Flexible financing to expand your business

Flexible financing solutions

The choice of financing depends on several factors, such as the specific needs of the company, the level of development, the industry and the growth strategy, but there are some models and solutions that are important to keep in mind.

Risky Debt

He “risky debt” It is a form of financing specifically designed for companies in rapid growth stages, such as startups and scaleups. Its main advantage is that the share of entrepreneurs and their shareholders will not be significantly diluted: it is, among other things, compound loanmainly because of the debt, which is repaid through interest, to which is added a small part focused on the acquisition of shares in the company.

BBVA Spark offers this “venture debt” solution, which provides entrepreneurs with a way to obtain financing without significantly reducing ownership in society. This can be essential to finance expansions and strategic projects without losing business control.

Growth Loans

It is a type a loan designed for those companies that have a mature business, profitable and with high growth prospects, which seeks to support growth and international expansion.

IN “growth loans”shareholders can retain control of the business without diluting their stake because the entities offering the required capital do not acquire shares in the company.

Another characteristic of this financing alternative is that it can integrate a support component from experts and professionals. These profiles offer essential help in developing expansion strategies for fast-growing companies and provide access to new contact networks.

BBVA Spark exemplifies this by offering these types of solutions with the support of specialists who understand the nature of the business and provide specialized advice.

“Revenue Based Financing” (RBF)

It is a type of financial capital for “startups” or “scaleups” that is returned to the investor in the form regular payments linked to income these companies. In the RBF model, this approach aligns payments with actual company performance, which can be especially beneficial during periods of fluctuating earnings.

It is a way to increase working capital, acquire new customers, expand business or finances international expansion.

‘Peer-to-Peer (P2P) business lending’

Peer-to-peer lending, and specifically between companies, is a relatively new alternative financing model, but it has seen a lot of growth in recent years. They enable businesses get funding directly from investors through online platforms.

In its most orthodox form, a P2P lending platform acts as a marketplace that brings the borrower and investor(s) into contact, so that the risk of financial loss if the loan is not repaid falls on the investor, not the platform. according to a report from University of Cambridge.

The flexibility of credit terms may depend on the platform and the specific agreement between the parties, but in general P2Ps offer more flexible terms compared to conventional bank loans, especially when it comes to interest rates, the company explains. European Commission.

Deposit on the invoice

A deposit on an invoice is a deposit in the amount pay the client due to a purchase or contract for the provision of services. It is a short-term financial solution, which, on the other hand, compensates for the temporary imbalance caused by clients paying in installments. Its flexibility is that it facilitates immediate access to funds by turning unpaid accounts into cash, which makes it possible to correct or alleviate situations of lack of liquidity.

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