Banking on Growth
N. D. "Mac" McCullar's mad, and he's not going to take it anymore. In particular, he's fed up with banks that don't understand fast-growing companies. "I've seen too many perfectly good businesses forced under simply because they outgrow their source of capital," says McCullar, the owner of First American Rental Center, based in Lithonia, Ga., and a two-time INC. 500 honoree. Now, he plans to fight back -- by starting a bank exclusively for fast-growing companies.
McCullar hopes to convince fellow entrepreneurs to pool their funds in a bank that would be sophisticated about the opportunities and pitfalls of growth. In making loan decisions, for example, the bank would look beyond tangible assets to such factors as a company's track record, the accuracy of its past projections, and the potential of its future markets. "Traditionally banks value a company at its worth if it closed down tomorrow," says McCullar. "Our bank will assess value based on the business's growth pattern."
Will it work? At least one experienced observer has his doubts. "Too often groups like this underestimate just how difficult it is to get a diverse body to agree on one course," says Dean Treptow, former president of Brown Deer Bank, in Brown Deer, Wis., a leading small-business lender. But similar efforts have borne fruit in the past. In September 1987 the Massachusetts State Carpenters Union Pension Fund opened its own bank in Boston; since then, assets have shot up to $242 million.
Besides, McCullar isn't about to be dissuaded. "Just when they tell me I can't do it," he says, "that's when I know I will."
-- Elizabeth Conlin
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