Asset-Based Lending
Use your receivables, inventory, and equipment as collateral for flexible credit lines. Scale capital as you grow, without rigid bank limitations.
Revolving credit that adapts to your business, not the other way around.
The problem
You're growing. Revenue is up. Assets are accumulating. But your bank won't increase your credit line fast enough to match your growth.
They see risk. You see opportunity. They focus on yesterday's financials. You're focused on tomorrow's potential.
Meanwhile, you have valuable assets sitting on your balance sheet, receivables, inventory, equipment, that serve as working capital if someone values them properly.
The result
You're asset-rich but cash-flow constrained. Growth opportunities pass you by because traditional lenders can't keep up with your trajectory.
The solution
Asset-based lending provides revolving credit secured by your receivables, inventory, and equipment. As your assets grow, your available capital grows automatically. Flexible structures that scale with your business, not against it.
The mechanics
Asset-based lending (ABL) is a revolving credit facility secured by your company's assets, primarily accounts receivable, inventory, and equipment. Unlike traditional bank loans, your borrowing capacity grows automatically as your assets grow.
We assess the value of your receivables, inventory, and equipment. This becomes the basis for your credit line: typically 75-85% of eligible receivables, 50-65% of inventory, and up to equipment value depending on type.
Based on your assets, we establish a revolving credit facility. This is your borrowing base, the maximum you access at any time based on your current asset values.
Draw on the line when you need capital, repay when cash comes in. As your receivables and inventory grow (especially during growth periods), your available credit grows automatically. No need to reapply or renegotiate.
We conduct periodic audits (monthly or quarterly) to verify asset values and adjust your borrowing base. This ensures your facility stays aligned with your actual asset levels.
Why it works
As your sales grow and assets accumulate, your available capital grows automatically. No need to constantly return to your lender begging for limit increases. The facility scales with your business trajectory.
Draw when you need it, repay when cash comes in. Use it for any business purpose: inventory purchases, payroll, vendor payments, equipment, growth initiatives. You're in control.
Your receivables, inventory, and equipment have value. ABL converts those assets to available capital without waiting for sales cycles or liquidation. Your balance sheet works for you instead of sitting idle.
Initial facility typically established in 1-2 weeks (vs. 4-8 weeks for bank loans). Once established, access to capital is immediate. Funding arrives within 24 hours of request.
We focus on your asset values and growth trajectory, not historical credit metrics alone. If you're growing and accumulating quality assets, we support that growth even when banks hesitate.
Fit
ABL works best for established, growth-stage companies with significant assets. Here's who typically benefits:
Established Businesses — Typically $5M+ in revenue with meaningful asset base
Asset-Rich Companies — Significant receivables, inventory, and/or equipment on balance sheet
Growth Companies — Scaling rapidly and outgrowing traditional bank credit limits
Manufacturers & Distributors — Industries with inventory and receivables naturally
Seasonal Businesses — Need flexible capital that scales up/down with seasonal cycles
Acquisition-Minded — Companies pursuing growth through acquisition or major expansion
Revenue under $3M annually (factoring or AR financing may be better fit)
Minimal assets (receivables under $500K, little inventory/equipment)
Service business with few tangible assets (AR financing may be better)
Startup with no asset base yet
Asset-based lending serves manufacturers, distributors, contract manufacturers, importers, transportation companies, and other asset-intensive B2B businesses. Each industry's asset mix (receivables, inventory, equipment) determines the facility structure.
Tell us a little about your receivables, inventory, and equipment and we'll come back with real numbers: borrowing base, advance rates, and timeline.
Same-day preliminary answer
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Explore the financial toolsThe alternatives
| Asset-Based Lending | Traditional Bank Line | Invoice Factoring | Term Loan | |
|---|---|---|---|---|
| Secured By | Receivables, inventory, equipment | Various, often UCC blanket lien | Receivables only | Various collateral |
| Amount | Typically $1M-$50M+ | Varies widely | $100K-$5M typically | Fixed amount |
| Flexibility | Revolving, scales with assets | Revolving but fixed limit | Revolving, invoice-based | Fixed term, amortizing |
| Speed to Funding | 1-2 weeks setup, then 24hr | 2-4 weeks initial | 2-5 business days | 4-8 weeks |
| Growth Accommodation | Automatic scaling | Requires renegotiation | Scales with invoices | None (fixed amount) |
| Best For | Growth companies, $5M+ revenue | Established companies, predictable | Smaller companies, invoice-heavy | Major purchases, expansion |
| Reporting Requirements | Monthly/quarterly audits | Periodic reporting | Regular invoice submission | Periodic covenants |
Bank lines have fixed limits that require lengthy renegotiation to increase. ABL borrowing bases adjust automatically as your assets grow. Banks also tend to impose restrictive covenants. ABL structures are typically more flexible.
Factoring finances only receivables and often involves customer notification. ABL finances multiple asset types (receivables + inventory + equipment) and typically doesn't notify customers. ABL is better for larger, more established companies.
Term loans provide a fixed amount for specific purposes with amortizing payments. ABL provides revolving access to capital that grows with your business. Use term loans for major equipment or real estate. Use ABL for working capital flexibility.
Getting started
We'll discuss your business, current assets (receivables, inventory, equipment), growth trajectory, and what you're trying to accomplish. This helps us determine if ABL makes sense and estimate potential facility size.
Provide recent financials, accounts receivable aging, inventory reports, and equipment lists. We'll assess asset quality and determine appropriate advance rates for each asset class.
We conduct a field examination to verify assets, review processes, and assess controls. This is more thorough than factoring underwriting but faster and less intensive than traditional bank due diligence.
Based on the audit, we'll propose facility structure showing borrowing base calculation, advance rates, pricing, and terms. Clear explanation of how the facility works and grows with your assets.
Complete loan documentation, file necessary UCC liens, and establish the facility. First funding typically within 24 hours of documentation completion.
Typical timeline: 2-3 weeks from initial contact to facility funding (subsequent draws within 24 hours)
Common questions
Typically companies with $3M+ in revenue and meaningful asset base ($1M+ in combined receivables, inventory, and equipment). Below that threshold, invoice factoring or AR financing is often more appropriate and cost-effective.
Typical ranges: 75-85% of eligible receivables (under 90 days, creditworthy customers), 50-65% of eligible inventory (finished goods valued higher than raw materials), and up to appraised value for equipment. Exact rates depend on asset quality and your industry.
Periodic on-site audits (initially, then quarterly or annually) where we verify your assets match reported values. We review invoices, inventory records, customer credit, and controls. This ensures the borrowing base stays accurate and appropriate.
Your borrowing base adjusts regularly based on your current asset levels, typically calculated monthly or even daily. As receivables and inventory grow (or shrink), your available credit adjusts automatically.
Unlike factoring, ABL typically doesn't involve customer notification. Customers continue paying you directly. We file UCC liens (public record) but don't directly notify customers unless there's a default situation.
Yes. Working capital, inventory purchases, payroll, vendor payments, equipment, acquisitions. Unlike term loans designated for specific purposes, ABL provides flexible working capital you deploy as needed.
ABL typically has fewer and more flexible covenants than traditional bank financing. Common covenants include minimum EBITDA, fixed charge coverage, and limits on capital expenditures or additional debt. We'll explain all covenants clearly upfront.
Often yes, though it depends on structure. ABL can often work alongside term loans, equipment financing, or subordinated debt. We'll coordinate with other lenders to ensure appropriate intercreditor agreements.
That's exactly when ABL shines. As you grow and accumulate more receivables and inventory, your facility grows automatically. No need to constantly return for limit increases or slow down growth waiting for bank approvals.
ABL facilities are typically structured for 1-3 year terms with renewal options. Many companies "graduate" to traditional bank financing once they're larger and more profitable. Others maintain ABL long-term as a permanent capital structure tool.
In practice
Scaling Manufacturer
Distributor Expansion
Contract Manufacturer Growth
Leveraged Buyout
For smaller companies or those needing only receivables financing. Faster setup, lower minimums, but limited to receivables only.
Learn moreSimilar to ABL but structured as a credit line against receivables only. Good middle ground between factoring and full ABL.
Learn moreFinance specific equipment purchases alongside your ABL facility. Preserve working capital for operations while acquiring necessary equipment.
Learn moreWhether you're scaling production, managing seasonal inventory, or pursuing an acquisition, ABL provides flexible working capital that grows with your business. Let's review your assets and growth trajectory.
One working-capital decision every other week. Which asset to borrow against, what a facility costs all-in, or how to make payroll before your customer pays, in a two-minute read.
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