Receivables Factoring

Many small business are strapped for cash. Banks are often reluctant to lend money to a company with an unproven track record and few assets, and while venture capital may be available, it is generally expensive. For online advertiser EQAL, the choice was to factor receivables. Even in the factoring market, EQAL faced problems because many factors like recurring receivables, which the company did not have. Fortunately, EQAL was able to find a factor that was comfortable enough with its business model. The cost of factoring for EQAL is a more than a bank loan, but less than venture capital, and has given the company access to cash flow.