SBA 7(a) for staffing agencies: the cheapest capital you can get, if you have the time.
Timecard Capital packages SBA 7(a) and SBA Express files for staffing and recruiting agencies and places them with our SBA-preferred bank partners. $50,000 to $5,000,000, 10% down, up to 10 years on working capital and 25 years on real estate, with a 680 minimum FICO and 24 months in business. SBA Express closes in 10 to 21 days; a standard 7(a) in 30 to 45.
What are the criteria?
SBA 7(a) / SBA Express — criteria
- Amount
- $50,000 – $5,000,000 (SBA Express capped at $500,000)
- Term
- Up to 10 years working capital and business acquisition; up to 25 years on owner-occupied real estate
- Down payment
- 10% on an acquisition or a start-up with industry experience
- Minimum credit score
- 680
- Minimum time in business
- 24 months (start-ups considered with industry experience and a 20%+ injection)
- Documents
- 3 years business + personal tax returns, YTD P&L and balance sheet, debt schedule, A/R aging, SBA Form 1919/1920, business plan and projections for an acquisition
- Collateral
- Available business assets; real estate pledged if the loan is real-estate-secured. Personal guarantee from all 20%+ owners.
- Uses allowed
- Working capital, leasehold improvements, business acquisition, partner buyout, refinance of qualifying business debt, owner-occupied real estate
- Uses not allowed
- Paying off a merchant cash advance is generally not an eligible refinance use. Ask us before you plan around it.
- Timeline
- SBA Express 10 – 21 days · Standard 7(a) 30 – 45 days
- Path
- Packaged by Timecard Capital, placed with SBA-preferred bank partners. Timecard does not underwrite SBA credit in-house.
SBA 7(a) and SBA Express are packaged by Timecard Capital and placed with SBA-preferred bank partners. See disclosures.
How does an SBA lender read a staffing agency?
An SBA file is a cash-flow file. The bank wants to see that the agency’s earnings cover the new payment with room to spare, and it reads a staffing P&L in a specific way.
- Gross margin, not gross billing. A $10 million agency billing at a thin spread is a smaller business to an SBA lender than a $4 million agency with a healthy markup. Know your spread by division before you apply.
- Client concentration. One client at 60% of billing is the first question. A spread book of accounts reads as durable; a single master-vendor agreement reads as a risk to be explained.
- Receivables quality. Your A/R aging is part of the package. Slow-paying but creditworthy institutional clients are fine; a growing 90+ column is not.
- Existing advances. Daily-debit positions on the bank statements have to be disclosed and usually resolved before closing. SBA generally will not refinance them.
- The buyer, on an acquisition. Industry experience and the 10% injection are what make a start-up or a first acquisition financeable.
Is SBA actually right for you?
SBA is right if
You’re buying an agency, buying out a partner or opening a second office, you have 680+ credit and two years of filed returns, you can put 10% down, and you can wait 30 to 45 days.
The payment on a 10-year SBA loan is a fraction of a 12-month advance for the same money.
SBA is wrong if
Payroll is Friday, a client just slipped to 90 days, or your credit is in the 500s. That is what factoring and working capital exist for.
We will tell you this on the phone rather than let you spend three weeks assembling a package that was never going to close.
Buying a staffing agency with SBA 7(a)
Agency acquisitions are a natural SBA use: the purchase price, the working capital to carry the acquired payroll through the first net-60 cycle, and the leasehold for the office can all sit inside one 10-year loan with 10% down.
Tell us about the deal before the file is built. The structure of the seller’s receivables — whether they come with the business, and whether they are already factored — changes which product we start with and how much working capital the loan needs to include.
Who funds an SBA loan at Timecard. SBA 7(a) and SBA Express files are packaged by Timecard Capital and placed with SBA-preferred bank partners. Timecard does not make SBA credit decisions and does not underwrite SBA credit in-house. The partner is identified to you in writing before you sign.
Invoice factoring, working capital and lines of credit are underwritten and funded in-house. See disclosures.
What does an $800,000 agency acquisition cost per month?
An owner buys a competing agency for $800,000 with 10% down and finances the rest on an SBA 7(a) loan over 10 years.
Illustrative only. Your actual amount, cost and term are set by underwriting your file. Nothing on this page is an offer.
Representative file — $720,000 SBA 7(a) over 10 years
- Purchase price
- $800,000
- Down payment
- $80,000 (10%)
- SBA 7(a) loan
- $720,000
- Term
- 10 years
- Rate
- 10.00% — illustrative
- Monthly payment
- $9,515, before the SBA guaranty fee and closing costs
- Status
- An illustration, not an offer
What a staffing agency needs to qualify.
Every number below is a real criterion. Factoring is the product most agencies start with, so its minimums come first. If you clear these, apply. If you don’t, call us and we’ll tell you what would change it.
| Factoring minimums | 3 months in business, $20,000 in open B2B invoices, no minimum FICO. We underwrite your clients’ credit, not yours. |
|---|---|
| Factoring facility | Up to $5,000,000. Up to 90% of each approved invoice advanced within 24 hours; the balance, less the fee, released when your client pays. |
| Minimum monthly revenue | $15,000 in business bank deposits for working capital, a line of credit, term loans and SBA. |
| Minimum time in business | 6 months for working capital and other products. 3 months for factoring. |
| Minimum credit score | None for factoring or working capital. 600+ for a line of credit. 650+ for a term loan. 680+ for SBA. |
| Funding range | $10,000 to $2,000,000 for working capital. $25,000 to $500,000 for a line of credit. Up to $5,000,000 for term loans, SBA, and factoring facilities. |
| Time to a real offer | About 4 business hours on a complete file. |
| Time to funding | 24 hours. Same day if a clean file is signed before 11:00 AM ET. Once a factoring facility is open, each week’s invoices fund within 24 hours. |
| Documents required | Application plus your 3 most recent months of business bank statements (4 months if your placements are seasonal). For factoring, add your A/R aging, client list and sample invoices or timesheets. |
| Contract length | 2 pages. |
| Repayment | Factoring: your client pays the invoice and the reserve is released to you. Working capital: fixed daily or weekly ACH from your operating account. No split funding. No holdback percentage. No lockbox on working capital. |
| Prepayment discount | Up to 30% off the remaining cost of funding when a working capital advance is paid off within the first 30, 60, or 90 days. |
| Whose credit counts | Your clients’, on factoring. A hospital system, a distribution center or a Fortune-size employer owing you money is the strength of the file. |
| Agency types approved | Light industrial and warehouse, manufacturing and skilled trades, nurse and travel nurse, allied and home health, IT and engineering, clerical and administrative, accounting and finance, event and food-service, construction labor, driver and logistics, security guard, janitorial, education and substitute, and direct-hire or executive search firms with a contract division. |
| Not required | Collateral for working capital. A business plan. Tax returns under $500,000. A minimum headcount on assignment. A specific payroll, timekeeping or VMS platform. |
| Open to | U.S. businesses with a U.S. business bank account. All 50 states. |
Four minutes. Three bank statements. No credit impact to apply.
SBA questions, answered.
Can a staffing agency get an SBA loan?
Yes. Staffing and recruiting agencies are eligible SBA 7(a) borrowers like any other for-profit U.S. small business. The file needs 680+ credit, 24 months in business, 10% down on an acquisition, and 30 to 45 days for a standard 7(a) or 10 to 21 days for SBA Express.
What can a staffing agency use an SBA loan for?
Working capital, buying another agency or its client book, a partner buyout, leasehold improvements for a new office, refinancing qualifying business debt, and owner-occupied real estate. Paying off a merchant cash advance is generally not an eligible refinance use; ask us before you plan around it.
How long does it take?
SBA Express closes in 10 to 21 days and is capped at $500,000. A standard 7(a) closes in 30 to 45 days. If the payroll is due Friday, that is what factoring and working capital exist for.
What does an $800,000 agency acquisition cost per month on SBA?
With 10% down, a $720,000 SBA 7(a) loan over 10 years at an illustrative 10.00% is $9,515 a month before the SBA guaranty fee and closing costs. An illustration, not an offer.
Who underwrites it?
SBA 7(a) and SBA Express files are packaged by Timecard Capital and placed with SBA-preferred bank partners. Timecard does not make SBA credit decisions or underwrite SBA credit in-house. The partner is identified to you in writing before you sign.
The cheapest money, if the calendar allows.
$50,000 to $5,000,000, 10% down, 680+ FICO. SBA Express in 10 to 21 days; standard 7(a) in 30 to 45.