Money out first, money in later
An online seller's cash cycle has three steps. First you pay a manufacturer or wholesaler for inventory, often well in advance. Then the goods ship, clear, and sit in a warehouse. Finally the product sells and a marketplace or payment processor sends the proceeds on its own payout schedule. At each step cash is committed, and the wait between spending and receiving can run for months.
The faster a product sells, the more acute the problem. A strong item that sells out has to be reordered before the money from the last batch has arrived. Growth makes the squeeze worse before it makes it better.
The cash-conversion walkthrough
- Place the order. A deposit goes to the supplier, with the balance due at production completion or shipment.
- Ship and clear. Freight, duties and prep costs follow, and none of it earns revenue yet.
- Receive and list. Goods arrive at the warehouse or fulfillment center; ad spend begins to drive traffic.
- Sell. Orders come in; the marketplace holds proceeds until its payout date, and returns can reduce them.
- Reorder. The next batch needs payment before earlier proceeds are fully in hand.
Each stage ties up cash that the business cannot use for anything else.
Ad spend is a second inventory
Advertising behaves like inventory because it is paid for first and returns revenue later. A seller launching a product might spend heavily on ads for the first weeks, accepting thin or negative margins to build sales history and rankings. That spend comes straight from the same account that pays for the next order.
For illustration only, and not our terms: a seller who plans a $15,000 inventory order and $5,000 in launch advertising needs $20,000 available before the first sale, even if the product is a proven performer. Working capital can fill that gap so the seller does not scale back an order that would have sold.
Marketplace payout timing
| Channel type | Cash pattern |
|---|---|
| Own web store | Payment processor deposits within days, fees deducted |
| Large marketplaces | Periodic payouts, with reserves held for returns |
| Wholesale to retailers | Invoice terms, often net 30 to 60 |
A seller using all three has deposits arriving on three different clocks, which is why monthly statements are the clearest view of the business.
Getting started
The application takes about five minutes. We ask for roughly three months of business bank statements, run a soft credit pull and require no tax returns. FICO 500 and above is considered. Funding ranges from $25,000 to $5,000,000, with money possible in as little as 24 hours. Sole proprietors, including one-person online shops, can apply. Apply here.