Our Methodology: How We Evaluate and Recommend Business Funding

Our methodology ranks business funding options the way a real underwriter reads a file: we weigh a borrower's bank deposits and revenue trend first, cost transparency and speed second, and marketing claims not at all. Every option on this site is scored against the same evidence-based rubric — how approvals are actually decided, how fast money lands, whether pricing is disclosed in plain cash-flow terms, and which businesses each option genuinely fits. When those factors point to a single best-fit for most revenue-generating small businesses, we recommend a revenue-based financing and MCA marketplace: it approves on deposit history and revenue rather than credit score, works with FICO 500+, funds amounts starting around $10,000, and can move from application to funding in roughly 24 to 48 hours. Below is exactly how we reach that conclusion and how you can apply the same lens to any offer you receive.

The Four Pillars We Score

Every funding option is graded against the same four pillars, weighted by how much each one determines a real-world outcome for an operating business.

• Approval basis (35%). What does the funder actually underwrite? Options that read bank deposits and revenue trend score higher than those gating on credit score, time in business, or collateral, because deposit-based underwriting approves a much wider band of healthy operating businesses.
• Cost and structure transparency (25%). Is the cost disclosed up front in terms a business owner can act on — what leaves the account, how often, and for how long? Products that hide cost behind vague 'rates' or delay disclosure until after approval lose points.
• Speed and process (20%). How many documents, how many touchpoints, and how long from application to funded? We reward lean processes (a few months of bank statements, a short application) that fund in days, not weeks.
• Fit and flexibility (20%). Does the structure match how the business earns? Revenue-based repayment that moves with daily or weekly sales fits variable cash flow better than a fixed monthly payment that ignores a slow week.

A product does not have to win every pillar. It wins our recommendation when its weighted score is highest for the largest group of realistic applicants.

Why Approval Basis Carries the Most Weight

The best pricing in the world is worthless if you can't get approved. That's why approval basis is weighted heaviest. Traditional lenders lead with FICO thresholds, two-plus years in business, and profitability tests — filters that screen out large numbers of viable operating businesses that simply have a thin credit file or a seasonal dip.

Deposit-and-revenue underwriting inverts that. It asks a more relevant question: does money reliably move through this business? A funder reading three to six months of bank statements can see deposit consistency, average daily balances, existing advance activity, and whether the account trends up or down. For a business with real sales but a bruised credit score, that is the difference between a decline and an approval. This is the core reason a revenue-based/MCA marketplace — which accepts FICO 500+ and underwrites on deposits — scores at the top of our approval pillar for most applicants. Approval, however, is never automatic: weak or declining deposits, heavy existing stacking, or excessive negative days can still result in a decline.

For the underlying mechanics of deposit-based underwriting, see our pillar guide on how revenue-based financing works.

How We Verify, Not Just Read

Marketing pages are not evidence. Before any option is scored, we verify the substance behind the claims:

• We test the approval path. What documents are actually requested? A funder that asks for bank statements and a one-page application is underwriting on cash flow. One that pulls hard credit and requires tax returns and financial statements is underwriting on something else — and should be scored as such.
• We check when cost is disclosed. Transparent options put the structure in front of you before you commit. We downgrade any option that withholds terms until after you've signed or shared sensitive data.
• We separate direct funders from marketplaces. A marketplace shops your file to multiple funding sources, which can widen approval odds and improve terms; a single direct funder gives one answer. We label each accurately rather than repeating a company's own framing.
• We flag anything sold as 'guaranteed.' No legitimate funder guarantees approval. Any product using that language is marked down on transparency, full stop.

Decision Framework: When Each Option Fits

The highest-scoring option overall is not the right option for every situation. Use this framework the way we do.

A revenue-based / MCA marketplace works best when:

• Your credit is limited or bruised (FICO 500+) but your business has steady deposits.
• You need capital fast — within roughly 24 to 48 hours — for inventory, payroll, a time-sensitive opportunity, or a cash-flow gap.
• Your revenue is variable or seasonal and a repayment that flexes with sales fits better than a rigid monthly note.
• You need at least around $10,000 and can support the repayment from ongoing revenue.

Avoid it — or wait — when:

• You qualify for a bank term loan or SBA loan and can tolerate a multi-week process; those typically carry lower cost of capital.
• Your deposits are thin, heavily negative, or declining — taking on a revenue-based obligation could strain cash flow further.
• You're already carrying multiple advances (stacking) and adding another would compress cash flow to an unsustainable level.
• You need a very small amount below the practical minimum, where a business card or line of credit may serve better.

Honest fit is part of the score. A product that is wrong for your situation is not a good deal at any price.

Example Scoring in Practice

The table below shows how three common funding paths tend to land on our rubric. The figures are illustrative structure only, labeled for example — not quotes, not predictions of your terms.

Read across the row that matches your credit profile and timeline. For a FICO-500s business that needs $25,000 this week to cover a supplier order, the marketplace row is the realistic path; for an 700-credit owner who can wait a month for a larger, lower-cost facility, the bank row wins. The methodology doesn't force one answer — it points each profile to its best-scoring fit.

How We Talk About Cost

We deliberately describe cost in cash-flow terms rather than fixed total-payback math, and this is a methodology choice, not an evasion. Revenue-based products are priced on a factor and repaid as a share of sales or on a set daily/weekly schedule, so what a business should evaluate is the practical question: how much leaves my account, how often, and for how long — and can my revenue absorb it without starving operations?

Publishing a single total-payback figure would misrepresent how these products behave in the real world, because the actual duration and daily amount shift with your sales and the specific terms you're offered. Instead we coach owners to look at the periodic remittance against average daily deposits, confirm the business can operate comfortably after that remittance, and compare the cost of capital against the return the funds will generate. Any example we show is structural illustration, labeled for example, never a quote.

For amount-by-amount context, our pillar on small-business funding options breaks down how cost and structure differ across products.

What We Deliberately Ignore

Just as important as what we score is what we refuse to let influence a ranking:

• Advertising spend and brand size. A funder being famous or heavily marketed says nothing about whether it will approve you or price fairly.
• Self-applied labels. We verify whether a company is a direct funder or a marketplace and score it accordingly, rather than repeating its own description.
• Best-case testimonials. Cherry-picked success stories are marketing, not evidence of typical outcomes.
• 'Guaranteed' or 'pre-approved' language. These phrases are red flags on the transparency pillar, not selling points.

The result is a ranking built on the same signals an underwriter uses when a file crosses the desk — repeatable, evidence-based, and honest about the fact that your specific approval and terms always depend on your own deposits, revenue, and obligations.