Business loans for when your growth starts to slow | finder.com

Business borrowing guide stage 5: Loans for stagnant businesses

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Has your business plateaued? Find out how you can finance your way back to growth.

With the market centering on innovation and entrepreneurship, it can be easy to be lulled into a false sense of security that continued business growth is inevitable. However, businesses of all sizes can go through stages where profits level out, and you may need financing to kick your business back into gear. This is the guide to read if your business is in that stagnant stage.

LoanBuilder, A PayPal Service Business Loans

Our top pick: LoanBuilder, A PayPal Service

Customizable business loans with no hidden fees.

  • Min. Amount: $5,000
  • Max. Amount: $500,000
  • One-time fixed fee charged over the life of the loan
  • Acclaimed customer service
  • Requirements: $100,000+ annual revenue, 1+ years in business, 600+ personal credit score

    When is a business considered stagnant?

    This is essentially when business growth plateaus. This may be due to an ongoing reduction in profit, to revenue slipping at a time of year when it should be increasing, or it becoming necessary to cut back in areas, such as marketing, which the business has not had a problem covering in the past.

    Common expenses stagnant businesses may need financing for

    Stagnant businesses can be in any industry and can be of any size, making their funding needs varied:

    • Marketing. Due to decreased or plateaued profits, you may have cut back on your marketing budget. This is not the time to be cutting back, but it’s sometimes a necessity. You may be looking for funding to be able to pay for this and generate new revenue for the business.
    • Human resources. There are several reasons a business may become stagnant, but this position may lead to failings in human resources, which impact the customer. By investing in your staff for customer service or product development, or hiring additional staff to assist with growth, you may be able to help your business expand.
    • Product or service redesign. Some businesses have a successful product or service at first, but they fall into stagnation due to lack of development or innovation. By seeking finance to expand your product line, re-innovate it or even just do market research, you can assist your business.
    • Hire outside help. It can be difficult to diagnose business issues if you’re entrenched in the business’s practices, which can make hiring outside expertise a good investment. You may opt for organizational experts, designers for marketing or website help or a PR agency that can drum up some interest in your business.

    What are the best types of financing for these needs?

    Loan type Loan amount How it works What to consider
    Line of credit $10,000–$1,000,000 Repay only what you use of the credit line, plus fees and interest
    • Flexible and based on your funding needs
    • Generous loan terms (usually up to 25 years)
    Term loan $5,000–$5,000,000 Make regular repayments over a set term, calculated at a fixed or variable rate
    • You must know how much you need to borrow
    • May be difficult to increase your loan amount if needed
    Invoice financing or factoring Up to 80% of the invoice amount Pay fees to get an immediate advance on your outstanding invoices
    • Improve cash flow by bringing invoice payments forward
    • If you become reliant on timely invoice payments, you may need to keep using the finance

    Useful guides for stagnant businesses

    Compare lenders who could help you put your business back into growth phase

    Rates last updated December 15th, 2018
    Unfortunately, none of the business loan providers currently offer loans for these criteria.
    Name Product Product Description Min Loan Amount Max. Loan Amount Requirements
    LoanBuilder, A PayPal Service Business Loans
    Customizable loans with no origination fee for business owners in a hurry.
    $5,000
    $500,000
    Annual business revenue of at least $42,000, at least 9 months in business, personal credit score of 550+.
    LendingTree Business Loans
    Multiple business financing options in one place including: small business loans, lines of credit, SBA loans, equipment financing and more.
    Varies by lender and type of financing
    Varies by lender and type of financing
    Varies by lender, but you many require good personal credit, a minimum business age and minimum annual revenue.
    Credibly Business Loans
    Funding to cover business expenses with daily or weekly repayments.
    $5,000
    $250,000
    500+ personal credit score, 6+ months in business, $15,000+ average monthly deposits
    Lendio Business Loan Marketplace
    Submit one simple application to potentially get offers from a network of over 75 legit business lenders.
    $500
    $5,000,000
    Must operate a business in the US or Canada, have a business bank account and have a personal credit score of 560+.
    National Funding Small Business Loans
    Working capital loans and equipment financing, some high-risk industries may be eligible.
    $5,000
    $500,000
    Be in business at least one year and make at least $100,000 in annual sales. Other loan types have additional requirements.
    LendingClub Business Loans
    With loan terms that vary from 1 to 5 years, enjoy fixed monthly payments and no prepayment penalties through this award-winning lender.
    $5,000
    $300,000
    12+ months in business, $50,000+ in annual sales, no bankruptcies or tax liens, at least 20% ownership of the business, fair personal credit score or better
    OnDeck Small Business Loans
    A leading online business lender offering flexible financing at competitive fixed rates.
    $5,000
    $500,000
    500+ personal credit score, 1+ years in business, $100,000+ annual revenue
    Fora Financial Business Loans
    No minimum credit score requirement and early repayment discounts for qualifying borrowers.
    $5,000
    $500,000
    Business age 6+ months. Monthly revenue $12,000+. No open bankruptcies.

    Compare up to 4 providers

    How to compare your business loan options

    If you’re unsure what business loan you should opt for, here’s how you can compare the options you have:

    • Loan amount. You will have a general idea of how much your business needs to borrow, so make sure the lender offers this. Business lenders usually have minimum and maximum amounts available, and if you’re taking out a secured loan, it will depend on how much your security is worth.
    • Interest rates. Lenders will charge a fixed or variable rate, or a factor rate, which is calculated differently. Check what type of interest rate will be charged and how high it is to get an idea of how competitive the loan is. Remember, the comparison rate will show you a representation of the interest rate plus fees.
    • Fees. You can be charged a whole range of fees with business loans. These can include upfront fees such as establishment and application fees, or ongoing fees such as monthly or annual fees. Late fees and default fees will also apply.
    • Turnaround time. How soon do you need the funds? Alternative online lenders can get your funds disbursed in as little as 24–48 hours after approval, but more traditional lenders may take longer. Be sure to check that the turnaround time meets your needs before you apply.
    • Flexibility. As your business is stagnant, you may need a more flexible loan than what is offered. For instance, can you borrow more funds easily if you need to? Are you able to repay the loan early without penalty, or make additional repayments? Verify the flexibility of the loan before you apply.

    What’s the eligibility criteria for different business lenders?

    Lender Requirements Read the full review
    National Business Capital Your company must have been in business for at least 6 months and have an annual revenue of at least $180,000. More
    SmartBiz SBA Loans 650+ personal credit score, US citizen or permanent resident, 2+ years in business, $50,000+ annual revenue, no outstanding tax liens, no bankruptcies or foreclosures in past 3 years More
    LendingClub Business Loans 12+ months in business, $50,000+ in annual sales, no bankruptcies or tax liens, at least 20% ownership of the business, fair personal credit score or better More
    Kabbage 1+ years in business, $50,000+ annual revenue or $4,200+ monthly revenue over last 3 months More
    OnDeck 500+ personal credit score, 1+ years in business, $100,000+ annual revenue More

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