Every Business Funding Option Explained — Find the Right Fit for Your Business

B2B businesses with outstanding invoices can convert them to immediate cash. Approval is based on your customers’ creditworthiness — not yours. No minimum credit score required.

An MCA purchases your future revenue at a fixed factor rate. Fast and accessible but the equivalent APR is typically 80–350%. Always check cheaper alternatives first if your credit score is 551+.

If an MCA is crushing your daily cash flow, refinancing can replace it with a cheaper regulated product. Done correctly it saves thousands and gives your business room to breathe.

A 551+ credit score unlocks bank-backed working capital at 18–35% APR. Below 551, revenue-based financing and invoice factoring are the most accessible lower-cost alternatives.

MCA providers never disclose APR — they only show factor rates. Use our free calculator to instantly convert any factor rate to its true APR equivalent and see exactly what you’re paying.

Revenue-based financing is similar to an MCA but regulated, with lower rates and flexible payments that adjust to your monthly revenue. Ideal for SaaS and subscription businesses.

SBA loans offer the lowest rates available for small businesses — but require 650+ credit, 2+ years in business, and a 2–8 week approval process. Worth the wait if you qualify.

Working capital covers short-term operational needs — inventory, payroll, seasonal gaps, contract fulfillment. Available in several forms (line of credit, term loan, factoring) depending on your credit and revenue profile.

Unsecured loans don’t require collateral — lenders use personal creditworthiness and revenue instead. Personal guarantees are still standard. Works for most business types and credit profiles above 550.

Unlike factoring, AR financing keeps invoice ownership with you — lenders advance against invoices as collateral. Your customer pays you as normal. No customer notification required.

Equipment financing uses the purchased asset as its own collateral — no additional security needed. Available for vehicles, machinery, restaurant equipment, medical devices, and more. Terms up to 7 years.

Startups are mostly frozen out of traditional bank loans — but not all capital. 0% business credit card stacking (up to $150K at no interest) works for 680+ credit. SBA Microloans work with 6+ months of history.

Grants don’t require repayment or equity — but competition is fierce and timelines are long. Best for businesses with a compelling story and time to apply. For immediate needs, use faster capital alongside grant applications.

True same-day funding is available — MCAs can fund in 2–4 hours, fintech lines in 24 hours. Apply before 10am Eastern to maximize same-day chances. Speed costs more: factor that into your decision.

“Invoice financing” covers two structures: factoring (you sell the invoice, factor collects) and AR financing (you borrow against it, you collect). Same cost range — different risk and relationship dynamics.

Buying an existing business with proven cash flow is often easier to finance than a startup. Lenders underwrite the acquired business’s DSCR. SBA 7(a) is the most common vehicle — 10% down, up to 25-year terms.

No tax returns, no financial statements — lenders use 3–6 months of bank statements instead. More accessible and faster, but they cost more. Best for messy books, young businesses, or time-sensitive opportunities.