The company: Medallion couldn't be any more New York in character if you buried it in sauerkraut and wrapped it in a foot-long bun. A publicly traded finance company based in Manhattan, Medallion got its start over 60 years ago by loaning New York cabbies money for operating licenses. Hence, its stock symbol: TAXI. Now, it even boasts former New York State Governor Mario Cuomo as a board member. The company has branched out from taxis to finance a variety of small service businesses, such as dry cleaners, laundromats, restaurants, day-care centers, vending machine operators, and even small radio and television properties. It lends under several Small Business Administration programs, but also on its own. To expand its small-business lending, Medallion took over Business Lenders, a Hartford concern late last year.

The philosophy: Historically, Medallion's specialty has been character loans, reflecting its tradition of lending to recent immigrants who usually don't have extensive local credit histories or many assets. Chief Operating Officer Allen S. Greene says that while the company eyeballs personal credit checks, experience and reputation count more. The experience requirement is pretty straightforward: If you want Medallion's money for a certain type of business, you have to know the territory. For Greene, that means someone who wants to open a dry cleaner has to have worked in dry cleaning. The reputation check can be more subtle. For example, Greene says that if a Korean immigrant approaches the company for the money to start a grocery store, a business that has attracted many new Korean arrivals to New York, he'll contact previous Medallion customers from that close-knit community to see if they know the applicant. "We can get a good notion of many businesses based on the relationships we've developed over the years," says Greene.

Greene says Medallion prefers to stick to lending, though it will sometimes take a stake via warrants, depending on the nature of a business. Terms vary as well. A loan to buy a taxicab medallion can carry a rate of around 8.5% to 9%, while one for a corner store can drift up to around 18%.

The typical deal: Ten years ago, Dee Blonski and her mother took over a family catering business, which Blonski's Calabrian grandmother had started in the 1940s. Shortly afterward, the economy slowed, and the corporate clientele that hired Blonski and company for power lunches and Christmas parties stopped calling. To keep things going, Blonski and her mother started bottling flavored gourmet olive oils, sauces, salsas, and salad dressings. Orders from retailers soon came pouring in.

At the same time, they found themselves in big demand at crafts shows and music festivals. They dubbed their venture "Sumptuous Selections," looked for a warehouse, and hit the market for capital. Blonski says Business Lenders saw the empty, filthy shell she and her family had chosen as a new headquarters and didn't flinch a bit. Using their house as collateral, they secured a loan for $200,000, and promptly bought an 80-gallon kettle and machines to fill bottles and jars to speed up production. Thanks to an order from QVC, the very next year sales jumped to $1 million from $250,000. They took out a second loan from Business Lenders in 1996 for $225,000, which they used for a network computer system, to hire additional help, and for additional refrigeration and warehouse fixtures, among other things. Today, their sales are well over $1 million, thanks to contracts with the housewares and furnishings chain Crate & Barrel and U.S. military installations.

"They really went out on a limb," recalls Blonski of her first contact with Business Lenders. "We had no track record, but they came in and mentored us on how to draw up a business plan, how to run things, staffing decisions, and a lot more."

The process: With up to eight pairs of eyes looking over your paperwork, expect Medallion to get a handle on your business in a hurry. In reviewing a recent application to set up Dunkin' Donut franchises, Greene says, a team fanned out in all directions to gather information. That included calling the franchiser's headquarters, visiting a small-business trade show in New Jersey, and calling up Dunkin' Donuts' top franchisees to find out about recent sales, and what differentiated the successful franchisees from the laggards.

What works: A solid grounding in the basics of a business. Ritter recalls being approached by a professional basketball player who wanted to open a nightclub in Hartford. The application was turned down not only because the after-hours scene in Hartford is quite competitive but also because the ballplayer had no experience running a club. It also helps to come with as formal a business plan as you can, three years of financials, and a concrete goal. "We'll do most of the paperwork," says Greene.

What doesn't: Bad information. The flip side of Medallion's focus on experience in a business is its ability to suss out instances when a potential borrower doesn't know what he or she is talking about or is covering up something. Greene says false information -- lies, white lies, half-truths, or just-plain exaggerations -- has a way of coming out.

Parting advice: "In niches, there are riches," says Greene.

By James A. Anderson in New York

To: LENDER PROFILES