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Time in business TIB
Also called TIB, years in business, business age, minimum time in business.
How long the business has been operating, measured by the funder from a date it can verify — usually entity formation, EIN issuance or the earliest bank activity it can see.
Drafted with AI assistance. Not yet independently checked. Nobody has verified the claims on this page against a source, so treat the figures and legal points as a starting point rather than as settled, and confirm anything you are about to act on. How we check things.
What it means
It is one of the two or three inputs that gate an approval outright. Most bank-statement funders set a minimum measured in months; banks and SBA lenders think in years and treat anything under two as startup risk requiring different treatment. Longer operating history reduces the modelled probability of failure and widens the products available.
The measurement date is not obvious and funders differ. Secretary of State formation date is the most common because it is verifiable in a public record. Others use the EIN assignment date, the date the business bank account was opened, or the date of the earliest deposit they can see in the statements provided. A business trading for a decade as a sole proprietorship that incorporated last year will often be scored as one year old.
Acquisitions and restructurings interact badly with this. Buying an established business through a new entity resets the clock in the funder's data even though the operations, staff and customers are unchanged.
Where this one catches people
Forming a fresh entity to escape existing obligations does not work and creates new problems. Funders check the ownership overlap, the address, the industry and the bank relationship, and the pattern is recognised. Where an existing advance is outstanding, moving revenue into a new entity is typically both a breach of the existing agreement's covenants and a fact pattern that a funder's counsel will describe in less neutral terms than "restructuring".
Where you will meet this term
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Time in business — common questions
What does time in business mean?
How long the business has been operating, measured by the funder from a date it can verify — usually entity formation, EIN issuance or the earliest bank activity it can see.
Where does time in business catch people out?
Forming a fresh entity to escape existing obligations does not work and creates new problems. Funders check the ownership overlap, the address, the industry and the bank relationship, and the pattern is recognised. Where an existing advance is outstanding, moving revenue into a new entity is typically both a breach of the existing agreement's covenants and a fact pattern that a funder's counsel will describe in less neutral terms than "restructuring".
Is time in business the same as an interest rate?
Time in business is defined above; if you are comparing it against a rate, check whether the two measures share a time dimension before you put them side by side.
Which products does time in business apply to?
Merchant Cash Advance, Working Capital, Term Loan, Business Line of Credit, SBA Loan.
Is there a worked example of time in business?
Not on this entry. Where a term is arithmetic, the arithmetic is shown; this one is not primarily a calculation.
What else should I read alongside time in business?
Bank statements, SIC code, Sole proprietor, Stips, Underwriting.
Has this definition been checked?
Not yet. This entry is drafted and live, and the notice at the top says so. Confirm anything you are about to act on.
Is this legal advice?
No. It is a definition. What a clause does in your contract, in your state, is a question for a lawyer licensed where you are.
Can I suggest a term?
Yes — [email protected]. The glossary grows from what people are actually shown in contracts.