Bootstrap Montana program is lending funds as well as expertise to small businesses in Montana.

Shane McClaflin has nearly 20 years of experience leading pack trips into the wilderness. His tenure as a business owner is far shorter. Even so, McClaflin and his wife and business partner, Sarah, are already a success story for a new zero-interest loan program that aims to spur job creation in rural Montana.
The McClaflins--who founded Sunrise Pack Stations in 2006 in Belgrade--borrowed only a few thousand dollars from the Bootstrap Montana Loan Program, enough to allow them to attend the International Sportsmen's Expo (ISE) in California in January to drum up business for the coming pack season. Not only did the trip result in increased bookings, it also gave them enough revenue to finance two more trade show appearances--both of which garnered additional deposits on upcoming trips.
"Once the ball got rolling, we were able to pay the loan back right away," Shane McClaflin says.
He adds that if he hadn't had access to a Bootstrap loan, the process of creating a sizable clientele base for his business--which he now feels that SPS now has well in hand, thanks to the contacts generated at the three trade shows--would have taken a minimum of two to three years.
"Without being able to go to a trade show, we would have had to put money into Internet advertising because that's how you reach the most people," McClaflin explains. "But the Internet is a huge place and you don't get people who are focused like they are at a trade show."
It's exactly the sort of quick-turnaround, small business success that Greg Gianforte, the CEO and founder of Right Now Technologies, had in mind when he partnered with business incubator TechRanch to found the Bootstrap Montana Loan Program last year. Gianforte and his wife donated $100,000 in seed capital from the Gianforte Family Charitable Trust to get the program off the ground.
"They paid back the loan within 30 days!" Gianforte says of the loan to SPS, just the second in the program's history. "And not only that, they used the proceeds to go to more shows and get more business. This is the kind of thing we're trying to do."

NOT FOLLOWING THE CROWD
Gianforte's name is practically synonymous with "bootstrapping"--that is, growing a company without the aid of outside or "equity" investment capital. Co-author of the influential book Bootstrapping Your Business: Start And Grow a Successful Company With Almost No Money as well as a proven entrepreneur, Gianforte believes that many businesses will grow better by bootstrapping than by pitching investors for dollars.
"The conventional wisdom is that you have to go raise money, yet that's not how most businesses are started," he notes, adding that less than one percent of new startups in the United States rely on outside investment capital.
The value of bootstrapping versus equity is especially true in small-population states like Montana, Gianforte contends.
"In Montana, as in many places around the country, the consequence of raising professional money is not something an entrepreneur is prepared to deal with," he continues. "Rightfully so, professional investors expect that they will get a return on their money."
Unfortunately for small businesspeople, the path to that return usually has only two endpoints, neither of which is always practical or even desirable for a Montana business he explains.
"There's only two ways (for an entrepreneur to pay back a professional investor)," Gianforte says. "You can take the company public or you can sell the business."
For a company to go public, he clarifies, a company has to have reached $50 million in revenue with a plan to get to $150 million. "We have a lot of great businesses in Montana, but most of them are never going to get that big," he asserts. And selling a rural business is a far from easy proposition, he adds.

MORE THAN MONEY
That leaves bootstrapping as the best option for would-be entrepreneurs. However, in a world in which the conventional wisdom often falls on the side of elaborate business plans and fundraising, helping entrepreneurs get off to the right start can be difficult. That's why, in addition to the zero-interest loan portion of the Bootstrap Montana program, TechRanch is planning a seminar series to introduce the concepts and ideas behind the program to underserved rural Montana.
TechRanch--which is administering the overall Bootstrap Montana program--applied for and received a grant from the U.S. Department of Agriculture to launch the seminars, which begin this month in the northcentral Montana town of Conrad, located about an hour north of Great Falls. Two other day-long seminars will be held in Miles City and Whitefish.
Jessica Watson, the director of finance at TechRanch, says that the seminars have been designed to offer real-world training and practical information to attendees.
"It's entrepreneurs speaking to entrepreneurs," she explains, citing just two of seminar leaders who have started and run their own businesses. In addition, each seminar will feature a keynote speaker plucked from the area's most prominent entrepreneurs, including Gianforte himself and Livingston's Andrew Field, CEO of PrintingForLess.com.
"The people who have been out in the trenches are teaching to the people who are currently experiencing those problems, and that adds a lot of value," Watson says. "It's not (someone) coming in teaching the latest hot business book which isn't even applicable because it was written for businesses in New York."
Watson says that TechRanch is hoping to train 150 people at the seminars this year and will continue future events if funding allows and interest is there.

GOOD JOBS, GOOD STATE
In addition to the seminars, loan applicants have also been receiving practical training. Gianforte notes that while only two grants have so far been given out--the other was to a Jefferson City tilemaker, Kimberly Loftus, who has also already repaid the loan she took out to attend the nation's largest floor covering tradeshow--more than half of those who have applied have received free business consulting.
"Of the 25 to 30 applications, although we've only approved two, we've probably given advice and counsel to about 15," Gianforte says. "There are benefits that come from the program even if we don't approve the loan."
Watson adds that she has helped applicants in the process and that she views such assistance as a crucial part of the program. "The online (application) process is very streamlined to be user friendly from the perspective of the applicant, and if they have questions, I'm more than happy to walk them through the process," she indicates.
Between the formal and informal education process and the loans, the Bootstrap Montana program is aiming for one ultimate goal: creating good jobs in Montana, especially in the rural areas that haven't seen anything close to the same growth experienced in small pockets of the state.
"We are favoring rural entrepreneurs because we want to get some of the prosperity (of places like Bozeman) elsewhere in the state," Gianforte explains. "This is an attempt in a private-sector way--there is no government involved here--to give people a leg up and help businesses get started."
It's not a giveaway, he notes, because the money must be paid back. And the zero-interest terms are for the first year only. "We thought about a grant program, but the truth is that people in Montana don't want handouts," Gianforte asserts.
Jessica Watson adds that the Bootstrap Montana program--as with all of TechRanch's business development activities--is designed to move Montana up on the ladder of economic development. "We don't want to be 45th or 50th forever!" she says.
"How do we create 10 jobs in Big Timber or six jobs in White Sulphur Springs or 25 jobs in Havre? That's what this program is about," Gianforte concludes.