Let’s look at popular sources for funding your business and see what the speed and requirements are for each.

Venture Capital

Description: Venture capitalists invest in a startups and growth companies. In order to attract VC money you need a strong team, a growth plan and a clear path for them to their cash out or get their investment back with returns. They typically won’t fund you for less than $5 million.

Credit Requirements: The better the credit the higher probability you can get this, but it’s based more on the team and your products and services rather than your credit.

Average Time Needed to Get Money: 6 months

Bank Line of Credit

Description: Banks will often set up a line of credit that will allow you to borrow and payback the money as needed. Great for funding needed inventory, funding invoices, etc.

Banks will also loan money for things like capital equipment where the equipment itself serves as collateral for the loan.

Credit Requirements: Must have great credit. Must be in business two years or more.

Average Time Needed to Get Money: If you have a great relationship with your banker it can only take a week or two.

Invoice Factoring

Description: Invoice factoring is not debt, it is simply accelerating receipt of money that is already rightfully yours, as you have already delivered the product or service to your customer, and are waiting to get paid.

Can work well with accounts receivable. Must have delivered products or service.

Can be from $10,000 / month and up.

Credit Requirements: Doesn’t matter about your credit, but your customer’s credit must be good.

Average Time Needed to Get Money: 1 to 2 days from the time you apply and are approved until you have access to the money

Angel Investors

Description: Angel investors vary all off the map as far as what their minimum investment is.

Typical range of investment: $10,000 to $500,000

Credit Requirements: This is going to be much more based on the team and the future rather than current profitability or credit scores. They will generally insist you are heavily invested yourself

Average Time Needed to Get Money: 2-4 months


Description: There are 2 kinds of crowdfunding: Equity and Debt.

With Equity crowdfunding you are actually selling part of your business to the investors. This generally means you have to give up more ownership of your company than later stages is in the early stage of your business, it is not worth much? Also when you have outside investors owning part of your business, this will put a burden on your time, since you will need to keep the investors up to date on what is happening with their money and your business.

With Debt crowdfunding, not only will you have to pay the company promoting your deal a 10% fee, but you will also have to pay the Debt providers a handsome return on their money, probably over 15% per year.

Credit Requirements: Depends most on the sizzle of your product and the video presentation you use to raise the funds.

Average Time Needed to Get Money: Two to four months

Family and Friends

Description: Approaching your family and friends for money has both pluses and minuses.

The pluses are:

  • They already know you

  • They can be quick to fund

  • Then can be patient when it comes to paying back the money

The minuses are:

  • They already know you…and may not trust you because of past behavior

  • They can put all sorts of non-financial restrictions on you that you wouldn’t feel comfortable with

  • If things don’t go well it most often causes a family rift, makes family get-togethers very awkward and can lead to years of silence between family members. If one of the other relatives steps in to help persuade the other relative with money, it can cause problems with that relationship as well.

  • The same thing can happen with friends. I’ve seen so many cases of great friends no longer talking to each other if one friend can’t pay the money back.

Credit Requirements: Depends most on your track record within the family and specifically with that one in particular. In the friends category, your past track record will be the key to a yes or no.

Average Time Needed to Get Money: Couple of weeks to a few months.


As you can see, the better your company’s background, products, and profitability, the easier it is to get funding. But if have bad credit, and have been in business for less than 2 years, but your customers have good credit, getting invoice financing also known as invoice factoring, can work as an alternative financing solution for your business. Best of all it doesn’t affect your credit since it is not a loan and not an obligation you have to pay back…your customers pay the factors directly so there is nothing for you to payback.

Free Invoice Factoring Report

Factoring is used by:

  • Small companies
  • Medium companies
  • Large companies including many Fortune 500 companies
  • Old companies
  • New companies
  • Companies with bad credit
  • Companies with good credit
  • Companies that sell to other businesses
  • But not companies that sell directly to consumers

To get your free copy of the Invoice Factoring Report where you will learn all if this is a good option for you including:

  • How does invoice fatoring work
  • When to use factoring
  • Benefits of factoring
  • Who uses factors
  • What are the requirements to use factoring in your business

To get your copy of the Invoice Factoring Report, simply fill out the form below.

About the Author

Philip Campbell is the founder of Small Biz Funding US, a small business financing and consulting company, whose mission is to assist small business owners to access the financing they need to grow their companies.

Philip has been a small business owner himself for 19 years, having founded and developed 4 different small companies, and therefore has hands on experience in regard to the challenges small business owners face in growing their companies, especially securing adequate financing.

With his training and experience, Philip is able to analyze and diagnose the financial standing of a business, and provide guidance on the best ways to finance the company.

You can contact Philip directly at 214-434-1141 or email at philip@smallbizfundingUS.com.