Is Your Capital Meeting Your Business Needs?

Understand Your Capital Needs

Is your capital sufficient to meet all of your company’s needs?  As the fuel that keeps you moving forward, capital is a critical component making today’s operations successful and helping reach tomorrow’s strategic goals.  Answering this question about sufficiency is an important exercise that should be undertaken regularly.

The first step to understanding your need is a review of payroll, inventory, additional production costs, day-to-day operating expenses, and other outlays, including working capital, that are necessary for smooth operational performance.  The next step requires knowing your accounts receivable collectability and average Day Sales Outstanding (DSO) ratio.  Finally, round out this exercise, by reviewing your complete cash flow and budget/projections comparison.  This gives you a clear picture of your current and near-term capital needs.

Options For Capital

Once a need has been determined, or updated, next step options are incredibly diverse.  Near unlimited funding sources provide traditional loans, lines of credit, private equity or other investment vehicle.  These multiple options means a variety of terms, conditions and varying levels of control.  Finding your capital match can quickly become an overwhelming process.

M&A Advisors Can Help With Capital Requirements

Your M&A advisor, as matchmaker, can help!  Starting by understanding your near-term capital needs, your advisor will help build a robust financial roadmap that anticipates future capital requirements.  However, finding scalable options is only one piece of the process.  Diversity in funding options means varying levels of risk.  Your advisor will work to understand your tolerance, while simultaneously future-proofing against economic and market uncertainty to come

Funding Sources and Finding the Perfect Match

Taking all this into account, your M&A advisor will explore their vast network of funding sources and knowledge to find the perfect match for your company’s needs.  The goal is to find a harmonious relationship between business and its financial backers, one that can grow with you and your company for the road ahead.

Ready to realize the full value of your business?