Who: Amilya Antonetti, 38, founder of Soapworks, a Los
Angeles manufacturer of natural household cleansers
Year started: 1995
Startup debt: More than $100,000
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Sales growth: 20 to 30 percent growth year over year
Antonetti says, "I applied for an SBA loan, but it took
over eight months to [come through]. In the meantime, I maxed out
every card I could get my hands on. And it's so easy to not pay
them off [right away] and not realize how much money you're
paying for that dollar that you borrowed. When I came up for air, I
sat down with my debt and [planned] how I was going to get out of
that hole. I realized it would take me years to pay it off. It
affected me for 10 years. My net worth is more now, so yes, it was
worth the risk, but it could absolutely have gone the opposite
way."
Who: Robert Siciliano, 37, personal-security and
identity-theft expert, and founder of Safety Minute
Seminars in Boston
Year started: 2000
Startup debt: $80,000
2005 sales projections: $120,000
Siciliano says, "I funded every aspect of my security
business with credit cards. I've paid for publicists, book
printing [and more] to keep the business running. [One pro] was
immediate financing. And when you start spending a lot of money
using credit cards, the credit card companies start increasing your
limits. Plus, the low minimum payments don't put pressure on
you. As an entrepreneur, I needed flexibility and didn't want
to burden friends or family for loans. [One con] is that if
you're not paying attention, you can get some pretty high
interest rates--that issue hit me, but I got it in check after a
few months."
Who: Mike Nikolich, 47, and Susan Nikolich, 49,
husband-and-wife founders of Tech Image Ltd., a technology PR firm in
Buffalo Grove, Illinois
Year started: 1993
Startup debt: Secured $100,000 in credit, but only used
$10,000
2005 sales projections: $2.5 million
Mike says, "I was not able to secure a commercial line of
credit off the bat, [so] my wife and I applied for 10 different
cards. When a commercial bank approved me for a line of credit [in
our third month of operation], we cancelled all the credit cards. I
completely forgot about [them] until a credit report revealed that
two of the cards were still active [with no balances], and we
quickly cancelled those cards. Since I'm uncomfortable with
debt, it might seem out of character for me to use credit cards to
finance a business. Quite honestly, those credit cards bailed me
out at a time when banks wouldn't consider loaning me the
money. I'd do it again, and I'd do it the same
way."