Industry: Technology
Region: National
Employees: 42
SBF Solutions:
– Increased Liquidity
– Pursue New Clients
– Flexible Facility
Software Product Incubator Increases Growth with Selective Factoring Facility
The client specializes in developing innovative software programming in the fast-paced and ever-changing IT segments of Augmented Reality/Virtual Reality, Robotics, 3D modeling and Cryptocurrencies. The company is located in the southeast and has been in business for 5 years. The company’s employees are located throughout the United States to support new and existing customer’s projects.
Challenge:
The company saw a 50% increase in revenue from the prior year, and recently acquired a large customer contract. While the Company was expanding new business, they were faced with cash flow constraints from current customers.
Their largest customer accounts for 90% of their project volume and pays invoices at a minimum of N90 days. In addition, other customers were demanding extended credit terms; which was taxing the Company’s current financing capacity. The Company was looking for a solution to alleviate the customer demands and supplement working capital to keep project deadlines on track.
Solution:
Seacoast Business Funding was referred to the client through their attorney, and quickly evaluated the situation. The client’s high credit-worthiness outweighed its substantial customer concentration; and Seacoast was comfortable with moving forward with the client and tailored a selective factoring facility.
Results:
Seacoast was able to meet the Company’s needs quickly by closing and funding on the $2 million revolving credit facility in 3 weeks. The client is now able to provide extended terms to customers without a loss in liquidity, and support current and prospective customer accounts.
