What Is A Cash Flow Funder

A cash flow funder buys future receivables from a business. The business gets the money today. The funder collects it back over the next few months through small daily collections from the bank account.

The decision comes from one place. The bank statements.

The file

Three to six months of deposits. Daily balance. How often money comes in. How often it runs out. Who else is already getting paid from the account.

That's the whole file. Decision in hours. Money in a day or two.

Not the credit score. Not the tax return. Not the collateral. The actual money moving through the account every day.

Why it's the cleanest model

In my opinion, this is the best way to fund a small business.

Banks underwrite the tax return. The SBA underwrites the paperwork. Cash flow funders underwrite the actual cash flow.

The tax return is twelve months stale by the time it gets reviewed. The paperwork takes weeks to assemble and months to approve. The bank statements are real time. They show what the business actually does, not what it did last year.

A small business doesn't operate on last year's numbers. It operates on this week's deposits. The model that matches the reality of how the business runs is the one that gets the answer right.

Why the data is better

If money is moving through the account, the business can carry a daily collection sized to that flow. If it isn't, no amount of credit score or collateral changes the answer.

The bank statements show the truth. They show whether the business is growing or shrinking. They show whether revenue is consistent or erratic. They show how many other funders are already pulling from the same account. They show the negative days. They show the NSFs.

A tax return shows none of that. A credit score shows none of that. The bank statements show all of it, in real time, every day.

Why it works

The data is real. The decision is fast. The business gets to keep moving.

That's why I think cash flow funding is the cleanest model in small business capital.