You’re a storm restoration company and you just spent two weeks in Florida helping put a huge swath of the state back together following a hurricane. In the process, you burned through all your working capital. Now you return home, feeling great about a job well done, but unsure how you’re going to survive the next 90 to 120 days before the utility in Florida pays you for your work.
If you’re like a lot of storm restoration company owners, you’re contemplating a bridge loan or some other type of business credit. You heard about a company called Nav that simplifies the process. You might’ve also heard about a new company called Payost that provides invoice financing. Which is the better choice? Let’s take a look.
What is Nav?
Nav is sort of like a travel website for business loans. Whereas a travel website takes your input and matches you to the best deals in airfares and hotels, Nav takes your information and matches you to the best potential business lenders based on their assessment of your approval odds.
Just as a company like Travelocity doesn’t own any airplanes or hotels, Nav doesn’t actually lend money. All they do is find the best deal for you—in theory.
How Does Nav Work?
Nav works by matching business owners in need of loans with the finance companies most likely to offer them the best terms. There’s nothing revolutionary about the company, the website, the model or the reality.
You input information about yourself and your company. They, in turn, provide you with a summary of your business credit report as well as a list of different types of loans, lines of credit, and other factors that you would pre-qualify for. This is in addition to the others they believe you might want to apply for.
The company offers 3 tiers of service:
- The free option gives you access to a summary of your personal and business credit reports.
- The Premium option provides more detailed reports.
- The Premium Plus option provides you detailed reports on yourself as well as credit reports on competitors, clients, and suppliers.
In addition, Nav recommends financial products based on the information contained in your business credit report. They make commissions on the products their customers avail themselves of and this is how they can afford to offer some free (if unspectacular) services.
As Nav is nothing more than a kind of clearinghouse for loan information, there are no actual requirements for using it. What they provide is a simple questionnaire that asks you a series of questions regarding:
- Basic personal details
- Your credit score
- How much you want to borrow
- Why you need the loan
- How soon you need the loan
- Your desired APR and more
Nav then uses your input to provide a list of business lenders that it determines will be a good match. Some will offer pre-qualified loans for someone like yourself. Other loans will take a bit more effort to obtain. At the end of the day, however, Nav doesn’t guarantee anything which means the list of candidates they provide you with may turn out to be a list of lost cause.
A review of Nav is really a review of the tech behind their loan-matching model. (Since they don’t actually provide funding or guarantee that any of the matches they direct you to will either.) In our estimation, the site boast of good enough functionalities.
It does a serviceable job providing numerous potential lenders to those in need. It also has a few value-added services that may help you improve yours and your company’s creditworthiness. That’s about it. They’re not registered with the Better Business Bureau, which is a bit puzzling although they do have a pretty good Trustpilot score, for what it’s worth.
No complaint is more common than that of a scarcity of money.
Nav Pros and Cons
Nav isn’t going to set the business world on fire. And frankly, what they offer isn’t necessarily what storm restoration companies need. Loans are great but if you have outstanding invoices of considerable value with a utility, you don’t want to get hooked into a loan.
You want to get paid for the work you did so you can get on with things. That’s what Payost is for. More on that in a moment. For now let’s take a quick look at the pros and cons of Nav:
- They offer a free way for business owners to find out what loans might be available to them.
- The application process is relatively simple and straightforward. No credit cards are required.
- Some of their value-added services might help you improve your overall credit standing.
- The information they provide may or may not be of use.
- They don’t have a BBB entry, which raises questions about accountability.
- The credit scores they provide are not the scores business lenders use to make decisions.
It seems likely that Nav could help companies keep a closer eye on the things that affect their business credit scores and as a result wind up improving that score over time and that is certainly a good thing. However, while a good business credit score is great to have, there are times you need a loan and times when all you need is to have someone pay your outstanding invoices. So let’s look at how Nav stacks up against Payost.
Nav vs Payost Comparison
Nav offers you a way to navigate through the jungle of financial products and puts you in touch with companies that are willing and able to lend you money in various forms. You’ll need to submit personal information, including your social security number in order to obtain this information.
Nav also provides information and tips on how to improve your business credit score. But this isn’t going to do you a lot of good when payment from the utility is still three months away.
Payost, on the other hand, provides invoice financing for companies who have outstanding invoices with AAA credit rated companies.
- Payost doesn’t care what your personal credit rating is.
- Working with Payost won’t affect your credit rating.
- Payost doesn’t provide loans so there are no monthly payments
- Payost doesn’t conduct a credit check that could damage your credit rating.
- Payost doesn’t purchase your invoices and simply just pays them off.
- Applying for Payost invoice financing typically takes just a few minutes.
- Money is often disbursed within 24 hours of approval.
- You don’t have to offer up your valuable equipment as collateral.
Payost is faster and better than working with banks. It doesn’t require you to inform the utility that you sold the invoice to a factoring company and it doesn’t slam you with outrageous interest rates.
Bottom Line: Should You Try Payost?
Nav seems like a well-intentioned, somewhat useful tool for those wishing to engineer a better credit rating for their company. For those in need of a small business loan or short-term line of credit, it might help point them in the right direction.
But if you have outstanding invoices with a utility or you have done work for a GC who has billed a utility for your services, there’s no need to commit yourself to an odious repayment cycle. Instead, just go to the “Apply Now” page of the Payost website and set your company back on track toward a more sustainable financial future.