COVID-19 Created the Growth for This WA Manufacturer; Celtic Capital Created the Financing Solution
The Company
This Company was started in 2013 and is based in Washington. It manufactures odorless, safe and natural disinfectant and cleaning solutions for both medical and consumer applications. In addition to making product, the Company makes and leases devices to other companies enabling them to make their own solution. They, in turn, pay a royalty based on the amount of solution made.
The Situation
The COVID-19 pandemic accelerated growth and the Company needed financing to expand its facility to make the devices and so that it could start offering terms to customers. Due to prior year losses, its bank was unable to provide the needed funds and referred management to Celtic Capital.
The Solution
This deal required two types of lenders – asset based to finance the receivables and equipment, and a revenue-based lender for the lease devices and royalties. We made the introduction to the revenue-based lender and while the inter-creditor agreement was challenging due to bifurcating the receivables, we took the time to work through the process to ensure this Company received the financing it needed. Celtic Capital provided a $750,000 Accounts Receivable Line of Credit and a $110,000 Equipment Loan.
The Result
Once the Company gets the devices manufactured and creates that side of the business, revenue is expected to climb quickly. And now that customers will be offered terms, there should also be a significant expansion of the client base leading to a higher growth rate.
About Celtic Capital
Companies looking for working capital to cover operating expenses, fund growth, increase buying power and take advantage of vendor discounts and rebates turn to Celtic Capital. With an appetite for the more complex transactions, Celtic Capital has a history of success in crafting creative, flexible asset based financing solutions from $500,000 to $5 million with no financial covenants.
As an independent lender, working with companies nationwide, Celtic Capital is willing and able to alter price and deal structure and expand lines of credit to handle its clients’ increased revenues; and when cash flow is an issue, will look toward providing an inventory facility to help offset lost cash flow.
If you know of, or are, a business in need of non-traditional financing, contact Mark Hafner at 800.742.0733 or mhafner@celticcapital.com, or visit us at www.celticcapital.com.