You may already know that a merchant cash advance is a form of funding, but aren’t sure if it’s right for your business. Who better to turn to for answers than Ali Habib Mayar, one of the most respected figures in the industry? Although he cut his professional teeth in corporate security, Mayar felt more at home helping startups access financing. It’s this desire that motivated the decision to found Platinum Rapid Funding, a New York-based company that specializes in merchant cash advances. He’s recently shared some insights on why they’re worth your consideration.
(Learn more about Ali Habib Mayar in this interview.)
Why are Merchant Cash Advances So Popular?
It’s commonplace for businesses to find themselves in need of a quick cash injection. Small businesses often must rely on external funding to take care of their day-to-day needs. As fate has it though, corporate lenders aren’t known to be particularly accommodating of such entities.
It’s little wonder that the merchant cash advance has grown so popular in recent years. Often referred to as an MCA, this is an arrangement where a business receives a lump sum cash injection upfront in exchange for a percentage of future earnings. Eligibility for funding is usually determined based on average monthly revenues and a number of other careful considerations regarding the business’ health.
This eliminates the need for collateral, which in turn makes MCAs a better option for small businesses.
Are Merchant Cash Advances the Best Way to Receive Fast Funding?
Cash flow is like oxygen. Not only does it sustain the life of a business, but its demand also rises whenever operations are ramped up. A small business may need external funding to make the most of boom periods, expand the business, or to boost the business when things are slow.
If all that sounds great, so should the fact that you’re better off taking the merchant cash advance route. Compared to traditional sources of funding, you’ll find it to be:
Faster: Because merchant cash advances have a shortened underwriting process, they therefore take much less time to fund. With a quicker turnaround comes a strategic advantage — if your business model runs on razor-thin margins, for instance, an MCA will provide plenty more wiggle room compared to a bank loan.
Easier to access: Unlike other institutions, MCA providers will only want an overview of your sales volumes to ensure that you have the means to handle repayment. This translates to less paperwork and a lower accessibility threshold.
More flexible: An MCA gives you the funds to grow your business as you see fit — there are no restrictions on where you can invest the money. From your marketing efforts to developing a new product, you’re allowed to do whatever makes the most sense in the present. (Learn more about ways to use your MCA in this post.)
More adaptable: While standard loans tend to follow a rigid structure, MCAs can be tailored to meet your business’s unique needs. Most providers set repayments according to sales volumes, but some also offer custom schedules.
Simply put, a merchant cash advance makes financing less of a burden and more of a lifeline to your business.
Want to learn more about MCAs from Mayar?
Interested in getting more MCA tips and advice? Just follow Mayar’s blog (AliHabibMayar.com) for more insights and tips on the subject. You can also visit his company’s website PlatinumRapidFunding.com to apply for a MCA or to reach out to a member of his team for advice.