To delve deeper into the Business Advising Services’ role, we spoke with Osbaldo Velázquez, a business advisor at Momentus Capital with 23 years of experience helping small businesses gain access to capital. He provided key insights into how his team refines business plans and helps entrepreneurs frame their ventures from a lender’s perspective.
How Business Plans Factor into Loan Applications
Osbaldo advises that a business plan serves two fundamental purposes. First, it provides business owners with a structured roadmap, detailing objectives and quantifying the steps required to achieve them. Second, it functions as a critical component of the loan application process.
“For entrepreneurs, a business plan defines their strategic vision. But lenders focus primarily on financial viability,” Osbaldo explains. “They evaluate a business’ projections as well as specific details, such as pricing models, cost structures, revenue streams, and market positioning.”
Osbaldo goes on to state that the Business Advising Services team collaborates with business owners to convert their business ideas, concepts, and strategies into data-driven financial projections, ensuring they are truly loan ready before approaching lenders. They help to address key considerations such as:
- What is the core product or service offering?
- How much does the business plan to sell and what pricing strategy is in place?
- Who is the target customer?
- What is the size of the market the business aims to reach?
- Are the projections realistic, given the business’ current position and industry trends?
- Do the projections demonstrate loan repayment capacity?
What Do Lenders Want from a Business Plan?
A common challenge for entrepreneurs is assessing their business plans through a lender’s lens. Osbaldo emphasizes that while industry expertise and experience are valuable, they do not guarantee that a business is low-risk in a lender’s eyes.
“We encourage entrepreneurs to put on a lender’s hat,” he notes. “If they were the lender and about to entrust $250,000 to a new business owner with industry knowledge and experience that has never actually run a business before, would they feel comfortable?”
Lenders are risk assessors. They rely on industry benchmarks and financial analyses to minimize their exposure to risks. With the help of their underwriters, they compare an applicant’s projections against market norms to evaluate the feasibility of a loan request. The BAS team helps entrepreneurs align their financial documentation with these expectations, to demonstrate loan repayment capacity and improve their chances of approval.
Loan-ready Business Plans Define Their Ideal Customer
Many business owners make the mistake of not clearly defining their ideal customers. They attempt to cast a wide net, which often results in inefficient marketing and resource allocation.
“A significant number of business plans lack a well-defined target demographic,” Osbaldo points out. “More sophisticated, loan-ready plans incorporate customer segmentation based on income levels, lifestyle factors, and spending behaviors. This level of detail enhances strategic marketing efforts and optimizes capital deployment.”
By identifying their ideal customer profile and structuring business strategies accordingly, entrepreneurs improve their competitive positioning. The Business Advising Services team assists in refining these strategies, increasing the likelihood that business owners not only secure financing, but also establish a sustainable operational model.
Using Business Plans for Financial Planning and Loan Application Structuring
One of the most important aspects of a loan application is stating the precise amount of needed capital. Osbaldo notes that many small businesses approach financing with a generalized estimate rather than a clear, loan-ready funding allocation.
“Entrepreneurs often state that they need a certain amount to succeed, but their business plans are not broken down into finer details — how funds will be allocated, anticipated returns, and revenue generation strategies,” he explains.
This becomes especially important for SBA 504 loans, a popular small business loan used primarily for the purchase of owner-occupied commercial property. The SBA 504 loan utilizes a dual-loan structure—one portion from a bank, another from a certified development company, with the borrower contributing a 10% down payment. Applicants must demonstrate to the lenders that they have the ability to manage both loans. This means providing detailed financial projections that prove they are loan ready.
“Understanding that loan structure is essential,” Osbaldo emphasizes. “Developing amortization tables for each loan or estimating combined loan payments provides lenders with a clearer picture of a borrower’s repayment ability.”
For businesses acquiring commercial property, projections should showcase the revenue potential unlocked by the increased space and how scaling operations will translate into business growth. Osbaldo advises entrepreneurs to link projected sales expansion to historical performance data, creating a logical and realistic trajectory from current operations to scaled growth.
“Beyond reducing rent, purchasing commercial property allows businesses to build equity,” he notes. “The primary objective of the 504 loan is to support the creation of jobs and business growth.”
The Advantage of In-House Business Advising Services
One of the defining benefits of Momentus Capital for small business owners is its integrated business advising approach. Unlike many other certified development companies that depend on external entities for business advising and technical assistance support, Momentus Capital provides these services internally, and therefore more effectively. This streamlined approach eliminates the inefficiencies associated with coordinating between multiple organizations.
“We operate within a unified team,” Osbaldo explains. “As a business advisor, being able to reach out to my loan officer and just have a simple conversation with them as to what some of the standard operating procedures are — they can share a quick email, and that helps me understand how to tailor my guidance to ensure the business plan meets those key points that will qualify the business owner for their business loan request.”
Momentus Capital uses technology platforms to coordinate, so all of the financing teams can access client information, review financials in advance, and identify key areas for improvement before engaging with applicants.
This integration significantly accelerates the financing process. Business owners receive strategic, individualized guidance without the red tape. “Usually, when a business owner is asking for a loan, it’s because they need it already,” Osbaldo says. “When they start this process, time is of the essence. It’s one of the things that really sets us apart. Our ability to deliver immediate, well-informed support.”
“Before we meet, we already know what the business owner’s need is, what their request is, and prepare the critical technical assistance and guidance that will help their financial projections become loan-ready.”
Osbaldo Velázquez, business advisor
Now that I’m loan ready, what kind of loan do I want?
Additionally, with access and knowledge of Momentus Capital’s continuum of capital solutions, the Business Advising Services has a whole host of solutions that provide comprehensive support for small businesses and community development.
From our free Business Advising Services and capacity building programs to flexible real estate and small business financing, and impact investing, we have the resources that entrepreneurs and changemakers need to succeed.
Securing financing isn’t just about submitting an application and presenting a loan-ready business plan. Our Business Advising Services team knows this. Having worked closely with a small business to refine a loan-ready business strategy, they are uniquely positioned to guide those same businesses to the financing options that align with their growth plans.
With Business Advising Services’ expertise, a business isn’t just applying for a loan — they’re building a strong financial foundation for the future.
