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Power Play

Can your lender pull the plug at any time?

This story appears in the October 2000 issue of Entrepreneur. Subscribe »

In a booming economy, with money flowing freely and banks clamoring for your business, you wouldn't think that the lender-borrower relationship could turn ugly. Yet that's exactly what happened to Roger Jacobs (an entrepreneur whose name has been changed), owner of a small cafe in the ski paradise of Mammoth Mountain, California.

In 1996, Jacobs shopped for funding for his new restaurant at a number of local and national banks. He settled on one that had a history of lending to the hospitality industry. "I felt confident that the loan officer understood my business, and he seemed willing to work with me," says Jacobs.

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