The Real Small Business Funding Demand Has Yet to Kick In

| By:
 FEATURE STORY 


Now that small and medium sized businesses received crucial PPP and EIDL funding during the COVID-19 pandemic, they have become more familiar with other options to obtain capital.

“…they’re learning that they can borrow money based on their revenue, not based on their credit and assets,” stated Sean Feighan, Co-founder and President of Cash Buoy. Feighan explained that the exercise of obtaining capital during Covid to stay in business created or further developed an appetite for small businesses to borrow money in general.

As these businesses are still utilizing the remaining government aid, the real demand has not truly begun, according to Dylan J Howell, CEO of Liquidibee. “…we have yet to see the real big demand that’s about to kick in, in my opinion, over the next six to twelve months, I believe that a lot more demand will come in,” Howell said. “A lot of companies received a good injection of government stimulus. And they’ve enjoyed that over the last year, year and a half. And as that comes to an end, companies are always looking for additional capital, whether it be to grow or foster future growth of their company.”

“I think we’re beginning now to see a new phase within small business,” said Avi Wernick, VP of Partnerships at FinTap. Because of the money that’s still lingering from the stimulus efforts, he thinks that alternative finance companies will soon see more demand in the coming months. But at the same time, those finance companies will have to determine if they’re even a good fit for their products. “I think some businesses will be more adversely affected. I think it depends a lot on the nature of the business owners, you know there are better business owners out there that are able to manage [their] finances more responsibly, and there are others that are kind of just more reactive.”

Erez Stamler, CEO and Managing Director of Fresh Funding, echoed a similar sentiment. He said that increased risk factors of a business coming out of Covid can make it harder to get them approved. Besides, a business now predisposed to forgivable funding or ultra long terms at very low interest may not necessarily demand other products in the market.

“So you will see demand, but you might not see increased amount of views or volume of deals, because you can’t replace SBA loans with MCA,” Stamler said.

Last modified: May 26, 2022
Larissa Brulato writes for deBanked. Connect with me on LinkedIn.


Category: Business Lending, merchant cash advance

Home Business Lending, merchant cash advance › The Real Small Business Funding Demand Has Yet to Kick In


    Better Accounting Solutions

    Smart Business Funding

    AMA Recovery

    South End Capital

    Legend Funding

    Total Merchant Resources

    One Percent Ventures

    Lendini

    Spartan Capital

    United Business Funding

    IOU Financial

    Wynwood Capital Group

    Torro

    Meridian Leads

    Thor Capital Group

    Splash Advance

    Meged Funding Group

    Hunter Caroline

    Pearl Capital

    Broker Fair 2022

    CAN Capital

    Liquidibee

    Arsenal

    Monetaria

    ROK Financial

    United Fund USA

    SOS Capital