Startup Receivable Funding for Small Business Owners and Entrepreneurs
How to Finance a Startup with Bad Credit or No Credit?
Table of contents
- Startup Receivable Funding for Small Business Owners and Entrepreneurs
- How to Finance a Startup with Bad Credit or No Credit?
- Can You Use Your Large Customer’s Credit to Fund Your Startup Company?
- What is Startup Funding or Start-Up Financing?
- The Start-up Factoring Financing Process:
- How to Qualify for Start-up Financing and What It Is?
- The invoice factoring due diligence process consists of the following:
- What is the Cost of Start-Up Funding for A/R Factoring Financing?
- What Industries Can Use Startup Invoice Factoring
- Start-up Financing Example
- Start-up Financing Advantage with Bankers Factoring
- Our Start-up Company Factoring Finance, provides the following:
- How Startup Receivable Factoring Works at Bankers
Can You Use Your Large Customer’s Credit to Fund Your Startup Company?
Why wait 30, 60, or even 90 days for Invoices to Pay?
Are you a Startup Founder struggling to pay bills every week? Entrepreneurs run into cash flow crunches where they worry if payroll will clear. 80% of startups fail due to poor cash flow management. Bankers Factoring works with Startup Companies to remove startup funding issues with accounts receivable-based startup financing. Even with little time in business or a low fico score, we can fund you against your B2B or B2G invoices versus a bank turndown on a startup loan with insufficient time in business or a business loan with bad credit for an entrepreneur.
Startup Funding through Accounts Receivable (A/R) Factoring Financing
Startup Funding through Accounts Receivable (A/R) Factoring Financing is a financing vehicle for startup entrepreneurs and business owners versus a hard to qualify for a small business loan. This type of Financing is secured by selling your open invoices for immediate working capital with a receivable-based line of credit. It is the fastest and easiest form of financing for small businesses, and with analysis, we take the credit risk for both products and services.
And unlike the small loan amount you might receive from the Small Business Administration SBA, bank, or credit union, our advance rate is only limited by your B2B or B2G sales. We are a great fit for businesses that generate accounts receivable as part of their action plan. Let us fund your dream and business vision as one of the few award-winning factors. With the dearth of best startup business loans options, self funding and a great business plan can only take you so far in growing your startup company, especially with a low or non-existent credit score.
Startups and Entrepreneurs extending credit terms need funding to operate their businesses. Startup Financing with A/R Factoring is a simple transaction that unlocks access to unlimited working capital for startup companies when startup business loans are impossible to qualify for. We can even fund the accounts receivable of nonprofit organizations. A/R funding to start a business has never been easier. We fund many businesses with our award-winning startup factoring services, even in this tough economy.
What is Startup Funding or Start-Up Financing?
Startup Funding is the overall need for startup companies to finance their new operation. Startup Funding through invoice factoring is a simple transaction to receive funding through selling open invoices or ARs. Invoice Factoring, also called AR Factoring Financing, is a method of business finance where startups secure liquidity quickly, unlike the other type of startup funding like conventional bank financing, angel investors, friends and family, or venture capitalists, who are business plan driven.
Financing startups with AR Factoring Financing is an excellent solution for the not yet bankable companies. Qualifying for Startup Funding is easier than a credit union or bank loans, where you need strong personal credit for all small business loans or real estate collateral. Many start-ups look to family and friends, but this is risky and can ruin relationships. And venture capital financing, equity crowdfunding, or an equity financing program can dilute your ownership share. Startup founders quickly find out that loan options are limited for startups with bruised or limited business credit.
To learn more, visit our previous article, “Non-Recourse Invoice Factoring for Startups.”
How to Obtain Start-up Funding with A/R Factoring Financing?
Startup Funding is the need for working capital to carry out business operations or achieve growth goals via a startup loan. Financing a Startup Company with A/R Factoring is a painless process that can provide startup financing this week. For startups and entrepreneurs, their lack of credit or financial history prevents them from obtaining startup business loans.
Do you need a pre-revenue business valuation for your stakeholders? Visit this article on startup business valuations for series A and subsequent funding rounds.
Startup Financing through invoice factoring does not put debt on your balance sheet like a business loan. New business ventures looking to leverage their sales and open invoices can implement Startup AR Factoring Financing to finance their business. Of the different types of startup funding, it is the easiest to qualify for when it comes to startup business funding.
We also have special startup financing programs for staffing agencies to get a startup small business running for an entrepreneurial business owner based on your B2B revenue and your potential to grow your sales.
The Start-up Factoring Financing Process:
- A Startup Company delivers goods or services to customers (account debtor).
- Send a copy of your invoice(s) to Bankers Factoring.
- Get paid up to 93% of the invoice value on the same day as approval.
- Bankers collect payments from your customer.
- The account debtor sends payment to Bankers Factoring and funds the remaining invoice balance, less our factoring fee. This step is called the discount or rebate and concludes the transaction.
How to Qualify for Start-up Financing and What It Is?
Startup Funding through Non-Recourse Invoice Factoring relies on the creditworthiness of the account debtor. The account debtor is our client’s customer responsible for paying the open AR. Startup business owners in financially distressed scenarios can leverage their available AR invoices for quick cash funding – working capital.
Unlike a Small Business Administration or SBA loan, factoring startup financing qualification is contingent upon the credit of the client’s customer (account debtor). Banks, credit unions, and SBA loans value real estate and a high personal credit score, not so much your accounts receivable. Visit our previous article, “8 Main Requirements for Invoice Factoring Qualification.”
The application, approval, and qualification process to receive Small Business Owner Startup Funding is very straightforward and is as follows:
The invoice factoring due diligence process consists of the following:
- Account debtor (customer) credit checks
- Bank and Financial statements
- Tax compliance
- General business operations
- Ownership interests
- Corporate structure
What is the Cost of Start-Up Funding for A/R Factoring Financing?
Startup Ventures do not need to resort to high-interest credit cards or Merchant Cash Advances. AR Factoring Financing benefits Startups with growing sales or receivables through our Tiered Pricing for Startups. The cost of invoice factoring is low, starting at .95% per 30 days, compared to high-interest-bearing debt that stresses entrepreneurs. American Express can be at a 25-40% interest rate. Startup factoring is cheaper and can give you faster money to cover your payroll and other expenses.
Venture capitalists or angel investors have a less than 1% chance of funding your business. If you have solid business or government customers, we can fund you from day one. The Small Business Administration (SBA) has startup business loan programs, but they are hard to qualify for, with minimum credit scores of 650.
Startup Funding and Selective Factoring
Startup Funding with selective Factoring generates more significant cash flow for our clients. Rather than sell one invoice, your Startup Company sells a batch of invoices to Bankers Factoring. You get to decide which receivables you want to sell for Startup Financing. Selective Factoring helps lower your cost basis for your factoring agreement.
At Bankers Factoring, we provide A/R Insurance through our Start-up Non-Recourse Factoring. If your customer declares bankruptcy, slow pays, or short pays, we take on the credit risk. Your factoring cost provides bad debt protection securing your cash flow with a credit department resource.
Visit our previous article to learn more, “Factoring Rates Explained,” to learn how startup factoring from Bankers is cheaper than a business credit card interest rate.
What Industries Can Use Startup Invoice Factoring
Bankers Factoring provides startup factoring financing solutions to businesses in many industries. Invoice Factoring injects working capital into startups for entrepreneurs, small businesses, and high-growth companies.
We recently worked with a Startup B2B SaaS Firm, Startup Staffing Firm, and a Startup Cleaning Company with invoice factoring solutions to overcome the lack of working capital. Startup Funding is challenging for entrepreneurs with new businesses lacking the financial profile conventional lenders look for.
Any Startup Company can finance their business with AR Factoring if they have open invoices. We are excited to fund your business with factoring start-up financing.
To learn more, visit “What Industries Use Invoice Factoring?“ and see how startup financing can be cheaper and less risky than a business credit card or website MCA loan.
Start-up Financing Example
For example, your Startup Business sells $100,000 worth of merchandise to a large commercial customer. Bankers Factoring will cash advance you up to $93,000 of the account receivables when the invoices are verified and approved. Your startup can use these funds for payroll, inventory, overhead, and growth with total costs less than a personal loan or MCA lender interest rates.
When your customer pays Bankers Factoring the invoice, we will send you the remaining invoice balance, less our fees. We provide the most competitive costs in the industry, starting at 0.75%. Fees typically run from 1.0-2.9% per 30 days with a daily rate after that. And do not forget; we take the credit risk, unlike traditional lending programs.
Start-up Financing Advantage with Bankers Factoring
Startup Funding is different when using invoice factoring financing. The easy approval and funding process is what busy entrepreneurs need to obtain working capital. We help businesses grow their cash flow and provide bad debt protection, unlike small business grants. We want you to have the working capital to pay your people and deal with business challenges.
Non-Recourse Invoice Factoring provides liquidity for Start-up Companies helping business owners forecast cash flow, fund payroll, and execute growth plans. If your start-up waits more than 30-60 days to get paid on open invoices, we can offer secure and consistent funding throughout the nation, from Honolulu to Miami, so you can execute your action plan. The Small Business Administration and their SCORE offices send us small business startups to meet their funding needs and financing options, even those needing equipment loans who can use their receivables versus a term loan.
We understand how tough it can be to find startup loans and to reach your funding goal with a decent fee structure. We don’t look heavily at your credit history, unlike other lending organizations.
Our Start-up Company Factoring Finance, provides the following:
- Access to Unlimited Working Capital and much cheaper than the MCA online lenders.
- A/R Balance Cash Factoring Advance of 80-93% without the dilution of an angel investor.
- Factoring Rates Start at .95%, about the same cost as business credit cards.
- Equipment financing by using your Solid B2B or B2G accounts receivable.
- Special Payroll and Factoring Programs for Start-Up Staffing Agencies.
- Same-day wires into your business bank account.
- AR Insurance
- Cash Flow Management
- Outsourced A/R Management
- Same Day Funding
- Payroll Funding
How Startup Receivable Factoring Works at Bankers
You will like how factoring startup financing works with Bankers Factoring. The best part of how it works is that it is based on your customer’s credit history and not your personal credit score. Designed for small business owners, a factoring business line of credit will allow you to safely grow your business from day one and turn your business idea into sales and profits with minimal self-funding or debt financing.
You will like how B2B and B2G startup financing works at Bankers Factoring. With one of the highest ratings among start-up factoring companies, we stand ready to help your new business performance. With our working capital, your business actions become a small business success story using our small business financing solutions to fund your business. Execute your business plan with our money versus the stress of self-funding. Get a startup business factoring facility with Bankers Factoring today. And remember, we don’t care about your time in business or a business loan minimum credit score requirement.