Running a small business comes with the realities of month-to-month operations — satisfying payroll, purchasing inventory, paying bills and much more.
Working capital loans for small business endeavors take the stress out of the day-to-day battle to stabilize finances and keep the company’s doors open. When you stop worrying about paying the bills, you can focus on improving your business and taking advantage of growth opportunities.
How do small business working capital loans work? Here’s a quick rundown:
A Different Kind of Small Business Loan
Almost any small business loan application will require a loan purpose. Not working capital business loans. This is a special category of loan that is made to help you meet your monthly obligations; day-to-day operations that aren’t necessarily related to profitability.
Working capital is a known concept in business lending, and you’ll find a number of options when looking for a working capital loan.
At Fundation, we offer business capital loans in principal amounts up to $150,000. These loans feature 1- and 2-year terms, as well as fixed interest rates. You make payments twice monthly, and there’s no prepayment penalty.
How Funds Are Used
Any business owner knows that revenue is rarely constant throughout the year. If you don’t have a significant cash base, lulls in revenue can put pressure on your ability to meet payroll, purchase inventory, replenish supplies, pay bills and satisfy any number of other regular obligations.
When you secure a working capital loan for your small business, you have a reserve that can help cover these expenses. If it’s low season, you don’t have to worry about making payroll. If your boom season is coming, you have extra cash to boost your inventory.
While business capital loans are not used for growth, they can give you the flexibility needed to take advantage of opportunities.
The Freedom to Seize Opportunity
Yes, working capital loans provide small businesses the strength to weather downturns. They also give small businesses the freedom to seize opportunities.
Here’s a scenario: You have the chance to acquire a key competitor. The business acquisition would be a huge boon to your future prospects. But applying existing capital toward the purchase would put into jeopardy your ability to cover upcoming expenses.
With a working capital loan, you have the money needed to satisfy monthly obligations — freeing up your capital to use for an acquisition, or a key hire, or the introduction of a new product.
Nothing undermines growth more than battling each month to stay afloat. Fundation provides working capital for small businesses, helping these growing companies stabilize operations so that they can focus on what matters most — sustaining success and growing for the future.
Contact Fundation today and learn more about the working capital loans available to your business.
Fundation combines the benefits of a bank loan with the ease and efficiency of an online lender. We offer conventional loans with competitive rates to businesses with varying credit profiles. Our technology allows us to deliver capital in as few as 3 business days through streamlining the collection and evaluation of customer information and conducting the majority of the lending process electronically. As a direct lender, we use our own capital to originate and hold the loans we make, so that we can focus on building relationships with our customers. Our dedicated customer relationship model enables us to understand each unique borrower’s business. This level of service, coupled with our best-in-class products, is why many of our customers come back to us repeatedly for more capital.