Monday, January 19, 2009

Rocket Fuel for Growth

A Southern California manufacturer and distributor of consumer electronics was searching for a $1.25 million revolving line of credit to fuel its growth. In its just completed first year of operation, it had achieved a revenue run rate in excess of $10 million and was profitable – an amazing accomplishment by any standard.

The company had excellent products, good accounts receivable, a solid business plan and a strong ownership team.

Yet, lacking a three year history of operating results, no commercial bank was willing to approve a loan especially during this period of an increasingly tight credit crunch.

Unable to find a cost effective source of working capital on its own, this hyper-growth company was referred to Funding 911 by a commercial banker.

Funding 911 introduced the company to two commercial bankers who each offered solutions not known by many financing advisors and not offered by many commercial banks. One was a revolving line of credit through a CAPLINE program guaranteed by the SBA. The other was a revolving line of credit offered through a state of California program.

My client has just closed a $1.25 million revolving line of credit with the commercial banker offering the CAPLINE product. This working capital facility will enable the borrower to receive loan advances tied to its accounts receivable and inventory at very attractive interest rates not available through any other sources. The CAPLINE program can currently support loan amounts up to $2 million.

My client now has the rocket fuel it needs to more than double in size in spite of a credit crunch which is strangling many businesses.

Need help finding the right lender or telling your story the right way for your business? Read "Matchmaking for Business Loans" and give me a call!

Tags : Working capital , accounts receivable , credit crunch , revolving line of credit , SBA , CAPLINE

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