Shaun Hyland from Reach Commercial Finance explains how the team sourced essential funding for a working capital finance provider with few lenders to choose from
I had met with the Directors of this South-East based business finance company previously and shared our extensive experience and knowledge of the lending industry, which then prompted this complex brief.
They wanted us to have a look at sourcing funding for a fledgling working capital finance provider, specifically a back to back invoice discounting facility.
This is a part of the market which many lenders leave well alone so finding a partner to work with was a key challenge.
We made initial, confidential contact with a number of lenders that had previously provided similar back to back facilities, using a one page ‘teaser’ document. If and when we received a positive response, we followed up with more detailed information and set up a meeting between our client’s management team and the lenders where appropriate.
Once we had established a relationship between client and lender, where both were comfortable, we provided ongoing assistance to deliver credit-backed terms and carried on supporting right through to the eventual drawdown of the seven figure monies on a 24 month facility.
During the negotiations we were able to structure the engagement in a way that was acceptable to our client by balancing fixed fees and contingent fees.
But the key to the securing of the funding was our ability to identify the lenders in the first place, someone who would have an appetite for this sort of opportunity, and to present a compelling, credible business case for it.
It could have been a very easy transaction to walk away from, as we suffered a number of rejections along the way, but in the end our perseverance paid off and we found the right investor to meet the brief.
“When we realised the challenges of sourcing funding for a fledgling working capital finance provider, we turned to Shaun Hyland at Reach Commercial Finance, having met him previously and been impressed by his experience and knowledge of the lending industry. Despite the shortage of lenders active in our part of the market, Reach successfully introduced us to people who provided the facility we needed to achieve our growth targets and establish our business. We believe in building business relationships that last and prefer to work with partners and clients that share our philosophy, which is based on delivering the highest levels of service. As we now look for further investment to drive our service levels higher still, we have again turned to Reach Commercial Finance for their assistance in identifying an investor that shares our vision.”
Director, Working Capital Finance Provider
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