OBJECTIVE: To secure additional working capital to fund rapid business growth without compromising the owner’s equity or control over the company.
SITUATION: The client was a relatively new business experiencing rapid growth after securing several large, high-value contracts. These contracts were significant for the company but required extended timelines, spanning over a year for completion. This created a pressing need for working capital to manage day-to-day operations and meet project demands while waiting for payments.
FINDINGS: Due to the client’s lack of an extensive financial history, traditional banks were unwilling to provide funding, leaving the client without access to conventional lending solutions. Factoring was also not a viable option, as the client was determined to maintain discretion and avoid signaling any potential financial challenges to their customers. These limitations presented a significant roadblock to securing the necessary funds to sustain operations and growth.
SOLUTION: By partnering with an Asset-Based Lender, the client successfully secured a line of credit that addressed their immediate financial needs. While the interest rates were higher than traditional loans, the client embraced a carefully crafted strategy that aligned with their growth objectives. This approach allowed the client to maintain confidentiality and navigate cash flow challenges effectively. Within two years, the company transitioned to being entirely self-funded. They have since expanded their business significantly, attracting numerous Fortune 1000 clients without revealing the financial hurdles they overcame. Today, the business operates with complete financial independence, funding all growth internally while maintaining strong client relationships and a thriving reputation.