Mayhew

Furnishing growth in a time of turmoil

Like many businesses, Mayhew, a leading office design company, was hit hard by the 2008 global financial crisis and the years that followed. For the first time in its 40-year history, with roots going back to 1934, the third-generation, family-run business saw an abrupt and prolonged slowdown in sales of its office furniture—which caused a chain reaction of challenging events.

First, its five year banking relationship became strained—ultimately resulting in the bank calling in its $5.5 million bank line. Next, credit challenges with its key office furniture supplier escalated, ultimately leading to a legal dispute.

Despite these setbacks, the company was determined to get back on track. It underwent a major restructuring, essentially launching a new company—also called Mayhew—as a way of switching suppliers and, ultimately, reducing costs. It also reached out to a financing company, signed a term sheet and spent $25,000 in legal fees to replace its $5.5 million bank line, in a bid to relieve the bank of its arrangement. After a two-month process, however, the financing company began dragging its feet, and the transaction stalled.

In March 2015, Mayhew had reached what many would consider rock bottom. It was in the midst of an asset transfer and a law suit with its supplier. A financing company had taken out a security interest but was refusing to advance the funds, and the bank wanted its money back.

It was during this time that owner Marcia Mayhew decided to call Liquid Capital.

“Through word of mouth, I got Liquid Capital’s number. We met, they toured our business operations, and they got to know our team. It seemed to be a good fit and, most important, they understood the need to move quickly.”                                             – Marcia Mayhew, CEO & President, Mayhew

Quick turnaround

Recognizing that time was of the essence, Liquid Capital immediately put together a competitive term sheet—a $5.5 million asset-based lending facility that would allow Mayhew to take the bank out of the picture while simultaneously providing the working capital needed to continue operations.

Once the facility was approved by Mayhew, Liquid Capital set to work conducting the due diligence necessary to put it in place. An army of lawyers later—including those working on behalf of the new Mayhew company, the old Mayhew company, the original underlying shareholder, Liquid Capital and the bank—the complex deal was closed in under 4 weeks in June 2015.

The arrangement was different than traditional factoring contracts in that it was all non-notification—essentially, to the outside world, it looked just like regular financing. This was critical given the sensitive nature of Mayhew’s restructuring. The company wanted to preserve as many of its client relationships as possible, and to successfully move them over to its new suppliers, the company needed to appear strong.

“Liquid Capital was nimble and able to accommodate our needs during a time of change, transition, start-up and growth.” – Marcia Mayhew

Onward and upward

Over the next two years, Liquid Capital collaborated with Mayhew, giving the company the runway it needed to complete its restructuring. In that time, Liquid Capital provided over 50 fundings—and approximately $40 million in revolving credit—which allowed Mayhew to close less profitable locations, sell some of its assets and preserve many of its previous client relationships.

Liquid Capital also helped Mayhew establish new supplier relationships after the restructuring by providing around 40 supplier comfort letters. These letters essentially guaranteed that payment would be received before the furniture left the suppliers’ warehouses—giving Mayhew’s suppliers much-needed peace of mind.

With Liquid Capital’s help, Mayhew is now happy to say that it survived the most tumultuous era in its history and is enjoying established sales. While this is good news, it’s also bittersweet as the company recently acquired financing from a strategic investor and is parting ways with Liquid Capital.

“We’re now enjoying such positive performance that it’s time for us to reduce our financing cost, with the goal of moving to conventional financing within the next six to eight months.” – Marcia Mayhew

While their relationship is coming to an end, Mayhew will not hesitate to recommend Liquid Capital to anyone in search of financing assistance.

“Liquid Capital has been an excellent partner and reliable friend to Mayhew—through thick and thin,” Mayhew says. “For anyone looking for financing, I recommend looking for a firm that offers flexibility and really understands the direction you want to go in. You don’t want them to handcuff you from doing your business.”

“Liquid Capital has been an excellent partner and reliable friend to Mayhew—through thick and thin.” – Marcia Mayhew

 

How High-Growth Companies Can Get Unlimited Cash Flow

If you are leading a high-growth company, do not overlook this fundamental financial strategy that could offer you unlimited cash flow. ‘Factoring’ could be the ultimate growth tool you’ve been searching for in your business.

Often, companies can use factoring when bank loans or equity investments don’t pan out as planned. But savvy business pros look at this opportunity far more strategically. During periods of development and successful operations, high-growth companies need to access large amounts of capital – quickly and with assurance. Factoring does exactly that – it frees up huge amounts of working capital, puts cash in hand, allows you take on new business and catapult your growth.

Here’s the 411 on what factoring is all about, (but if you’re already in the know just skip ahead).

Factoring is the process of selling your accounts receivables (customer invoices) to a specialized company (‘factor’) who will give you the majority of that cash up front. You’ll be able to use that capital for whatever purpose you deem the most important in your business instead of waiting the 30, 60 or 90 days you’d usually be stuck with. Once the factoring company collects payment for the invoice, they’ll release the additional funds to your company minus an agreed upon reserve fee. That’s it – you can continue to factor new accounts receivables to keep your working capital topped up and your high-growth strategy on target.

These are the six key reasons growing companies should take advantage of factoring.

1. Quick application

Factoring applications are relatively quick to complete since they focus largely on the accounts receivable in your business. The biggest requirement of factoring is that you must be generating regular and consistent sales from credit-worthy clients. Once your application is approved, you can have working capital delivered within 24 hours.

2. Cost efficient

It’s a common misconception that factoring costs can be prohibitive – while in actuality it can be a smart business decision. For businesses with healthy gross profit margins, the benefit from new sales opportunities will outweigh any costs associated with accessing working capital. Factoring can help you say ‘yes’ to new deals and dramatically increase revenue, which can also set you up for additional growth with expanded client relationships. But if you have to say ‘no’ to deals because the cash flow isn’t there, your bottom line will suffer.

3. Tailor made for high-growth companies

High-growth companies can hit a point where their financial needs can’t be met. Banks often cap their financing, especially when past results and financial history checks don’t match their criteria – and by their very nature, growing companies likely don’t have that history. However, since factoring companies are focused on the quality of your accounts receivable, a growing company with legitimate invoices can continue to expand even without that prior history. Factoring companies look forward and up, so there are no limits to your financing potential. That means unlimited cash flow.

Related: Does my business qualify for factoring?

4. Don’t give up control

When growing your company, you likely don’t want to give up your ownership. Where venture capital deals often require that you sacrifice some of that equity, factoring does not. Your growing company stays in your control and ownership – so the more successful you are, the more you’ll fully reap those monetary rewards.

5. Work with banks

Choosing between bank loans and factoring isn’t necessary, as companies can work with multiple financing partners at the same time. In fact, many businesses will have a traditional bank loan for their base financing and then use a factoring partner as the business grows. Other companies will work with their factoring partner first to grow their business at a faster rate, and eventually, graduate on to add traditional bank financing.

6. Gain a finance partner

Factoring experts have great connections to other finance and business pros. They are business professionals who know that their success is also tied to your company success. This mutually beneficial partnership means you’ve gained a valuable colleague as part of the deal. It doesn’t stop there – as a well-established factoring partner can provide growing businesses with additional advice on improving payment terms, collections, areas for expansion and new sales opportunities.

If you’re a high-growth company ready for more working capital and unlimited cash flow, talk to us today and we’re happy to walk you through the application process or answer any questions.

Recent Fundings – June 2017

ultimate entrepreneur mindset

Do You Have the Ultimate Entrepreneur Mindset?

ultimate entrepreneur mindset

How do your entrepreneurial skills, personality, motivation and drive stack up against your peers? Do you have the qualities of the best in the business?

Check out the highlights from our roundup below. Explore what 15 of the hottest entrepreneurs do every day to keep on schedule. Learn the five must-have skills for every top businessperson. Then see if you’ve adopted the entrepreneur mindset to take full control of your business – or if you’re actually thinking like an employee.

Are you starting your day off right?

From Medium

It’s fascinating to see how some of our favorite entrepreneurs, creatives, and thought leaders spend their time every day. What are their morning routines like? What time do they rise in the morning? When are they most productive? How do they relax? …

Some wake up by 4am; others don’t start the day until closer to 11am. Some exercise every single day; others write or meditate. … What’s clear, is that having a routine of some sort matters. Routines help us get into a flow state that unlocks our ability to be happy and effective every day. While there weren’t any across-the-board consistencies, there were some themes:

  • Get a decent amount of sleep
  • Read things that are interesting to you
  • Try to break a sweat daily
  • Spend time with people you love
  • And when you really need to kick into gear, there’s nothing that a good cup of coffee (or an ice plunge) can’t help with 😉

Read on for a glimpse into the daily routines that successful entrepreneurs, creatives, and thought leaders swear by.

Sam Altman, President of Y Combinator

I try to do the things that I think are important, and be ruthless about not doing things that I don’t think are important. This sounds easy in theory, but requires a lot of discipline in practice. I generally have about three big goals and 20 small to-do items for each day.

Steve Schlafman, VC at RRE Ventures

I’m up every morning at 6am. Hot yoga at 6:30am. Breakfast meeting by 8:30am. Back-to-back meetings from 9am–6pm. I might get 30–60 minutes for email in between. Go to a work-related event or dinner with a founder, executive, friend, etc. Spend time with my wife. Read a book from 10:30–11ish. Bed by 11pm. Rinse and repeat.

Joel Gascoigne, Co-founder & CEO of Buffer

These days, I generally have a lot of quick meetings with different people on my team. I’m mainly focused within product/engineering, customer service, hiring, and then on the higher level. My calendar is open to people on the team, and it generally gets quite booked up. I have quick 20-minute sessions to give advice on a specific challenge. I also have 1:1s with several people on the team, so I usually have one of those each day, too. Other than work, I try to exercise several times a week (either strength training at the gym, running, or doing a bodyweight workout at an outdoor gym).

Read full story & all routines…

The 5 skills of the most successful entrepreneurs

From Influencive

In today’s economy, workers cannot depend on having a stable, full-time job with benefits until they retire. Most people will go through times in their career when they work freelance or are considered an independent contractor. Many of us will also begin our own business at some point. In a gig economy, everyone needs to know how to create their own brand. We are all entrepreneurs. …

Most people who go into business have entrepreneurial figures they admire. … Look at what they do and figure out what works for them. You will notice how many entrepreneurs have similar skills.   Once you notice that, you can apply those skills to your own work.

Concentration

Concentration is an important skill for successful entrepreneurs. For our purposes, concentration has two meanings. The first is your ability to focus. Our digital world is full of distractions. We have all experienced the time suck of the internet. Moreover, we are constantly distracted by our phones and keeping in touch with family, friends and co-workers. …

Leadership

Leadership is a vital trait for entrepreneurs. After all, anyone who wants to succeed in building their own brand and/or business should expect to be in a position of authority and to have other people working for them at some point. That means that you need to be able to lead. … Most people need to work at developing leadership skills. Even people who are natural leaders can benefit from working on improving their leadership skills. …

Organization

Organization is a significant trait of successful entrepreneurs. You need to have your ducks in a row if you want to accomplish everything you need to do in a timely enough manner. Organization is another skill that you might have a natural aptitude for, or it might be something you struggle with. Either way, you should view organization as a skill you can learn and improve upon. …

Read the full story for all five skills…

Do you think like an Employee or an Entrepreneur?

From Eric Tippetts

While every human being is different, we do have certain similarities that can set us apart from other groups of people. One of the primary items that group people together are their mindsets.

Entrepreneurs must have mindsets that are quite different than an employee.

Herein lies a common problem I have recognized with new entrepreneurs… They jump into the entrepreneurial world with an employee mindset.

The Key Mindsets of the Entrepreneur:

  • Entrepreneurs focus on the important things: A large percentage of employees are focused on the job they have to do whether it is important or not. The mindset of the entrepreneur requires them to focus on what is the most important, profit making task.
  • Entrepreneurs do not procrastinate: While an employee may put off a task until tomorrow, the entrepreneur is all about doing it NOW! Procrastination is NOT in the entrepreneur dictionary.
  • Entrepreneurs rely on their “gut”: The entrepreneur has to make split-second decisions on a daily basis.
  • Entrepreneurs own their failures: Many employees tend to find excuses for failures, but successful entrepreneurs have learned the success only comes because of multiple failures. The entrepreneur mindset is to own the failure and not put the blame elsewhere.
  • Entrepreneurs set high, but reachable goals: Personally, I believe every person should set goals, but few do. Successful entrepreneurs understand that each day, week, month and year must be a series of high, but reachable goals.

See the full article & all 17 entrepreneur mindsets…

 

Entrepreneurs also need to have their sales pitch perfected and polished – ready to sell their products and win new customers. Learn how to craft the ultimate 60-second elevator pitch that will capture attention, generate interest and grow your client base.