Term funding
A single amount, delivered on a fixed schedule over a set period. The most predictable of the three, and usually the lowest cost.
What it actually is
One amount, once. You know the figure, you know the schedule, and you know the date it finishes on the day you sign. Nothing moves with your sales.
That predictability is the product. It is what makes term funding the right instrument for an expense you can price in advance, and the wrong one for a gap whose size you are guessing at.
The trade you are making
A fixed schedule does not care what kind of month you had. Revenue-based funding flexes with sales and costs more for the privilege; term funding costs less and does not flex. That is the same trade in both directions, and which side of it you want depends on how steady your revenue actually is.
Owners talk themselves into the lower cost and then meet a quiet February. If a fixed obligation in your worst month of the year would be genuinely difficult, the cheaper product is not the cheaper product.
What qualifying usually takes
Typically the strictest of the three. A funding partner committing to a longer period wants more evidence: time in business, credit history, and consistent deposits over a longer window than the other products ask for.
Longer periods are generally available on larger amounts. That is a pattern across partners rather than a rule, and as with everything else here, the partner sets it and puts it in writing.
Whether it fits
This one is the easiest of the three to match against a real situation, because the situation usually has a price tag on it already.
This is probably your product if
- A defined one-time purchase with a known cost
- Revenue is steady enough that a fixed obligation is not a risk
- You want the total cost to be the lowest of the three
- You would rather know the end date than have flexibility
- Your file is strong on credit as well as deposits
Look at something else if
- Revenue swings hard between months or seasons
- You are not certain what the amount needs to be
- The same gap will come back and you will want capital again
- You are under six months in business or below $15,000 a month
What it costs
Usually the lowest total cost of the three products, because the funding partner is taking the least uncertainty. Predictability is the thing you are being charged less for.
Questions we get about this one
Can I finish it early, and does that cost less?
Ask the funding partner directly, because the answer differs between them and it is worth knowing before you sign rather than after. Some structures reduce the total if you finish ahead of schedule and some do not. We are not a party to the agreement and cannot answer it for a partner we have not put you in front of yet.
What if I need more part way through?
It is possible and it is not automatic. A second position changes how any partner reads your file, which is exactly why the application asks about open positions — that is not a trick question, it is the thing that most often explains an outcome. Tell us what you already have.
Why is this usually the cheapest of the three?
Because the funding partner is taking the least uncertainty. A fixed schedule over a set period is more predictable for them than a share of sales that might arrive slowly, and predictability is what you are being charged less for. The trade is that the schedule does not care what kind of month you had.
What we can't tell you
The amount, the period, the cost, and whether it is offered at all are the funding partner's to decide, not ours. We do not set them and we do not sit inside the agreement. We will tell you honestly which of the three products your file is a realistic candidate for — and that judgement is worth more to you than a number we are not in a position to promise.
The other two
The same application covers all three.
One form. Then a real conversation.
Two minutes, no cost, no obligation to take anything that comes back. Call first if you would rather — a person answers.