5 reasons alternative financing is the best funding solution for new businesses

Getting business funding is hard, even for healthy, well-established organizations – Most banks need at least 2 years of transaction records to prove sustained profitability, 650+ business or personal credit scores or sometimes collateral to even consider the application.

Imagine how much more difficult this becomes if you are a new business with no transactional data, profit statements, or an established business FICO score. Not meeting these eligibility criteria doesn’t mean that your business is not successful, but how do you convince banks to sign off on the risk presented by your lack of documentation? Well, you can’t!  This means that looking for money in the usual, traditional sources will be a waste of time and effort for new business owners.

Alternative lending companies are a better bet! Financing companies like Mantis Funding (which operates out of New York) are a haven for small business owners looking for liquidity to run and grow their companies. These alt-lenders offer the best solution to the capital crunch faced by new businesses.  Here’s why – 

1. Credit scores aren’t the only factor for approval

For new businesses – and also for many older established companies – the biggest hurdle for accessing funding from banks or credit unions is their less-than-pristine credit scores. A poor FICO score disqualifies them instantly. Alternative online lenders don't base their decision-making process ONLY on credit scores – it is just one of the many factors considered, which makes it easier for new businesses to qualify for funding.

For example, alt-lender Mantis Funding reviews several data points such as business revenue, personal and business transactional data, and more while processing applications.

2. Larger amounts are available through alt-lenders

If new businesses need substantial amounts, then alternative lenders are the ones they should approach. Banks might oblige with a small sum, but if a new business needs a more substantial amount, it is highly unlikely to qualify for the whole outlay.

3. There are many types of financing offers to choose from

For a fresh business, juggling challenges in different areas, flexibility is vital. With an alt-lender, they will find a wide variety of financing offers to match their situation. For example, online lenders like Mantis Funding offers start-ups options such as a business line of credit, small merchant cash advances, invoice factoring, and more – each with different repayment terms.

4. They are FAST

While not every business owner is looking for fast funding, it is certainly an added benefit! Knowing the status of your application enables entrepreneurs to plan appropriately, and this can be especially vital for new businesses, which are already dealing with uncertainty on so many sides. Top alt-lenders like Mantis Funding review, negotiate and transfer money in 1-3 business days. In urgent cases, they can even manage the whole process in 24 hours.

5.  Alt-lenders offer competitive rates

With lots of negotiating room, business owners can be sure of finding the best rates in the industry with alternative financing institutions. While their base offers are competitive to start with, they do adjust the rates to suit business requirements.

Things are tough enough for new businesses, why add financing woes to the mix? A new venture is usually in a state of flux for at least the first year or so, and alternative lenders allow entrepreneurs lots of flexibility to go with the flow.

From keeping the operations ticking while revenue kicks into unlocking new areas of expansion – at every step of their operations, access to cash can help entrepreneurs concentrate on running their business and stop worrying about finding funds.