OVERVIEW – Information on business financing solutions offered by commercial finance companies in Canada. What you wanted to know but were afraid to ask on various loans and asset monetization strategies for cash flow and working capital needs
Commercial finance companies in Canada are often the alternative and solution provider for loans and financing solutions. In other words… they are … trending! Let’s dig in.
One key factor around loan solutions and asset monetization strategies that is commonplace with a non bank finance firm is that they are often ‘ niche’ focused , simply speaking they have a tremendous amount of expertise in certain areas of business finance.
Since these firms do compete with banks they tend to offer a broader range of services and credit facilities. Most importantly they offer solutions that are not provided by our Canadian chartered banks – a good example might be purchase order financing or SR&ED tax credit financing for refundable tax credits.
While is it sometimes common to refer to these financiers as ‘ asset based lenders’ the reality is that the term is so general that further clarification is required. In almost all cases Canadian banks prefer, in fact insist upon being your ‘ senior lender ‘ – which very simply means they typically have a charge on all assets of your company, including , unfortunately, the assets they are ‘ not ‘ financing!
The most common senior lending facility tends to be the business revolving line of credit. These facilities, whether from a bank or a non bank commercial finance company offer revolving credit for daily operations? The main difference in a business credit line from a commercial finance company is that it is often more ‘ asset ‘ focused as opposed to ‘ ratio’ and ‘ covenant’ focused as with a bank. That translates into more credit approval and higher borrowing power!
Term loans and other bridge loans are also offered by commercial finance firms. They tend to be shorter term in nature and are often a ‘ bridge ‘ to future financing.
While unsecured cash flow loans are often sought by business owners/financial mgrs, such a bank loan will come with strict covenants and ratios around your cash flow. These loans are often more easily obtainable from commercial finance firms, albeit at a higher rate. Another term for those loans in particular is ‘mezzanine ‘ financing.
Statistics tell us that over 80% of all Canadian businesses finance new assets via equipment leasing companies. Whether it’s for growth or asset renewal these equipment finance solutions are the backbone of fixed asset financing in Canada. Assets financed include technology, plant equipment, rolling stock, etc
If you’re focused on understanding which non bank commercial finance companies can help your business operate or grow seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can ensure access to funding solutions that make sense for your particular business.
Stan Prokop – founder of 7 Park Avenue Financial –
Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 10 years – Completed in excess of 100 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing. Info & Contact Details :
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Direct Line = 905 302 4171
Office = 905 829 2653
‘ Canadian Business Financing with the intelligent use of experience ‘
ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
7 Park Avenue Financial
Canadian Business Financing