Finagle a Bagel

Finagel a Bagel owners Alan Linchman and Laura Trust were most interested in becoming independent owners in October 1998 after taking over the company. They decided to take on debt instead of taking on a Venture Capital Partner to prevent the feeling of working for someone else. After acquiring the company, they realized the company was already in good standing and wanted to continue that success by opening up more successful locations in the right areas.  The idea lead to the cash flow allowing them to service the debt that they originally took on, along with understanding the time frame for the debt that was taken on and its payback schedule. In essence Allan and Laura had a solid plan in place.

They were met with the opportunity to use their own money or wage the to cost to borrow the money within that plan. In using their own money they saw their value in multiple over the course of the 13 years. The original earnings potential went from 10 times, down to negative, then up to four times and now five times earning potential. Their interest rates began at them borrowing in the double digits to 0.25 and how 0.45 on a line of credit.

It’s very tough for a small business to start out owning their property. Most small business start out leasing to cut costs. However, Allan and Laura knew that for long-term benefits it would work in their favor to own their locations. Real Estate was scares in their area of New England. They decided that whatever issues arose that they would meet those challenges using the equity in the business and properties. The recession 10 years later lead to Allan and Laura having the ability to have the leverage to renegotiate and reposition properties with banks that were making offers of interest on Allan and Laura’s property because they thought that they were renters instead of owners.