Can alternative funding fuel my business goals?
Yes! Alternative funding can be an excellent source of capital for businesses. Unlike traditional lenders, our partners lend based on the potential of the opportunity, rather than relying solely on clients’ financial statements. The future is where the business is, not the past. If an entrepreneur can manage and grow their business, attracting the necessary funding to fuel success is straightforward. Our experienced team has arranged financing for over 1500 companies nationwide.
Contact us today at (917) 740-0617 to explore funding options for your situation.
Alternative financing:
Play Chess While Others Play Checkers
Alternative financing refers to any type of financing that falls outside the traditional lending channels such as bank loans, credit cards, or lines of credit. Small businesses greatly benefit from tapping into alternative financing.
These alternative sources offer more flexibility and access to capital which may not be available through traditional funding sources.
Benefits include:
- Faster access to funds,
- Flexible credit requirements,
- Expanded financing options,
- Accommodating collateral requirements,
- Favorable repayment terms.
These benefits allow the entrepreneur greater flexibility to manage cash flow. It gives room to focus on growing operations.
Additionally, alternative financing provides small businesses the opportunity to build a credit history and establish relationships with new lenders, which leads to even more financing options in the future.
Alternative financing comes in many forms, but the most dangerous is Contract Financing.
It’s the contractor’s secret weapon. Contract financing focuses on the opportunity. It zeroes in on a business’s capability not its credit or financial statements.
For those reasons, alternative financing opens a wide variety of benefits to a broad segment of the business community.
Avant-Garde provides the entrepreneur access to capital in all its forms to small businesses and all types of contractors including Federal, State, Municipal Governments, and Commercial industries.
Accounts Receivable Lines of Credit
With our partner, TFN Lending, Avant-Garde provides an Accounts Receivable Line of Credit (ARLC).
Don’t confuse an ARLC with factoring. Though these two forms of accessing capital appear alike they are very different.
Simply put factoring is the selling of an asset where ARLC is using those assets to secure financing.
The biggest benefit of ARLC is cost. The different is night and day. Government and commercial contractors are heavy users of receivable finance. It simply provides better financing options over traditional factoring. Our financing gives the business owner a competitive advantage in securing government and commercial projects. Beyond a line of credit we provide a variety of business loan services including, payroll funding, mobilization capital, contract bidding support, and other services important to a successful contracting business.
Contact us at (917) 740-0617 to explore some alternative financing that may fit your situation.
Equipment leasing and financing
According to the US Small Business Administration, 80% of businesses lease a portion of their equipment. Ease of credit approval, speed and the tax benefits are the main reasons companies choose equipment leasing and financing. Equipment leasing also affords business owners the ability to grow their businesses without significant out of pocket expenses.
Lease financing can be incredibly flexible and here’s a few reasons why:
- Application only approvals up to $150k (min 5 years TIB required)
- Soft credit pulls only
- approve credit scores from 600 and up
- approve most start-up companies
- can approve start-up restaurants up to $75k
- Competitive programs are available for start-up medical professionals
- Working capital available up to $250k for all industries with 1-2 years time in business
- Asset based lending programs available for out of box type deals
In summary, the world of creative finance encompasses a myriad of financing options not offered by conventional financial institutions.
The universe of non-traditional financing is vast. Below is a short list of some better-known examples of funding types:
- Peer-to-peer lending: This form of funding can be put as a “Neighbor helping Neighbor” concept. A borrower receives working capital vis-à-vis another individual. Usually an online platform facilitates the transaction for an established fee.
- Invoice financing: Better known as factoring, this form of financing is very popular among government contractors. Invoice financing takes place when a business sells an bona fide debt, an invoice, to a willing financial institution, usually at a price below the face amount of that invoice. The rights to the invoice are surrendered by the selling business and transferred to the financial institution for collection.
- Accounts Receivable Line of Credit: AR Lending is a popular alternative to invoice financing. This transaction entails establishing a line of credit based on the aggregate number of outstanding invoices a business may have at any giving moment. Accounts receivable lending is a form of borrowing where specific business assets are pledged as collateral. This type of financing is relatively less expensive alternative to invoice funding and competitive alternative to traditional forms of borrowing.
- Merchant cash advances: MCA’s came on the scene in the late 90’s as an effective venue of working capital for restaurants. Since then finance companies expanded their portfolios to encompass a broader variety of industries. Similar to AR lending, the finance company advances a lump sum of capital based on the anticipated future revenue of the client company. The financing company collects payment directly from the business owner’s credit card processor or checking account.
- Crowdfunding: Similar to peer-to-peer funding, crowdfunding focuses more on equity participation by an investor and is less geared to a lending transaction. Crowdfunding also uses online platforms or social media to execute its transactions.
- Equipment financing: From startups to established Fortune 500 companies, equipment leasing is a very popular venue for off the balance sheet financing due to the variety of benefits it provides. Whether a business is acquiring new equipment or pledging specific existing equipment as collateral, equipment leasing provides an excellent venue for preserving or accessing working capital.
Overall, atypical business financing offers flexibility, convenience, and accessibility beyond long-standing models of funding. However, as in life, it’s important to use the right tool for the right challenge. It’s important consider all options and to consult with a financing advisor before taking on any form of business financing. By doing so you can avoid overpaying, entering less beneficial terms, and lost time chasing or researching options.
At Avant-Garde we invite you to contact us for a complimentary review of your situation.