Three years ago, executives at dance company Sin City Salseros decided to set down some roots in Las Vegas after spending years as a traveling dance troupe. They did everything right. They found a great piece of land near the famed strip, secured a loan to purchase the property and found a contractor to build a new building. However, at the last minute, the bank backed-out on funding the furniture, fixtures and equipment (FF&E), leaving the company to scramble to complete the building.
“We ended up with a high interest loan to fund the FF&E so that we could finish the building,” said owner Nate Strager. “We opened our doors with almost nothing in in the bank, and it was a major grind.”
Unfortunately, stories like this are all too common according to Chris Hurn of Fountainhead.
“Some entrepreneurs like Strager do everything correctly only to have the rug pulled out from under them by a short-sighted banker,” said Hurn. “Others get over-extended in different ways, so they need to refinance their business debt as a way to operate smarter and more profitably.”
Sin City Salseros recently turned to Fountainhead to refinance its debt and lower its overhead. The company also paid off an initial investor.
“Fountainhead worked closely with us, and through every hurdle during the process, they had an answer,” said Strager. “It was a really great experience.”
Sin City Salseros also used the proceeds to purchase targeted Google ads and redesign its website. The dance company lowered its overhead and doubled its students in the first month.
But the story doesn’t end there because Sin City Salseros is not your typical dance studio. Yes, it offers dance classes for kids and adults, but it also has a large event space and banquet facility which can host dance competitions, corporate events, weddings, baby showers and even concerts. Its Rhythms Dance Studio & Event Center has 3,000 square feet of event space and another 1,000 square feet on its patio – a facility with incredible potential as envisioned by Strager.
Next problem: Las Vegas didn’t know how to regulate the business. While it seems like it’s legal to do almost anything in the desert city, Strager was restricted from hosting public events.
The company turned away more than $250,000 in event business because it was not allowed to hold public events. Local bands that wanted to play there and charge admission were not allowed, for example. Non-profit organizations that wanted to host open-to-the-public fundraisers were also turned away.
Strager worked closely with Las Vegas to secure a brand-new class of license for Rhythms Dance Studio & Event Center called a “Tavern-Restricted” license. It enables the company to now host public events and also serve and sell alcohol.
“The license cost $21,000 and we would not have been able to purchase it if we didn’t refinance our debt with Fountainhead,” said Strager.
Strager feels like he learned a valuable lesson and hopes other small business owners know that they are not alone when struggling with growing pains.
“Fountainhead put us in a much better financial position,” said Strager. “The company stepped up and we appreciate them because it really helped us.
