Gail Nord likes to sit on the floor.

Thats the first thing you notice about this New York City small businesswoman, and thats what makes her business a huge success.

And what makes Gail's story even more heartwarming is the fact that she launched her new business with no bank loans, and with no government help.

At a time when the National Federation of Independent Businesses, the countrys biggest trade group for small businesses, says small business optimism has dipped for the third month in a row in a soggy economy where consumers are still not spending, Gails New York City business is going like gangbusters, people are barreling into Gails business.

And so are their dogs.

Like my Louie and Sharon, the best poodles in the galaxy, who behave like an old married Italian-Irish couple (Louie is in love with Sharon after 12 years, Sharon growls at him in her sleep).

Gail runs Playground Pups on the upper west side of New York City thats both a godsend to harried New York workers and a dream come true.

To make a long story short, I decided after 20 years of managing audio/video post production facilities both in New York and San Francisco, that I was tired of running other people's businesses and I also felt that I was stuck in an industry that had changed dramatically and I was no longer interested in, she tells me. My passion has always been dogs and I decided to follow my passion, as they say." Nice story to hear amidst the Prozac crankiness and the gloomy atmosphere, right?

So how did Gail make the leap?

I left my job and began researching opening a dog daycare facility on the upper west side. I knew it was the right location - home to dog and baby lovers, so I knew I would have a built-in client base, Gail says.

Next step was getting money to start the business. And just like the situation so many businesspeople are now facing, thats where the dream began to crumble.

I began trying to secure financing, Gail tells me, When I came to the quick realization that banks will not give loans to small companies that have been in business less than three years.
Dreadful, no? But Gail plunged ahead.

I also worked with the SBA [Small Business Administration] for several months before they essentially told me the same thing - they will not guarantee an SBA loan for a start-up company, Gail says.

Wait, what about all of the White Houses promises to help small businesses? So what did Gail do?

I had to self-finance, which involved a second mortgage and the steady decimation of both my old 401k and my son's college fund, she says. Not fun.

Goodnesswith Social Security insolvent, small businesspeople like Gail are draining the very accounts theyll need in retirement, because they cant get small business loans? And theyre loading up on more mortgage debt, too? This is really bad news.

The 401k withdrawals hurt the worst, due to the penalties, but the mortgage repayments have worked very well, because they are long-term loans with relatively small payments each month, Gail says.

Next, Gail looked high and low for the best location.

After many days of pounding the pavement to find the perfect and affordable location, I signed a lease and began the build-out, Gail says.

That meant overnights at Home Depot. Rehabbing a building took a lot of work.

Lots of hard-earned lessons there! Gail says.A dog daycare/boarding/grooming/training facility has very unique needs and special issues, regarding health, safety, and cleanliness. It pays to do your homework.

But what about government regulation?

To be properly licensed and insured you need to do things by the book and you're foolish if you don't because cheaping out will cause much larger problems down the road, Gail warns. This involved becoming certified as a dog handler (one-week course) and getting all appropriate permits with both the Building Department and the Board of Health. A little intimidating but not really too bad.

Okay, watching dogs takes a lot of stamina, no?

Most importantly, even before I even signed my lease, I signed an agreement with Linda Gatto, my wonderful daycare manager and trainer, Gail says.

Linda met with Gail every week for six months before she officially started, and her expertise and guidance were invaluable, Gail adds. I also secured my great groomer, Genna, who worked with me before we opened in helping to design a well-functioning grooming salon, again something I knew nothing about.

Gail adds: GIRL POWER! But theres this key piece of advice.

After over 20 years in management, I know that the most important factor in success is the people you surround yourself with, Gail says.

Business has taken off.

So now my business is skyrocketing (knock on wood), and we are beginning to look for our second location which we hope to open next spring or sooner if possible, Gail says. I was able to create just the type of place that I envisioned - warm, intimate, personal, and staffed with qualified people who love and respect dogs. Every day that I walk in here, I am filled with joy when I greet my beautiful clients as they arrive each morning.

That means more sitting on the floor.

No matter what my mood or stress level (which is pretty high) I am always happy to see them, Gail says. This has truly been a labor of love for me and I'm proud to say that I turned 50 this year and can look back with no regrets about what might have been, if only I had the nerve.

Fantastic story, no?

Elizabeth MacDonald joined FOX Business Network (FBN) as stocks editor in September 2007.
Follow Elizabeth MacDonald on Twitter @LizMacDonaldFOX.