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You’ve made the decision to get funding for your business. Congratulations! Now you have a little bit of homework you need to do. Continue reading to see what funding companies look for when funding a business.
There are a few things that companies look for before determining if they can fund your business. The specific items that a funding company needs may vary, but most places will ask for some documents before you can qualify to receive funding. Take this list as guidance, not the end all, be all.
EIN and/or SSN are required to verify that the person apply is who they say they are. It also helps determine if there are any risk factors that come up when looking into the applicant or their business. For example, a lot of funding companies are reluctant to fund a company that has had a recent bankruptcy.
A United States-based business bank account and the last 3 months of bank statements are typically needed to see the cashflow of the business. This gives funding companies an idea of what’s coming in and out of the accounts and helps them find any risk factors.
FICO scores are needed so that the company can determine credit risk. Note that a bad credit score does not necessarily mean the application will automatically be declined. A higher score tells a funding company that there is more than likely a smaller risk to fund them. Different companies require different FICO score minimums to qualify, so be sure you see what your funding company of choice requires.
Time in business is another thing that companies look into. Again, different companies require different things so do your research! Most companies will require at least 1 year in business, though some have lower qualifications or higher qualifications.
Revenue is important when it comes to funding a company. A lot of funding companies require a minimum revenue to qualify, though a good starting point is at least $50,000 in revenue. This tells funding companies how profitable the business is, which will also help them determine how much they can fund.
Remember, different companies will require different parameters when they determine approval odds for a client. This post will simply help you understand the very basic items you will need to provide to a funding company to get your case reviewed.
If you are ready to get the ball rolling and get started with the funding approval process, click here to apply through our secure portal. It takes about 5 minutes and once approved, you can receive your funding in as little as 24 hours. If you are still unsure about the funding process and would like to speak to a real human to help find the right business funding solution for you, we are here to help! Call one of our experienced funding advisors to help you get on the right track.
This content is for educational or informational purposes only and should not be taken as legal or financial advice. The information in this content does not necessarily reflect the views of Coast Funding Services LLC or its partners.