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  • Writer's pictureAmi Kassar

Amisight 9/22: The Debt Paradox

Here is a pattern that we often see.

When we start our businesses, we are so excited to get going that we are willing to sell our firstborn to do it. We take on debt and do whatever it takes to get up and running.

The first few years are often rough, as we struggle to figure out our model, and soon we have monthly loan payments to worry about.

If things go well, we work our way through it. The business gets on a stable footing, and we get our loans under control.

At this point, we understandably never want to see another loan payment again. However, the paradox is that we have finally figured out the model, and this is the time to scale up and throw the fuel on the fire. It's less risky to borrow money at this point to grow than it was before.

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1 Comment

Tim Tolan
Tim Tolan
Sep 22, 2021

So true Ami. And over the course of owning my own business I’ve done all sorts of short term loans that I would NEVER consider doing again. It’s sometimes what a SBO has to do to keep the trains running on time. Having said that we did an SBA loan to expand our business and its one of the best business decisions I’ve ever made. We will more than double revenues this year with bigger and more lofty goals for 2022. Would never have happened without the expansion capital.

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