Free Webinar: Top 10 Tips for Funeral Home Renovation

Join Live Oak Bank and TWC for a free webinar on funeral home renovation!

In this webinar, the funeral home experts from Live Oak Bank and TWC Construction will share their top ten tips from design to financing for funeral home renovations. Regardless of the size of your renovation project, these tips will help you take your next steps in achieving your goal. Have your questions ready for the live Q&A session following the presentation!

Date: Thursday, May 19
Time: 2 PM EST

Register here:


Kelly TerWisscha
Kelly TerWisscha is CEO and Chairman of the Board of TerWisscha Construction, Inc. He has served as the President of MN Associated Builders & Contractors (ABC), a construction trade association with over 24,000 firms represented across the U.S. Kelly is most involved with overseeing the areas of project management and control, administration, accounting, sales, and marketing.

Kate Groat
Kate Groat joined Live Oak’s Funeral Home Lending team as an Underwriter when it launched five years ago. For the past three years, Kate has worked as a Loan Officer where her industry knowledge and lending experience allow her to structure loans to meet the needs’ of funeral professionals. She is highly dedicated to her borrowers and strives to serve them with speed, understanding, and expertise. Prior to becoming a banker, Kate taught middle and high school students math and special education.

Webinar Replay: Budgeting Best Practices for Poultry Growers

We recently held our first webinar, Budgeting Best Practices for Poultry Growers, on Wednesday, March 30th. Over the hour long presentation, Senior Loan Officer, Graham Kelly, and QuickBooks Specialist, Stephanie Dickert, covered SBA lending for the agriculture industry, budgeting for a poultry farm and accounting basics for poultry businesses.

Here is a glimpse of what we covered:

Q: Is there a suggested dollar amount to set aside for future upgrades and for paying on the loan principal yearly?

A: Once you have everything budgeted for your flock, look at how much money is left. The first thing you want to do is allocate money for your emergency/upgrade fund. Focus on putting aside 6-12 months of expenses (you will get those from your budget per flock) for your emergency fund. Say your goal is $100,000; once you reach it, start taking that per flock amount you have been saving for the emergency/upgrade fund and start applying it toward paying down your loan.

Planning for future equipment replacement is also a very important piece of your budget. The first step is to have a good relationship with your integrator. Future equipment upgrades, benefits, and costs should be a regular conversation with your service tech, broiler or breeder manager. Next, estimate the average life span of various large ticket equipment items in the facility (feeders, drinkers, generator, fans, etc.). Then, have a plan to finance these items. They will need to be replaced five, seven, or ten years in the future. Add a line item into the business budget for equipment upgrades, and, with each flock, put the appropriate dollar amount into a savings account.

Debt reduction is a very productive way to use excess business cash flow. We encourage businesses to focus on debt reduction only after a strong cash position has been established. Running a business on a thin cash position is risky and stressful. Fund an emergency account (referenced above) with 6-12 months of operating expenses first, then after the emergency fund is established, excess cash flow can be used for debt reduction.

If you would like to learn more, you can watch the presentation here. Live Oak specializes in loans to the agriculture industry and has structured our lending and funding solutions around the industry’s specific needs.

Free Webinar: Veterinary Hospital Design 101

Veterinary Hospital Design 101: What to Expect from Finance to Construction
Date: Thursday, May 19
Time: 8 PM EST

Deciding to build a new facility for your veterinary practice is an exciting step in your career. However, many veterinarians don’t know exactly where to start or what to expect during the process. During this webinar, the experts from Live Oak Bank and TWC will walk you through what to expect from start to finish. Whether you’re in the beginning stages of planning or the middle of construction, this free webinar will provide valuable information that will help get you into your new building!

Register here!

If you have questions regarding the design/build process or financing for your practice, contact us today!
Patrick Spach –
Kelly TerWisscha –

Webinar: Financing Options for Your Self-Storage Assets

We recently participated in a webinar hosted by List Self Storage focused on financing options for your self-storage assets. Live Oak Bank’s General Manager, Terry Campbell, joined Shawn Hill of The BSC Group and Chris Jernigan of Jernigan Capital on a panel outlining financing options for the industry. Terry covered SBA 7(a) and 504 financing. Here are three takeaways from his presentation.

  • Live Oak’s team focuses solely on self-storage. If you are interested in working with a bank that knows the industry and will guide you through the loan process, we have you covered.
  • Although SBA loans require a lot of paperwork, Live Oak does everything electronically. With our technology platform, Portal, you can access the progress of your loan at any time. With Portal, you can upload and E-sign documents and easily video or voice chat with your loan team members.
  • There are many attractive components to SBA 7(a) loans including no balloons or covenants. Whether you are new to the industry or a veteran, we are here to help. Contact us to learn more about our loan program and get started.


Want to learn more? Click here to listen to the full webinar.



ICCFA Event: Vital Signs- Is Your Funeral Business Healthy?

Join us at ICCFA to learn how key business metrics affect your funeral home.

Vital Signs: Is Your Funeral Business Healthy?
Presented by: Tim Bridgers
Saturday, April 16 at 12 PM

Your doctor or hospital relies on a few simple tests to get a pretty clear picture of your overall health – your vital signs. The same is true for funeral homes. Based on its work with hundreds of firms across the US, Live Oak starts with a few key metrics to gauge the health of the business. Tim Bridgers will look at those vital signs and how they’re used to guide capital investment and lending decisions. He will also offers prescriptions that business owners can use to improve their numbers and build the value of their businesses.

Questions about financing? Stop by booth #1131 at ICCFA or contact our team today.

Mark Milton ( – 910.202.6934
Tim Bridgers ( – 910.685.7446
Jim Breaux ( – 910.758.2266

Webinar Replay: Tax Implications of Buying & Selling an Insurance Agency

Tune in as Jon Persky of Optimum Performance Solutions and Live Oak Bank discuss tax implications in agency transitions. Get the tools and advice you’ll need to be proactive in the process as you start, buy, sell or perpetuate your insurance agency. Learn to evaluate your ability to do the deal and ask the right questions and find resources when you need them.

About the Presenter

Jon Persky graduated from Duquesne University, holds an MBA in Finance from the University of Pittsburgh, is a Certified Public Accountant, a Certified Insurance Counselor, and a Professional in Human Resources.

He has spent the majority of his professional career in the insurance industry in positions such as Controller, Chief Financial Officer, and Personnel Director. The agencies Jon has been associated with range from a large commercial lines agency to a 35 location non-standard specialty auto agency.

As a national faculty member of the Society of Certified Insurance Counselors for over 20 years, Jon is the Society’s exclusive lecturer on Perpetuations, Mergers & Acquisitions, and Agency valuations. He facilitates these topics as well as many others at Graduate Studies Ruble Seminars and Agency Management Institutes countrywide.

Seed Succession Financing

Seed Succession Financing

Reprinted with permission by Bob Veres and featured in the March 2016 issue of Inside Information.

Download the Seed Succession Financing PDF here.

Seed Succession Financing

Posted in Practice Management

Tuesday, March 1. 2016

Live Oak Bank is now in the business of financing the first stage of successors buying into their advisory firms.

Jason Carroll, managing director of investment advisory lending at Live Oak Bank (headquartered in Wilmington, NC;, has made it his mission to facilitate successful successions at independent advisory firms: that is, the transfer of ownership from the founders to the next generation of advisors. In the past month, his firm has started taking one of the biggest obstacles off the table.

“Just 30% of advisory firms today have a succession plan in place,” Carroll says. “We’re going around the country with presentations on how to encourage juniors to buy in. At the same time,” he adds, “we’re rolling out our new Live Oak Partial Equity Buy-In Program, which is designed to finance the first stages of the purchase.”

Live Oak Bank is an unusual entity, to say the least. Where most banks look for tangible collateral when they lend money, Live Oak Bank lends on cash flow to companies (like advisory firms) which have little to no collateral. The bank specializes in financing succession transactions in specific niches—independent pharmacists and veterinarians, and since 2013, firms in the advisory space.

In the past, the loans were all guaranteed by the U.S. Small Business Administration. Because of the black-and-white language of the SBA rules, these transactions had to be for $5 million or less, with a maximum term of 10 years, and had to be allocated to the final stage of a succession buy-in. The SBA mandates that the selling advisor could not continue to be an owner after the loan, or manage the day-to-day operations or otherwise control the company. (Owners could, however, continue to work at the firm, typically in a client-facing advisory or rainmaker capacity.) There was, until now, no provision for the bank to finance the early stage successor buy-ins.

So far, the company has lent $264 million to advisory firms under the SBA program—with, Carroll says with more than a hint of pride, zero defaults. But from inception, he has wanted the bank to help advisors get started on the path to succession, by financing the earlier rounds of internal buy-ins. That, of course, means lending its own capital without the SBA guarantees.

In fact, this was the most common feedback we received when this newsletter profiled Live Oak Bank in April 2014. Advisors wanted their successors to start buying them out, but

1) they didn’t want to exit ownership right away, and

2) the successors didn’t have the money to buy that first 10-15% of the company.

Until this year, Live Oak Bank didn’t have a solution for that first couple of tranches. What changed? “We rang the bell and went public on the Nasdaq exchange on July 23 of last year,” says Carroll. “It put a lot of money on our balance sheet.” The partial equity buy-in loan program received approval shortly thereafter and is being rolled out as you read this.

How does it work? Live Oak Bank will finance your succession plan in stages. In the first stage, successors might receive financing to buy 10% of the company per year, moving closer to the 50% ownership line but almost certainly not crossing it. “The first generation probably isn’t going to want to give up 51% control until there’s a final succession deal in place,” Carroll explains. “So let’s say the loans are for 10% in each of the first four years.”

Each loan is for a 5-year term, but they will amortize over 7 years, which makes the payments more affordable for the successors.

Then the owner and second generation reaches an agreement for the remaining 60% of the firm to be purchased under the provisions of the SBA-guaranteed loan program. This loan will typically pay off any remaining balances on the earlier loans.

The rates will be the same for the earlier (nonguaranteed) and the final (SBA) loans, and will be based on the size of the amount borrowed. “We don’t make commissions here, so it works exactly the reverse of what you might think,” Carroll explains. “Everything is based on prime, which is currently 3.5%. The lowest rate will be prime plus 2%, up to a high of prime plus 2.75%, and the smaller loans will carry a higher rate.”

Why? “It costs us just as much to underwrite a $100,000 loan as it does one for $5 million,” Carroll explains. “To offset our underwriting costs, we have to bake in a little higher rate for the smaller loans.”

How does that underwriting work? As mentioned earlier, Live Oak Bank lends on cash flow rather than collateral, so underwriting is really an analysis of two things: the creditworthiness of the second-generation borrowers, and the financial health of the firm they’re buying.

Start with the borrowers. “They have to show they’re a responsible financial advisor in two aspects,” Carroll explains: “One, that their personal credit and their personal financial statement is okay. Two: that they’re in good standing with the SEC—and FINRA, if that’s applicable.”

He adds that Live Oak Bank’s underwriters recognize the financial challenges facing a professional who might be 35-45 years old. “If they’re anything like me,” Carroll says, “they have a mortgage, a HELOC, a couple of car payments, and maybe they’ve finally climbed out from under their student debt. They don’t have a million bucks to buy into the firm, which is why they’re coming to us. We don’t expect them to have that.”

Underwriting the firm requires a sophistication in the advisory business that your bank down the street will not possess. “Our main question is: Can the firm afford itself?” says Carroll. “If the successors were to say, hey, I want to buy out the whole thing; the seller is done—from an internal succession, without that seller’s salary, can they afford it based on the cash flow of the firm itself?”

Carroll says that the sweet spot for his firm is advisory firms with between $100 million and $1 billion in AUM, but they are better described by the internal facts on the ground: founding advisors who have identified their successors and are ready for them to start buying ownership, but the firm has grown so quickly that the next generation is having trouble affording the first couple of purchases.

If they can just get that first 10% of the firm in the hands of the next generation, everything else becomes a lot easier; the profit distributions help pay interest on the loan.

“The founder is saying, ‘I like this arrangement because I don’t have to leave for five years,’” says Carroll. “They can start the process with this next generation advisor who has been saying, please let me buy in, but when they run the numbers, he doesn’t have enough money.”

Carroll says that Live Oak Bank’s biggest competition, when it comes to financing successions, is the sellers themselves, who may negotiate a 10% return on their loans to the next generation. This forces the bank to stay competitive. “It’s why we have to stay at that 5.5% level,” he says. “And because it is a business loan, you’re writing off your business interest on your taxes. So, net, the successors are coming in at 3.5%.”

Of course, the bank also offers working capital loans, to address the not-uncommon situation where the successor generation wants to invest in the firm they’re buying into, and the founder responds that this future investment would be coming out of his distribution, to improve the value of a firm he won’t be owning.

Carrol hopes that the availability of outside financing will help move the needle on all those succession plans that aren’t happening currently. And, interestingly, he’s finding that some owners have changed their minds about retiring only when somebody finds their lifeless body slumped over the desk in their office. “Some of the founders we talk to, when the find out what we’re offering, they’ll say, hey, where’s my ejection button?” he says. “I’ve already identified my successors, and I’m ready to get started on retirement. Can I accelerate it?”

Read the full article Seed Succession Financing here.

Free Guide to Finance for Insurance Professionals


Every business needs capital. It’s your stake in that big lifelong game called Success. Your capital empowers you to do a lot more than keep the lights (and computers) on: it’s the foundation for your future growth, and your protection during future economic downturns.

Interested in financing options for the insurance industry? Our insurance lending experts break down what you need to know in our Whitepaper, “Insurance Professionals Guide To Finance.”

Download The 2016 Insurance Guide to Finance.

FEC Launches eLending Initiative in Time for Amusement Expo

WILMINGTON, N.C., Mar. 11, 2016 — Live Oak Bancshares (“Live Oak”) announced that it has officially launched its eLending initiative. This initiative offers expedited loans from $75k to $350k that are perfect for the purchase of games and equipment in an industry that has historically struggled to find financing. The process has been streamlined with quick approvals and fast closings, generally within 30 days, so borrowers can get the funds fast and get back to work. Additionally, the program offers competitive rates, 10 to 15 year terms, no prepayment penalties, no balloons or covenants and no fees charged by or paid to Live Oak.

“We plan to compete with bank and non-bank lenders with a completely transparent lending experience. Customers can expect to get a loan decision within 48 hours of a completed application, with a dedicated eLender to work with along the way. As a bank, we have the advantage of a lower cost of funds than non-bank lenders, which we pass on to our customers giving them a lower monthly payment,” said Neil Underwood, President, Live Oak Bank.

Jason Lumpkin, formerly a senior loan officer within Live Oak’s Emerging Markets division, has been tasked with leading the eLending team as General Manager. Lumpkin joined Live Oak in 2011 and has served in multiple capacities within the company, from portfolio management and servicing to loan origination and new vertical business development. That development includes helping establish the FEC lending team with Live Oak Domain Specialist, Ben Jones.

“Live Oak will continue to provide loans up to $5 million, but this new eLending initiative helps meet a need in the FEC industry that was currently unfulfilled. With 10 year terms and low rates based on the borrower’s cash flow versus collateral, Live Oaks eLending platform makes small business loans accessible and affordable. This is truly a game changer for the Amusement industry,” said Ben Jones, Live Oak FEC Domain Specialist and GM.

Live Oak will be at Amusement Expo Booth #333 where an eLending expert will be available to answer questions about their new expedited loans. Amusement Industry professionals interested in loans from $75,000 to $350,000 can stop by the booth to be prequalified in as little as 10 minutes with their social security and tax ID numbers. Live Oak will also have loan specialists available to discuss financing needs up to $5 million.

About Live Oak Bancshares, Inc.

Live Oak Bancshares, Inc. (Nasdaq:LOB) is the parent company and registered bank holding company of Live Oak Banking Company, a national online platform for small business lending.