Can my agency get a business loan if it has been open less than two years?

The short answer, and where the two-year rule comes from

The “two years in business” line an agency owner keeps hearing is a term-loan and SBA rule, not a rule for all business funding. Both of those products are underwritten on tax returns, and a firm needs two filed years before there are returns to read. Billable Capital’s term loans require 24 months, a 650 FICO and $40,000 a month in deposits; SBA 7(a) requires 24 months and a 680 FICO. If that is what you were told no on, the no was about the product, not about the agency.

The products underwritten on bank statements rather than returns have much shorter clocks. Working capital needs 6 months. Receivables funding needs 3. A line of credit needs 12. A fourteen-month-old agency with real billing has two products open to it today and a third within the year.

What a young agency actually qualifies for

Working capital: 6 months, no minimum credit score

Working capital runs from $10,000 to $2,000,000 over 3 to 18 months and is underwritten on the operating account: six months in business, $15,000 a month in deposits, and no minimum FICO. Approval size is typically 75% to 150% of one month’s deposits, so an agency depositing $40,000 a month is looking at an approval in the range of $30,000 to $60,000. Offer in about four business hours, funded in 24, repaid by a fixed daily or weekly ACH. The owner signs a personal guarantee; there is no collateral.

Receivables funding: 3 months, underwritten on your clients

If the agency bills brands or businesses on net-30, net-45 or net-60, receivables funding is the product built for the gap. The facility opens in 3 to 5 business days, then advances up to 90% of an approved invoice within 24 hours. The minimums are 3 months in business and $20,000 in open, invoiced B2B receivables. The credit decision is about the client who owes the invoice, so a founder with a thin or bruised personal file is not the obstacle. Retainers already billed count; unbilled work and consumer clients do not.

Line of credit: 12 months, 600 FICO

At the one-year mark a line of credit opens up: $25,000 to $500,000, 600+ FICO, $25,000 a month in deposits, charged only on what you draw. For an agency this is usually the second product, opened after a strong quarter so it is sitting there when a client pays on day 58.

What the underwriter looks at when the history is short

With six months of statements instead of several years of returns, the file is judged on what the deposits show. Four things carry most of the weight.

• The floor, not the top line. The payment is sized against the slowest month in the window. An agency that lands two retainers in month five and nothing in month four will be sized on month four. Say so when you apply.
• Who pays you. Six retainer clients paying monthly reads better than one project invoice, even if the project is larger. A single anchor client is not a decline, but expect a question about the contract.
• Average daily balance. An account that never dips below a cushion between client payments is a stronger file than one with a higher top line that lives at zero before payroll.
• Pass-through media. If you front media or production and the client reimburses it, the reimbursements inflate deposits without being fee revenue. Flag them. An underwriter who finds them later re-sizes the file; one who is told up front structures around them.

Which product first

• Between 3 and 6 months old, billing businesses on terms: receivables funding is the only door open, and it is a good one. Use it to turn the invoices already out into payroll.
• 6 to 12 months, payroll or a hire ahead of the work: working capital over 3 to 9 months, weekly ACH if deposits cluster around a few client payment dates. Pay it down early when a large invoice clears and keep up to 30% of the remaining cost.
• Past 12 months with 600+ credit: open the line in a strong quarter and leave it unused until needed. There is no cost on an undrawn balance.
• Buying a boutique shop or buying out a co-founder: that is a term loan or SBA use, and it waits for the 24-month mark. Plan the date around it rather than forcing a short-term product into a long-term job.

Agencies are one of the firm types approved by name — see marketing agencies and creative studios — and no particular billing or project system is required. Underwriting is from the bank statements.

What you’ll need

• The 4-minute application. Applying does not affect your credit.
• Your 3 most recent months of business bank statements for the operating account — 4 if billing swings with campaigns or year-end retainers.
• For receivables funding: an A/R aging report, sample invoices or statements of work, and a client list.
• A one-line note on any pass-through media or production reimbursements in the deposits.
• Any existing advance disclosed up front, so the offer is structured around it.