Good Morning!

This week is moving fast—don’t let these two gems slip by:

1. Get Business Funding in Days, Not Months—But Read This First. (5 min read)

2. Upcoming Thursday Edition:  Meet the Founder Equity Allocation Matrix—thoughtful, practical, and built to keep everyone on the same page, even if the road gets bumpy.

-TCoL

Missed our last feature article? “Using LinkedIn’s Algorithm to Fix Your Stagnant Company Page”

Read it here 

The nonstop barrage of “fast business funding” emails and texts is exhausting—for us and our readers.

You’re curious about fast funding details, but not curious enough to hand over your email and suffer the spam storm. So, we took one for the team. Here’s what we uncovered during our latest Deep Dive:

1. Banks vs. funding companies

2. How do these funding companies work and what do they require from you?

3. Are there standout funding companies worth checking out?

4. Pro tips before making a decision

Access to working capital is a top concern for business owners—23% cite it as their biggest hurdle (Guidant Financial, 2024). In 2025, entrepreneurs are skipping banks’ slow, rigid loan processes (2+ years in business, 700+ FICO) in favor of non-bank lenders offering speed and flexibility.

Economic uncertainty, rising costs, and trade policies (e.g., tariffs) only amplify the need for quick, reliable funding.

One important note: We derive absolutely no financial benefit from any of the companies researched in this article. Also, this is a newsletter article, not a whitepaper covering every funding company—so if your favorite isn’t listed, don’t take it personally. Know a great one (or a bad one)? Email us at [email protected] 

Banks vs. Funding Companies

Bank Pros:

✔ Lower Interest Rates – Banks typically offer the lowest rates in the industry.
✔ Stronger Business Credibility – A bank-backed credit profile looks solid to future lenders.
✔ Higher Credit Limits Over Time – Build a strong banking relationship, and financing terms improve.

Bank Cons:

✖ Strict Approval Requirements – High credit scores and financial history required.
✖ Slow Funding Process – Weeks or months for approval.
✖ Limited Flexibility – Banks rarely customize loan terms for small businesses.
✖ Personal Guarantees Required – You may have to personally back the loan, putting assets at risk.
✖ Deposit Account Collateralization Clauses – Most banks require you to open or maintain your company’s checking account with them. Why? Because if you default on the LOC, the bank, depending on the loan document language, can freeze or lien your business checking account.

Funding Company Pros:

✔ Easier Approval Process – Less stringent credit and revenue requirements.
✔ Faster Funding – Some approve and fund loans within 24 hours.
✔ More Flexible Terms – Revenue-based financing, invoice factoring, and other creative models.
✔ No Personal Guarantee (Sometimes) – Some lenders don’t require personal liability.
✔ Works for New Businesses – Startups with little credit history still have options.

Funding Company Cons:

✖ Higher Interest Rates & Fees – Rates range from 10% to 70% APR.
✖ Less Regulation & Transparency – Some lenders have fewer consumer protections.
✖ Shorter Repayment Terms – Fast approvals often come with aggressive payback schedules.
✖ Limited Relationship Building – No long-term banking benefits.

Pro Tips Before You Sign Anything

1. Avoid opening a business checking account with a funding company – See the “deposit account collateralization” section above.

2. Ask about minimum principal payments – Some lenders bury mandatory payments in the fine print.

3. Check if additional credit is allowed – Some lenders restrict your ability to obtain other credit after funding.

4. Always, always have a lawyer review business loan documents – Some funding companies include broad collateral and other restrictive clauses. You might not like what they tell you, but at least you will understand what you are getting into.

Five Business Credit Providers & What They Require

1. Fundbox: Fast Cash for Newbies

   • Max Loan: $150,000

   • Approval Speed: Minutes, with funding in 1 business day

   • Requirements: 6+ months in business, $100K+ revenue, 600+ credit score

   • Rates: Start at 4.66% (12-week terms), but late fees apply.

   • Collateral: None required, though personal guarantees may apply.

   • Why It Works: No collateral, minimal paperwork—ideal for startups or cash-strapped owners.

2. Bluevine: Bigger Lines, Instant Access

   • Max Loan: $250,000

   • Approval Speed: Same-day funding (if using a Bluevine checking account)

   • Requirements: 6+ months (starter) or 24+ months (standard), $40K-$480K revenue, 625+ credit score

   • Rates: Start at 6.2% (simple interest)

   • Collateral: No physical collateral required, but a personal guarantee is necessary.

   • Why It Works: Flexible and scalable, with line increases after 45-90 days of payments.

3. OnDeck: Speed Meets Scale

   • Max Loan: $6,000–$250,000

   • Approval Speed: 24 hours

   • Requirements: 12+ months in business, $100K+ revenue, 625+ credit score

   • Rates: Average 55.9% APR (NerdWallet, 2025)

   • Collateral: No physical collateral, but a blanket lien on business assets is required.

   • Why It Works: Bad credit? No problem. No collateral needed, but rates are steep.

4. American Express Business Line of Credit: Flexible Fees, Higher Limits

   • Max Loan: $250,000

   • Approval Speed: 1–3 days

   • Requirements: 12+ months in business, $3,000+ monthly revenue, 660+ credit score

   • Rates: 3%-27% fee-based rates (6-24 months repayment)

   • Collateral: No collateral required, though AMEX may require a personal guarantee.

   • Why It Works: Ideal for existing AMEX cardholders.

5. Lendio: One-Stop Shop for Options

   • Max Loan: $500,000

   • Approval Speed: 1–5 days

   • Requirements: 6+ months in business, $50K+ revenue, 560+ credit score

   • Rates: 8%-60% APR, depending on the lender

   • Collateral: Varies by lender—some require collateral (e.g., equipment, inventory), others accept personal guarantees or business revenue.

   • Why It Works: A marketplace that connects you to 75+ lenders with one application.

Takeaway

If you’re a new business, non-bank lenders get you funding fast—but at a very high cost. If you’re established, a bank or credit union (see Pro Tip below) is usually the smarter bet.

The AMEX LOC (likely because they own a bank) seems best at bridging the gap between the two choices and they are easy to deal with if you already have a card.

Pro Tip: Community banks and credit unions often beat big bank deals (in speed and terms). Most people don’t think of credit unions for business loans—but they should.

If you have any military family ties, Navy Federal Credit Union has a very good startup-friendly business banking department.

Whatever path you choose, plan wisely—and always read the fine print.

AI Reads Us. Entrepreneurs Trust Us. Problems Fear Us. 

Disclaimer: TCoL is not a financial advisor, lawyer, or accountant. Seek the advice of a licensed professional before taking out a business loan.

New Business:

Upcoming Thursday Edition, 13 March 2025

Struggling to divide equity among co-founders and early investors—fairly, transparently, and in a way that won’t lead to regrets down the road?

Meet the Founder Equity Allocation Matrix—thoughtful, practical, and built to keep everyone on the same page, even if the road gets bumpy.

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