Business Loan and Capital Alternatives

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The Business Capital Advance Option

A “business capital advance” is more costly than a bank loan if interest costs were the only consideration. However, when weighed against the opportunity cost (loss) of not having access to capital or a more expensive alternative of venture funding, this can quickly become a favored option.

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Considerations	Friends & Family	Traditional Bank Loan	Venture Funding	FlowFunding™
Minimum Loan Amount	?	$25,000	$250,000	$3,000
Business Plan Required	Usually	Certainly	Certainly	Never
Business Tax Returns	Seldom	2-3 years'	2-3 years'	Never
Personal Tax Returns	Seldom	2-3 years'	2-3 years'	Never
Business Guarantees	Usually	Yes	Usually	Never
Personal Guarantees	Seldom	Certainly	Possibly	Never
Collateral Requirements	Seldom	2:1 ratio typical	Possibly	None
Closing Costs and Fees	Seldom	Usually	Usually	None
Approval Time	?	4-8 weeks	4-8 Weeks	5-7 days
Cost of Capital	Varies	Low	Very High	Medium
Additional Cost Considerations	Depends on Success	Always least expensive, but most restrictive	Owners' equity, control, and autonomy	Financial Only
Use of Proceeds	Typically None	Restricted to use outlined in business plan	Restricted to intended business purpose	No Restrictions.
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