Amerifi, LLC delivers another $340,000 in the medical industry to a Biotechnology company.
This particular deal was EXTREMELY high risk due to all the overdrafts in the most recent month’s bank statement. Despite this, Amerifi was able to secure $340,000 over a 2 year term for the client which provided the necessary capital in a critical time of need. The client had more than a $500,000 equity in real-estate they were willing to use for collateral to help us get the deal to the finish line.
Here is the Story:
A 10 year old Biotech company has been trying for months to close a $5mm equity Raise. During this time, their cash flow suffered due to the volatility of their industry and prolonged sales cycles.
In just 24 months, the company’s revenues grew 1500% from approximately $300,000 to $5 million but sometimes too much of a good thing can take a turn for the worst. This rapid growth spiraled out of control which depleted all of their operating capital. In the financial world, we call this phenomenon —“growing broke”
Exponential growth this fast can turn a great business into a BK overnight if not watched over carefully. With their backs against the wall they were forced to secure over 5 merchant cash advances (Daily / weekly payment loans) to stay afloat.
Merchant cash advances, when used properly by responsible business owners, are a wonderful way to secure quick and easy capital without jumping through any hurdles. Business with an immediate need for a fast cash infusion benefit greatly off of this product. However, business owners who neglect their financials become reliant on this fast capital and before they know it the daily and weekly eat up their cash flow.
Unfortunately, our client was caught up in the latter, taking on more funding that they could handle and the frequent payments led to many overdrafts on the account. When the overdraft penalties kicked in, and making payroll seemed impossible, this growing Biotech company turned to Amerifi to bail them out.
Expectations were low when they approached us about consolidating multiple cash advances into a program with monthly payments. They need to survive until the $5 million dollar equity raise closed. Eliminating the daily payments and into a program with monthly payments was the only option for them to get to the finish line. In just two weeks, (the standard funding time for a real estate backed loan) we secured a $340,000 loan over a two year term that they make payments towards monthly. This term loan paid off all of their previous MCA’s, alleviated cash flow problems and got the business back on track. Now this Biotech company has the capital they need to sustain growth, have a healthy cash flow, and most importantly pay their employees.
We are happy to see them grow and cannot wait to see what the future holds for them!
Amerifi specializes in helping merchants consolidate MCA debt into more traditional type funding programs. These programs come in many forms such as a 1-5 year term loan, a business line of credit, a 2-5 year real-estate loan, or an asset based line of credit secured by A/R, & or inventory, equipment or real-estate.
To learn more about our finance options or consolidation options, please visit amerifi.com/applynow