No operating history means every number is a forecast — and the study’s job is to make each forecast traceable to evidence outside the founder’s optimism.
A start-up loan file contains no tax returns to spread, which is why SOP 50 10 points projection-based credits toward independent feasibility analysis. The discipline that replaces history is traceability: every material number in the pro forma must trace to something verifiable — a defined trade area with census-evidenced demand, competitor performance benchmarks, executed contracts or letters of intent, industry expense ratios from RMA and comparable data, and a construction budget validated against cost standards.
The ramp is where start-up studies are won or lost. Businesses do not open at stabilization: members join over months, occupancy builds over seasons, and the expense base is substantially fixed from day one. A credible study models the ramp explicitly — month by month in the first two years where the asset class demands it — and sizes working capital from the cumulative cash deficit the ramp produces, not from a rule of thumb.
For a start-up, the management dimension carries unusual weight, and it is evidenced rather than narrated: direct operating experience in the category, completed projects of comparable scale, the named general manager with the industry résumé, the franchise system’s training and support where one exists. More than one Wert-Berater determination has carried a management condition precedent — a GM hire, an executed management agreement — because the analysis showed the gap plainly.
Start-up sponsors benefit from engaging the study early — confirming the engagement path with their lender first, since institutions differ on who must initiate: the analysis surfaces equity shortfalls, ramp deficits, and entitlement gaps while they are still curable, which is considerably cheaper than discovering them in committee.
President, Wert-Berater, Inc. — independent feasibility study consultants since 1998. 4,000+ engagements completed across all 50 states and internationally, evaluating $41.2 billion in project value for SBA, USDA, EB-5, conventional, and institutional financing decisions. Fiduciary duty runs to the lender and agency in every engagement.
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Schedule a ConversationIndependent feasibility studies since 1998 — 4,000+ engagements, $41.2 billion in evaluated project value. Standard delivery in 10 to 15 business days. Fiduciary duty to the lender and agency.
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Wert-Berater, Inc. is an independent provider of feasibility studies and other related services. The firm does not provide financing or equity investment advice, and does not arrange, broker, or place debt or equity capital of any kind.
All appraisal assignments are performed by Bruce E. Jones, MAI, ASA-GC, BCA, CMEA, a member of the Appraisal Institute since 2006, a staff member of Wert-Berater, Inc. and owner of Special Purpose Realty Valuation.