Funding Growth Capital Where You Least Expect It
In business, lucrative opportunities are occasionally presented to business owners, but so often the ability to act on the deal and profit from these opportunities comes down to timing and the availability of capital to act quickly. This means that businesses are often forced to give up the chance to grow because they simply cannot afford to.
In this case, the firm was a media company that specialised on video broadcasting on TV screens and monitors in public places like hotels, bars, train stations, bus stops and the like.
They were presented with the opportunity of acquiring their primary competitor for roughly $200,000. This would make them by far the major player in that market space. If they could complete the acquisition and consolidate the 2 businesses, they would be able to eliminate as much as $150 000 per year in overheads, meaning that not only would the opportunity create significant profits, but it would also help to streamline costs in the consolidated business. The savings alone would almost pay for the acquisition in one year.
Regrettably, neither the Company nor any of the directors owned any real estate. They visited several Banks but despite a good business plan and demonstrating the savings and efficiency which would flow from a combined business, no Bank would assist them.
It looked like they were going to miss out on this amazing opportunity.
At this stage, someone mentioned Nova Cash Flow Finance to them.
They contacted Nova, submitted an application and all the supporting documents.
Nova was able to advance against only some of the debtors. In other words, they offered the Client a “Selective Factoring Facility”. In effect Nova was advancing funds to the Client backed by the credit worthiness of their customers
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The acquisition was able to proceed based on the funding Nova provided through the selective factoring facility. The businesses were combined and the significant savings that were anticipated did eventuate; exactly as planned.
The Client only needed to operate the facility for a little over 6 months by which time they have generated enough cashflow and profit to payout the Nova facility.