Denied a Loan? Fix This First
Based on insights from Ryan R. Richardson
Partner at Grundy’s Consultancy | Business Funding Specialist
Every day, passionate business owners walk into the world of lending with hope—and walk out confused.
They believe in their mission. They see the potential. But what they don’t realize is that lenders aren’t evaluating potential…
They’re calculating risk.
The dream is real. The denial is too.
You’ve got the idea.
You’ve got the hustle.
You might even have some sales rolling in.
So you apply for a loan thinking, “Why wouldn’t they fund me?”
Then the email hits your inbox like a punch in the gut:
❌ “We regret to inform you…”
It’s frustrating. Confusing. Even humiliating.
But here’s the thing: It’s not personal. It’s mathematical.
This isn’t about whether you deserve the money. It’s about whether you’re fundable in the eyes of a lender.
Let’s break this down and show you how to fix it.
Lenders don’t care about your goals. They care about their risk.
As Ryan R. Richardson puts it:
“Banks don’t lend based on your dreams. They lend based on your data.”
That means they’re not looking at your intention or your passion.
They’re looking at your structure, your revenue, your credit profile, and your plan.
The harsh truth?
Most small businesses aren’t fundable because they don’t present a clear, structured return on investment.
What does "not fundable" actually mean?
Being not fundable doesn’t mean you’re a bad business owner.
It usually means:
- You’re structured as a sole proprietor without formal documentation
- You have inconsistent or undocumented revenue
- Your business credit profile doesn’t exist, or worse, it’s mixed with your personal credit
- You have no clear plan for repayment or use of funds
Even if your business is thriving, if your paperwork is a mess, you’re invisible to lenders.
The lender's lens: risk vs return
Let’s look at how a lender thinks.
Imagine two businesses come in asking for $50,000.
Business A has:
- No business bank account
- No EIN
- No documented profit
- Vague goals like “grow my brand”
Business B has:
- A legal entity and a tax ID
- Documented monthly revenue
- A clear plan showing ROI on the borrowed funds
Which one gets funded?
Spoiler: it’s not the one with the best Instagram account.
Here's what you can do instead
If you’ve been denied—or you’re just getting started—here’s a better path:
- Structure yourself properly
Form an LLC or corporation, open a business bank account, get an EIN, and separate personal from business. - Document your revenue
Even if it’s small, keep records. Lenders love predictability more than they love potential. - Build your business credit profile
Vendors like Uline or NAV can help you establish trade lines that report to commercial bureaus. - Know your numbers
What’s your average monthly revenue? Your profit margins? Your customer acquisition cost? Lenders want clarity. - Work with someone who speaks “lender”
That’s exactly why Ryan and our team at Grundy’s Consultancy exist. We translate your vision into the numbers lenders want to see.
This is about more than just funding
Yes, getting funded is important. But building a fundable business sets you up for long-term success.
This isn’t just about a loan. It’s about control, growth, and financial empowerment.
As we often say at Grundy’s:
“Don’t just chase approval. Build fundability.”
Want help getting fundable?
We’ve helped hundreds of business owners turn “No” into “Yes” by restructuring their approach to capital.
If you’re ready to stop guessing and start building smart, book a free consultation with our team.
FAQ
Why do most small business loan applications get denied?
Most denials happen because the business lacks fundability, meaning no formal structure, no separate business credit, inconsistent revenue, or no clear plan for how the funds will be used and repaid.
What do lenders actually look for in small businesses?
Lenders evaluate risk. They want to see a legal structure (like an LLC), business bank accounts, documented revenue, a solid business credit profile, and a plan that demonstrates a return on the loan.
Can I get funding if I just started my business?
It’s possible, but difficult. Lenders typically want to see 6–12 months of business activity. However, there are strategic ways to build fundability even in the early stages, and that’s where our team can help.
What's the difference between being fundable and being profitable?
Profitability shows you’re making money. Fundability shows a lender that your business is structured and stable enough to repay a loan. You can be profitable and still get denied if you’re not properly set up.
How can Grundy’s Consultancy help me become fundable?
We assess your current business setup, identify funding red flags, and walk you through the exact steps to structure, document, and position your business for lender approval. It’s not just about access to money, it’s about building long-term financial control.