Construction has one of the toughest cash-flow profiles in business: you front materials, labor, and equipment for weeks, then wait on progress draws, retainage, and slow-paying general contractors. A booked schedule does not help if the cash to make payroll and buy materials is tied up in unpaid invoices. This guide covers how contractors and trades fund that gap without waiting on a slow bank.
Why construction runs cash-tight
Progress billing means you are paid in stages, retainage holds back a percentage until the job is done, and GCs often pay 30 to 90 days out. Meanwhile materials and crews must be paid now. Growth makes it worse — bigger jobs mean bigger up-front outlays. Banks underwrite slowly and want collateral trades often cannot pledge against a receivable.
Funding options for contractors
Revenue-based funding (a merchant cash advance) advances a lump sum against your deposits and is remitted as a small share of revenue — fast, and usable for payroll, materials, mobilizing a new job, or bridging retainage. Equipment financing fits a specific machine or vehicle purchase, and a line of credit suits those who qualify. The advantage of revenue-based funding is speed and approval based on deposits rather than credit.
How approval works
Approval weighs your business bank deposits and revenue, not your credit score or collateral, so a contractor with steady deposits can be evaluated despite credit blemishes. Eligible applications can get a same-day decision with funding commonly within 24 to 72 hours. Not all applicants qualify.
The bottom line: construction funding should bridge the gap between doing the work and getting paid. Y Millennial Funding is a direct funder of revenue-based funding for contractors doing $25,000 or more in monthly revenue — a small business loan alternative, not a loan.