Michael Davis
November 10, 2025
Opening or expanding a storefront is exciting (and expensive). Between construction, equipment, inventory, and payroll, most operators need outside capital to get across the finish line.
The good news is that there are more financing options than ever for small business owners in 2025. The challenge is figuring out which one actually fits your business. Each option comes with its own tradeoffs: speed versus cost, flexibility versus control, short-term convenience versus long-term impact.
Here’s a breakdown of nine ways to fund your storefront, and where Homegrown fits in.
1. Traditional Bank Loans
The classic choice. Bank loans offer lower interest rates than most alternative financing options, but they’re slow and paperwork-heavy. Approval often takes weeks or months, and banks usually require strong credit, detailed financial statements, and collateral.
If you’re an established business with solid cash flow and patience for the process, this can be a reliable source of funding. But for newer or fast-growing businesses, the timing and restrictions can make it a difficult fit.
Pros: Low rates, longer repayment terms
Cons: Slow approval, rigid requirements, personal guarantees
2. SBA Loans
The Small Business Administration partially guarantees these loans, making banks more willing to lend. SBA 7(a) loans are the most common, offering up to $5 million in financing. They’re ideal for businesses with strong fundamentals.
The downside is the process. It’s long, complex, and usually requires personal guarantees.
Pros: Favorable interest rates, higher approval odds
Cons: Long timelines, heavy documentation, personal risk
3. Business Lines of Credit
A line of credit gives you access to flexible funding that you can draw from as needed, similar to a credit card but usually with better rates and higher limits. Many operators use lines of credit to cover short-term gaps, seasonal inventory, or unexpected expenses.
The key is discipline. Because you can draw and repay repeatedly, it’s easy to overextend.
Pros: Flexible, reusable, and fast to access once approved
Cons: Variable interest rates, risk of overuse
4. Equipment Financing
If you need expensive machinery, furniture, or technology, equipment financing can help you buy it while spreading out the cost. The equipment itself serves as collateral, which can make it easier to qualify.
The tradeoff is that this funding only covers physical assets — not payroll, rent, or other operational needs.
Pros: Easier approval, asset-backed, preserves cash flow
Cons: Limited to equipment purchases, depreciation risk
5. Merchant Cash Advances
This is one of the fastest and easiest types of funding to access, but also one of the most expensive. A funder advances you cash upfront in exchange for a portion of your future sales.
It’s attractive for speed, but the repayment structure can be aggressive and unpredictable. Many operators who start here end up looking for more sustainable options later, or they get caught in a cash crunch due to the short repayment cycle.
Pros: Fast approval, minimal documentation
Cons: High fees, daily or weekly repayments, cash flow pressure
6. Revenue-Based Financing
Revenue-based financing ties repayment to your monthly sales. When business is strong, you pay more; when things slow, you pay less. It’s a flexible middle ground between debt and equity, ideal for growing businesses that want to avoid personal guarantees or ownership dilution.
This is where Homegrown fits in. We provide up to $2 million in growth capital for multi-location brick-and-mortar entrepreneurs, in exchange for a small percentage of monthly sales — typically 1–6%. Payments flex with your revenue, so you’re never stuck making fixed payments when business slows.
Pros: Flexible, equity-free, performance-based
Cons: Not ideal for businesses with unpredictable or declining revenue
7. Equity Investment
Equity funding means bringing in investors who provide capital in exchange for ownership. It can give you access to larger checks and strategic support, but you’re giving up partial control of your business in return.
For some founders, that tradeoff is worth it. For others, it’s too costly long-term.
Pros: No repayment schedule, potential strategic value
Cons: Loss of ownership, complex investor relationships
8. Crowdfunding
Crowdfunding platforms like Kickstarter or Wefunder allow you to raise small amounts of money from many people. It can double as a marketing campaign by building awareness around your brand before you open.
But it takes serious effort to stand out, and most campaigns fall short of their funding goal.
Pros: Community-building, no repayment required
Cons: Time-consuming, unpredictable results
9. Credit Cards
Still one of the most common forms of small business financing, and one of the riskiest. Credit cards can help cover immediate expenses or bridge timing gaps, but high interest rates and low credit limits make them unsustainable for major investments like a buildout.
Pros: Immediate access, easy to use
Cons: High interest, personal liability, limited capacity
There’s no one right way to fund a storefront. The best option depends on your stage, your goals, and your tolerance for risk. The key is understanding what each type of capital costs you, whether that’s cash, control, or peace of mind.
At Homegrown, we’ve built a model designed specifically for operators. It’s flexible, transparent, and grounded in real-world experience.
Expansion is hard enough. Your financing shouldn’t make it harder. If you’d like to learn more about how Homegrown can help fund your next location, apply for funding or subscribe to our newsletter for more insights.
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