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Coming Up Short

Short-term financing could help your company overcome temporary setbacks or cash-flow issues.

This story appears in the December 2004 issue of Entrepreneur. Subscribe »

For Idaho entrepreneur Leo A. Geis, running his commercial aerial photography business is somewhat akin to working without a net. Inconsistent customer demand, changing technology, and the need to rapidly expand into new geographic markets all make for an unpredictable commercial existence. "There is no cookbook for a company like this, so we're guessing a lot," says Geis, 46, whose Idaho Airships Inc. also specializes in forensic imaging for use in litigation. "Because of that, we [need] buffers financially that you don't [need] in established or more predictable markets."

One of those safeguards has been short-term financing. Not long after launching the Boise company in 1997, Geis had to upgrade his photography equipment to get better aerial images. To fund the unanticipated purchase, the half-million-dollar company borrowed $80,000, most of which was financed for just one year. The interest rate was about 4 percent higher than for a longer-term arrangement, but the flexibility was well worth the cost, in Geis' view. "We don't know what we're making next week or four weeks from now," he says. "It allows us to make a minimum payment if necessary or to load the payment without penalty."

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