Show me the money: Free counseling and community banking turns Ulster County business dreams into reality

by Zac Shaw for Ulster Strong

Small business owners in Ulster County are used to figuring things out themselves. Financing is different. It has rules, gatekeepers, and a learning curve that can be costly if you’re not hip to how the money game is played. The people who spend their days helping small businesses realize their goals say the same thing: do not treat financing as an afterthought. Treat it as another part of the business you can learn, with help.

“The most important thing we do is help people make good business decisions,” said Sam Kandel, director of the Mid-Hudson Small Business Development Center (SBDC). “Number one, if a business doesn’t have cash flow, it’s not going to be successful.”

Kandel has been with the program for 23 years, first as an advisor and now as director. His center, based at SUNY Ulster, is part of a national network under the umbrella of the U.S. Small Business Administration (SBA). In New York, the SBDC is funded through the federal government and the SUNY system. The Mid-Hudson center covers seven counties, including Ulster, with satellite offices in places like SUNY New Paltz, the Poughkeepsie and Orange County chambers, Port Jervis, and the Catskill Watershed Corporation.

“We provide free counseling services to small businesses,” Kandel said. “There are about 150 other advisors in the state. We have a vast knowledge base that we can use in order to help our clients with whatever comes through the door and the services are free.”

A large share of those clients first show up because a lender sent them.

“We’re a referral service, so a lot of our referrals come from lenders,” he said. “In order to apply for any kind of funding from either a commercial bank or an economic development agency or an IDA, you’re required to have a business plan. You’re required to have financial projections. A lot of what we help people do is A, to understand what the process is and B, to help them put business plans and financial projections together.”

For many owners, it is the first time they have ever written a plan.

“Some people come in with just what’s in their head and we try to get it down on paper and translate it into numbers,” Kandel said. “This is something that people do once in their lives typically, and it’s something that we do on a daily basis.”

He is blunt about what those plans are really for.

“A business plan is all about crossing t’s, dotting i’s, and supporting the financial assumptions that make businesses work,” he said. “Businesses succeed and fail on numbers. It doesn’t matter what you put in those [business plan] paragraphs. It’s basically just footnotes to the financials, because if you don’t make more money than you spend, if you don’t have positive cash flow, then your business is doomed to failure.”

One of the first myths he has to clear up is about who actually lends the money.

“People have the misnomer that SBA is a direct lender, which they’re not, except for some small micro loans that they offer,” Kandel said. “The SBA is a guarantor.”

He describes two main SBA programs that show up in local deals. An SBA 504 loan “is basically for real estate and fixed equipment and that is in partnership with the bank.” The SBA 7(a) program “provides up to an 85% guarantee to a bank… it’s a kind of a catchall for anything else that a business might need.” Those guarantees exist, he said, because “banks are risk averse and that mitigates the risk.”

Another common myth is that there are easy grants for startups.

“The first question people ask is, are there grants? And the answer to that is no,” Kandel said. “I always say that the grant, the G word, is a dirty word because typically, especially for startups, there’s no grant money around… So first they have to dispel the myth that there are grants available.”

In practice, startup capital is a mix of SBA-guaranteed loans, local loan funds, and personal money.

“Usually startup businesses are funded by loans that are guaranteed by the SBA,” he said. “And then there’s also investment. Friends, family, personal savings, home equity. If it’s not a huge amount of money and a huge risk, then sometimes people will use the equity they have in their homes to start a business. The terms are better too, because usually when you take out a 30-year home equity loan, your payments are going to be a quarter of what they would be for a five-year loan from a commercial bank.”

Kandel estimates that about 60% of his center’s work is with people “who are considering starting a business” and 40% with existing firms that want to grow, refinance, or buy a building. In Ulster County and the Catskills, that often means hospitality and service trades.

“Certainly the Catskills are very skewed towards hospitality,” he said. “I’ve worked with a hundred restaurants over the past 23 years. And other things related to hospitality: service businesses, people who are plumbers, carpenters, in the service industries.”

While securing financing is the SBA’s bread and butter, small businesses that are struggling with debt can also benefit from their sage guidance.

“It can take a rebuilding period to get to the point where you become bankable,” Kandel said. “That doesn’t mean you go out of business. It means you do the things necessary to make your business more bankable.”

Sometimes that guidance is away from the pursuit of the business entirely.

“I would say that over the years that I’ve been doing this, I’ve probably talked more people out of doing what they want to do than having them actually move forward,” he said. “It’s a big responsibility to encourage people to put their life savings into a business that doesn’t have a chance to be successful. That’s the benefit of working with people at the SBDC, so that people don’t make bad business decisions.”

Once the plan and the numbers are in good shape, the conversation usually moves to a local bank. That is where lenders like Rondout Savings Bank step in.

“The role of a community bank like Rondout Savings Bank in financing small businesses is twofold,” said Evan Rothfuss, VP Sr. Commercial Loan Officer. “First, we provide access to the capital that helps businesses start, grow, and invest in their future. But equally important, we care about our community and act as a community partner and resource. Because we’re deeply rooted in the Hudson Valley, we understand the local market and the challenges small business owners face.”

For borrowers, Rothfuss is the main human interface with the bank.

“In my role as a Commercial Loan Officer, I’m the primary point of contact for the borrower,” he said. “I walk clients through the entire loan process—from taking the application and gathering financials to explaining requirements and answering any questions they have along the way. I also coordinate closely with our underwriting department, making sure we get the information we need and keeping the customer informed so the process feels smooth and transparent.”

Many owners are surprised by how many factors go into a credit decision.

“One of the most common [challenges] is not fully understanding how a credit decision is made,” Rothfuss said. “Many borrowers assume there’s one single factor that determines approval, when in reality we look at a combination of things—cash flow, personal and business credit history, collateral, industry trends, management experience, and the overall strength of the business plan. All of these pieces come together to tell the full story of the business.”

Showing up unprepared is another pattern he sees.

“Another common challenge is approaching the bank without a detailed business plan,” he said. Owners should come in “with a clear plan of the business’s goals, a timeline for when the capital is needed, up-to-date financial documents… and an understanding of their own numbers, including cash flow and debt obligations, so they can speak confidently about their business. The more organized and transparent a borrower is, the smoother the process is for everyone, and the better positioned we are to structure a loan that fits their needs.”

Rondout often sends people back to the SBDC first if the idea needs more structure.

“Rondout Savings Bank works closely with the SBDC, as they’re an excellent resource for helping small businesses get prepared for financing,” Rothfuss said. “They assist with developing solid business plans, financial projections, market research, and overall strategy… Once they’ve worked with the SBDC and come back to us with that foundation in place, we’re able to have a much more productive conversation about financing and how we can help them move forward.”

In Ulster County and the broader Hudson Valley, Rothfuss sees clear trends in what people are trying to finance.

“With low vacancy rates and strong housing demand, we’re seeing continued interest in residential real estate investment—particularly construction financing for multifamily developments and apartment buildings,” he said. “There’s also increased demand for working-capital lines of credit, especially in the hospitality and tourism sector. Because the area has become more seasonal, many businesses appreciate having a line of credit to help manage cash flow during slower periods.”

The bank’s small business customers span restaurants, developers, contractors and trades, professional services, and small manufacturers.

“Ulster County’s economy has strengthened and diversified in recent years, so a wide range of businesses are seeking capital—whether for expansion, equipment purchases, property improvements, or simply to gain leverage as they grow,” he said.

Rothfuss says the best time to talk to a lender is before the need becomes urgent.

“My biggest advice for small businesses seeking financing is simply: don’t hesitate to start the conversation early,” he said. “We can often save businesses time by helping them prepare the right documents, think through their financing needs, and structure their plans in a way that sets them up for success.”

He also stresses candor.

“I also encourage business owners to be open and transparent,” Rothfuss said. “The more we understand about the business—its challenges, opportunities, and long-term plans—the better we can tailor financing solutions that truly fit.”