Credit Cards... A trap or an opportunity?

[Loopy1]

I've had a few businesses. One successful until after 9/11, another not so much. I've also had innumerable cc's. If I had it to do over, I'd only have one and use it responsibly. One thing to remember if you get one. All banks are your friend until you miss a payment. Then they start being a little like dealing with the mafia.

Go ahead, get a cc. They can be useful tools if used correctly. But like any tool, they can injure badly too. Personally, I mostly use a Visa debit card tied to my current business account. That way the money has to be there to buy. And sometimes I have to wait but I'm still alive and breathing...

For vacuum bagging you don't need anything fancy. Look for used a/c service pumps. The rest is cheap.

[Airborne]

Three places I never bring my credit card:

Hobby shops
Titty bars
Fireworks stands

Try a credit union, they usually have very reasonable rates for personal loans.

[Vitamin J]

I think if you have to ask an FPV forum for CC advice you aren't ready for one.

[Blizzard1287]

i disagree, there are a lot of people here that are smarter than your average bear

[steamburn]

From the personal point of view, CCs are both, a blessing and also a trap.
Have only one and that one has to be from a Credit Union....NOT A BANK!!!

From a business perspective, you still don't have a consistent positive cash flow, therefore, thinking like a bank, no business credit for you.

But from another perspective, maybe your idea is awesome and worth a lot as an investment, therefore you should be looking for venture capitalists. There are quite a lot out there that will give you from a very small amount to very large amounts of money but for that you need to write down a 'Business Plan'. The Business Plan will clarify to yourself and to a possible investor(s) the chances of success on your idea. It might be so good, that maybe people from this Forum could get interested.

Consider a Venture Capitalist anybody that has faith in you:
your Mom and Dad
your brothers and sisters
close friends
other relatives
etc.

[Vitamin J]

Greenace, you should start a kickstarter project. Go to kickstarter.com, it's designed to help people fund their ideas where elsewhere it wouldn't be possible. You need to put a lot of time and effort into your business plans first though.

[BCSaltchucker]

credit cards are only to be used as a convenience, not for actual 'credit.' The interest rates are completely freaking insane. Only a fool would actually carry anything more than $0 on their balance each month unless they had some dire emergency (oh yeah, they are also good for dire emergencies).

So they are good for convenience (if you are disciplined) and dire emergencies. Maybe useful for rebuilding credit, if that is an issue for you. But if you trashed your credit before, then I would say you are a bad candidate for rebuilding credit with a CC!

Finally, one other big use for credit cards: cash back. I get about $6000 a year back from my 2 credit cards. That is because my business processes a lot of its purchases with a business credit card, and the CC company pays me back about 2% or so. Also run most of my personal spending through another CC. But never carry a balance!

BTW borrowing 100% to finance a business startup is fine. I did it. But it is a dental practice, so your mileage will vary.

[GreenAce92]

Ok perhaps I can see that it was "foolish" to ask on this forum however I felt that I would get a far greater concentration of "accurate answers" versus the lowlife bums that live around here who don't seem to do anything but decay.

Anyway, personally I think like many other things, money is just a human conception, if I was able to produce my own goods and materials, to hell with money! Then again, the world runs on money so I am caught in this dillema. Poverty sucks man, I keep thinking that at 19 I should already be on my own and yet on my third year of college I can't help but still feel like a poor ****.

I want the city life you know? Night Clubs ( to get my fill ) nice suits, tall buildings, I live on a roof of one of these tall buildings etc... haha maybe I'm a dreamer.

Thank you guys for the responses though really, I keep rereading them seeing what's up, currently I don't have a dyer need for machines until I create demand from the market and through help of others I am able to keep experimenting / perfecting so the need of the CC has not yet become an immediate demand.

Anyway I think that people like us who toy with electronics have a better / higher understanding of life in general if not more intelligent now don't think of me as a suck up **** but really, I always feel so disgusted walking into walmart or other stores filled with such "users" and not producers.

You know? Over population? Well... it's because there is no longer survival of the fittest, the smart ones make it available for the dumber ones hence a huge concentration of life form that is unproductive.

Sorry to deter so much but damn it! It's like we are taught about space yet we stay here and worry about stupid things like "money". I'm not a greedy money guy but I would like to be able to say "I said no" not "I couldn't afford it".

Please don't take the way my brain functions as "On the sauce" my mind does not stop functioning until I pass out from exhaustion really... then I am delirious the next day till I start up again hahaha crazy right?

[GreenAce92]

My brother in law literally took out more than $50,000 using credit cards to start his business. We all told him he was crazy - but he insisted the investment/risk was worth it. As it turned out, two years later he had paid them all off and his business was thriving. I know this is an extreme exception to the rule of what normally happens, but using CC's for significant upfront financial capital almost always guarantees disaster.

Here are some links that might be helpful before using CC's for this purpose:

LINK1

LINK2

Also, any entrepreneur should read Rework --> LINK The author is against "borrowing money for business" and he explains why it should be avoided whenever possible. I've read this book several times - it's a common sense approach to being successful in any business and it's easy to read and understand - based on real-life experiences of successful business endeavors. Often, a business can grow by offering a lower number of products and services while focusing on higher quality items being offered (rather than developing a larger number of customer options).

I'm really interested in your response

I have recently been talking to this guy who is a friend of my friends dad.

He is helping me think more "optimistic" about the vast applications of auto-piloted pre-programmable drones however his main contribution so far was to "donate" $25.00 but then at one point he slipped in something along the lines of "I expect to get a share of the profit"...

Which to me seemed leech like, I apologize for sounding so "spiteful" but prior to this slip-in we were talking about how investors continually get paid back ( dividend ) by companies even after being fully reimbursed. So is this in the sense what you are talking about when it is a bad idea to borrow money to start up?

I am just overwhelmed in a way since there is so much work to be done, I'm talking about video production, website design, perfecting the flaws of the aircraft, then arduino programming, marketing... I suppose it can be done by one man but man... it is hard! Why be shitty at all things when you can perfect one thing?

Hence I tried to partner up with a couple people but ended up not working out ( they lacked the drive / innovation ).

I think the one thing that could beget myself is this lingering "Cancerous" self-doubt that stays in the back of my head. That my plans will fail and hence the CC issue would be exactly that, a disaster.



Thank you for the link, I do apologize for being personal but the internet is such an incredible source of information especially when you are able to reach like-minded people that are in different locations.

[GreenAce92]

Greenace, you should start a kickstarter project. Go to kickstarter.com, it's designed to help people fund their ideas where elsewhere it wouldn't be possible. You need to put a lot of time and effort into your business plans first though.

Hey Vitamin J

Thanks for suggesting this site, it looks wonderful!

I will present my ideas and I suppose this will be a check to see if my business ventures are good or if I am just dreaming.
Though my friend convinces me that it is a sure thing.

Thanks again, p.s. I'm almost done with prototyping. Hope you push my plane till it bleeds