- Relaxed credit score requirements
- 2-7 days time to funding
- Lends to new businesses
- Opaque terms and fees
- High factor rates
Cashbloom is a California-based alternative business funder offering short-term working capital in the form of loans and merchant cash advances.
Cashbloom operates in both the U.S. and Canada, though not all of its products will be available in every state or province. Overall, the company offers high rates, but is unusually flexible with regard to whom it’ll fund. Brand new businesses aren’t automatically ruled out here, making Cashbloom a potential funder of last resort.
As always, you’ll want to comparison shop before committing to any kind of alternative loan. Our short-term funding comparison chart can give you a head start.
Table of Contents
Cashbloom offers the following:
You must meet these prerequisites to qualify for funding from Cashbloom:
|Time in business:||1 month (MCA)
3 months (loan)
|Revenue:||$5,000 per month (MCA)
$120,000 per year (loan)
Additionally, your business can’t be in active bankruptcy. The loan product is not available in the following states: AR, CT, DE, FL, MA, MI, MT, ND, NV, NY, RI, TN, and VT. MCAs are available in all 50 states. Products are available in Canada, with the exception of Quebec.
Cashbloom ultimately favors a proprietary process called “BloomScore” to make its funding decisions over more traditional metrics. What this process is isn’t exactly clear, but the company says it has to do with your cash flow and comparing your business’s profile against industry trends and data points.
Terms & Fees
The terms for Cashbloom’s products look something like this:
|Borrowing amount:||$5,000 – $1 million|
|Term length:||3 – 24 months|
|Factor rate:||x1.2 – x1.5|
|Origination fee:||See below|
|Effective APR:||Learn more|
|Collateral:||UCC-1 blanket lien|
Cashbloom deals in merchant cash advances and, where applicable, short-term loans. These products differ from traditional loans in a number of important ways.
Since the term length is too short to accrue much interest, the cost of borrowing is determined by a factor rate, usually expressed in the form of a multiplier. To find out how much you have to repay, you simply multiply the factor rate by your borrowing amount. For example, if you have a factor rate of x1.2, and you are borrowing $10,000, you will have to repay $12,000 ($10,000 x 1.2 = $12,000).
In the case of short-term loans, you’ll be making about 21 micro payments per month—one per business day. These are withdrawn from your business bank account via automated clearing house (ACH). Each of these payments will be about the same size. With a merchant cash advance, you’ll still be making 21 payments a month, but they’ll be made in the form of a percentage of your daily credit sales. Since these can vary based on how strong your sales are on a given day, the term length of MCAs is more of a rough estimate. If you’re doing great business, you’ll pay off your MCA quickly. If you’re having a rough couple months, it will take longer.
Though merchant cash advances traditionally require the client business to accept credit card transactions, Cashbloom can also structure the advance as something more closely resembling a short-term loan. This means you’ll be making fixed daily (rather than sales-based) payments via ACH. This might be appetizing for businesses that would prefer the short-term loan structure but live in a state in which Cashbloom doesn’t issue those loans.
One thing to be aware of is that Cashbloom charges a number of fees beyond the direct cost of borrowing money. This includes an origination fee, an administrative fee, and if you’ll be paying through automated clearing house withdrawal, a $350 service charge.
Cashbloom’s funding is unsecured. So, while you don’t have to put up collateral, you will be exposing your business to collections should you default.
Like most alternative funders, Cashbloom offers a streamlined application process that is substantially faster than those of traditional banks. You can begin the application online, though be aware that this is more of a screening process than anything. That automated process should be more or less instantaneous. You’ll then be contacted by a sales rep to complete your application. This will usually involve submitting some paperwork to corroborate your business’s income and outstanding debts. The full process is typically complete within a business day.
Sales & Advertising Transparency
Cashbloom discloses a decent amount of information on its site but falls short of disclosing its rates. The company also doesn’t dive too deeply into how its products differ from traditional bank loans, but it doesn’t go out of its way to obfuscate either. Overall: not the most transparent, but above par.
Customer Service & Technical Support
Clients seem to be very satisfied with Cashbloom’s customer service overall. I found them to be a little more aggressive with their sales pitches than some of their competitors, but also fairly willing to answer questions. You can reach Cashbloom by phone, through its website, or through one of the company’s social media accounts (Instagram, Facebook, Twitter, or LinkedIn).
Negative Reviews & Complaints
Cashbloom has an A+ rating with the BBB, with no complaints currently on record. There are no reviews either, however, so it’s hard to read too deeply into what that rating means. In fact, negative online user reviews are in short supply, period. Here are some criticisms I’d have:
- Expensive: A typical criticism of alternative funding, corroborated by (mostly positive) reviews is that the “terms could be better.” Think of this as subprime for businesses. If you’re looking at MCAs, it should be because you’ve exhausted cheaper options.
- Missing Details: Though the company is far from the worst offender, Cashbloom could help prospective customers out by disclosing a few more details.
- All Products Aren’t Available Everywhere: Some states have tighter lending restrictions than others. Many alternative lenders depend on extremely high-interest rates for their business models and may not be able to charge those rates in those states. Cash advances generally side-step these restrictions, which is why you can get one in all 50 states.
Positive Reviews & Testimonials
Cashbloom has overwhelmingly positive reviews on Trustpilot, where it scores a 9.7 out of 10. User reviews praised:
- Customer Service: Most positive reviews praised the customer service, which they said was responsive and helpful.
- Speed & Efficiency: Alternative funders are, if nothing else, fast. Cashbloom is no different.
- Willingness To Work With New Companies: Generally, most alternative lenders want you to have been in business for at least six months before they’ll work with you. Cashbloom cuts it back to one to three months.
Between fees and overall rates, Cashbloom strikes me as being on the expensive side, even for an alternative lender. That said, the upside to this is Cashbloom also seems willing to take on an unusually high amount of risk. Businesses that have been around for only a month can potentially find funding here, albeit at quite a high cost. The company has been around for a while without garnering too many major complaints, so you probably won’t be in for any really nasty surprises once you process the sticker shock. Just make sure you don’t qualify for more affordable funding before you do.
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