1. Financing your growing operation
Key Programs & Considerations
Good afternoon, Beginning Farmers!
By a show of hands:
How many of you are starting up your own farm, ranch or agribusiness? Or the first generation in your family to farm or ranch or own an ag business?
How many are transitioning or planning to transition into an existing operation?
How many are both??
Good! In my travels, I’m often asked, or told concerns about, quite frankly, that there’s not enough new entrants into agriculture production, whether attached to an existing operation or unattached and entrepreneurial. I’m quick to share that that is not my experience. At FCSAmerica, young, beginning producers continue to find opportunities to grow, expand, retool, reshape, diversify or transition into another operation. They’re adapting to the changing economic environment and finding ways to succeed in these challenging times. Many other beginning farmer lending programs continue to see interest and demand, including the Farm Service Agency, the Iowa Finance Authority, etc. I’ve been reminding folks that economic turbulence brings opportunity, and we’re seeing that manifest in a variety of ways.
Okay, I digress. What I want to focus on in our short time together is the key programs and considerations as you look at financing the start-up and growth of your operation.
Now, in order for me to talk about available programs, I’ve got to set the stage. And this is applicable for everyone. I know that not everyone will need loans or credit, even while starting up an operation, but many of the principles that guide lending/financing are those that guide good business management. Let’s discover that together:

2. Top Programs to Consider
Farm Credit Services of America
AgStart Financing
Real Estate, Improvements, Livestock, Machinery and Operating Financing
Eligibility limited to “young” or “beginning” producers
Development Fund
Business planning assistance matched with working capital investments
Matched with AgStart or conventional financing, eligible borrowers can complete a business plan and apply for up to $150,000 in liquidity via a low-interest term note.

3. Top Programs to Consider
Farm Service Agency
Direct Loans
Farm ownership and Operating Loans
In addition to Y&B lending, they offer these loans to minority and disadvantaged borrowers
Microloans
Guaranteed Loans and Lender Participations
Lending solutions that partner with your local Farm Credit/Lender
For many, helps the lender take on the collateral risk with your operation.

4. Top Programs to Consider
Iowa Ag Development Authority
Beginning Farmer Loans
Partners with lenders or contract sellers with the issuance of federal tax- exempt bonds
Custom Farming Tax Credit Program
Spread out equipment cost & assistance in price competition
Loan Participation Program
Assistance for low income producers
Last in/Last out; can partner with FSA 5/45/50 program.

5. 5 “C’s” of Credit
Another show of hands: how many of you have heard of the 5 C’s of Credit? Or the 6 C’s or …. Just the general concept of C’s of Credit?
Okay, in the next 60 seconds, together, with your tablemates, come up with what you think are the 5 C’s. And if you’re sitting alone, make your tablemate Google 
As soon as you come up with the 5, raise your hand to let me know you’re done.
Okay – so everyone hands up, and we’ll take these one at a time, in an order that’s convenient for my presentation. If you missed the one I name off, you have to put your hands down. First, how many of you came up with Capital? Capital being the cash, assets, equity, value, etc, both short and long term, that make up the financial content of your operation.
Next, Collateral?? The assets that secure your commitments?
#3, for 30 points: Conditions?? The terms and structure of your financial commitments….
Next, Capacity?? Your operation’s financial capabilities to perform, including servicing your financial obligations.
And finally, Character?? Your integrity, management ability, historical performance, etc.

6. 5 “C’s” of Credit _CAPITAL___________________________
_COLLATERAL_______________________
_CONDITIONS_______________________
_CAPACITY__________________________
_CHARACTER________________________
Another show of hands: how many of you have heard of the 5 C’s of Credit? Or the 6 C’s or …. Just the general concept of C’s of Credit?
Okay, in the next 60 seconds, together, with your tablemates, come up with what you think are the 5 C’s. And if you’re sitting alone, make your tablemate Google 
As soon as you come up with the 5, raise your hand to let me know you’re done.
Okay – so everyone hands up, and we’ll take these one at a time, in an order that’s convenient for my presentation. If you missed the one I name off, you have to put your hands down. First, how many of you came up with Capital? Capital being the cash, assets, equity, value, etc, both short and long term, that make up the financial content of your operation.
Next, Collateral?? The assets that secure your commitments?
#3, for 30 points: Conditions?? The terms and structure of your financial commitments….
Next, Capacity?? Your operation’s financial capabilities to perform, including servicing your financial obligations.
And finally, Character?? Your integrity, management ability, historical performance, etc.

7. Character
&
Capacity
Another show of hands: how many of you have heard of the 5 C’s of Credit? Or the 6 C’s or …. Just the general concept of C’s of Credit?
Okay, in the next 60 seconds, together, with your tablemates, come up with what you think are the 5 C’s. And if you’re sitting alone, make your tablemate Google 
As soon as you come up with the 5, raise your hand to let me know you’re done.
Okay – so everyone hands up, and we’ll take these one at a time, in an order that’s convenient for my presentation. If you missed the one I name off, you have to put your hands down. First, how many of you came up with Capital? Capital being the cash, assets, equity, value, etc, both short and long term, that make up the financial content of your operation.
Next, Collateral?? The assets that secure your commitments?
#3, for 30 points: Conditions?? The terms and structure of your financial commitments….
Next, Capacity?? Your operation’s financial capabilities to perform, including servicing your financial obligations.
And finally, Character?? Your integrity, management ability, historical performance, etc.

8. CAPABILITIES
REQUIREMENTS
&

9. Preparing to Meet with a Lender
Do the hard work of planning (ask for help!), including:
Strategic
Business
Financial
Risk
Make the 1st meeting about your plan and the lender’s capability to assist with that plan
Ask for their advice and feedback (It’s free and a great way to test their willingness to learn about you and your plan)

10. Final Comments Persevere: Economic turbulence brings opportunity
Stay sharp: Practice planning, implementation & assessment
Give yourself a break: Focus on your top strengths and skills; partner for your other needs
Marry Up: Take time to assess potential business partners/ service providers; interview them and ensure the right/best fit

11. questions