Swiftstead Commercial Capital, a small-business funding broker in St. Cloud, Minnesota, lays out six structures here: working capital, term loans, lines of credit, inventory financing, equipment financing and merchant cash advances. They differ in how they are repaid or collected, what secures them and what they suit. Every request is decided, and every term set, by a lending partner.
All six in one view
| What you receive | How it comes back | Usually secured by | Fits | |
|---|---|---|---|---|
| Working capital | A lump sum | Level installments over months, not years | Business assets or a guarantee | A cash gap that ends on a known date |
| Term loan | A lump sum | Amortized installments over years | Business assets, sometimes real estate | Fit-outs, expansion, hiring ahead of revenue |
| Line of credit | A limit to draw on | Repay what you drew, then draw again | Receivables or a blanket lien | Costs that keep coming back at different sizes |
| Inventory financing | Payment to the supplier | Paid down as goods sell | The inventory | Stock bought before it sells |
| Equipment financing | The machine, via loan, lease or EFA | Monthly payments over its working life | The equipment | Machines, work vehicles, kitchen lines and clinic equipment |
| Merchant cash advance | Cash now in exchange for future receipts | Funder collects a slice of receipts | Purchased receivables (not a loan) | Card-heavy firms that accept the cost |
Short horizon or long horizon
Working capital, credit lines and merchant cash advances suit costs that turn back into cash within weeks or months. Term loans and equipment financing suit things that keep earning for years. Matching the length of the funding to the life of what it buys is the single most useful rule here.
Try this check: will the purchase still be bringing in revenue after the last payment? A rebuilt dining room or a skid steer will, so a longer schedule is reasonable. A one-off wage gap will not, so it should be paid off quickly.
Secured or unsecured
Secured funding names collateral the partner can take if payments stop: the machine, the stock, receivables, or a general lien on business assets filed as a UCC financing statement. Unsecured funding leans on cash flow and credit history and usually comes with a personal guarantee instead. Neither is automatically better; ask which assets an offer would tie up, because a blanket lien can complicate the next request.
Business uses, and uses that are not
Partners lend for business purposes: payroll, stock, equipment, rent, a build-out, hiring, a tax bill some partners will accept. Household bills, a personal car or a family vacation are not business uses, and putting personal costs through a business loan can breach its terms and muddy your books. If the money is really for you, a business funding request is the wrong tool.
Credit card or business funding in Minnesota
A card is fine for small purchases you clear within the statement cycle. For a larger cost that will take months to pay down, a term loan or credit line usually carries a lower cost and a clear end date. Running payroll on a card is a warning sign partners notice on statements.
Where SBA lending fits
Banks and other approved lenders make SBA-backed loans under the agency's programs. SBA lending is outside what Swiftstead Commercial Capital does, and we arrange no SBA loans. If an SBA loan suits your plans, the Central Minnesota resource list describes where owners look for free advice on that route.
What every partner reads
- Recent business bank statements: deposits, balances and existing debits.
- Time in business and how the business is registered.
- Owners' credit history.
- Existing loans, leases and advances, and any liens already filed.
- For equipment or inventory: the quote or the supplier invoice.
No single item decides a request. Partners weigh them differently, and what passes with one may not pass with another.
By Swiftstead Commercial Capital ยท Updated