Almost anyone giving you credit when you initially launch your business will ask you for a personal guarantee. Giving the personal guarantee is one of the most stupid things I have ever done and was simply not necessary, even though it seemed like it at the time.

I guaranteed hundreds of thousands of dollars in debt, because at the time, I had already invested all of my personal assets into the corporation. I justified it, like every other entrepreneur does with, “I've got nothing to lose!”

The truth is that even though I had nothing to lose at that point in time, I didn't think that the personal guarantee would leave me hundreds of thousands of dollars in debt, with no assets and no revenue stream to pay for that debt.

If I had just said no to the personal guarantee, most everyone that requested it, would have still done business with the company anyway. They want to make money, and they can't make money if they don't do business.

If the personal guarantee would stop the business transaction, alternative strategies could have been put in place, even if it cost a little more money to do so.

As your business grows you will have the opportunity to accumulate some personal wealth. The last thing you want is to run into a catastrophic event that kills the company and have no money, let alone have a bunch of debt to go with it.

If you have to guarantee debt personally, consider getting an equity investor in your business instead. You don't want debt on the books, and you don't want to put yourself into a bad situation like I did.