Radon test. Check.

Utility bills. Check.

Smoke and carbon monoxide detectors. Check.

On went the list, like seven-card stud — condo docs, insurance coverage, chimney inspection — check, check, and check.

We were all over it. Each time they raised the bet, we covered. The result? There were no contingencies last month when the high bidder signed the Purchase & Sale agreement to buy our Waltham condo. We had everything lined up and threw it all into the deal — washer, dryer, refrigerator — including the kitchen sink, to make sure it would happen.

We knew the drill — anticipate their questions, respond to the Buyer immediately, and lay your cards on the table. They got their mortgage, and we got our deal, which has subsequently closed.

It’s no different with a small business these days. Banks and private investors are scrambling to put their money to work. Yes, they’ll kill a lot of trees to paper the deal, and they’ll securitize themselves six ways to Sunday with collateral. Yet for a well-run company in this environment, it’s a buyer’s market for funding.

BUT (ahh, you knew there was a but coming, didn’t you?)…

…you have to be ready. A year’s worth of rising sales, a solid pipeline of prospects, new products on the drawing board, and an experienced management team add up to very little if you can’t bring your cards (in the form of credible documentation) to the table in short order.

When the bankers or the investors come calling, here’s what you need to have readily accessible with a few clicks of the mouse:

1. Three years of CPA-reviewed financial statements. Producing just a tax return doesn’t do the job. The notes to an accountant’s review summarize your historical financial strategy. They’re an important point of departure for discussing where you’re going.

2. Year-to-date financial statements compared to budget and to same months last year. The critical component of the narrative is your explanation of the key variances, year over year, and budget vs. actual. Special props go to those who have it all arrayed in an Excel file, with cellular comments documenting the monthly variances.

3. A projection of revenues and expenses, balance sheet and cash flows for the rest of the year. To the extent that this has been regularly updated, incorporating your latest financial tactics and strategy and detailing your assumptions, you win early credibility with potential financing sources.

4. The “cap table,” detailing the capitalization of the company. Who invested how much, when, and on what terms? Coupled with the Shareholders’ Agreement, this sets the stage for constructive dialogue about the next equity financing deal.

5. The receivables and payables aging statements and the list of fixed assets. In addition to providing an excellent barometer of your day-to-day financial management capability, this information for a banker helps to answer the early question, “What am I lending against?”

Of course, being a good poker player, you can leave these five cards face down until you know the game and the stakes. Your simple acknowledgment that these documents are readily available will move the conversation in your favor, as will showing your “cards” in turn as you tell your company’s story. And because there’s no substitute for experience, inviting a banker or two in for a trial run will help you determine whether or not you’re holding a winning hand.

My wife and I had a strong hand when — out of the blue — a prospective condo buyer came knocking at our door, but we were still sorting our cards when he folded. A week later, our cards were aligned. Check, check, check, check: four bidders, one at our asking price. Not bad for a couple who a few months ago hadn’t even considered jumping into the market. With a saleable asset, you’re never that far away… from Showtime.

Alligator Bites

When it comes to forecasting, the alligator has for decades relied on The Kiplinger Letter to provide a meaty digest of political and economic perspectives from Washington. Last week’s Letter signed off with a paragraph that predates even our first foray into the Swamp, but is fully applicable in the current muck and mire…

Note the following Kiplinger Letter analysis from 1957. Sound familiar?

“People ask why government won’t cut taxes and spending. OK, here’s why:

“The whole system is geared to spending more…on practically every front.

“Every government administrator, big or little, wants more for his functions…and is backed by like-minded lobbies in Washington, lobbying for more.

“Every member of Congress tries to get more for his district, his voters.

“Even the average citizen, perhaps even you, has some special interest, and wants government to spend more for that, and economize on other things.

“Almost no one dares stick his neck out for cuts… on any specified front.

“The total forces for spending exceed the total of forces for cutting.

“And, mind you, this applies to the general public as well as to government.”