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  1. #1

    $20M Yearly, 820 Credit, wants $350k+

    Client makes $20M yearly ~$1.5M monthly
    Credit: 820
    Loans: Paypal and Kabbage
    Recently secured EIDL for $150k.
    Industry: Cattle Broker


    Client originally was looking for an SBA of $350k, but understands the inconveniences that come with them. The need for collateral, a lot paperwork and funding time. That being said he is open to taking a cash advance due to convenience. He is used to Paypal rates and wants something comparable as that is what his margins can support. Who can fund this deal?
    Last edited by pjfunds; 07-08-2020 at 11:08 PM.

  2. #2
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    I'll jump in before Kevin does.... are they a B2B or B2C business? What industry? Perhaps a factor (that's NOT a lot of paperwork with the right factor) is better than an MCA, and will act like a LOC rather than a term product which will give more working capital and is the gift that keeps on giving, client, lender and broker.

    https://www.abfunders.com/business-l...ine-of-credit/
    https://www.abfunders.com/loan/business-line-of-credit/

  3. #3
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    Quote Originally Posted by pjfunds View Post
    Client makes $20M yearly ~$1.5M monthly
    Credit: 820
    Loans: Paypal and Kabbage
    Recently secured EIDL for $150k.


    Client originally was looking for an SBA of $350k, but understands the inconveniences that come with them. The need for collateral, a lot paperwork and funding time. That being said he is open to taking a cash advance due to convenience. He is used to Paypal rates and wants something comparable as that is what his margins can support. Who can fund this deal?
    1.5Mil monthly=$2Mil-$3Mil in AR outstanding if they are B2B. An ABL facility would be more cost effective and take 30 days to close. Factoring would be the quickest route. It would not be as cheap as ABL, but much more cost effective than advance. The client will be happy and YOU will make more money.

    What Industry?
    How much AR is outstanding?
    If there is inventory we could potentially finance some of it if we are financing the AR. It would slow the process down a touch so it would be best to start with AR and step into inventory post closing.

    KH
    Hedley Lamarr......That's Hedley

  4. #4
    Sponsor Reputation points: 9187 DannyFoxCap's Avatar
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    Depending on the Industry, Fox can fund this deal, but not at Paypal rates. Reach out to me if you are not already signed up.
    Direct: 347-468-7528
    Cell: 305-753-3967
    Fax: 866-557-0455
    Email: Danny@foxbusinessfunding.com

  5. #5
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    Lightbulb Long-Term Funding

    Quote Originally Posted by pjfunds View Post
    Client makes $20M yearly ~$1.5M monthly
    Credit: 820
    Loans: Paypal and Kabbage
    Recently secured EIDL for $150k.


    Client originally was looking for an SBA of $350k, but understands the inconveniences that come with them. The need for collateral, a lot paperwork and funding time. That being said he is open to taking a cash advance due to convenience. He is used to Paypal rates and wants something comparable as that is what his margins can support. Who can fund this deal?
    SBA 7(a) closes in the range of 30 to 60 days. A benefit of SBA 7(a) is that 1st 6 months payments are paid by the SBA.

    I would check your info from the merchant EIDL does not fund up to $150K - they either received PPP $$ or possibly an SBA Bridge Loan?

    In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are able to apply for an Economic Injury Disaster Loan advance of up to $10,000. This advance is designed to provide economic relief to businesses that are currently experiencing a temporary loss of revenue. This loan advance will not have to be repaid. Recipients do not have to be approved for a loan in order to receive the advance, but the amount of the loan advance will be deducted from total loan eligibility. SBA will begin accepting new Economic Injury Disaster Loan (EIDL) and EIDL Advance applications on June 15 to qualified small businesses and U.S. agricultural businesse.

    Moving forward, this owner should qualify for long-term funding. I rep for an SBA Bank, call me to discuss options.



    Dave Lambert, Business Development
    dave@fcbankcard.com
    Merchant Services Consultant
    High Risk Merchant Payment Solutions
    SBA 7(a) Loans & Short-Term Funding
    T/VM: 727-291-7890
    Office: 727-233-1111
    Skype: fc-financial

  6. #6
    Quote Originally Posted by Yankeeman07 View Post
    SBA 7(a) closes in the range of 30 to 60 days. A benefit of SBA 7(a) is that 1st 6 months payments are paid by the SBA.

    I would check your info from the merchant EIDL does not fund up to $150K - they either received PPP $$ or possibly an SBA Bridge Loan?

    In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are able to apply for an Economic Injury Disaster Loan advance of up to $10,000. This advance is designed to provide economic relief to businesses that are currently experiencing a temporary loss of revenue. This loan advance will not have to be repaid. Recipients do not have to be approved for a loan in order to receive the advance, but the amount of the loan advance will be deducted from total loan eligibility. SBA will begin accepting new Economic Injury Disaster Loan (EIDL) and EIDL Advance applications on June 15 to qualified small businesses and U.S. agricultural businesse.

    Moving forward, this owner should qualify for long-term funding. I rep for an SBA Bank, call me to discuss options.


    This is incorrect information. The EIDL is currently providing loans up to 150k (2MM for agriculture). The 10k that you referenced is an advance (grant) that business owners can receive regardless of whether or not they get approved for the loan.

  7. #7
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    Quote Originally Posted by Quick Funding Solutions View Post
    This is incorrect information. The EIDL is currently providing loans up to 150k (2MM for agriculture). The 10k that you referenced is an advance (grant) that business owners can receive regardless of whether or not they get approved for the loan.
    EIdL is NOT doing $2mm on ag deals. It’s doing $150k max PER entity that you own with an aggregate of $2mm

  8. #8
    The client is a cattle broker.

  9. #9
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    So he doesn't even sell the cattle himself, eh?
    Let me guess: It's B2B, but it seems like you can't factor that AR. He gets paid after the deal is transacted, by the seller or purchaser, and doesn't actually have AR at all, as it's done COD. Nobody likely owes him money.

    Am I right in saying that what you showed is all gross revenue, and his net is probably a very small percentage of that?

    If he wants unsecured business LOCs, like Kabbage with bank rates, those are much easier to take care of than an SBA. The LOCs that don't have to report to the personal credit.

  10. #10
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    Livestock brokers are pretty prevalent. Most have agreements with farmer to sell livestock on their behalf and also have agreements with end buyers. You would have to review the AR & AP detailed agings. You will also need to review contracts from sellers and buyers are there are rights in place to protect the farmers. Margins in this business are usually sub-20%. That being said, you will have to find a facility that is very cost effective and a lender/factor that understands the rules regarding farmer's rights.

    This in not my first time at the rodeo....... Pun intended.

    KH
    Hedley Lamarr......That's Hedley

  11. #11
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    Lightbulb EIDL Grant?

    Quote Originally Posted by Quick Funding Solutions View Post
    This is incorrect information. The EIDL is currently providing loans up to 150k (2MM for agriculture). The 10k that you referenced is an advance (grant) that business owners can receive regardless of whether or not they get approved for the loan.
    So your stating that the advance is a "GRANT" that does not have to be paid back?
    Dave Lambert, Business Development
    dave@fcbankcard.com
    Merchant Services Consultant
    High Risk Merchant Payment Solutions
    SBA 7(a) Loans & Short-Term Funding
    T/VM: 727-291-7890
    Office: 727-233-1111
    Skype: fc-financial

  12. #12
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    The advance only has to be paid back if the subsequent loan is taken, in which case the grant is considered part of the loan I believe. But if the business ONLY gets the grant up to 10k or 1k per employee that does not in fact need to be paid back. The 150k EIDL that the OP stated was over 30 years @3.75% with the first 12 monthly payments deferred while interest accrues.

  13. #13
    Thank you everyone for your help, we ended up moving forward on sba 7a

  14. #14
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    Quote Originally Posted by pjfunds View Post
    Thank you everyone for your help, we ended up moving forward on sba 7a
    This is great @pjfunds. Great job for your merchant.

  15. #15

    Izzy F

    Quote Originally Posted by pjfunds View Post
    Client makes $20M yearly ~$1.5M monthly
    Credit: 820
    Loans: Paypal and Kabbage
    Recently secured EIDL for $150k.
    Industry: Cattle Broker


    Client originally was looking for an SBA of $350k, but understands the inconveniences that come with them. The need for collateral, a lot paperwork and funding time. That being said he is open to taking a cash advance due to convenience. He is used to Paypal rates and wants something comparable as that is what his margins can support. Who can fund this deal?
    Hi,
    My name is Izzy,
    Hit me up i can help you with funding ASAP..
    Feel free to call me on 202-836-7538
    Looking forward helping you out.
    Thanks

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