Tech Financing Needs : What You Ought To Know About Technology Corporate Finance

Get Rid Of Technology Financing Challenges Once And For All

OVERVIEW – Information on technology corporate finance solutions in Canada. Consider these tech financing strategies to maximize ROI

Tech financing needs in Canada can be a combination of challenge (and a headache!) Canadian businesses in the SME and large corporate sector. Technology corporate finance solutions, no matter how small or large your company is, come in a variety of flavors and sizes. Let's dig in.

The start up or early phase company has difficulty in attracting any type of financing. So planning for tech solutions and upgrades is crucial and challenging. The reality, as harsh as it is in Canada is that owner equity provides the majority of early stage financing for operations and technology. The irony here is that many times the technology is what will drive higher and faster growth and profits.

Service based businesses, and those relying on ' IP ' (intellectual properly)

create even more of a problem for themselves, as much of the financing for the SME Commercial sector in Canada is ' asset based '. So from the owner/financial manager perspective they feel they are compelled to take financing at rates, structures and terms that are less than favorable.

It's no secret to Canadian business owners and entrepreneurs that it's difficult to pitch technology financing needs to our Canadian chartered banks. The reasons are pretty simple: Tech needs seem to quickly become obsolete, and even with prices of the majority of tech assets going down in price they still are a huge part of any firms ' CAPEX' budget.

So who are the ' sources of financing ' - those firms that can fill the tech financing gap you're faced with? As well, is there a better way to address rapid growth in technology changes and those ' life cycles'?

One way to secure financing for hardware, software, telecom equipment, etc is to take a look at the Government CSBF loan. Recent changes have appeared to make the program even more popular. Billions are borrowed every year under this program.

So is there a clear cut way to finance the acquisition of technologies? The obvious choice? LEASING! The reasons are pretty simple - along with typical tax and accounting advantages the owner/manager has the ability to match cash outflows with the ' estimated ' useful life of the asset.

And because many firms want to ' use ', not ' own' tech assets they also have the choice of opting for operating leases. These allow for maximum flexibility when it comes to upgrades, buying out, or simply extending.

Currently the industry as a whole prides itself of fast approvals, often within a day or so. And again, those assets that can be financed:

APPLICATION SOFTWARE
COMPUTERS
SERVERS
LAPTOPS/NOTEBOOKS/TABLETS
TELECOM EQUIPMENT
PHONE SYSTEMS

If you're looking to get the proverbial ' monkey off your back ' when it comes to financing tech needs seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in ensuring you're ' up to speed' in tech corporate finance requirements.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN TECHNOLOGY FINANCING EXPERTISE





Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Business Cash Flow Loans : Reversing the Working Capital Slowdown

Your Business Cash Flow Financing Nightmare Is Probably Not Just In Your Head

OVERVIEW – Information on business cash flow loans and asset monetization strategies for Canadian businesses. Working capital needs can be fulfilled in a variety of manners – here’s why and how
















Working capital shortages can almost always be reversed with the right asset monetization or business cash flow loans. It's no secret that challenge can easily become a nightmare

when not identified and properly addressed in a timely manner. Let's dig in.

Critical to implementing the right solution is the understanding of some key basics - they include:

Understanding your ' cash flow cycle’

Halting and managing cash outflows

Being able to accelerate cash receipts via proper credit and collection policies

Your company can improve overall business health with proper cash flow management and external and internal financing. We've mentioned above that ' cash flow cycle '. It's simply the ability to understand how a dollar flows through your company and how long it spends in inventory, A/R, etc.

But what solutions are in fact available to halt the oncoming of a cash flow crisis.

They typically include:

Bank lines of credit

Asset based non bank lines of credit (Known as ' ABL ' they are the alternative to Canadian chartered bank facilities

A/R financing (this comes in a variety of shapes and sizes)

Inventory finance

Working capital term loans (permanent injections of working capital)

Purchase order/Contract financing

Tax Credit Financing (SR&ED Tax credits)

These are the external financing solutions available to any firm that wants or needs to address avoiding a cash flow crisis. Internally though owners and financial managers can better monitor and accelerate cash via constantly assessing days sales outstanding, inventory turns, and payables days outstanding. Oh and don't forget expense mgmt!

A simple cash flow forecast can easily anticipate upcoming working capital and cash shortages. A simple trick - Constantly monitor the relationship between A/R and sales on a monthly basis, in the form of a ' ratio'. If that ratio is greater than one? Danger ahead! Simply speaking cash flow problems are upcoming as you are running out of cash.

Your company is either eligible for bank financing or it is not. Bank finance solutions in Canada are low cost, and flexible. In some cases your company might be eligible, but not in the amounts needed.

Short term shortages must be addressed by short term financing strategies, typically lines of credit, A/R financing, and inventory finance. Many businesses of a small to medium size are considering A/R finance these days. This tool turns everyday sales into everyday cash. Our recommendation is to consider CONFIDENTIAL RECEIVABLE FINANCING. While more expensive than bank lines it provides unlimited financing and allows you to bill and collect your A/R in a matter similar to bank credit facilities.

If you want to avoid the cash flow nightmare via proper business cash flow loans and asset monetization strategies seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your working capital needs.




Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN CAS FLOW BUSINESS LOANS EXPERTISE







Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?
CONTACT:

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com





' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Franchise Loans Canada : Let The Sun Rise On Franchising Finance Success

Are You ‘ All In ‘ When It Comes To Franchising Finance in Canada You Don’t Have To Be !

OVERVIEW – Information on franchise loans in Canada . Franchising finance properly executed doesn’t have to be the financial personal commitment that some franchisees think it needs to be . Here is why


Franchising finance makes many would be ' entrepreneurs ' feel like they must be ' ALL IN ' when it comes to franchise loans in Canada. ‘ALL IN ' of course connotation major personal investments in their franchises. Does it have to be that way? Not necessarily! So let's dig in.

When it comes to financing a franchise in the current ' hot ' Canadian franchise market the clients we talk to seem to think that comes with significant personal investments, overdrafts on personal lines of credit, and complicated financing packages that inter mingle with their personal finances. Again, that’s what they think, but it’s not necessarily the case.

We must emphatically say that the would be franchisee would be entrepreneur must in fact contribute some capital to the business. It goes without saying there no ' free ride ' on ' OPM ' - i.e. 100% other people’s money.

In fact some of the amounts required to properly finance this type of business in fact are normally not financeable - those include the actual franchise fees themselves, brokerage or consultant fees, etc. These types of charges typically come out of the owner’s capital investment.

As a broad rule you should be prepared, depending on the overall situation, to put down anywhere from 10-50% of the total amount of financing required to kick start your venture.

Funding the balance of franchise loans in Canada is typically dependant on the size of the purchase, the quality of cash flow forecasts, and lenders interpretation of the viability of your franchisor as a whole. Not all franchisees might be aware that many franchisors are willing to let a franchise fail, knowing they can re-sell it to another potential viable franchisee. Here issues such as ' location/ location/location' and mgmt competence and experience are important.

Never forget that at the end of the day the actual repayment of the franchising loan, which typically is amortized over 5-7 years will in fact come from ongoing cash flows and profits. Since most franchisees tend to be 100% cash businesses that is important.

In Canada franchises are financed via a small handful of specialty finance lenders, the Govt SBL loan, and a combo of various other financing solutions that might inlcude equipment financing, merchant advances, working capital term loans, etc.

So our advice? You don't have to be ' all in ' thinking you have to pledge your personal assets in franchising finance. More important is the ability to seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can assist you with your funding needs.


Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN FRANCHISING FINANCE EXPERTISE





Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT

7 Park Avenue Financial

South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Lease Back Financing Tips : Sale And Leaseback Transactions Can Be A Winning Strategy

Sale Leaseback Financing Makes Seemingly Impossible .. Possible!

OVERVIEW – Information on the ‘ leaseback ‘. Sale and leaseback transactions, done properly, can be a solid cash flow tool . Here’s some key considerations







Sale and leaseback transactions are sometimes a truly perfect solution cash flow needs. In some ways it’s a ' perfect storm' of financing - your business gets to keep the asset in question (typically equipment or real estate) while at the same time employing its use and possession.

By the way, that could include your corporate jet - although we don't run into
a lot of those these days.


What are the fundamental reasons for choosing the lease back? It usually comes down to:

A need for access to capital that otherwise might not be available, or available the rate and structure the business owner/manager desires

It’s sometimes a more efficient and quicker process than starting the journey into looking for new debt solutions or having to consider ownership dilution from new equity sources. Alternately the owner/owners of the business are now required to put in additional personal funds

The ongoing need and use of the asset to operate and grow the business - otherwise the asset should probably simply be sold!

In certain cases, as we mentioned, rates and costs of financing might be more attractive under the sale/leaseback

Because of the nature of how the transaction is recorded the lease back, properly structured can enhance the overall ROI - ' return on investment’

As we noted any asset of the business can theoretically be sold and leased back. A typical solution is business real estate, i.e. the business operating premises. Even Canadian banks in recent years have shed their huge office towers under this effective strategy. - And they of course still inhabit the buildings.

The other asset category is business equipment, which, while depreciating still has valuable use to the business. That raises the point that it’s important to consider the financial and tax consequences of the leaseback - for example if the funds received are greater than the present value of the equipment a profit on the transaction might have to be reported.

When you enter into this financing strategy your choices are the same as with any other lease financing transaction. Simply speaking you can structure your deal as a capital ' lease to own' or an operating ' lease to use '. The operating lease might be perfect for things such as a technology transaction for computers and telecom equipt. for example.

And that corporate jet

we were talking about? All of a sudden is a perfect candidate for an operating lease!

We caution clients that it's always important at the start of considering such a transaction it’s important to fully understand the value of the equipment or asset being re financed. That residual value must be well understood in the context of your company's needs for the asset and the financing structure required.

Seek out a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in putting together a winning strategy on refinancing business assets. The impossible just became possible.




Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :

7 PARK AVENUE FINANCIAL = CANADIAN SALE AND LEASEBACK EXPERTISE








Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '

Stan Prokop

Business Asset Finance Via Confidential Factoring Services Finally Explained

Looking for a Cash Flow Rescue Solution - Confidential A/R Finance Via Non Notification might just be it


OVERVIEW – Information on the benefits of confidential factoring services . Business asset finance via an invoice discounting program is a happy medium between bank A/R financing and alternative finance solutions




Business asset finance comes in a variety of 'flavors '. One of those is Confidential Factoring Services, which is the monetizing of your sales and receivables into immediate cash flow. Let's dig in.

While any form of Canadian business financing is meant to allow the owner/.manager to grow the business the harsh reality sometimes is that it also ' rescue ' the company when financial challenges and pressures have made traditional forms of financing unavailable . Think ' the bank'.

And by adding the word ' confidential '

into this method of financing it’s as close to traditional financing as one can get.

In the business cycle of any commercial business, whether that is a product or service sales generate receivables which generate cash. Whether your firm is start up, early revenue, or fast growth its all about your ability to ' release' working capital out of sales revenue.

Canadian chartered banks do that for you by setting up business lines of credit. The receivables (and sometimes inventory) act as the 'collateral' for the facility. Confidential factoring services provide the same result; they just do it in a different manner.

That difference is the essence of receivable finance/factoring in general, as the paperwork around the facility ' monetizes' your A/R. The paperwork in effect has you ' selling' your sales for cash as they are generated, and the use of confidential factoring allows this to be done privately between you and the finance firm.

That level of confidentiality is important , because we benchmark that against ' old school'

factoring ( still hugely popular ) which makes the whole process fairly public between your clients, yourself etc. In our experience business owners and financial managers in the SME (small to medium enterprise) sector like to keep how they finance their business to themselves.

Let's make sure we all understand the process of CONFIDENTIAL RECEIVABLE FINANCING. As you generate sales you receive 90% of your sales invoices as immediate cash to your business bank account. In our case immediate pretty well means ' same day ‘. Bye bye receivables - hello cash on hand!

So what are the benefits then?

Hopefully they are pretty obvious. They include your ability to run and grow your business. As long as you are generating revenue you will always have the respective amount of cash available.

For the majority of many of our clients we see them now being able to take on larger contracts and sales orders. No more worrying that your are reaching your ' borrowing limit ‘, as with pre set bank credit lines.

Some clients also use this cash to pay down other debt they have taken on, although it’s important to ensure you are matching short term financing solutions with short term debt obligations.

Let's summarize the process again quickly -

1. Sell your products and services!
2. Provide your invoices to your finance partner
3. Receive immediate cash (10% is held back and paid to you as soon as your client pays - it’s a ' buffer ')

Note - the financing costs of Confidential factoring are taken out of that 10% holdback and as an example would be in the 150 -200$ range on a 10,000$ invoice.

If you're looking for a rescue plan on cash flow challenges seek out and speak to a trusted, credible and experienced Canadian business financing advisor who can ensure that this unique method of financing is carefully explained re costs, benefits, and operations.



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :



7 PARK AVENUE FINANCIAL = CANADIAN CONFIDENTIAL RECEIVABLE FINANCING EXPERTISE


Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?
CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '


























Stan Prokop

Tax Loans For SRED Credits In Canada : Finding Your Way In SR ED Financing

What Seems To Be The Problem Here? SR&ED Tax Credit Financing Explained – Finally !



OVERVIEW – Information on R and D tax credits in Canada . SRED Credits can be financed. Here’s how SR ED financing via tax loans works and why tax credit financing should be considered if you are filing these claims







Tax loans in Canada for SRED Credits - Canada's R &D refundable credit system seems to pose challenges for some clients that are looking to monetize, via SR ED financing, their claims. Does there have to be a problem? We don't think so, let’s dig in.


SR&ED credits are available, of course, via the governments ' Scientific Research and Experimental Development Tax Credit ' program. Although federal budgets in recent years have changed the program significantly from a view point of streamlining the process, certain portions of the allowable refund were also cut back, i.e. capital expenditures relating to the actual R&D.

In Canada the majority of tax credit claims are prepared by independent consultants. These claims are filed of course in conjunction with your year end tax return. Retaining a good preparer for your claim is one part of the financing process of a claim. In the past couple years a lot of focus was placed on the way consultants bill and prepare claims - the majority of which are on a ' contingency' basis which in hindsight probably caused some bad behavior by a small few.

We encourage all clients to both consider whether they are eligible for the SR&ED credit, as well as focusing on filing the claim promptly as there are some deadlines in place under the program


Refundable credits return billions of dollars to Canadian corporations each year. Your ability to cash flow or monetize your claim makes the program complete in some way. Your company is in effect ' fast tracking ' the return of cash flow to your company by filing and financing your claim.

How then are the claims financed? It certainly doesn't have to be problematic if you have some expertise backing the process. A simple business application starts the whole process - typical info needed here are a copy of your claim, info on who prepared it, as well as your business financials.

We note here that many firms that complete claims range from start ups to firms that are still in early stages of revenue. So it's important to understand that the key collateral under a SR ED financing is fact just the claim itself. In effect you've created a (government) account receivable and are simply financing /monetizing that specific A/R.

The newest trend in tax loans for SRED is the ability of your business to in effect pre-finance your claim - you are reimbursed for funds you are spending during your spend . That fast tracks the return of R&D capital even faster.

If you're looking to avoid any ' problems ' associated with financing SRED CREDITS seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success
The probable result - Problem gone!



Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :


7 PARK AVENUE FINANCIAL = CANADIAN SR&ED TAX CREDIT LOAN EXPERTISE




Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?

CONTACT:

7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '





















Stan Prokop

Asset Based Lending In Canada : 7 Park Avenue Financial

7 Park Avenue Financial - In the News

The Editorial team at CANADIAN EQUIPMENT FINANCE magazine recently asked us to comment on ASSET BASED LENDING in Canada . Here's the article below from this excellent Industry/business magazine - CLICK HERE FOR LINK TO DIGITAL VERSION OF THE APRIL EDITION






The Growing Popularity of Asset Based Lending

By Stan Prokop, CEO, 7 Park Avenue Financial

From a general overview, asset backed lending (ABL) is both popular and
readily available across almost all industry sectors within the Canadian
marketplace. With its uptick in popularity over the last several years, ABL
has not only seen an increase in traditional asset backed lending, but most
Canadian chartered banks have embraced ABL finance in some form as well -
either through direct ownership of ABL entities or through partnerships.

The Current Trends

Asset backed lending is currently seeing some of the lowest borrowing rates
in years. The result of these low rates has been the placing of tremendous
pricing pressure on those deals that have higher credit quality.

When looking at sector trends, within retail there are many larger retailers
taking significant advantage of ABL inventory credit lines to finance
growth, expansion, and basic refinancing needs. Certainly ABL lenders that
place significant emphasis on the liquidation value of assets have made
major inroads on transactions. The healthcare sector is also a fast-growth
sector that is benefitting from asset backed lending.

Historically technology-based firms have not utilized ABL to any major
extent - typically because their assets are heavily focused on intellectual
property with lower emphasis on the staples of ABL borrowing such as
receivables and inventory. However, with the competitive nature within the
current lending environment, many asset based lenders are compelled to
consider alternate asset categories, such as purchase orders, contracts,
patents, and tax credits, as financeable assets.

Along with the widening of alternate asset categories, maximum deal sizes
continue to be almost unlimited in nature. However, many firms are lowering
the bar on minimum transaction size. While Tier 2 lenders will consider
$250,000 deals, Tier 1 lenders are more apt to consider transaction sizes
below $5 million. In the past this has not typically been the case. On
larger transactions it's certainly not unusual to see inter-creditor
agreements between ABL lenders and other secured lenders.

Gains in Market Share

In recent years, 'subsets' of ABL have made huge gains in market share.
These include such sectors as factoring firms, working capital lenders,
purchase order/supply chain financiers, floor plan lenders, and merchant
cash advance firms. While considered a part of ABL lending, these firms are
generally smaller, more nimble, and niche oriented.
As well, although the venture capital market in Canada is currently
considered to be emerging from a very difficult period, many private equity
lenders are now considered real competition to true ABL lenders and are
providing both equity and liquidity to transactions.

Knowledge and Awareness

ABL is still significantly misunderstood and oft miscategorized. Many CFOs
and business owners still continue to view Canadian chartered banks as the
only primary financing solution. However, increasingly, business owners,
managers, and boards now recognize that asset backed lending solutions are
often the solution to refinancing troubled firms that face insurmountable
challenges from the traditional lending environment. And as a result, the
role of the intermediary is taking on ever-increasing importance as business
owners recognize that they don't have the time and expertise to source ABL
financing solutions without the assistance of qualified, trusted, and
experienced advisors.

Despite some lack of awareness and knowledge among CFOs and business owners,
asset backed lending is nevertheless coming into its own in Canada. The
recent IPO from Callidus Capital suggests this to be the case - certainly
from a public acceptance point of view - and the oversubscription of that
public offering seems to suggest true interest and validation of this aspect
of Canadian business financing.

Stan Prokop of 7 Park Avenue Financial provides business financing for
Canadian firms. He specializes in working capital, cash flow, asset based
financing, equipment leasing, franchise finance, and Canadian tax credit
finance.

END OF ARTICLE




Stan Prokop - 7 Park Avenue Financial :

http://www.7parkavenuefinancial.com

Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :






Stan Prokop









Have A Question /Comment On Our Blog Or Canadian Business Financing Alternatives ?
CONTACT:
7 Park Avenue Financial
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8

Direct Line = 416 319 5769

Office = 905 829 2653



Email = sprokop@7parkavenuefinancial.com


' Canadian Business Financing with the intelligent use of experience '