Paul Quintero on Financing Options

There are many different options for financing. Paul Quintero, CEO of Accion East, offers advice on how to select the right option.

Video Transcript

I think there's a concept in finance of suitability, and to address suitability most financial advisors usually start with understanding your, your appetite for risk and B) what the consequences are if something doesn't work out. So it's hard to address that question for every kind of owner but let me give you different kind of scenarios. If you are someone that has a fairly good nest egg in the form of a 401(k), is looking to launch something as a new effort, has perhaps another job and is looking to grow this hobby, then leveraging financing sources like your credit card, might be, and is often, a very common practice. Why? Because it's easy to access the capital, even though there are high interest rates, you're not usually talking about a lot of money. And if, in the worst case, the business hobby doesn't take off you're not out so much and you have a way to repay it. That's typically what we have seen in the kind of early stage business we work with. If you have no source of income or need to generate a source of income I would never advise someone to put liens on homes, or to do anything, or spend any retirement account, or do anything that would potentially harm or limit your financial options for the future. Sometimes it's better just not to venture into something that's that unsecure or uncertain. So, as a general matter, we don't advise people to risk their personal assets.

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