The phone keeps ringing, the emails keep coming, but we need to agree on some basics.
A factoring company provides financing by making advances on invoices to creditworthy customers. An invoice is defined as a product or service that has been delivered or completed (100%) and accepted as due by the customer.
– So if you need money to open a restaurant – a factoring company can’t help
– Any type of retail store that sells to consumers – maybe try a home equity line
– Need money for Anything related to real estate property – again, not for a factoring company
– You’re an agent who wants money in advance of commissions – there are a few specialty places that do that, but generally commissions are not “invoices”.
– You have a contract but need up front money to get it going – this is technically mobilization capital
– Your company has annual contracts and you want money today for funds that will be collected over the next year – a factoring company purchases 30 day invoices that cannot age more than 90 days
– No equipment, no inventory, no proforma or pre-billing
– And we definitely cannot pay to help a relative of a deposed government official from a foreign land.