Why Are Small Businesses Giving Away Equity When They Don't Need To? The Hidden Power of Invoice Factoring

In today's financing landscape, small and mid-sized businesses (SMBs) are often faced with one painful decision: give up ownership or stall growth.

As customer demand grows, many founders struggle with the working capital required to take on new orders, hire staff, or purchase inventory. The instinctive solution for many business owners has become equity dilution - selling shares to outside investors to secure immediate capital.

But according to Adrian Ghila, founder of California-based factoring company Factor & Fund, many of these businesses may be giving up ownership far too soon - and unnecessarily.

"In the last 12 months alone, I've met dozens of businesses that sold equity simply because they didn't know they had better options," says Ghila. "Their capital problem wasn't investment - it was cash flow timing. And that's exactly what invoice factoring solves."

Equity Isn't Always the Smartest Capital
Venture capital and private equity come with long-term strings attached. Founders lose control, profits are permanently shared, and decision-making power often shifts away from the original owner.

What many SMBs don't realize is that much of their financing need is short-term. They've already performed the work or delivered the product - they're just waiting 30, 60, or even 90 days for their customers to pay.

"If you've invoiced $500,000 but you're waiting 60 days to collect, you don't need an investor," Ghila explains. "You need access to that cash right now."

What Is Invoice Factoring?
Invoice factoring allows businesses to sell their unpaid customer invoices to a factoring company like Factor & Fund in exchange for immediate working capital - often funded in as little as 24 to 48 hours.

Unlike traditional loans or credit lines, invoice factoring:

- Does not create debt or require monthly payments.
- Approves businesses based on their customers' creditworthiness.
- Grows naturally as sales and invoices grow.
- Leaves ownership and equity completely untouched.

Industries Most Affected
While invoice factoring is not new, its relevance has surged across industries where receivables often sit unpaid for long periods:

- Trucking & Freight
- Staffing Agencies
- Manufacturing
- Wholesale & Distribution
- Healthcare & Insurance Recovery

These businesses face large customer orders but operate on thin working capital. Invoice factoring bridges that gap quickly and affordably.

The Equity Alternative Most Founders Don't Know Exists
According to Ghila, the real problem is lack of awareness.

"We regularly speak with business owners who think selling shares or borrowing heavily is the only way forward. Once they understand how invoice factoring works, most realize they can fund their growth without giving up long-term equity or control."

Factor & Fund has built its model specifically for SMBs that need fast, flexible funding while avoiding long-term debt and ownership dilution. With transparent flat-fee pricing, no long-term contracts, and fast underwriting, Factor & Fund serves businesses across California and the U.S.

To learn more, visit https://factorandfund.com

1968 S. Coast Hwy #1316, Laguna Beach, CA
Adrian Ghila

Factor & Fund helps small and mid-sized businesses unlock the cash trapped inside unpaid invoices. Founded by entrepreneurs who understand the daily challenges of growing businesses, Factor & Fund delivers simple, transparent, debt-free funding solutions across industries like trucking, staffing, manufacturing, and wholesale. Approvals happen within 24 hours, and funds are typically released within 48 hours.

This release was published on openPR.