Experienced Factor Wins a New Client with Haversine’s Participation Solution
Do you have deals you are trying to ‘win’ or even retain, but your prospect or client’s funding need is higher than your house limit will allow? This scenario is the perfect time to think of us. Haversine can confidentially share in your client funding transaction, while you lead, manage and maintain the relationship with your client.
Take a look at how Haversine was able to help one factoring company earn a growing staffing firm’s business by offering to share in an $8 million facility, while also competitively structuring a lower pricing component to help the factor ‘win’ their business.
Quick Overview: Factor Wins a New Client Using Haversine’s Participation Financing
An experienced factoring firm with a long history in the space had been competing on a staffing transaction for some time. The staffing client’s needs had lessened during the pandemic with reduced revenue combined with the PPP monies available from the government. As 2022 started, the company started to see an increase in sales and had also run through their PPP funds, creating an increased need for working capital. And, with their specific niche and customer base, the company was going to need a larger facility – up to $8 million, and possibly more throughout the year.
The incoming factor’s senior lender had specific concentration covenants that limited the line size that could be offered to the staffing firm. Additionally, the staffing firm had received aggressively priced offers from competing factors. With these two elements, it became clear that to win this deal, the factor needed a partner that could:
• provide participation financing for now and through the company’s expected growth,
• offer a lower rate, allowing the factor to blend down their rate to be more competitive with the size transaction in the specialty finance space today, and
• assist in the underwriting of the deal for this size transaction, acting as an additional set of eyes during the due diligence process.
Haversine was able to step in and quickly provide a secondary review of the deal and offer a larger participation line for now and for the future. Moreover, Haversine worked with the factor to establish a fixed fee basis on the participated funds to help the factor secure the deal with the staffing firm.
A win, win!
We worked together to create a win for everyone. Using the participation financing offered by Haversine, the factoring company could aggressively compete and help a growing staffing company receive the funding they needed for their future growth.
Industry: Staffing Company
Product: Factoring Participation
Product Overview: Participations
When a prospect or client exceeds your concentration limits, rather than send the deal to a competitor, Haversine can share in that opportunity, ensuring you are able to keep the relationship. Our participation program is confidential to your client, keeping us in the background. Participations allow you to:
1. take on larger transactions,
2. diversify risk,
3. blend down the rate to retain clients or ‘win’ new deals, and
4. enhance your yield