the money itself or used to take a loan against.

Chris:

Yeah, and it has to be paid back just like a regular loan, of course, right.

Dennis:

Right, but it can be done without penalties as opposed to. I know some people over the years that I've met have closed out their 401k or a portion of it, paid the early withdrawal fee and used it to fund their company, and I know the first time I heard it I said I think you didn't have to do it that way. Talk to your accountant, see if you can find out the details on that. And eventually I did talk to my accountant, dave, and he explained yeah, there's a number of ways you can access that money for a company that you own with no penalty.

Chris:

Yeah, like I think it was. Dave Ramsey said you know, before you take on debt, make sure you know how you're paying it back. Otherwise your lender, not you, owns your future. That's so true.

Dennis:

Chris, that is so true. I mean, look at college loans. So many of these young parents with kids in high school have no idea what they're signing on for. Yeah, when they sign on the dotted line and their son or daughter graduates four years later and they got six figures in debt and it hits them like a slap in the face. You got to start paying this back. Yeah, yeah, make sure, always make sure when you're taking out a loan. Look at all your options. Yeah, because there's always more than one option, especially with a startup.

Chris:

Yeah, you don't want a lender telling you how to run your business at some point, which is what ends up happening, you know, if you get in that situation.

Dennis:

Yeah, there's a lot of compliance with certain types of loans.

Chris:

I mean you're taking on a partner when you get a lender. So you know, yeah, yeah, so you know the story of FedEx Fred Smith. No, fedex Fred Smith.

Dennis:

No, it's a crazy story.

Chris:

So anyway, fred, he wrote a paper at Yale on how to do FedEx, basically, and got a C for the paper. So he decided he was going to go out and do it anyway. He had $4 million in inheritance and $80 million in loans he raised based on this paper. And he went out and started working it. And, of course, he started it in 73, which was the oil crisis, which pretty much wiped out even established businesses, not let alone a business that's based on airplanes and whatnot. So he had $5,000 left in his account to make payroll. He got on a plane, went to Las Vegas, made $27,000, came back that week, paid everybody and then stretched it out long enough that they ended up landing $11 million. I think it was $11 million loan and today they're I don't know $60 billion company. But that's all he needed. But that's an example where he actually took, you know, 4 million of his own money and then, you know, combine that with 80 million and actually got it to work.

Chris:

So it's kind of an extreme example of you of, uh, you know, using debt to build a company. It almost got him. You know, it almost got him.

Dennis:

There's a lot of businesses over the years that were close to the edge. That that you know you can never give up and that don't ever give up on your business.

Chris:

And we've hit this on this podcast quite a bit again and you can't figure out all the things that are possibly going to happen. He had no idea that the oil crisis was going to hit in 73. No, I mean, his business was in pretty good shape. He hit that oil crisis and it almost put him out of business. You know, oil for planes and stuff went through the roof. Well, you couldn't even get it sometimes, yeah, you couldn't even get it. So here he has a business, just-in-time business, and you can't up, so just goes to show you. But you know, he kept his cool, took a little bit of a risk, probably more than I would.

Dennis:

I would advise yeah, that's not on our list of things you can do to you know I wouldn't recommend that, but that's sort of an extreme example.

Chris:

But he didn't make it, you know he did at the end, you know, get through it.

Dennis:

Well, you mentioned that he raised additional millions and millions above and beyond what he had acquired. Takes us to our next strategy of selling stock Selling stock in your company before you really own a company. It's kind of a roll of the dice. If you are going to start a landscape company and you don't have the money and somebody loans you $50,000 to start this, how do you value the startup? The startup has no value. You haven't done any landscaping work yet. You haven't created any revenue. So when you're selling stock as a young business owner, it's a bit of a roll of the dice because that investor he might kick in $25,000 and then now you have enough money to get up and running and maybe he owns 25% of the business as a silent partner. Five years later you've got 15 trucks and 20 employees and you're doing $6 million a year in revenue. And the silent partner that floated you $25,000 in the beginning for 25% of your company he owns a quarter of your company and all he did was put up $25,000.

Dennis:

I was actually in a meeting with one of my friends who's an attorney. He's a business attorney. He talked about this. This had nothing to do with why we're getting together, but he said. I see it all the time that this creates the breakup of the partnership, because the owner and managing partner is doing all the work and yet this silent partner that floated him 25 grand is basically taking 25% of the profits at the end of each year.

Dennis:

So be aware of that If you're ever going to sell stock in your company. What my attorney friend told me was it's actually very common it's hey, I'm doing all the hard work and you know. But if you go back and read the contract, you know that's what you agreed to. He's giving you 25 grand and he's going to own 25% of your company. And let's face it, when he gave you 25%, your company was worth nothing, right? You didn't? You hadn't cut a lawn yet, you hadn't installed a shrub yet. So he's getting paid for his risk. He's getting paid for his risk. So be aware of that If you ever, it's usually a family or friend that would loan you this type of money. And just be aware of that, because it does happen, it's real, yeah there's some spectacular breakups.

Chris:

You know that you can go through Part of the research for this. I was kind of looking at some of them. Of course, the big ones hit, you know, Facebook is probably one of the biggest ones where, at any rate, mark Zuckerberg and his partner at the time best of friends broke up over that, basically, and Zuckerberg stuck it to him, diluted him, which is very common, by selling more stock after you bought stock, correct, which is another danger of it and, yeah, broke up their friendship, their long-term friendship. So, yeah, lots of examples in the real world of this sort of problem.

Dennis:

Of course, if you get more, than 50% of your stock sold, you lose control of your company at that point. Yeah, you do. There's pros and cons to it. If you're ever going to sell stock up front like that, make sure that you know the person. And how do you value the startup, the amount of money that they're giving you? What percentage of nothing does that money represent? And then, how well do you know the investor? What are his or her short, medium and long-range goals? Does this person want to cash out down the road? You really got to consider those things. Will this person be a silent partner? Will he just be an investor, or is he going to work in some capacity for the company? Will this investor take ownership? Draws? Have a good business attorney, draw that up, draw, drop your paperwork. So these questions are asked before the money is exchanged and before the agreements are made. Have you ever done a royalty-based model?

Chris:

Well, I'm in a royalty-based thing right now AGM. So yes. So the answer to that question is yes. Basically, that's what AGM is based on. So yeah. So I joined AGM because I love this model. To tell you the truth, I see it as almost like an annuity going forward, and it's a great model. You know, dunkin' Donuts was started that way. He never bought businesses. After he owned his first one, he immediately turned around and started franchising them out, and so he never used any of his own money to grow Dunkin' Donuts effectively. It's a great model startup and it's actually a good model for those people that were joining and getting those Dunkin' Donuts early on. They didn't have to develop the business idea. The idea was developed for them.

Dennis:

I have a client that I helped over the years. He started his first company like 15 years ago. It didn't go well. He tried a year or two later. It didn't go well. He tried a year or two later, it didn't go well. And he would often ask me you know what's going wrong, what am I doing wrong? And you know we would have these discussions.

Dennis:

But the truth is he just wasn't ready. He wasn't ready to go all in. He didn't want to leave the security of his corporate job that he had. He kept starting businesses on the side and as soon as times got tough he would abandon the part-time business and stay with his corporate job. And he got kicked around a few times and I always told him when you're serious, let me know, when you're really serious about starting a business, let me know. And about 10 years ago we had this conversation and he was ready. He was leaving Corporate USA and he was going to start a business and he needed a little bit of money and he really needed a lot of guidance.

Dennis:

So that's one where I, as the investor, provided some startup capital and then for the first two years I worked a lot of hours, mostly nights and weekends, mostly in a consulting format and at year two. That's when I began taking a small monthly royalty, and to this day I still take a 4% monthly royalty and it's worked out great for both of us. Right To me, it's a fun thing working with a startup who's real serious. Now he's been kicked around in the corporate world. He'd been beat up, you know, various times in small businesses that he started and now he was serious about it. So him leaving his corporate job, that told me he's got skin in the game, he's all in, and my putting up the startup money was my skin in the game and I don't really know anything about his industry, I just know business 101. And so about after two years I began collecting my royalty and that continues to this day.

Dennis:

It's a great gig. We still work one day a month, maybe two days a month, tax time. I help him out a little bit, I work with him on strategic planning and other such things and he owns 100% of the company. With a royalty-based model like that, I, the investor slash asylum partner, I really don't own any of the company. He owns 100% of the company and he takes his own salary. He does his own marketing and advertising. He builds his own clientele, he has his own employees. I mean again, I assist him with experience and information and I'm always working with him on various components of his company. But he owns the company 100%. I don't own any of it.

Chris:

That's interesting. So it's kind of a twist on this royalty idea. Typically you think of the Dunkin' Donuts in a royalty deal. You buy your Dunkin' Donuts and you pay royalty to the company. This way it's kind of spun around You've got a company but you're paying royalty to the. You're maybe a fractional CFO is kind of like what you are. I guess is what you would kind of be considered in this situation.

Dennis:

I call it more of a consulting role or, you know, an advisory position, Right right, but a use of royalty in that fashion, which is kind of an interesting way of doing it, sure, and then when I say the royalty-based model, that type of thing, yeah, if you're a young potential entrepreneur and you've got a person, a friend, a family friend, a mentor, you know, with 20, 30 years in the business world, it's not a bad idea. Cut a deal with this guy. Maybe he floats you $50,000 in startup money and he works with you in an advisory capacity and you pay him a monthly royalty. To me it's a win-win. Yeah, that's really interesting.

Dennis:

I've only ever done one of them. I've tossed that idea out to a few other people occasionally. None of them the other ones have ever come to fruition, but the one I did. It's still going and we're both thrilled Wow.

Chris:

To win-win. That's interesting. Yeah, hadn't thought of that.

Dennis:

That's an interesting read on that. So, to wrap up, today's topic is funding your startup Everything from sole proprietors to partnerships who bootstrap it, to taking on debt, selling stock, possibly even a royalty-based model. There's a lot of options out there. Consider any and all of them. There's pros and cons to each one.

Chris:

Yeah, check your resources Again. We talk about all the time. Go to your bank, go to some mentor, find these people that can actually go through these different methods with you or maybe make suggestions or turn you on to people that can help you. It's a difficult thing when you're starting a new company and you don't quite have the resources just to dive right in. So get some help.

Dennis:

Chris, you'll often hear me talk about your inner circle. That's me and my financial planner, my bank or my attorney. You know my accountant. These are the people that you want to talk to before making a decision like this. I mean, if you're going to bootstrap it, you can kind of go that on your own, not a big deal. But if you're going to go outside of that realm, you know, talk to your mentor, talk to your business friend that has been doing this for a while, talk to your attorney, talk to your accountant. Get some thoughts and opinions on this type of thing before you make a decision, and that will assist you in making the right decision.

Chris:

You're never too young to start building that group of people around you.

Dennis:

Yeah, and you're never too old. You're never too old either.

Chris:

Yeah, yeah, you don't want to start doing that 10 years into your business. It's yeah, yeah, you don't want to start doing that. You know, 10 years into your business, something you want to start right out of the gate. All right, well, great, so.

Dennis:

I think that kind of wraps us up.

Chris:

Yeah, that was a good one. Got through it with all of our coughing and hacking and hopefully we'll be better for the next show.

Dennis:

In the meantime, no monkeys were harmed in the making of this podcast. That's right.

Chris:

All right, see you next time. Thank you for tuning in to Monkey Business Radio. If you enjoyed today's episode, please make sure to subscribe, like and follow us wherever you get your podcasts. It really helps us reach more aspiring entrepreneurs like you, and if you've got a question or topic you'd like us to cover, leave a comment or reach out to us on social media. We'd love to hear your thoughts and keep the conversation going. Don't forget to leave us a five-star review if you found the episode valuable and make sure to share it with anyone who might benefit from our tips and stories. We'll see you next time. This podcast is produced by American Gutter Monkeys LLC. Build real wealth through business ownership. For details, visit us at AmericanGutterMonkeyscom.