Repairing car

Performance Repair Services

The perfect storm

Even the most business-savvy entrepreneurs face challenges when dealing with the volatile energy sector. But for those without a business background, navigating this uncertain terrain can be particularly stressful.

That’s a lesson Brett Haskill learned the hard way when his automotive repair company, Performance Repair Services, started fixing diesel engines for power plants. With over 20 years in business, the family-owned company had a wealth of expertise servicing a vast array of engines, generators, pumps and more. As a result, its new service offering was well-received. Unfortunately, given the energy sector’s uncertainty, the company never knew when, or if, its customers would pay their invoices—an issue that became increasingly severe when the oil and gas sector crashed in 2014, impacting energy-related businesses like Performance Repair Services.

To add insult to injury, not only was Performance Repair Services facing severe cash flow issues resulting from inconsistent accounts receivables (AR), but Haskill was also forced to unexpectedly buy out his business partner less than two years after the two acquired a new company. The timing couldn’t be worse, and—as a result—by the summer of 2017, the company found itself in severe financial trouble.

“I didn’t have enough capital to operate my business. The projected growth of my business was sidelined and I owed the bank over one million dollars, so they weren’t remotely interested in helping me.”

~ Brett Haskill, President, Performance Repair Services

Just before bankruptcy started looking like the only viable option, however, Haskill’s local banker recommended he contact Liquid Capital.

A much-needed lifeline

Haskill had employed the services of a factoring company years before, with—for lack of a better word—terrible results. So, when his banker suggested he see if Liquid Capital could help save his struggling business, Haskill was understandably skeptical. It wasn’t until two other people suggested he talk to the company that he finally decided to pick up the phone.

“Liquid Capital seemed like a perfect fit right from the beginning. Not only did they offer the best price structure, but they were genuinely eager to work with me at a time when other lenders were terrified of the energy sector. It was a slam dunk,” Haskill explains.

He also liked the idea that Liquid Capital offered credit insurance, so if one of his clients couldn’t pay their bill, he would be covered to receive up to 90 percent of the cost of the invoice back. This was a particular benefit for Performance Repair Services, which had suffered approximately $15,000 in losses due to bad accounts in the two years prior.

Eager to turn the tide, Performance Repair Services entered a factoring arrangement with Liquid Capital, selling all of its AR over to the company. It then used the cash to finance its labour costs, expand its inventory and pay back-taxes. The free-flowing capital essentially allowed Performance Repair Services to get back on track—and return to its original growth trajectory.

“I used to hate doing invoicing because I would send off all my invoices and just cross my fingers that they’d get paid. Now, my invoices get paid the day I issue them—I’m in control of my cash flow and able to focus more on growing my business.”

~ Brett Haskill, President, Performance Repair Services

Smooth sailing

Since partnering with Liquid Capital last summer, Performance Repair Services has seen a significant increase in revenue—Liquid Capital is now funding twice the amount it did a few short months ago, and invoices often come in multiple times a week. With the energy sector emerging from its downturn, Haskill believes this is only the beginning.

“It’s honestly starting to look better, finally. A lot of O&G companies are changing their portfolios to invest in clean energy and power generation right now, which is benefiting our business,” Haskill says.

Having more control over its AR has allowed the company to pursue much bigger projects than before, safe in the knowledge that it has the capital to cover the labour, parts and other costs required to fulfill them. As a result, Performance Repair Services is growing at a fast clip—and Haskill’s passion for it has been renewed.

“Liquid Capital saved my company from bankruptcy by putting me in a better financial position to pursue new opportunities. I recently started working with a US company, selling a new generation system that could potentially grow my business exponentially in the next two years,” Haskill says. “Already, we’re fulfilling a big service agreement on a $1.5 million gross sale to a new client. In fact, we’re acquiring new clients on a fairly regular basis now.”

With the stress of invoicing a distant memory, Performance Repair Services anticipates maintaining its relationship with Liquid Capital for some time to come.

“My experience makes it very clear that Liquid Capital is willing to work with real, everyday people that may be struggling with their business but still have the ambition to succeed. Thanks to them, my company is now on cruise control.”

~ Brett Haskill, President, Performance Repair Services

A seating soldjer

Defense Products & Services Group USA

Engineering success takes more than know-how

After many years working as a military engineer in the US, Ken Fincher came up with an idea that he knew might be successful not only as a business venture, but also as a way to save lives on the battlefield.

Ken’s revolutionary tow bar system—designed to help move tanks, personnel carriers or other large vehicles that break down or are damaged in combat—was half the weight and twice as strong as previous towing systems, and could be set up 50 times faster by 75% fewer people. This meant putting fewer people at risk and getting them out of danger much more quickly.

After working on the design for years, having molds made, speaking with the US and Canadian militaries and putting the product through field testing, the company started by Ken and his wife—Defense Products & Services Group USA (DPSG USA)—had secured a manufacturer and was ready to begin production. The problem? The manufacturer required 30% up front to build the product.

“Our process represented a genuine breakthrough in design and production that would save lives in combat. Tow bars typically take 24 weeks to make; we’ve got it down to roughly 16 to 18 weeks to build a multi-piece tow bar whose individual sections can be lifted by one person. We needed to get this product in the hands of the military, but the small business loan we were trying to acquire fell through. That’s when our loan broker introduced us to Liquid Capital.”

~ Ken Fincher, President, Defense Product Services Group USA Inc.

With factoring, working capital issues don’t limit success

Initially, DPSG USA took out several high interest loans to finance upfront product development costs, but once multiple contracts were in place, that approach didn’t make fiscal sense. When DPSG USA’s other loan options proved a dead end, Liquid Capital was able to provide a $55,000 merchant cash advance to settle some immediate financial requirements (a deal that went beyond Liquid Capital’s usual support process), then a traditional A/R factoring solution that could provide the longer-term assistance DPSG USA needed.

Currently, DPSG USA’s product manufacturer is based in Canada, and its major sales contract is for $5 million with the Canadian military. The military’s payment terms are 30 to 45 days, but DPSG USA needs to place its manufacturing orders 30 days in advance due the time it takes to make the product. There are also penalties for not delivering to the military on time—not to mention the risk of losing future business.

By factoring its receivables with Liquid Capital, DPSG USA has access to a $2 million credit facility on which it withdraws approximately $880,000 per month to pay any advance operating costs, and Liquid Capital doesn’t require payment until the receivables are paid by DPSG USA’s client. This fills DPSG USA’s financing gap perfectly, cash-flow is stabilized and it doesn’t require high-interest loans to keep the production/sales process moving smoothly.

“Liquid Capital has top-notch customer service. They’re not only helpful and offer great advice, they’re also highly patient as they understand the unexpected nature of contracts. This is the first time we’ve been involved in a factoring relationship, but our experience has been an excellent one. We’re really pleased with the level of professionalism we’ve received.”

~ Ken Fincher, President, Defense Product Services Group USA Inc.

Reaping both expected and unanticipated benefits

On top of the core benefits factoring delivers around cash flow and working capital, DPSG USA has realized some less anticipated advantages. Prior to working with Liquid Capital, DPSG USA—a US-based company—had to convert the money it was paid by the Canadian Department of National Defence (DND) from Canadian to US dollars in order to run it through its bank, then back to Canadian dollars to pay its manufacturing contractor. With Liquid Capital involved, payments are received from the DND and made to the contractor directly, within Canada, allowing DPSG USA to totally eliminate the payment of significant transfer fees.

“It was a big help that Liquid Capital had a relationship with both the Canadian and US governments, as well as experience doing military contracts. That was a huge credibility factor and sales point for us. When I told Liquid Capital that the Canadian government expected us to be paid in a certain way, they were easily able to accommodate those needs.”

~ Ken Fincher, President, Defense Product Services Group USA Inc.

Future prospects look strong with factoring support

DPSG USA is looking forward to expanding its military contracts in Canada, the US and internationally. Already, three more contracts for the Canadian military are in the offing, and the fact that DPSG USA can count on Liquid Capital to help fund upfront costs is a huge boon to its confidence.

For their part, Liquid Capital understands that DPSG USA will eventually qualify for a traditional banking relationship, but they understand that this evolution is part of the nature of the alternative financing environment. After all, the ultimate aim is to enable companies to move on because Liquid Capital has helped put them on the road to success.

“With financing, it’s important to shop around, do your research and make sure you understand the product. The solution must be transparent and deliver on its promise, and we honestly didn’t see anything that was as easy to understand as what Liquid Capital offered. There’s so much confusing—sometimes misleading—information out there; when you come across a company that’s telling the truth with no hidden items, it’s such a big help. It really gave us a comfort level we didn’t have with other providers.”

~ Ken Fincher, President, Defense Product Services Group USA Inc.

Cutting flowers

Dig It Apparel Inc

A fast road to success

When Claudia Harvey, CEO and Co-Founder of Dig It Apparel Inc, and her partner came up with the idea for Dig It Handwear® —a line of utility/gardening gloves specifically targeted to women because they could protect hands and manicured nails—they knew it was a good one. Still, they weren’t prepared for how good—and how in-demand—their product would be.

The idea was hatched at a casual BBQ. After damaging their hands and nails in the garden the day before, the two entrepreneurs researched the marketplace and realized there was a need to create a glove that protects women’s hands and nails—and the investment they’ve made in their manicures. Taking the leap to launch the business, Dig It appeared on the top-rated CBC show Dragons’ Den within just a few months. Their goal was to obtain $50,000 in financing for 10% of the business—along with some publicity.

Their plan worked. Dig It partnered with Kevin O’Leary (also of NBC’s Shark Tank fame). Shortly after their appearance on the show, the business started to grow and the orders started rolling in—including orders from Home Depot Canada and US worth upwards of $400,000. The retailer wanted the product in time for spring, just a few months away.

While this was undoubtedly good news, it also came with its fair share of challenges, particularly because Dig It didn’t have the cash flow needed to manufacture and ship such a large order, let alone make it through the 35 to 60 days it would take Home Depot to pay the invoice (very typical of the retail market). Additionally, acquiring bank financing was difficult because Dig It wasn’t yet large enough to qualify for a commercial loan, and the need was greater than a small business loan could support.

“We fell into the gap. A small business loan is usually about $50,000, which we qualified for, but we needed between $200,000 and $250,000—and weren’t even sure specifically how much. The bank needed more solid information to bump us up to a commercial loan, and we didn’t have it. So we were not able to get the loan secured in time for manufacturing. We needed to look at other options.”

Claudia Harvey, CEO and Co-Founder, Dig It Apparel

Right solution, right time

In need of financing—and fast—Dig It started exploring the options. They started talking to other banks, but didn’t yet have the relationships or track record needed. Next, they considered selling a portion of their company—fortunately, a trusted person in their business network introduced them to Liquid Capital before that became necessary.

Immediately, Dig It realized that Liquid Capital was different from the banks. Liquid Capital understood about manufacturing cycles, sales cycles and the resulting payment gaps. As such, they knew it could take between six or nine months before a loan was repaid—and they were okay with that. The fact that Liquid Capital didn’t require proof of sales, was willing to move quickly and was also recommended by a trusted friend made the decision to go with the company a comfortable solution.

Liquid Capital quickly set up Dig It Apparel with two tiers of financing—factoring and PO financing—to help cover the company’s manufacturing costs. The loan requirements were based on manufacturing need, so, while a $300,000 credit line was made available to Dig It, the company was only charged interest on the money it actually used.

The arrangement allowed Dig It to manufacture and ship four containers’ worth of gloves in prepacked retail displays in time for the spring market—and the products completely sold out. Nine months later, the company was able to repay Liquid Capital in full.

“It helped to get an introduction to Liquid Capital from someone I trusted. Thousands of dollars were on the line. We had to basically bare our souls to a company that isn’t regulated like a bank. To move to a factoring company, you need trust and a solid introduction to a reputable provider.”

Claudia Harvey, CEO and Co-Founder, Dig It Apparel

A new phase

The supportive aid from Liquid Capital enabled Dig It to expand, allowing it to offer banks the solid projections necessary to obtain traditional financing. A year and a half later, with the aid of a bank line and investor funds, the company is setting its sights on expanding its product line and moving further into the US market, where its products will imminently be carried by over 120 retailers.

While she no longer requires the services of Liquid Capital, Claudia will never forget the integral role the company played in Dig It’s development and success and will not hesitate to recommend the company to anyone looking for help in transforming their business dream into reality.

“Liquid Capital was an integral part of our growth and evolution. It allowed us to free up our money for product expansions, so we’re now able to expand our geographical footprint and product lines,” she says.

A scientist working with biotools

BioTools

Getting the right tools to the trade

For 17 years, BioTools has been innovating and producing many of the scientific instruments critical to both pharmaceutical and university bio-research. After the business moved to Jupiter, Florida—an emerging biotech centre that has also attracted research institutes such as Scripps and the Max Planck Institute for Neuroscience—some of BioTools’ angel investor funding dried up, just as the company was introducing two new products. Despite having orders for equipment, they wouldn’t be able to produce it without an alternative source of financing.

Their first step was to bring on a CFO from the CFO Center, an organization that helps small- to medium-sized companies outsource CFOs with large corporation skills and experience. To circumvent the inherent time required—and share the cost involved—in raising equity-based funding, the CFO recommended that BioTools arrange a Liquid Capital purchase order (PO) financing facility. At the same time, the company would continue to look for the right long-term investment support.

”As CFO, my responsibility was to do everything possible to help BioTools succeed, and there were some key challenges. They sell high cost, low volume, extremely complex instruments to leading global research organizations, meaning sales are substantial but intermittent and production is done to order. This model is problematic for most financing companies, but Liquid Capital is boldly unique. They meet one-on-one to understand the client’s product, cash flow cycles and sales challenges; they make recommendations; and most importantly, they tailor financing to the client’s unique situation. In my experience, Liquid Capital solutions consistently exceed my expectation and their competition.”

Vince Arnette, Regional Director South Florida, The CFO Center

Finding a flexible financing solution

BioTools might have considered a bank loan, but its balance sheet was unlikely to support that. They did get a small loan from a merchant cash advance company, but it was not sufficient. They had also worked with a company that factored receivables, but they specifically need financing based on purchase orders, of which they had a backlog. With strategic investors still in the future pipeline, Liquid Capital was able to provide a fast, flexible solution that really fit the bill.

Flexibility, in fact, was key. The way BioTools’ products are designed, assembled and shipped is not the standard model. Delicate instruments often need additional calibration, and the path to the buyer is not always A to B. Liquid Capital was able to accommodate this alternative production model without delaying the necessary funding.

BioTools now has a PO financing facility that was opened at $1 million, and they can have their credit automatically extended as long as they continue selling to creditworthy customers. With a combination of PO and AR (accounts receivable) financing, BioTools is funding both production as well as other ongoing expenses, such as payroll, rent, etc. As a result, they are in the process of filling their order backlog.

“We have over $1.6M in back orders, but have never been able to finance those POs. Continuing to receive orders that we knew would be sitting on the shelf put us in a terrible position. When Liquid Capital said they could give us a much larger, PO-based facility, it was a godsend. Now we’re happy to get more POs, rather than getting frustrated. It’s really a fantastic facility.”

Rina Dukor, PHD, founder and president, BioTools

Financing benefits extend beyond the business

With Liquid Capital’s help, BioTools is back on track for production and shipping, and they hope to push all existing back orders out by end-of-year. And this is one case where success is more than a business outcome. There’s a reason BioTools’ customers have been patient; the products they’re waiting for are state-of-the-art and unique, and ensuring they get to the right research people and institutions means a lot more than just making investors happy.

“This isn’t just a financial transaction. The products impact students’ learning and facilitate innovative research in academia and pharma. These are new technologies that will lead to new drugs and better science. Every day these instruments aren’t in the hands of our customers is a day when they won’t discover something new.”

Rina Dukor, PHD, founder and president, BioTools

Financing for a bright future

With PO financing in place, BioTools is in an excellent position to find new customers and fill more orders going forward. Once the back orders are managed and people know BioTools is stronger than ever, the same customers will be placing more orders, while additional customers who may have been hesitant will start ordering as well.

“I started the business on credit cards and savings, plus a bank line of credit, but it wasn’t enough. Our instruments cost $60,000-100,000 to build. Liquid Capital understood the business model and came through. Getting a CFO was critical as well. In retrospect, I wish we’d had both in place from the outset.”

Rina Dukor, PHD, founder and president, BioTools

Two male workers in a factory

Air Oasis

Getting into the right financial condition

It takes vision, ambition and talent to grow your business. But once that growth starts to happen, it also takes capital. That’s the position Air Oasis owner Kaleb Zeringue found himself in when he decided to make Liquid Capital part of his business’s financial strategy.

Air Oasis is a Florida-based HVAC installation company that had been working diligently toward adding commercial business to complement its strong residential clientele. With that in mind, they were looking to get into the Florida hotel space installing air system upgrades. Zeringue’s efforts paid off, and he landed installation contracts with Marriott International. Marriott would use a third-party engineering firm to design and order the upgraded air systems for specific hotel properties such as Marriott Courtyard at Mayo Jacksonville. Once the new equipment arrived at the hotel site, Air Oasis would install it over a one- to two-week period.

With work in place and increasing, Air Oasis was looking for a line of credit to ensure it could meet its client’s needs as well as its own payroll and other working capital requirements. Although the bank was unable to underwrite the funding, they referred Air Oasis to Liquid Capital. It turned out an accounts receivable factoring solution was ideal for the company’s needs.

”Our business was growing pretty rapidly. We had a contract lined up with Marriott for six jobs in a row—that’s $150,000 worth of work—but we didn’t have the funds to float it. Each job costs thousands to execute, but with the 45-to-60-day payment schedule, I just didn’t have the cash flow to pay my people. If we couldn’t get funding really quickly, we probably couldn’t have done the jobs.” – Kaleb Zeringue, Owner, Air Oasis

Where there’s work, there’s a way

The Marriott upgrade work Air Oasis had secured was a series of pressurization projects. It involved replacing air system equipment, doing duct work modification and determining the right air-flow balances across the property. With a month’s worth of labour often costing $25,000 and materials perhaps $10,000, the costs on such projects can mount quickly. In most cases, banks will not finance based on accounts receivable, so Liquid Capital’s solution was the perfect way for Air Oasis to realize its potential.

In keeping with Liquid Capital’s hands-on approach, they visited Zeringue at his office to better understand his needs. He liked the concept of factoring and was further impressed that the facility could be done as spot financing—one deal at a time—and that he wasn’t locked into using it any more than he wanted or needed. The one-on-one service and attention, along with the principal’s geographical proximity and availability, sealed the deal for Air Oasis. A financing deal—which now funds roughly $75,000 to $100,000 quarterly—was quickly worked out and the Marriott contract secured.

“It can be an incredibly frustrating position to be in. You go to the traditional banks and they won’t help, even though you have signed commitments. For anyone in that position, factoring is an incredible solution. Instead of waiting 45-60 days to get paid, we were getting paid the week we finished the work, then Marriott would pay Liquid Capital. It’s been five or six years now, and factoring is still a big part of our success.” – Kaleb Zeringue

The definition of value for money

For companies that have the opportunity to take on bigger, more lucrative jobs but are worried about cash flow, as Air Oasis was, factoring delivers. Despite losing a bit on the percentages, Zeringue believes that the reward—and the fast payment—more than makes up for it.

“Liquid Capital gave me the cash flow to look for bigger jobs, sign bigger contracts and make better profits. Instead of doing a residential job where I’m making, say, $1,000 per day, I’m averaging $5,000 per day at Marriott while using and paying the same amount of labour. Then I can take on even bigger contracts. It’s a ride you want to be on. Now I do anywhere from $200-300K/year.” – Kaleb Zeringue

Planning for the future

For Air Oasis, Liquid Capital’s factoring solution has opened doors to more than better contracts. Companies in the residential HVAC business struggle perpetually with low margins. To take business to the next level, Air Oasis needed the increased profit base a steady commercial contract would bring. That success has led to the development of a new business line based on a refrigeration monitoring system Zeringue designed for coolers and freezers.

“The Marriott contract was critical to taking the company forward—and Liquid Capital was critical in making that contract possible. I couldn’t be happier with Liquid Capital. Their solution is helping me get where I want to be. I simply couldn’t have done it without them.” – Kaleb Zeringue

Office space

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

 

Cheese and bread on a board

Silani Cheese

The “cheese” may “stand alone,” but sometimes the company needs help

Great cheese does stand alone. Its character speaks for itself. However, mid-sized companies like Ontario’s Silani cheese can run into financial barriers that are hard to surmount without assistance, even when product quality and demand are high.

Silani Cheese, a family-owned company manufacturing a wide variety of specialty cheeses for over 60 years, had run into financial issues due to an unusual combination of circumstances. After some unanticipated cost overruns and infrastructure issues, as well as several contracts that failed to come through as expected (and for which it had purchased machinery), it naturally turned for help to the banking facility it had in place. Unfortunately, certain margin criteria in the banking arrangement unexpectedly changed resulting in a reduced credit facility, forcing it to negotiate an insolvency/restructuring proposal with its creditors.

During the restructuring process, the company had repaid its bank debt using personal funds as well as financing from Farm Credit Canada, but in order to fully exit the proposal, it needed a broader financing solution—one that factoring could readily deliver.

”The need was critical and two-fold. Coming out of a company restructuring process, we of course had to pay the creditors. But to get the business rolling and back on its feet, we needed a steady, reliable source of working capital.”

Joe Lanzino, CEO, Silani Sweet Cheese Ltd.

Getting the right solution—from the right people

Factoring was the right solution for Silani’s issues, it just needed the right provider. After several months of working with another factoring company during the restructuring process, going so far as to complete due diligence and advancing to the point of signing legal documents, Silani expected a cash advance to take the deal forward. At the eleventh hour, however, the provider backed out. After a second factoring provider also failed to deliver timely, effective service, Silani finally came to Liquid Capital.

Despite arriving rather late in the process, Liquid Capital impressed immediately with their face-to-face approach, deadline-driven commitment and upfront clarification of what was possible in terms of timing. In the end, Liquid Capital negotiated the deal, completed due diligence and funded Silani on the timeline it needed—all in less than three weeks—enabling Silani to exit the insolvency proposal and repay part of the Farm Credit loan as well.

“The other companies we dealt with just weren’t cutting it. Their financing approach made us nervous, and they made promises they couldn’t keep. When Liquid Capital came in and took over the deal, everything changed. We were three weeks into problematic negotiations with the other company—with an irreversible deadline looming—and Liquid Capital jumped in, put everything together and closed the deal two days ahead of schedule.”

Joe Lanzino, CEO, Silani Sweet Cheese Ltd.

Making the most of the factoring solution

As a cheese producer, Silani receives milk deliveries three to four times a week, and those deliveries have to be prepaid. The upfront cash demands of the business are significant and unavoidable, making a reliable credit facility a business essential. With Liquid Capital, Silani now receives multiple fundings every week, as needed, so it has all the working capital it needs—plus enough to plan for growth.

Liquid Capital’s ability to understand and effectively manage the legal and timing aspects of the insolvency process was also a huge advantage for Silani. There’s a finite time limit to execute on the terms of these deals, and if they expire, the deal is done—and so, potentially, could be the business.

“It was pretty clear that Liquid Capital had a good deal of expertise with insolvency matters. They were very knowledgeable about what the ‘real’ deadlines were and what had to be done. I’m not sure what would have happened without them.”

Joe Lanzino, CEO, Silani Sweet Cheese Ltd.

Paving the way for success and growth

With insolvency and restructuring behind it, Silani is full steam ahead. It has a new operating facility with added capacity and room to grow, and it’s counting on Liquid Capital to provide the financial resources it needs to find and service new business.

Having returned to profitability, Silani is taking time to focus on the business by improving training, increasing efficiency and adding capabilities—for example by putting in automatic labelers—all without having to worry about funding.

“Liquid Capital did everything they said they would do. They made a proposal and that’s what they delivered, without deviating in any manner. It was just so different from the other companies we dealt with. Put your terms together and deliver—what more can you ask? A fantastic experience.”

Joe Lanzino, CEO, Silani Sweet Cheese Ltd.

 

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