Financing Options for Startups and Emerging Entrepreneurs
For startups and new businesses, finding the right financing is key to launching and sustaining operations in those critical first few years. However, many startups and emerging businesses do not have the credit ratings or financial history required by traditional lending channels to secure the funding they need. Additionally, many startups do not want traditional loan debt placing a strain on cash flow because revenue cycles are usually uneven.
So what financing options are available for startups?
Factoring for Startups
Cash flow is crucial for every business, but startups need as much access to capital as possible because of the lean and robust business model. Waiting 30 days or longer for clients to make payments on invoices can really place a strain on finances. Accounts receivable financing, or factoring, eliminates the waiting period. Factoring is a simple exchange of unpaid invoices for cash, and the process typically takes place within 24 hours. This allows new and small businesses to boost cash flow and accumulate capital to maintain operations and achieve rapid growth.
Merchant Cash Advance
A merchant cash advance is an infusion of working capital without regular payment schedules, and it is not dependent on credit ratings. Instead, a merchant cash advance is repaid through a small percentage of every sale customers pay for via credit card. This gives businesses the flexibility they need to grow, while not placing a burden on cash flow during uneven revenue cycles. Cash advances are a great fit for those new and small businesses that use a point-of-sale system.
SBA loans have been a reliable form of financing small businesses and startups for years. SBA loans can be used for everything from working capital to equipment, and even property. The trick is finding a lender who can offer fast approvals and processing, so you do not experience any delays or red tape when trying to secure financing.
Unsecured Lines of Credit for Startups
Having an extra source of working capital is essential to success. Unfortunately, many traditional credit providers have very high requirements for startups. There are unsecured business lines of credit specifically designed for startups, and they come with very low interest rates and very good credit limits.
Growth Lending Group provides a wide range of financing options for startups and emerging entrepreneurs. If you would like to learn more about factoring, merchant cash advances, SBA loans, or our program for unsecured business lines of credit, contact our offices today.